Revenio Group Corporation: Interim Report January 1-September 30, 2015: Net sales and operating profit grew significantly, strong sales in all key markets

Revenio Group Corporation, Stock Exchange Release, October 27, 2015 at 9:00

Revenio Group Corporation Interim Report, January 1-September 30, 2015

Revenio Group Corporation is adopting the publication procedure enabled by the Financial Supervisory Authority's Regulations and guidelines 7/2013 (Disclosure obligation on issuers) and is publishing its Interim Report for January-September 2015 as an appendix to this stock exchange release. This stock exchange release is a summary of the Revenio Group Corporation's Interim Report for January-September 2015. The Interim Report can be read in full in the PDF appendix to this release. The Interim Report is also available on Revenio's website: www.revenio.fi.

Net sales and operating profit grew significantly, strong sales in all key markets

July-September 2015 in brief, continuing Group functions:

• Net sales were EUR 5.3 (3.8) million, an increase of 39.8%
• The operating result was EUR 1.6 million (1.1), a rise of 46.4%
• Diluted and undiluted earnings per share were EUR 0.17 (0.10)
• The FDA license application was filed in early September. Revenio is unable to accurately estimate when the FDA will issue its decision, but anticipates that it will obtain the license in 2016
• Icare enters into distribution cooperation with Topcon Medical in the US
  
  

January-September 2015 in brief, continuing Group functions:

• Net sales were EUR 14.8 (11.1) million, an increase of 33.4 %
• The operating result was EUR 4.5 million (3.1), a rise of 45.5 %
• Diluted and undiluted earnings per share were EUR 0.47 (0.36)
• Icare to enter into distribution partnership with Iridex Corporation in the United States
• Technology for the screening, diagnosis and monitoring of asthma and skin cancer was licensed in February, and the projects are progressing according to plan

Key figures, continuing functions, MEUR:

Financial guidance remains unchanged

Revenio reiterates the updated financial guidance announced on August 10, 2015 in connection with the publication of the Q1-Q2/2015 results for 2015:

Full-year consolidated net sales and operating profit are expected to grow from last year.

Growth in net sales is expected to remain robust in the second half, but will fall short of net sales growth in the first half in percentage terms.

Investments in new business operations related to health tech will have an impact on consolidated operating profit and cash flow. These investments will not be significant in 2015.

Earlier financial guidance:
The net sales and operating profit of Icare are expected to grow from last year. Investments in new business operations related to health tech will have an impact on full consolidated operating profit and cash flow. These investments will not be significant in 2015.

Olli-Pekka Salovaara, President and CEO, comments on the third quarter results:

"As expected, Revenio's performance in the third quarter was strong, with the increase of 39.8% in net sales and 46.4% in operating profit reflecting our market position as one of the global leaders in intraocular pressure measurement technology.

In addition to healthy sales performance in the United States, we achieved excellent sales in China in the third quarter. Sales in the United States grew 39% year-on-year, partly fueled by the dollar exchange rate which developed favorably from our perspective. Sales in China took a very positive turn after we were granted a sales license. Similarly, probe sales continued to grow and are expected to become more substantial following growth in device sales and increasingly active use of the devices.

In September, after lengthy preparations, we submitted a license application for our HOME tonometer, intended for self-monitoring eye pressure at home, to the United States Food and Drug Administration.  Although we are unable to accurately estimate when the FDA will issue its decision, we are preparing to receive the license in 2016. We are also making preparations to launch sales in the United States immediately after the license has been granted.

Several studies associated with the HOME tonometer are currently under way, and a significant number (200) of scientific publications address its 24/7 measurements, both indicating the widespread interest in continuous intraocular pressure measurement. Sales of our HOME tonometer developed slightly slower than planned during the year, mainly because compensability issues remain unresolved in key markets. Regardless of this, active ophthalmologists are increasingly introducing HOME tonometers, but more widespread use will require more extensive compensability. Because the US markets are important in terms of global sales growth, obtaining an FDA license is very important to Icare.

During the review period, we took steps to align the Icare organization in the United States with the growth prospects of this major market. The United States is Revenio's most important market area, accounting for approximately 42% of the Group's net sales. Since the beginning of May, I have been working at our US office in Raleigh. My objective is to support and develop our local organization and distributor network. During the review period, we hired a financial administration specialist to work at our US office, and in October we hired a product marketing manager specializing in the market launch of the HOME tonometer.

The development work carried out by Revenio Research on asthma and skin cancer products is progressing on, and in some areas even ahead of, schedule. I feel very confident about the future of these product concepts and believe that we will be able to announce more details next year on the productization of both concepts and the timing of their global market launch.

Sales efforts related to the Oscare Sono(TM) osteoporosis detection device focused on locating distributors and end customers. Although sales volumes are currently modest, we are movng in the right direction. I am confident that the steps we are now taking will boost Oscare sales in the coming months, even if we may have to wait for a dramatic change in sales figures.

When setting our sales and profitability performance targets for the final quarter, it is important to bear in mind that a decision was made in late 2014 to grant VAT relief on healthcare devices. This boosted our sales considerably in the final weeks of 2014 and had a major impact on the comparison figures for Q4/2014. No similar tax incentive is on the horizon this year. Moreover, the US dollar exchange rate fluctuations have subsided, and similar gains to those recorded in the first half are not to be expected towards the year-end. However, we expect the final quarter to go as planned."

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:
President & CEO Olli-Pekka Salovaara, tel. +358 40 567 5520
olli-pekka.salovaara@revenio.fi
www.revenio.fi

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

The Revenio Group in brief

Revenio is a Finnish health tech group whose core business is tonometers. The Revenio Health Tech segment comprises the business operations of Icare Finland Oy, Revenio Research Oy and Oscare Medical Oy, which specializes in osteoporosis screening and monitoring. The common denominators of Revenio's business operations include screening, follow-up and the global need to make cost savings in health care via preventive measures. Revenio seeks vigorous growth in health technology, both organically and through acquisitions and mergers.

In 2014, the Revenio Group's net sales totaled MEUR 16.0, with its operating margin for continuing operations standing at 27.5%. Revenio Group Corporation has been listed in Nasdaq Helsinki.