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Elekta
Interim / Quarterly Report • Nov 24, 2022
2906_ir_2022-11-24_63eb9222-b967-46e2-b3fd-6ea773d13daf.pdf
Interim / Quarterly Report
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Interim report, May–October 2022/23
- Gross order intake amounted to SEK 4,598 M (4,045), corresponding to a 6 percent decrease in constant exchange rates
- Net sales were SEK 4,081 M (3,697), corresponding to a 5 percent decrease in constant exchange rates
- Adjusted gross margin amounted to 37.3 percent (38.6)
- Adjusted EBIT amounted to SEK 316 M (533), corresponding to an adjusted EBIT margin of 7.7 percent (14.4)
- Earnings per share was SEK 0.32 (1.00) before/after dilution
- Adjusted earnings per share was SEK 0.55 (1.00) before/after dilution
- Cash flow after continuous investments amounted to SEK -417 M (-17)
Second quarter First six months
- Gross order intake amounted to SEK 8,468 M (8,025), corresponding to an 8 percent decrease in constant exchange rates
- Net sales were SEK 7,408 M (6,707), corresponding to a 1 percent decrease in constant exchange rates
- Adjusted gross margin amounted to 38.1 percent (37.9)
- Adjusted EBIT amounted to SEK 447 M (734), corresponding to an adjusted EBIT margin of 6.0 percent (10.9)
- Earnings per share was SEK 0.47 (1.33) before/after dilution
- Adjusted earnings per share was SEK 0.74 (1.33) before/after dilution
- Cash flow after continuous investments amounted to SEK -1,010 M (-360)
Group summary
| Q2 | First six months | ||||||
|---|---|---|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | Δ | 2022/23 | 2021/22 | Δ | |
| Gross order intake | 4,598 | 4,045 | -6% 1 | 8,468 | 8,025 | -8% | 1 |
| Net sales | 4,081 | 3,697 | -5% 1 | 7,408 | 6,707 | -1% | 1 |
| Gross margin | 36.2% | 38.6% | -2.4 ppts | 37.4% | 37.9% | -0.6 ppts | |
| Adjusted gross margin 2 | 37.3% | 38.6% | -1.3 ppts | 38.1% | 37.9% | 0.1 ppts | |
| EBIT | 199 | 533 | -63% | 316 | 734 | -57% | |
| Adjusted EBIT 3 | 316 | 533 | -41% | 447 | 734 | -39% | |
| EBIT margin | 4.9% | 14.4% | -9.5 ppts | 4.3% | 10.9% | -6.7 ppts | |
| Adjusted EBIT margin 3 | 7.7% | 14.4% | -6.7 ppts | 6.0% | 10.9% | -4.9 ppts | |
| Cash flow 4 | -417 | -17 | -2,362% | -1,010 | -360 | -181% | |
| Earnings per share, SEK 5 | 0.32 | 1.00 | -68% | 0.47 | 1.33 | -64% | |
| Adjusted earnings per share, SEK 5 6 | 0.55 | 1.00 | -45% | 0.74 | 1.33 | -45% |
1Compared to last fiscal year based on constant exchange rates.
2Adjusted gross margin = Gross margin excluding items affecting comparability attributable to the Cost-reduction Initiative within the Resilience and Excellence Program, see page 29. 3Adjusted EBIT = Operating income (EBIT) excluding items affecting comparability attributable to the Cost-reduction Initiative within the Resilience and Excellence Program, see page 29.
4After continuous investments. 5Before/after dilution.
6Adjusted earnings per share = Net income attributable to Parent Company shareholders, excluding items affecting comparability attributable to the Cost-reduction Initiative, in relation to the weighted average number of shares (excluding treasury shares), see page 29.
This is information is such that Elekta AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication by the below mentioned contact persons at 07:30 CET on November 24, 2022.
Forward-looking information. This report included forward-looking statements including, but not limited to, statements relation to operational and financial performance, market conditions, and other similar matters. These forward-looking statements are based on current expectations about future events. Although the expectations described in these statements are assumed to be reasonable, there is no guarantee that such forward-looking statements will materialize or are accurate. Since these statements involve assumptions and estimates that are subject to risks and uncertainties, results could differ materially from those set out in the statement. Some of these risks and uncertainties are described further in the section "Risk and uncertainties". Elekta undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, whether as a result of new information, future events or otherwise, except as required by law or stock exchange regulations.
Second quarter
Product launches and Costreduction Initiatives on track
The uncertain macroeconomic environment and supply chain challenges continued to impact our installations, costs and margins in the second quarter. At the same time, we saw revenue growth in Europe and the U.S., as well as in Service. Elekta successfully launched key products that will support profitable growth going forward. Our Costreduction Initiative also progressed well during the quarter.
