Year-end report May-April 2018/19

STOCKHOLM - May 29, 2019

Fourth quarter

• Gross order intake amounted to SEK 5,401 M (4,656), an increase of 16 percent in SEK and 8 percent based on constant exchange rates.
• Net sales were SEK 4,086 M (3,409), an increase of 20 percent in SEK and 12 percent based on constant exchange rates.
• EBITA increased by 16 percent to SEK 985 M (848)
• The EBITA margin amounted to 24.1 percent (24.9).
• Operating result was SEK 755 M (714).
• Net income amounted to SEK 536 M (502). Earnings per share was SEK 1.40 (1.31) before/after dilution.
• Cash flow after continuous investments was SEK 1,359 M (979).
• Six Elekta Unity orders booked in the quarter.

 Year-end May 2018 – April 2019

• Year-end May 2018 – April 2019Gross order intake amounted to SEK 16,796 M (14,493), an increase of 16 percent in SEK and 8 percent based on constant exchange rates.
• Net sales were SEK 13,555 M (11,573), an increase by 17 percent in SEK and 10 percent based on constant exchange rates.
• EBITA increased by 5 percent to SEK 2,477 M (2,369), including a positive effect of SEK 70 M related to a divestment during the fiscal year.
• The EBITA margin was 18.3 percent (20.5).
• Operating result was SEK 1,696 M (1,845).
• Net income amounted to SEK 1,198 M (1,348). Earnings per share was SEK 3.14 (3.53) before/after dilution.
• Cash flow after continuous investments was SEK 962 M (1,589).
• Net debt amounted to SEK 439 M (803).  
• 17 Elekta Unity orders booked in the fiscal year.

Dividend for fiscal year 2018/19

• The Board of Directors proposes a dividend of SEK 1.80 (1.40) per share for the fiscal year 2018/19.

*Compared to last fiscal year based on constant exchange rates.

Outlook for fiscal year 2019/20

• Net sales growth of 8-10 percent, based on constant exchange rates.
• EBITA margin of around 19 percent.

CEO comment 

Strong finish to a successful year of proven Unity excellence and software innovations 

A strong finish in the fourth quarter sums up a successful year 2018/19. We outperformed the previous year’s sales growth with contributions from all business lines and regions. Feedback from clinics underlined Elekta Unity’s excellence and the sales funnel has continued to grow, resulting in a healthy order intake. Order intake overall had a good growth rate of 8 percent, both for the year and in the fourth quarter. We exceeded the annual net sales target and delivered on the revised EBITA margin target. Based on our outstanding innovative product portfolio, solid financials and an increasing pipeline, I am confident and excited about our future prospects.

Q4 – A strong finish
During the final quarter we delivered a good performance. We achieved strong net sales growth and continued a robust order trend overall. After regulatory approvals in North America we received our first commercial Unity orders in both the U.S. and Canada. The ESTRO meeting in April emphasized the increasing interest we see for our innovative advancements in precision radiation medicine. In addition to Unity, our newest software solution, MOSAIQ® Plaza and our upgraded treatment planning system Monaco® HD, received a lot of attention. Net sales and order intake developed well across the business lines with especially strong growth in software. Gross margin improved significantly, and a reduced net working capital improved our cash flow, resulting in a better cash conversion for the quarter.

Good growth in 2018/19
During the year the demand for radiation therapy solutions remained strong in all regions. We managed to increase our growth pace through our innovative product portfolio and a strengthened sales leadership in Europe, Middle East and Africa. We achieved this at the same time as we shortened the process from shipment to installation for our solutions. I am very proud that it resulted in an annual record number of installations. It demonstrates Elekta’s great delivery power. A strong installed base is also a very good foundation for our service business going forward.

All business lines contributed to the growth, both in solutions and services. Our software business developed well during the year, and I am especially satisfied with its growth in North America. Leksell Gamma Knife® also had a very strong development, coming close to the strongest year of its history. 

Elekta Unity had a good performance with healthy order intake and sales. The pipeline is very impressive and growing. However, some of the expected orders for the fourth quarter shifted into the new fiscal year due to longer procurement processes with Unity. After closing the fiscal year, we have received regulatory approval from Japan. At present 45 units have been ordered globally and I am confident that we will reach our target of 75 units by Mid-2020.

Looking at profitability we had a tough start of the year but managed to improve the annual outcome by a strong fourth quarter. I am satisfied to see that the gross margin improved at year-end resulting from a better product mix and successful product positioning. Our EBITA margin is expected to improve as we benefit from our process enhancing efforts, COGS reduction program and a continued revenue growth from our investments in Unity and China.  

Further growth
To sum up the year we exceeded our net sales target and delivered on the revised target of the EBITA margin. I would like to thank all our employees for their efforts leading to this achievement. True teamwork where each and every one is important for our success.

Looking ahead we face the ramp-up of Unity’s commercialization including regulatory approvals in China as well as the first clinical studies. We put further resources into Elekta Digital to e.g. further develop artificial intelligence features that support more efficient cancer treatment. Based on our prospects the guidance in the new fiscal year is for a net organic sales growth rate of 8-10 percent and an EBITA margin of around 19 percent. Elekta’s outstanding innovative product portfolio, together with our strong order pipeline, solid financials and the organizations’ commitment for further growth makes me confident of our mid-term scenario and excited about our future.

Richard Hausmann, President and CEO

Shareholder information

Conference call
Elekta will host a telephone conference at 10:00-11:00 CET on May 29, with president and CEO Richard Hausmann, and CFO Gustaf Salford.

To take part in the conference call, please dial in about five minutes in advance.

• UK dial-in number:         +44 (0) 333 300 9260 
• US dial-in number:         +1 646 722 4903 
• Swedish dial-in number: +46 (0) 8 566 427 03 

The telephone conference will also be broadcasted live online, through the following link (however, in order to ask questions, it is necessary to call in): http://event.on24.com/wcc/r/2003600-1/2C26486E459138EA3608C1CAEEAA5B15?partnerref=rss-events

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This is information is such that Elekta AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication by the below mentioned contact persons at 07:30 CET on May 29, 2019. (REGMAR)

For further information, please contact:
Cecilia Ketels, Head of Investor Relations
Tel: +46 76 611 76 25, e-mail: Cecilia.Ketels@elekta.com 
Time zone: CET: Central European Time

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