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Sectra’s three-month interim report 2017/2018: Growth and increased operating profit

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Linköping, Sweden, September 12, 2017 – International medical imaging IT and cybersecurity company Sectra (STO: SECT B) reported increased net sales, operating profit and cash flow compared with the year-earlier period. Sectra’s financial focus is to increase its operating profit per share while maintaining its operating margin, and Sectra’s financial performance measures continue to exceed the Group’s target levels.

First quarter in figures 

  •  Order bookings increased 0.9% to SEK 227.6 million (225.5).  
  •  Net sales totaled SEK 265.1 million (230.5), up 15.0%. Adjusted for currency fluctuations, sales increased 15.4%. 
  •  Operating profit rose 38.0% to SEK 44.3 million (32.1), corresponding to an operating margin of 16.7% (13.9). Adjusted for currency fluctuations, operating profit increased 38.9%.  
  •  Cash flow after changes in working capital amounted to SEK 24.3 million (17.6).  

Torbjörn Kronander, President and CEO of Sectra AB, comments 

“Sectra’s operating areas continued to develop and the trend for the Group’s financial results was positive. Our Imaging IT Solutions business area got off to a much better start than in the comparative quarter, but we cannot draw any definitive conclusions based on the outcome for a single quarter. Sales in Secure Communications also improved, mainly as a result of development assignments and products for secure communications. Although the business area’s new venture in the area of cybersecurity for critical infrastructure has not yet generated any substantial sales, we have signed a number of strategic orders and are growing in the Nordic energy sector.”  

“Order bookings did not quite reach the desired level and we are continuing to focus on growth. In many of the markets where Sectra operates, we command such a large market share that our growth opportunities are limited. However, this is not the case in the US, where, in addition to a high level of customer loyalty, we also have a relatively small market share. We have been commissioned by several prominent healthcare providers in the US over the past year, and I expect that we will continue to benefit from favorable business opportunities in the US market going forward. To achieve long-term growth, we must also enter new markets and channels. Over the past year, we have established ourselves in two new countries, namely France and Canada.”  

“Customer demand for the solutions we provide remains favorable, and we witnessed no changes to the underlying trends in our markets. We have a stable foundation, with a substantial share of long-term customer contracts, and more than half our sales comprise recurring revenue.”  

For further CEO comments and information, see the attached interim report.  

Presentation of the interim report  

A teleconference will be held by Torbjörn Kronander, President and CEO of Sectra AB, and Mats Franzén, CFO of Sectra AB. The presentation will be held in English.  

Time: September 12, 2017 at 10:00 a.m. (CET) 

To participate, call: 

SE: +46 8 56642690

UK: +44 2030089802

US: +1 8557532235

The report presentation can also be followed live online: www.sectra.com/irwebcast. A recorded version will be available via this link after the conference. 

This information constitutes information that Sectra AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and/or the Swedish Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out below, at 08:00 a.m. (CET) on September 12, 2017.

For further information, please contact:
Dr. Torbjörn Kronander, CEO and President Sectra AB, 46 (0) 705 23 52 27
Press photos: flickr.com/photos/sectramedicalsystems

About Sectra 
Sectra assists hospitals throughout the world to enhance the efficiency of care, and authorities and defense forces in Europe to protect society’s most sensitive information. Thereby, Sectra contributes to a healthier and safer society. The company was founded in 1978, has its head office in Linköping, Sweden, with subsidiaries in 15 countries, and operates through partners worldwide. Sales in the 2016/2017 fiscal year totaled SEK 1,141 million. The Sectra share (STO: SECT B) is quoted on the Nasdaq Stockholm exchange. For more information, visit www.sectra.com

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Sectra’s operating areas continued to develop and the trend for the Group’s financial results was positive. Our Imaging IT Solutions business area got off to a much better start than in the comparative quarter, but we cannot draw any definitive conclusions based on the outcome for a single quarter. Sales in Secure Communications also improved, mainly as a result of development assignments and products for secure communications. Although the business area’s new venture in the area of cybersecurity for critical infrastructure has not yet generated any substantial sales, we have signed a number of strategic orders and are growing in the Nordic energy sector.
Torbjörn Kronander, President and CEO of Sectra
Order bookings did not quite reach the desired level and we are continuing to focus on growth. In many of the markets where Sectra operates, we command such a large market share that our growth opportunities are limited. However, this is not the case in the US, where, in addition to a high level of customer loyalty, we also have a relatively small market share. We have been commissioned by several prominent healthcare providers in the US over the past year, and I expect that we will continue to benefit from favorable business opportunities in the US market going forward. To achieve long-term growth, we must also enter new markets and channels. Over the past year, we have established ourselves in two new countries, namely France and Canada.
Torbjörn Kronander, President and CEO of Sectra
Customer demand for the solutions we provide remains favorable, and we witnessed no changes to the underlying trends in our markets. We have a stable foundation, with a substantial share of long-term customer contracts, and more than half our sales comprise recurring revenue.
Torbjörn Kronander, President and CEO of Sectra