Interim report January – March 2023

First quarter in brief
 

•  Net sales amounted to 16,1 million SEK (9,9), which means a sales growth of 63 percent.

• Operating profit amounted to -2 million SEK (-3,6), corresponding to an operating margin of -13 percent (-37).

• Net profit for the period amounted to -2,2 million SEK (-3,5).

• Earnings per share amounted to -0.05 SEK (-0.08).

Significant events during the first quarter

During the first quarter SyMRI received regulatory approval in Singapore, UK and Canada.

Significant events after the first quarter

Nothing to report.

CEO comments

Sales and cost development in line with the growth plan

Sales in the quarter amounted to SEK 16.1m (9.9). The outcome is a record for a first quarter and corresponds to an organic growth of 63 percent compared to the same period last year. Sales development mainly consists of larger orders from partners and increased direct sales. Operating profit amounted to SEK -2.0m (-3.6). This corresponds to a margin of -13 percent (-37). The development is explained by the fact that sales increased more than costs during the quarter. The cost increase compared to the same period last year stems from planned investments in line with our growth plan. As previously communicated, we have now reached a level of costs that is reasonable and relevant to our business model from which we now continue to grow with an increased focus on profitability. The outcome in the first quarter is in line with our plan and we reiterate that we expect revenues in excess of SEK 90.0m and an operating margin after depreciation of at least 20% in 2023.

The financial impact of the business and price model

With undiminished force we continue to establish SyMRI as a standard of care. The business model we developed includes sales directly to end customers and to MR system manufacturers. Over time, sales increase to both segments and in more geographic markets. The pricing model we have implemented includes options for a permanent license and now also time-limited variants. Of course, we always make an overall assessment of each deal. Among other things, any counterparty risk is evaluated and if we consider it relevant, we make applicable reservations. In addition to the above, we take the license period into account in our pricing. We too are affected by the pressure of inflation and our customers are increasingly aware of this reality with price increases as a result. The fact that with this model we tie up more capital than before is a natural consequence, which also means that we have a greater focus on cash flow. Increased capital bidding primarily applies to licenses for customers who have already installed an MR system. An example could be a sale of a five-year license to such a customer. In this case, the agreement is made with the customer that payment must be made over the license period. After applicable reservations, the income is booked, and invoicing is done from the start of the first year and thereafter evenly over the license period.

Looking ahead

SyntheticMR is well equipped to reach the goals we have set for 2023. The response from the market for SyMRI and the value the product provides to the customer is positive. The installed base we have is still negligible in terms of market share. The organization is sufficient to provide growing direct sales with increased efficiency and results. The sales organization has been expanded over several years and its efficiency has potential for improvement. The same applies to our innovative work in research and development. We are satisfied with the geographical priorities that have been made in terms of market areas. As we increase our sales, we also broaden our presence. Nowadays, we have three established subsidiaries. During the first quarter, SyMRI was approved for clinical use in three new countries. Canada, UK and Singapore are markets with high potential that provide good conditions for increased market penetration globally. We also see that our partner collaborations develop and deepen. These also facilitate the likelihood that we will achieve continued market success. The global license and distribution agreements we have strengthen our direct sales capacity. Our collaborations around product development continue successfully. Regardless of financial goals, we are driven by the ambition to successfully establish SyMRI as a standard of care. If we succeed, financial rewards will follow.

Ulrik Harrysson

CEO, SyntheticMR AB (publ)

This is a translation of the Swedish version of the report. When in doubt, the Swedish wording prevails.


 

This disclosure contains information that SyntheticMR AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 23-05-2023 08:08 CET.

For additional information, please contact Ulrik Harrysson, CEO, SyntheticMR AB, +46 70 529 29 87 ulrik.harrysson@syntheticmr.com or Johanna Norén, CFO and Head of Investor Relations, SyntheticMR AB, +46 70 619 21 00 johanna.noren@syntheticmr.com.

SyntheticMR AB develops and markets innovative software solutions for Magnetic Resonance Imaging (MRI). SyntheticMR AB has developed SyMRI^®, delivering multiple, adjustable contrast images and quantitative data from a single 5-minute scan. The SyMRI product is available in different packages. SyMRI NEURO delivers multiple contrast images, tissue segmentations and quantitative data on the brain. SyMRI MSK provides multiple contrast images and quantitative data for knee and spine anatomies. SyMRI NEURO is CE-marked and FDA 510(k) cleared and SyMRI MSK is CE-marked. SyMRI is a registered trademark in Europe and the USA. SyntheticMR is listed on the Spotlight Stock Market Exchange in Stockholm, Sweden. For more information, visit www.syntheticmr.com.