Mixed market situation with key wins
The market and order situation continued to be challenging in the quarter with our order intake declining in EMEA and the Americas. We were selected to deliver 37 Versa HD linacs to Italy's national health service, which will be booked in the third and fourth quarters. In India, we continued to drive adoption with leading Karkinos Healthcare acquiring several Versa HD and Harmony Pro linacs to be strategically deployed across the country.
Key product launches and rollouts
During the quarter, we continued the roll out of our new Gamma Knife platform, Elekta Esprit, for which we now have both CE and FDA regulatory clearance. Elekta Unity received CE mark for its Comprehensive Motion Management (CMM) with True Tracking and automatic gating functionalities and the FDA application is submitted. These features represent the next phase of Elekta Unity's CMM vision and will drive efficiency and productivity, as well as create opportunities for condensed treatment courses. fewer side effects, and improved outcomes for cancer patients.
To strengthen our position as a customer lifetime companion we expanded our value-added services. By introducing Elekta Care 360, the global service portfolio has expanded with services such as dosimetry, consultancy and physics start-up aiming at enhancing customers' clinical operations.
The new launches and our work with price improvements will contribute positively to revenue and margin growth going forward.
Installations and supply chain
Elekta's revenue declined in the second quarter as installations continued to be negatively impacted by Covid restrictions in China, customer readiness and continued supply chain disturbances. We enjoyed growth in the U.S. and in Europe – but saw a decline in China impacted by the lock downs. Together with inflation, the low revenue and supply chain challenges also explain the lower margins.
Cost-reduction Initiative on track
During the quarter, we have successfully driven our Cost-reduction Initiative and started to see our expenses sequentially decline. We are on track with our plan and will deliver annual savings of around SEK 450 M.
Looking forward
We expect the uncertain macroeconomic environment and supply chain challenges to continue to impact installations, costs, and margins in the third quarter. However, we foresee that the supply chain situation will gradually improve in the fourth quarter.
Gustaf Salford President and CEO
Unity provides True Tracking in real time
Strong Service revenue growth
Second quarter Order intake and order backlog
The global macroeconomic challenges continued to drive uncertainties resulting in cautiousness and soft order development in the second quarter. Total order intake declined by 6 percent based on constant exchange rates compared to last year's second quarter with double-digit order growth. Order intake was weaker in mature than emerging markets. The MR-Linac with its latest developments was rewarded in the market, resulting in increased order intake for Elekta Unity in the quarter.
Order backlog increased both in SEK and based on constant exchange rates, and amounted to SEK 42,817 M, compared to SEK 39,656 M on April 30, 2022. The positive translation effect due to the conversion to closing exchange rates amounted to SEK 3,079 M.
Gross order intake
| Q2 | First six months | |||||||
|---|---|---|---|---|---|---|---|---|
| SEK M | 2022/23 2021/22 | 1 Δ |
Δ | 2022/23 2021/22 | 1 Δ |
Δ | ||
| Americas | 1,167 | 1,086 | -13% | 8% | 2,147 | 2,551 | -31% | -16% |
| EMEA | 1,532 | 1,446 | -9% | 6% | 2,974 | 2,710 | 1% | 10% |
| APAC | 1,899 | 1,513 | 2% | 26% | 3,347 | 2,764 | 5% | 21% |
| Group | 4,598 | 4,045 | -6% | 14% | 8,468 | 8,025 | -8% | 6% |
1 Based on constant exchange rates.
North and South America (Americas)
In the Americas, order intake decreased by 13 percent during the second quarter based on constant exchange rates. The decline was mainly explained by the development in Canada and South America. Despite continued cautiousness in the U.S., order intake remained on the previous year's high level. Mexico showed good order growth and included the highend radiotherapy part of a bundled deal.
Europe, Middle East and Africa (EMEA)
In EMEA, orders declined by 9 percent based on constant exchange rates. The strong order momentum from the large tender in Spain continued, but large radiotherapy markets, such as Denmark, the Netherlands and France, drove the decline in Europe. Although Africa showed negative development, the Middle East reported good growth.
Asia Pacific (APAC)
Orders in APAC increased by 2 percent based on constant exchange rates during the second quarter. The modest growth rate in APAC was mainly explained by weak development in large mature markets such as Japan, Australia and New Zealand. The Chinese market expanded during the quarter and order intake showed good growth. East Asia had a positive development, with Korea as the main driving country.
