Revenio Group Corporation: Financial Statement Bulletin January-December 2017

Revenio Group Corporation

Stock Exchange Release February 15, 2018 Financial Statement Bulletin at 9.00 am

This release is a summary of Revenio Group's January-December 2017 financial statement bulletin. The complete report is attached to this release as a pdf-file. The stock exchange release is also available on the company's website at www.revenio.fi.

Fourth-quarter operating profit excluding non-recurring items grew by 43%, net sales up by 15%

October-December 2017 in brief, continuing Group functions

• Net sales totaled EUR 7.6 (6.6) million, showing an increase of 15.0%
• The weakening of the US dollar had a major impact on net sales growth. The currency-adjusted organic growth of net sales in October-December was 20.7%, or 5.7% percentage points stronger than reported
• Operating profit excluding non-recurring items was EUR 3.1 (2.1) million, or 40.1 percent of net sales, an increase of 42.8%. Non-recurring items refer to the acquisition of Oscare Medical Oy's minority shares (46,5%) and related write-downs. After the arrangement, Revenio owns the entire share capital of the company.
• Probe sales continued to grow and were 27.8% higher than in the previous year
• Earnings per share, diluted and undiluted EUR 0.22 (0.21)

January-December 2017 in brief, continuing Group functions

• Net sales amounted to EUR 26.8 (23.4) million, up 14.3% from the previous year
• Consolidated operating profit excluding non-recurring items was EUR 9.5 (7.1) million, or 35.5 percent of net sales, an increase of 34.6%
• The currency-adjusted organic growth of net sales was 17.0%, or 2.7% percentage points stronger than reported
• Probe sales grew and were 25.8% higher than in the previous year.
• Earnings per share, undiluted EUR 0.86 (0.70)
• Icare HOME approved for sales in the United States in March
• The new wireless mHOME application was introduced in June
• The TonoVET Plus product for measuring intraocular pressure in animals was launched in June
• The Board will propose to the Annual General Meeting of March 20, 2018 a dividend of EUR 0.78 

Key figures, continuing operations, EUR million

Financial guidance for 2018

Net sales growth is expected to remain strong. Profitability is expected to remain at a healthy level despite relatively increasing growth investments.

CEO Timo Hildén comments on the year 2017:

"The year 2017 was one of strong growth for us, boosted by an increase in market shares in our current markets as well as the growth of new markets of importance to us, such as China and India.  Our net sales increased by 14.3%, totaling EUR 26.8 million. This was particularly attributable to successful sales in all key market areas and especially strong sales growth in the United States. Our operating profit, excluding non-recurring items, grew by 34.6%, reaching EUR 9.5 million, which amounts to 35.5% of net sales.

2017 was also a year of positive growth for health technology globally although major changes are taking place in the regulation of the sector. For many years, we have invested heavily in the development of our own processes and quality systems, which has enabled us to achieve world-class quality at a very low cost. We are particularly proud of this.

The new-generation Icare ic100 tonometer has been very well received on the market. The product has already been launched in almost all major markets, and we expect to receive a sales permit in China in early 2018. Almost 10,000 products have been sold.

The Icare ic100 has served as the basis for the new Tonovet Plus tonometer, designed for the measurement of intraocular pressure in animals, which was launched in the summer of 2017. The product has received positive attention among veterinarians around the world in a short period of time. Interest has been heightened by the fact that Tonovet Plus is the only product on the market with an algorithm based on clinical measurements made on four different species (dogs, cats, horses, rabbits). The sales of products for measuring the intraocular pressure in animals amount to almost 15% of our net sales.

The Icare HOME tonometer was granted a sales permit in the United States in early 2017 after a lengthy process. It is noteworthy that this was the first time ever that the U.S. Food and Drug Administration, FDA, approved an ophthalmologic device designed for use at home. As ophthalmologic measurement devices have not previously been used by patients for self-monitoring, we must persuade both patients and doctors to realize the indisputable benefits of home measurement in the detection and treatment of glaucoma. This process will take time. In 2017, our focus in the United States was mainly on attracting major key-opinion leaders in the sector to start using Icare HOME, initiating clinical trials, and developing a nation-wide network of physicians. These activities form the base on which to build sales growth.

