Elos Medtech Interim Report January 1 - June 30, 2019

ROBUST GROWTH AND AN IMPROVED OPERATING MARGIN

April - June 2019

• Net sales for the second quarter increased to SEK 184.1 (166.0) million, which corresponds to organic growth of 10.9 percent. After currency conversions, our growth rate was 7.1 percent.
• Operating profit amounted to SEK 15.6 (5.2) million. Operating margin for the second quarter of 2019 was 8.5 percent, up from 3.1 percent in the same period in 2018.
• Profit after net financial items was SEK 8.6 (5.2) million. Net financial items were negatively affected by a net exchange rate loss of SEK -3.9 (2.4) million and totaled SEK -7.0 (0.0) million.
• Profit after tax amounted to SEK 6.6 (3.4) million, which corresponds to SEK 0.82 (0.42) per share.
• Cash flow from operating activities was SEK 47.7 (19.6) million, and amounted to SEK 11.7 (2.2) million after investments.

Comments from the CEO, Jan Wahlström

Further growth and four quarters in a row with improved profitability. Our margins continued to improve over the period, which is a clear indication that our decision to focus on efficiencies and specialization was the right one. We are now well equipped to start taking on additional customers. Our sales performance in the second quarter lived up to our expectations and we are now targeting continued improvements in profitability.

Orthopedics, which is the biggest driver of growth in the company, has continued to expand rapidly. Several projects are underway and there is considerable potential for further expansion. Our move to the new factory in Memphis has been initiated. Everything is going to plan and we expect production to be up and running before year-end. Our focus remains on being a strong contract manufacturer in our areas of specialization. We are suffering growing pains and, although this is a good thing, we now need to devote our energies to recruitment and on increasing our output and improving our profitability.

We have also seen strong growth in our polymer business, which is a key driver in our Life Science business area. This was a major factor behind our increased profitability for the period.

Our dental strategy, which centers on simplifying the digital workflow for dentists and dental technicians, is very much in tune with the times. We have recently signed several new agreements with leading companies in the industry, which has made Elos Accurate® accessible to more customers. We have also taken the next step toward our long-term goal for proprietary products by signing our first distributor agreement in the US, which is a very encouraging development in this market.

With a growth rate of 11 percent in the second quarter and 16 percent for the six-month period, we have continued our growth trajectory while maintaining a focus on improved profitability.

For further information, please contact:

Jan Wahlström, CEO, +46 70 212 18 89, e-mail: 
jan.wahlstrom@elosmedtech.com 
Christian Bergaust, CFO, +46 70 293 50 40, e-mail: christian.bergaust@elosmedtech.com 

For additional information about the Elos Medtech Group, visit www.elosmedtech.com

This information is information that Elos Medtech AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above on July 18, 2019, at 11:00 (CET).


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About Us

Elos Medtech is one of the leading development and production partners for medical technology products and components, such as dental and orthopaedic implants and instruments. The operations are conducted at facilities in Sweden, Denmark, China and USA. Customers are mainly internationally active medical technology companies in the market segments Dental , Orthopedics and Life Science. Elos Medtech employs more than 550 people worldwide and generates revenue that exceeds MSEK 600. Elos Medtech has been traded on NASDAQ Stockholm AB since 1989. The Elos Medtech B share is classified as a Health Care company on the Small Cap list.