Revenio Group Corporation: Interim Report January 1- March 31, 2019

Revenio Group Corporation, Interim report, April 16, 2019 at 8.30 am

Revenio Group Corporation Interim Report January 1 – March 31, 2019

Due to an amendment to the Securities Market Act, the descriptive sections of Revenio's Interim Reports Q1/2019 and Q1–Q3/2019 will be shorter and more concise. The normal Interim Report will be published for the first six months of the financial period, January–June 2019. 

Figures in brackets refer to the same period in the previous year, unless otherwise stated. 

Strong start to the year – net sales up over 20%  

January–March 2019 

  •  Net sales totaled EUR 8.4 (7.0) million, up by 20.7%  
  •  EBITDA totaled EUR 2.9 (2.2) million, or 34.0% of net sales, up by 27.2% 
  •  Operating profit totaled EUR 2.6 (2.1) million, or 30.6% of net sales, up by 20.8% 
  •  The currency-adjusted growth of net sales in January–March was 15.6%, or 5.2 percentage points weaker than reported 
  •  Operating profit was weighed down by non-recurring acquisition-related costs amounting to EUR 265,000. Operating profit adjusted by the non-recurring acquisition costs was EUR 2.8 million, or 33.7% or net sales.  
  •  Earnings per share, undiluted EUR 0.086 (0.069) 
  •  After the review period on April 13, 2019 Revenio signed an agreement to acquire all shares of the Italian company CenterVue SpA. The acquisition is estimated to be completed during the first half of 2019
  •  Revenio’s current CEO Timo Hildén will, based on his own wish, move to lead the acquisition and integration work as Senior Advisor
  •  M.Sc. (EE) Mikko Moilanen has been appointed as the CEO of Revenio Group Corporation and Revenio’s Group company Icare Finland Oy. He will assume the position at the latest on October 14, 2019, possibly even earlier.
Group key figures, MEUR
1.1-31.3.2019 1.1-31.3.2018 Change-%
Net sales 8.4 7.0 20.7
EBITDA 2.9 2.2 27.2
Operating profit, EBIT 2.6 2.1 20.8
Undiluted earnings per share 0.086 0.069
31.3.2019 31.3.2018 Change, %-point
EBITDA-% 34.0 32.2 1.7
Operating profit-%, EBIT 30.6 30.5 0.0
Return on investment-%, ROI 17.9 15.3 2.6
Return on equity-%, ROE 13.1 11.8 1.3
Equity ratio-% 71.5 74.8 -3.3
Gearing-% -35.8 -33.6 -2.2

The Group has adopted the IFRS 9 and IFRS 15 Standards from January 1, 2018 onwards. IFRS 16 has been adopted as from January 1, 2019. Additional information is available on pages 3-4. 

Financial guidance for 2019 

Due to the acquisition, Revenio will refine its financial guidance published on February 14, 2019 after the transaction is confirmed.

Earlier financial guidance: Net sales is expected to show strong growth compared to the previous year and profitability is expected to remain at a strong level.

CEO Timo Hildén:

"In terms of sales, 2019 got off to a strong start, despite the fact that a major one-time order was placed in the corresponding period last year. Our net sales grew by 20.7% and amounted to EUR 8.4 million. The EBITDA for the period was EUR 2.9 million, up by 27.2%. During the review period, operating profit was weighed down by non-recurring acquisition-related costs amounting to EUR 265,000. EBITDA adjusted by non-recurring acquisition costs was EUR 3.1 million, or 37.1% of net sales.

Sales were excellent, especially in what have traditionally been major countries for us, such as the United Kingdom, where distributors are to some extent already anticipating the uncertainties caused by Brexit. As a result, our deliveries to the UK were larger than usual during the period; in normal circumstances, they would have occurred partly only during the following quarter. Other strong countries were Germany, Australia, Canada, and Italy. 

Icare ic200, launched in the fall of 2018, was granted a sales permit in Japan in March, and sales are already expected to start during the second quarter. Japan has been an important market for the predecessor of the product, Icare PRO, now replaced by Icare ic200. In the U.S., we launched clinical trials of the product, required for filing a sales permit application with the US Food and Drug Administration (FDA). We aim to file the sales permit application during 2019. 

As we have previously noted, interest in the Icare HOME tonometer is gradually turning into demand. Icare HOME has been adopted for use with patients at six of our partner clinics in Finland, which we consider to be a very important development in the domestic market. In the U.S., we are planning to introduce a new marketing model for Icare HOME, in which optometrists will refer patients to ophthalmologists who are actively using Icare HOME. The marketing model involves renting the device to the patient. In addition, we launched a new Clinic software version for the Icare HOME, including several new features, such as alerts for eye pressure, reference tables, and new language versions. A number of major new studies on Icare HOME are underway or starting in the U.S.; we expect these to provide strong support for our marketing in the future. We have also launched a new Icare HOME publication that compiles all the clinical trials already conducted. In Germany, an extensive Icare HOME trial is starting at the University of Munster with over 1,000 patients. 

Major growth continued in probe sales, totaling 36.3% of net sales. 

We have signed new distribution agreements for the asthma product Ventica, with distributors in over 10 countries by the end of the period. Their primary goal in the first phase is to find good reference clinics to adopt Ventica for trial use and hence act as opinion leaders for local asthma specialists and pediatricians. Through distributors, we can also more easily participate in local country-specific conferences. 

The development of the hyperspectral camera Cutica for skin cancer detection is progressing as planned. As a new step, we have studied the use of artificial intelligence for the automatic processing of image material.

After the review period on April 13, 2019 we informed that we have signed an agreement to acquire all shares of the Italian company CenterVue SpA. The acquisition is estimated to be completed during the first half of 2019. The acquisition is extremely important for Revenio's growth strategy, and therefore I have expressed the Board of Directors my wish to concentrate on leading the acquisition and integration work as Senior Advisor. I have been in the health technology industry for 40 years, of which 20 years I has served as CEO of various companies. During this time, I have gained considerable experience of coordinating and integrating different corporate cultures. In my new position, my focus will initially include, along with the CEO's duties and later full-time, finalization of the acquisition, launching and completing the integration work as well as supporting Mikko Moilanen in taking on his tasks. We will return to the progress of the acquisition process, it’s impact on our financial guidance and progress of the integration work with separate releases.” 

General statement 

This report contains certain statements that are estimates based on the management’s best knowledge at the time they were made. For this reason, they involve a certain amount of inherent risk and uncertainty. The estimates may change in the event of significant changes in general economic conditions. 

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. Revenio’s core business is to develop and commercialize effective and easily adopted devices to assist in the diagnostics of glaucoma and its monitoring during treatment. 

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 technology is on the early detection of glaucoma, skin cancer and asthma, and the monitoring of these during the treatment process. 

In 2018, the Revenio Group's net sales totaled EUR 30.7 million, with its operating margin standing at 33.3%. Revenio Group Corporation is listed on Nasdaq Helsinki.