In late summer 2017, we launched the new cloud-based mHOME mobile application, which enables the user to transfer measurements from the Icare HOME tonometer to a cloud service using a mobile device. This supports and facilitates the monitoring of daily fluctuations in intraocular pressure especially for patients who live far from care facilities. mHome also allows a physician to give patients the possibility of monitoring their own intraocular pressure results. In 2018, we will complement our current business model by approaching patients directly to ensure their easy access to the products.

Probe sales continued to grow strongly, reaching over 15 million probes sold, or almost 30% of total sales. This considerable capacity is based on years of development efforts to improve the efficiency of automated probe production. Our current capacity is sufficient for the annual production of over 20 million probes.

Icare's position in the tonometers market is very strong. Superior technology, world-class quality, and a strong brand combined with the regionally best, effective, and motivated distribution organization enables us to expand our product portfolio both organically and through acquisitions. We analyze both options carefully and only proceed if there are technologically and economically well-justified options available.

The development of new health technology products always involves risks, which are often only discovered in wider clinical measurements, as in the case of Ventica. Its technology had previously only been studied on child patients with a varying degree of asthma symptoms, but the recent study carried out in Croatia measured healthy test subjects with no symptoms. These measurements led to different results than the previous studies. The differences appear to be related to the stage of sleep, which is why we have launched new studies in Croatia. We expect preliminary results from this study during the first half of 2018. At the same time, we will continue studies in Germany, where we are part of the most extensive asthma study ever conducted in the country.

Development of the hyperspectral camera has progressed according to plan. The industrial design of the commercial model has been completed, and our goal is that, by the end of 2018, the product will be ready for us to file a sales license application in Europe (CE marking) and launch clinical trials.

I am extremely grateful to our employees for their day-to-day efforts and commitment to our common targets. We have a top team, and we attract top experts in their fields. Our shareholders gave their evaluation of our work by choosing us as the best medium-sized listed company in 2017. We truly appreciate and take pride in this recognition. My heartfelt thanks also to all our partners and subcontractors for the past year. This is a solid base to build on together."

Conference call

A conference call will be held in English for analysts, investors, and the media on the same day starting at 3:00 p.m. There will be an opportunity to present questions during the conference call. Participants can dial in through one of the following numbers:

Finland: +358 (0)9 7479 0360
Sweden: +46 (0) 8503 36573
United Kingdom: +44 (0) 330 336 9104
USA: +1 323-794-2558

Participants can dial into the conference call, using confirmation code 172809.

Audiocast

CEO Timo Hildén's presentation can also be followed through a live audiocast at www.revenio.fi/sijoittajat, starting at 3.00 p.m. A recording of the presentation will be available at the same address by 20.00 p.m.

Revenio Group Corporation
Board of Directors

For further information, please contact:
Timo Hildén, CEO, tel. +358 40 580 4774
timo.hilden@revenio.fi
www.revenio.fi

DISTRIBUTION:
Nasdaq Helsinki Oy
Financial Supervisory Authority (FIN-FSA)
Principal media
www.revenio.fi

The Revenio Group in brief

Revenio is a Finnish, globally operating health technology corporation whose worldwide success is based on a strongly patented intraocular pressure measurement technology. The Revenio Group consists of Icare Finland Oy, Revenio Research Oy and Oscare Medical Oy. The common denominators of Revenio's business operations include screening, follow-up and the global need to make cost savings through preventive health care. Revenio seeks vigorous growth in health technology. Revenio aims to develop even more efficient and easily adopted methods for the early-stage detection of diseases with significance for public health. The focus of Revenio's screening technology is on the early detection of glaucoma, osteoporosis, skin cancer and asthma, and the monitoring of these during the treatment process.

In 2017, Revenio Group's net sales totaled MEUR 26.8, with its operating margin for continuing operations standing at 35.5%. Revenio Group Corporation is listed on Nasdaq Helsinki.