Gross order intake Group
Gross order intake Americas
Gross order intake EMEA
Gross order intake APAC
Second quarter Net sales
Elekta's revenue declined in the second quarter, as installations were impacted by the supply chain disturbances and Covid restrictions in China. The supply chain issues meant component shortages and extended lead times, as well as long shipping times delaying linac deliveries. Covid restrictions impacted both customers' readiness and planned installations. Based on constant exchange rates, net sales decreased by 5 percent, however in SEK, net sales increased by 10 percent to SEK 4,081 M (3,697).
Net sales per region
| Q2 | First six months | |||||||
|---|---|---|---|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 1 Δ |
Δ | 2022/23 | 2021/22 | 1 Δ |
Δ |
| Americas | 1,327 | 1,111 | -3% | 19% | 2,365 | 1,938 | 1% | 22% |
| EMEA | 1,332 | 1,284 | -7% | 4% | 2,522 | 2,427 | -1% | 4% |
| APAC | 1,421 | 1,302 | -5% | 9% | 2,520 | 2,341 | -3% | 8% |
| Group | 4,081 | 3,697 | -5% | 10% | 7,408 | 6,707 | -1% | 10% |
1 Based on constant exchange rates.
The development was negative in all geographic regions. In the Americas, the U.S. market was positive whereas fewer installations in Canada were the main driver for the region's negative development. Europe contributed with good growth in the quarter, although a strong decline in the Middle East and Africa more than offset this growth for EMEA. The negative development in APAC was impacted by lockdowns in China, and lower installation volumes in Japan and Australia. India continued to show good growth in the quarter.
Service grew with 7 percent based on constant exchange rates with continued good growth across all business lines. Solutions decreased by 13 percent based on constant exchange rates. At the end of the period, Elekta had an installed base of approximately 7,000 devices, of which about 5,100 units were linacs, MR-Linacs or Leksell Gamma Knife systems. 46 percent of the installed base of linacs was in emerging (underserved) markets with growth of more than 40 systems in the quarter.
Net sales per product
| Q2 | First six months | |||||||
|---|---|---|---|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 1 Δ |
Δ | 2022/23 | 2021/22 | 1 Δ |
Δ |
| Solutions | 2,322 | 2,254 | -13% | 3% | 4,028 | 3,885 | -7% | 4% |
| Service | 1,759 | 1,443 | 7% | 22% | 3,380 | 2,821 | 6% | 20% |
| Total | 4,081 | 3,697 | -5% | 10% | 7,408 | 6,707 | -1% | 10% |
1 Based on constant exchange rates.
7% revenue growth in Service
Net sales by quarter
Net sales by RTM2
Revenue growth in the U.S. and Europe
Second quarter Earnings
Adjusted gross margin amounted to 37.3 percent (38.6) in the second quarter. The decrease compared to last year was impacted by lower sales volume of approximately 160 basis points as well as higher supply chain costs and inflation of approximately 250 basis points. These effects were partly offset by a favorable Solutions/Service mix of approximately 140 basis points and a positive contribution from foreign exchange rates of approximately 140 basis points.
Operating expenses increased by 3 percent during the second quarter based on constant exchange rates. The increase is explained by higher selling expenses, partly offset by decreased net R&D expenditure, while the administrative expenses were on the same level as the comparing quarter. The higher selling expenses reflect more in-person customer events and meetings including travel and exhibitions such as ASTRO and launch events in China. On a rolling twelve-month basis, gross R&D expenditure to net sales was 15 percent (12), relating to accelerated investments in innovations. Net R&D expenditure decreased versus last year as R&D projects proceeded and amortizations were lower. Amortization of intangible assets and depreciation of tangible fixed assets amounted to a total of SEK 266 M (246). Foreign exchange hedges had a negative impact on adjusted EBIT. Adjusted EBIT was SEK 316 M (533) representing a margin of 7.7 percent (14.4). EBIT, including items affecting comparability, amounted to SEK 199 M (533), which represented a margin of 4.9 percent (14.4). Items affecting comparability related mainly to personnel related costs and amounted in the second quarter to SEK 117 M, whereof SEK 45 M impacted gross margin.
Net financial items increased to SEK -40 M (-30). The key driver was higher interest expenses as a result of increased interest rates. Taxes amounted to SEK -38 M (-121), representing a tax rate of 23.7 percent (24.0). Net income amounted to SEK 122 M (382) and earnings per share amounted to SEK 0.32 (1.00) before and after dilution. Adjusted earnings per share amounted to SEK 0.55 (1.00) before and after dilution. Return on shareholders' equity amounted to 9 percent (14) and return on capital employed was 9 percent (12).
