Elos Medtech Interim Report January 1 - March 31, 2019
Continued healthy growth and improved operating margin
• Net sales for the quarter increased and amounted to SEK 189.9 (155.7) million, which corresponds to organic growth of 22.0%. After currency adjustments, our growth rate was 15.2%. During the quarter, a finished goods warehouse of SEK 13.3 million was sold to Bruel & Kjaer.
• Excluding sales of finished goods, organic growth was 13.4% and adjusted for currency effects 6.8%.
• Operating profit amounted to SEK 21.4 (10.9) million. Operating margin in the first quarter of 2019 was 11.3%, compared to 7.0% in the first quarter of 2018.
• Profit after net financial items was SEK 20.6 (9.6) million. There was a positive impact of 2.4 (0.8) million on net financial items from exchange differences.
• Profit after tax amounted to SEK 15.3 (7.1) million, which corresponds to SEK 1.90 (1.15) per share.
• Cash flow from operating activities was SEK 9.4 (8.7) million, and amounted to SEK -13.5 (-6.2) million after investments.
Comments on Q1 from Jan Wahlström, CEO
What a fantastic start to 2019. Sales have increased faster than our long-term goal of 10%. During the quarter we grew by 22% and all business areas contributed strongly positively. We have continued to take market shares and achieved an all-time-high for quarterly earnings, with EBIT of 11.3%, which is the highest level of profitability in Elos Medtech’s history. This is because all units now contribute to the good development.
Our efforts with Operational Excellence and lower scrap costs have continued with very good results. We’ve significantly reduced the volume of scraped materials, which has a direct positive impact on our earnings.
The transfer to Bruel & Kjaer has progressed in accordance with plan. The inventory has now been sold and during the next quarter, all production will be moved there as well.
In line with our plans to develop more proprietary products, we’ve had a patent approved by the US Patent and Trademark Office. The patent covers a drilling system that is used during implant surgery, leading to greater precision that requires fewer instruments. We’ve also benefited from EU funding for research on white titanium surfaces in our efforts to develop proprietary products. Receipt of the grant is confirmation of our high competence as well.
With rapid growth, there is a need to recruit new employees. So, to meet customer requirements on delivery, above all in USA, we will focus our efforts on this quite a bit in the near future.
We’ve started an exciting journey that involves comprehensive changes to take Elos Medtech to the next level. We have our sights on higher profitability, which we feel is attainable due to the positive trend in orthopedics (particularly robotic surgery), expanded production capacity, better coordination of our global units and investments in attractive segments. Growth in all of our business areas is healthy and I’m looking forward to the next quarter with enthusiasm.
For further information, contact:
Jan Wahlström, President and 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
This is the type of information that Elos Medtech AB (publ) is obliged to publish in accordance with the EU Market Abuse Regulation and the Swedish Securities Market Act. The information was issued for publication by the contact persons stated above on April 23, 2019 at 13.30 (CET).
For additional information about the Elos Medtech Group, visit www.elosmedtech.com
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