Elos Medtech Interim report, 1 January-31 March 2016
• Net sales amounted to SEK 140.4 M (105.5), which adjusted for exchange-rate fluctuations corresponds to an increase of 34.5%, of which organic growth was negative 2.0%.
• Operating profit totalled SEK 12.0 M (10.2 before non-recurring items of 4.5).
• Profit after net financial items totalled SEK 6.8 M (7.6). Net financial items were negatively impacted by exchange-rate differences of SEK negative1.7 M (2.9).
• Profit after tax amounted to SEK 4.9 M (5.6), corresponding to SEK 0.80 (0.93) per share.
• Cash flow from operating activities was SEK 20.5 M (12.1) and, after investments, amounted to SEK 7.0 M (negative 13.3).
CEO, Johannes Lind-Widestam, comments
“The start of 2016 was marked by a wait-and-see approach to demand for medical technology products, but demand did eventually increase during the quarter in all of the Group’s market segments. As a whole, strong demand was noted in North America, satisfactory demand in Europe and a continued weaker trend in Asia in the first quarter.
In Elos Medtech’s market segments, the trend was generally stable, with sharp rises in Trauma & Spine and Diagnostics, while slight reverses were noted for Dental Implant Systems and Medical Devices. During the quarter, the Trauma & Spine market segment noted growth of 370%, primarily driven by Onyx Medical – which is living up to our extremely high expectations – and also to good progress at the operations in Timmersdala. The Diagnostics market segment also reported a very strong quarter, with growth of 32%. The Dental Implant Systems market segment started the year sluggishly, with a 5% downturn, which was an effect of lower volumes for own products. However, the trend for the major contract accounts was stable. The Medical Devices market segment reports an 8% decline, which was primarily due to lower demand at the operations in Tianjin, China, where the corresponding quarter in 2015 was very strong. However, on a positive note, deliveries from the operations in Tianjin have stabilised. Compared with the weak second half of 2015, this means that a negative trend has been broken and market conditions in the market segment going forward are expected to be stable.
It is extremely gratifying that we, the very same day that Elos Medtech holds its Annual General meeting and presents the interim report for the first quarter of 2016, also have the inauguration of Microplast’s extended production unit in Skara. Throughout the expansion of the facility, we have continued to attract new customers, at the same time as a number of existing customers continue to grow through new projects, thus emphasising the importance of this expansion.
Elos Medtech continues to invest in its range of own products and has enhanced the marketing organisation with an addition five employees who were recruited at the beginning of the year. For the first time in several years, the sales trend has shown a decline, primarily due to shifts in sales resulting from delays in the market launches of major customers, combined with the fact that the first quarter of 2015 was very strong. We expect to again report growth in the second quarter and onwards.
The operating margin is now rising again, to 8.5%, which is a healthy step in the right direction following a weak fourth quarter, although we have some way to go before achieving our objective. We are working continuously through a number of actions to improve our margins. Cash flow from operating activities amounted to SEK 20.5 M, which is an increase of 69%.
In conclusion, the trend is positive for our operations, and within the entire Group, we are now continuing our efficiency and product development efforts coupled with increasing intensity in sales and marketing activities.”
For further information, contact:
Johannes Lind-Widestam, President and CEO, 46 (0)705-41 72 22, e-mail: johannes.lind-widestam@elosmedtech.com
Ulrica Ehn, CFO, 46 (0)510-48 43 67, 46 (0)702-72 11 61, e-mail: ulrica.ehn@elosmedtech.com
The information in this interim report is such that Elos Medtech AB (publ) is obligated to publish in accordance with the Securities Market Act and/or the Financial Instruments Trading Act.
The information was issued for publication on 26 March 2016 at 01:00 p.m. (CET)
For additional information about the Elos Medtech Group, visit www.elosmedtech.com
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