Cash flow
With SEK -417 M (-17) the second quarter cash flow was lower compared to last year mainly due to lower earnings. Investments in intangible assets amounted to SEK 327 M (289) and were mainly related to R&D investments in the Linac family and software. Investments in tangible assets decreased to SEK 35 M (52). Cash conversion in the second quarter was -12 percent and, based on rolling twelve months, cash conversion was 60 percent.
Cash flow (extract)
| Q2 | First six months | |||
|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 2022/23 | 2021/22 |
| Operating cash flow | 147 | 644 | 498 | 962 |
| Change in working capital | -202 | -319 | -751 | -718 |
| Cash flow from operating | ||||
| activities | -55 | 325 | -253 | 244 |
| Continuous investments | -362 | -342 | -758 | -604 |
| Cash flow after continuous | ||||
| investments | -417 | -17 | -1,010 | -360 |
| EBITDA | 465 | 780 | 844 | 1,258 |
| Operational cash conversion | -12% | 42% | -30% | 19% |
37.3% adjusted gross margin
15% R&D expenditure of net sales, RTM
Cash flow from operating activities
Second quarter Working capital
Net working capital as a percentage of net sales (rolling twelve months) was stable with -2 percent (-2) and followed a seasonal pattern. Accounts receivables and customer advances increased as a result of higher level of shipments in the quarter. The higher inventory level was a result of extended supply chain lead times and buildup for coming quarters. All individual working capital items were significantly impacted by currency movements, while the net effect on the total working capital from currencies was limited. For more information, see page 27.
Financial position
Cash and cash equivalents and short-term investments amounted to SEK 1,535 M (2,796). Interest-bearing liabilities excluding lease liabilities amounted to SEK 4,669 M (4,570). Net debt increased to SEK 3,134 M (1,773) as a result of accelerated investments in innovation. Net debt in relation to EBITDA was 1.38 (0.62). The average maturity of interest-bearing liabilities was 3.6 years.
Net debt
| Oct 31 | Oct 31 | Apr 30 | |
|---|---|---|---|
| SEK M | 2022 | 2021 | 2022 |
| Long-term interest-bearing liabilities | 4,138 | 3,050 | 4,099 |
| Short-term interest-bearing liabilities | 531 | 1,520 | 510 |
| Cash and cash equivalents and short-term | |||
| investments | -1,535 | -2,796 | -3,077 |
| Net debt | 3,134 | 1,773 | 1,532 |
| Long-term lease liabilities | 784 | 849 | 841 |
| Short-term lease liabilities | 256 | 217 | 245 |
| Net debt including lease liabilities | 4,174 | 2,840 | 2,618 |
The exchange rate effect from the translation of cash and cash equivalents amounted to SEK 34 M (5). The translation difference in interest-bearing liabilities amounted to SEK 38 M (11).
Sustainability agenda
Elekta's sustainability agenda is set on improving access to healthcare globally while operating a responsible and sustainable business. The UN Sustainable Development Goals (SDGs) guide Elekta's approach to sustainability. The sustainability focus areas are: Access to Healthcare, Environmental Action, Business Ethics and People in Focus.
Business Ethics – Enhanced compliance initiatives
As part of Elekta's continuous work in Business Ethics, Elekta has had a dedicated focus on accelerating compliance and business ethics efforts, where the importance of business ethics and doing business with integrity were broadly emphasized in various communication channels. These initiatives were combined with the delivery of an upgraded online Compliance training, mandatory for all employees and covering the highest risk areas of the Elekta Code of Conduct. Elekta also released an updated
Working capital
1.38 Net debt/EBITDA
Second quarter
"Compliance Ambassador" program in order to increase support for local implementation of Elekta's compliance and business ethics strategy and relaunched a "speak up campaign" promoting the Elekta Integrity Line and other whistleblowing channels that encourage people to report any concerns relating to business ethics.
Risk and uncertainties
Elekta's presence in a large number of geographical markets exposes the Group to political and economic risks on a global scale and/or in individual countries. For more details, please see the Annual Report 2021/22, page 36.
Covid and the war in Ukraine impact Elekta's operations, supply and demand. These and similar events have impacted supply chains and may lead to an economic downturn, interest rate and inflation pressure, as well as foreign exchange rate fluctuations affecting Elekta's business and financial results. In fiscal year 2020/21, and the first nine-months of fiscal year 2021/22 (before the war in Ukraine), the Group's revenue in Russia, Belarus and Ukraine represented about 2 percent. Elekta has neither production nor Tier 1 suppliers in these three countries.
Significant events
Second quarter
Elekta's Nomination Committee for AGM 2023
The Chairman of the Board has convened the Nomination Committee for the 2023 Annual General Meeting (AGM) consisting of representatives from the Fourth Swedish National Pension Fund, Nordea Funds, SEB Funds, Didner & Gerge Fonder in addition to the Chairman himself.
Elekta Care 360 launched
In October, Elekta announced Elekta Care 360, an expansion of Elekta Care's global portfolio of customer services aimed at enhancing customers' clinical operations. Elekta Care 360 increases Elekta's value-added services and strengthens the position as a lifetime companion. The solutions include, for example, dosimetry, consultancy, and physics start-up services.
CE mark for CMM with True Tracking and automatic gating
In October, Elekta announced that that its MR-Linac, Elekta Unity, has received CE mark for its Comprehensive Motion Management (CMM) with True Tracking and automatic gating functionalities. This functionality provides continuous tracking of the 3D position of any target in real time.
Elekta wins majority of Italian public tender
In October, Elekta announced that it had been selected to deliver 37 Versa HD linacs (60 percent of the tender) for a total value of approximately EUR 50 million to Italy's national health service. The order is expected to be booked during Elekta's third and fourth quarters of 2022/23 and the installations to be completed in 2023/24 and 2024/25.
Elekta Esprit receives CE mark and FDA clearance
In August, Elekta announced that the next-generation Leksell Gamma Knife® radiosurgery platform, Elekta Esprit, received CE mark and in October, it received FDA 510(k) clearance.
Midterm outlook
- Net sales CAGR >7% until 2024/25
- EBIT margin % expansion until 2024/25
Dividend policy
• ≥50% of net income for the year
Second quarter
AGM 2022 approves dividend and new Board member
In August, Elekta's AGM resolved on a dividend corresponding to SEK 2.40 per share, to be paid in two installments. The Meeting also elected Kelly Londy as a new member of the Board and Laurent Leksell was reelected as Chairman of the Board.
Changes in Executive Management
During the quarter Elekta carried out changes in the Executive Management team in order to streamline and enhance the business. Business line Oncology Informatics Solutions (OIS) now reports to Chief Product Officer, Maurits Wolleswinkel; Neuro Solutions to President Brachy Solutions, John Lapré; and HR to General Counsel and EVP, Jonas Bolander. These new Heads will represent the business line/function in the Executive Management team going forward. Andrew Wilson, former President OIS, and Karin Svenske Nyberg, former EVP HR, have left Elekta to pursue new challenges.
First quarter1
- New radiosurgery system Elekta Esprit launched
- Elekta and the Netherlands Cancer Institute to co-develop the next generation of radiotherapy solutions
- Elekta's Nomination Committee's proposal to the AGM
- Changes in Executive Management (Carlos Castilleja)
Cost-reduction Initiative
In the first quarter 2022/23, Elekta accelerated the Resilience and Excellence Program by launching a Cost-reduction Initiative to reduce structural costs and enhance productivity across the organization. The Cost-reduction Initiative will generate annual savings of approximately SEK 450 M. The measures include increasing productivity in operations and service as well as optimizing the innovation pipeline and leverage the global product organization. The Initiative will also drive efficiencies in selling and administration functions. In the first half of 2022/23, the Initiative has reduced spending by SEK 50 M. Implementation costs related to the Initiative are expected to amount to up to SEK 400 M and are reported as items affecting comparability. In the first half of 2022/23 the implementation costs were SEK 131 M, see page 28.
Employees
The average number of employees during the period was 4,664 (4,522). The average number of employees in the Parent Company was 58 (55).
Shares
Total number of registered shares on October 31, 2022, was 383,568,409 of which 14,980,769 were A-shares and 368,587,640 B-shares. On October 31, 2022 1,485,289 shares were treasury shares held by Elekta.
1 For more details about the previous significant events please see respective quarterly report.
The Board of Directors and the President and CEO declare that the undersigned interim report provides a fair overview of the company's and Group's operations, their financial position and performance, and describes material risks and uncertainties facing the company and other companies in the Group.
Gustaf Salford President and CEO
Stockholm, November 24, 2022
Laurent Leksell Chairman of the Board
Kelly Londy Member of the Board
Wolfgang Reim Member of the Board
Birgitta Stymne Göransson Member of the Board
Member of the Board
Caroline Leksell Cooke
Johan Malmquist Member of the Board
Jan Secher Member of the Board
Cecilia Wikström Member of the Board
Review report
Elekta Ab (publ), 556170-4015
Box 7593 Stockholm
Introduction
We have reviewed the condensed interim report for Elekta AB as at October 31, 2022 and for the six months period then ended. The Board of Directors and the Managing Director are responsible for the preparation and presentation of this interim report in accordance with IAS 34 and the Swedish Annual Accounts Act. Our responsibility is to express a conclusion on this interim report based on our review.
Scope of review
We conducted our review in accordance with the International Standard on Review Engagements, ISRE 2410 Review of Interim Financial Statements Performed by the Independent Auditor of the Entity. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and other generally accepted auditing standards in Sweden. The procedures performed in a review do not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the interim report is not prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act regarding the Group, and in accordance with the Swedish Annual Accounts Act regarding the Parent Company.
Stockholm, the 24th of November 2022
Ernst & Young AB
Rickard Andersson Authorized Public Accountant
Consolidated income statement – condensed
| Q2 | First six months | 12 months | |||||
|---|---|---|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 2022/23 | 2021/22 | RTM | 2021/22 | |
| Net sales | 4,081 | 3,697 | 7,408 | 6,707 | 15,248 | 14,548 | |
| Cost of products sold | -2,602 | -2,270 | -4,641 | -4,164 | -9,588 | -9,111 | |
| Gross income | 1,479 | 1,427 | 2,767 | 2,543 | 5,660 | 5,436 | |
| Selling expenses | -421 | -317 | -812 | -633 | -1,534 | -1,355 | |
| Administrative expenses | -339 | -287 | -657 | -561 | -1,269 | -1,173 | |
| R&D expenses | -362 | -310 | -748 | -701 | -1,419 | -1,372 | |
| Other operating income and expenses | -15 | -27 | -23 | -34 | -37 | -48 | |
| Exchange rate differences | -142 | 47 | -210 | 119 | -175 | 155 | |
| Operating income | 199 | 533 | 316 | 734 | 1,226 | 1,643 | |
| Financial items, net | -40 | -30 | -79 | -66 | -155 | -142 | |
| Income after financial items | 160 | 503 | 237 | 668 | 1,071 | 1,501 | |
| Income tax | -38 | -121 | -56 | -160 | -240 | -345 | |
| Net income for the period | 122 | 382 | 182 | 507 | 831 | 1,157 | |
| Net income for the period attributable to: | |||||||
| Parent Company shareholders | 122 | 383 | 181 | 509 | 826 | 1,154 | |
| Non-controlling interests | 0 | - 1 |
0 | - 2 |
5 | 3 | |
| Average number of shares | |||||||
| Before dilution, millions | 382 | 382 | 382 | 382 | 382 | 382 | |
| After dilution, millions | 382 | 382 | 382 | 382 | 382 | 382 | |
| Earnings per share | |||||||
| Before dilution, SEK | 0.32 | 1.00 | 0.47 | 1.33 | 2.16 | 3.02 | |
| After dilution, SEK | 0.32 | 1.00 | 0.47 | 1.33 | 2.16 | 3.02 |
Consolidated statement of comprehensive income
| Q2 | First six months | 12 months | ||||
|---|---|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 2022/23 | 2021/22 | RTM | 2021/22 |
| Net income for the period | 122 | 382 | 182 | 507 | 831 | 1,157 |
| Other comprehensive income: | ||||||
| Items that will not be reclassified to the income statement: | ||||||
| Remeasurements of defined benefit pension plans | - | 0 | - | 10 | 17 | 27 |
| Change in fair value of equity instruments | - | - 3 |
-15 | - 1 |
-58 | -45 |
| Tax | - | 1 | - 9 |
- 3 |
- 4 |
2 |
| Total items that will not be reclassified to the income statement | - | - 2 |
-24 | 6 | -45 | -16 |
| Items that subsequently may be reclassified to the income statement: | ||||||
| Revaluation of cash flow hedges |
-144 | -33 | -210 | -116 | -542 | -448 |
| Translation differences from foreign operations | 496 | -169 | 673 | -63 | 1,494 | 758 |
| Tax | 30 | 7 | 43 | 24 | 112 | 92 |
| Total items that subsequently may be reclassified | ||||||
| to the income statement | 382 | -195 | 506 | -155 | 1,063 | 402 |
| Other comprehensive income for the period | 382 | -197 | 483 | -149 | 1,018 | 386 |
| Total comprehensive income for the period | 504 | 184 | 664 | 358 | 1,849 | 1,543 |
| Comprehensive income attributable to: | ||||||
| Parent Company shareholders | 503 | 186 | 664 | 360 | 1,843 | 1,540 |
| Non-controlling interests | 1 | - 2 |
1 | - 2 |
6 | 3 |
Consolidated balance sheet statement – condensed
| Oct 31 | Oct 31 | Apr 30 | |
|---|---|---|---|
| SEK M | 2022 | 2021 | 2022 |
| Non-current assets | |||
| Intangible assets | 11,390 | 9,034 | 10,262 |
| Right-of-use assets | 923 | 966 | 975 |
| Tangible assets | 969 | 896 | 954 |
| Financial assets | 720 | 552 | 615 |
| Deferred tax assets | 696 | 454 | 616 |
| Total non-current assets | 14,699 | 11,903 | 13,423 |
| Current assets | |||
| Inventories | 3,216 | 2,416 | 2,533 |
| Accounts receivable | 3,666 | 3,037 | 3,647 |
| Accrued income | 2,047 | 1,988 | 1,796 |
| Other current receivables | 2,062 | 1,702 | 1,827 |
| Cash and cash equivalents | 1,535 | 2,796 | 3,077 |
| Total current assets | 12,526 | 11,940 | 12,880 |
| Total assets | 27,225 | 23,843 | 26,303 |
| Equity attributable to Parent Company shareholders | 9,128 | 8,143 | 8,913 |
| Non-controlling interests | 4 | - 2 |
3 |
| Total equity | 9,131 | 8,141 | 8,916 |
| Non-current liabilities | |||
| Interest-bearing liabilities | 4,138 | 3,050 | 4,099 |
| Lease liabilities | 784 | 849 | 841 |
| Other liabilities | 854 | 782 | 884 |
| Total non-current liabilities | 5,776 | 4,681 | 5,824 |
| Current liabilities | |||
| Interest-bearing liabilities | 531 | 1,520 | 510 |
| Lease liabilities | 256 | 217 | 245 |
| Accounts payable | 1,464 | 1,111 | 1,352 |
| Advances from customers | 4,686 | 3,802 | 4,161 |
| Prepaid income | 2,335 | 1,946 | 2,342 |
| Accrued expenses | 1,835 | 1,603 | 1,901 |
| Other current liabilities | 1,211 | 822 | 1,054 |
| Total current liabilities | 12,318 | 11,020 | 11,564 |
| Total equity and liabilities | 27,225 | 23,843 | 26,303 |
Second quarter and first six months Changes in consolidated equity – condensed
| Oct 31 | |||||
|---|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 2021/22 | ||
| Attributable to Parent Company shareholders | |||||
| Opening balance | 8,913 | 8,197 | 8,197 | ||
| Comprehensive income for the period | 664 | 360 | 1,540 | ||
| Incentive programs | 8 | 7 | 17 | ||
| Dividend | -459 | -420 | -841 | ||
| Total | 9,128 | 8,143 | 8,913 | ||
| Attributable to non-controlling interests | |||||
| Opening balance | 3 | 0 | 0 | ||
| Comprehensive income for the period | 1 | -2 | 3 | ||
| Total | 4 | -2 | 3 | ||
| Closing balance | 9,131 | 8,141 | 8,916 |
Second quarter and first six months Consolidated cash flow statement – condensed
| Q2 | First six months | 12 months | ||||
|---|---|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 2022/23 | 2021/22 | RTM | 2021/22 |
| Income after financial items | 160 | 503 | 237 | 668 | 1,071 | 1,501 |
| Amortization and depreciation | 266 | 246 | 528 | 524 | 1,042 | 1,039 |
| Interest net | 24 | 23 | 51 | 52 | 105 | 106 |
| Other non-cash items | -130 | 7 | -96 | -36 | -270 | -211 |
| Interest received and paid | -26 | -31 | -43 | -63 | -94 | -114 |
| Income taxes paid | -145 | -104 | -178 | -183 | -447 | -452 |
| Operating cash flow | 147 | 644 | 498 | 962 | 1,405 | 1,869 |
| Change in inventories | -175 | 34 | -597 | -128 | -566 | -97 |
| Change in operating receivables | -459 | -543 | -259 | -252 | -298 | -291 |
| Change in operating liabilities | 432 | 190 | 105 | -338 | 819 | 376 |
| Change in w orking capital |
-202 | -319 | -751 | -718 | -45 | -12 |
| Cash flow from operating activities | -55 | 325 | -253 | 244 | 1,361 | 1,858 |
| Investments in intangible assets | -327 | -289 | -676 | -515 | -1,381 | -1,220 |
| Investments in tangible assets | -35 | -52 | -82 | -89 | -181 | -188 |
| Continuous investments | -362 | -342 | -758 | -604 | -1,562 | -1,408 |
| Cash flow after continuous investments | -417 | -17 | -1,010 | -360 | -201 | 450 |
| Short-term investments | - | - | - | - | - | - |
| Business combinations, divestments and investments in other shares | - 3 |
-99 | - 2 |
-121 | -122 | -241 |
| Cash flow after investments | -420 | -116 | -1,013 | -481 | -323 | 209 |
| Dividends | -459 | -420 | -459 | -420 | -879 | -841 |
| Cash flow from other financing activities |
-60 | -285 | -105 | -718 | -273 | -886 |
| Cash flow for the period | -938 | -821 | -1,576 | -1,619 | -1,475 | -1,517 |
| Change in cash and cash equivalents during the period | ||||||
| Cash and cash equivalents at the beginning of the period | 2,423 | 3,652 | 3,077 | 4,411 | 2,796 | 4,411 |
| Cash flow for the period |
-938 | -821 | -1,576 | -1,619 | -1,475 | -1,517 |
| Exchange rate differences | 50 | -34 | 34 | 5 | 213 | 183 |
| Cash and cash equivalents at the end of the period | 1,535 | 2,796 | 1,535 | 2,796 | 1,535 | 3,077 |
Second quarter and first six months Parent company
Income statement and statement of comprehensive income - condensed
| First six months | |||
|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | |
| Operating expenses | -3 | -130 | |
| Financial net | 461 | 353 | |
| Income after financial items | 458 | 223 | |
| Tax | -55 | 21 | |
| Net income for the period | 403 | 244 | |
| Statement of comprehensive income | |||
| Net income for the period | 403 | 244 | |
| Other comprehensive income | - | - | |
| Total comprehensive income | 403 | 244 |
Balance sheet - condensed
| Oct 31 | Apr 30 | |
|---|---|---|
| SEK M | 2022 | 2022 |
| Non-current assets | ||
| Intangible assets | 36 | 39 |
| Shares in subsidiaries | 2,762 | 2,752 |
| Receivables from subsidaries | 2,137 | 2,160 |
| Other financial assets | 29 | 44 |
| Deferred tax assets | 20 | 44 |
| Total non-current assets | 4,984 | 5,039 |
| Current assets | ||
| Receivables from subsidaries | 4,303 | 2,599 |
| Other current receivables | 32 | 42 |
| Cash and cash equivalents | 265 | 1,863 |
| Total current assets | 4,600 | 4,504 |
| Total assets | 9,584 | 9,543 |
| Shareholders' equity | 2,313 | 2,368 |
| Non-current liabilities | ||
| Interest-bearing liabilities | 4,138 | 4,099 |
| Provisions | 11 | 13 |
| Total non-current liabilities | 4,149 | 4,112 |
| Current liabilities | ||
| Interest-bearing liabilities | 500 | 500 |
| Liabilities to Group companies | 2,504 | 2,482 |
| Other current liabilities | 118 | 81 |
| Total current liabilities | 3,122 | 3,063 |
| Total shareholders' equity and liabilities | 9,584 | 9,543 |
Second quarter and first six months Accounting principles
This interim report is prepared, with regards to the Group, according to IAS 34 and the Swedish Annual Accounts Act and, with regards to the Parent Company, according to the Swedish Annual Accounts Act and RFR 2. The accounting principles applied are consistent with those presented in Note 1 of the Annual Report 2021/22.
New or revised standards and interpretations, not yet applied, are not considered to have a material impact on the Elekta Group´s financial statements.
All figures are stated in SEK M and, accordingly, rounding differences can occur. Comparisons refer to the corresponding period for the prior year, unless otherwise stated.
Related party transactions
Related party transactions are described in note 35 in the Annual Report for 2021/22. No material changes have taken place in relations or transactions with related parties companies compared with the description in the Annual report 2021/22.
Exchange rates
For Group companies with a functional currency other than Swedish kronor, order intake and income statements are translated at average exchange rates for the reporting period, while order book and balance sheets are translated at closing exchange rates.
| Country | Currency | Average rate | Closing rate | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Q2 | Oct 31 | Apr 30 | ||||||||
| 2022 | 2021 | 1 Δ |
2022 | 2021 | 2022 | 1 Δ |
2 Δ |
|||
| Euroland | 1 EUR | 10.643 | 10.153 | 5% | 10.915 | 9.940 | 10.349 | 10% | 5% | |
| Great Britain | 1 GBP | 12.414 | 11.862 | 5% | 12.720 | 11.751 | 12.294 | 8% | 3% | |
| Japan | 1 JPY | 0.076 | 0.078 | -2% | 0.074 | 0.075 | 0.075 | -1% | -2% | |
| United States | 1 USD | 10.437 | 8.562 | 22% | 10.971 | 8.522 | 9.839 | 29% | 11% |
1 October 31, 2022, vs October 31, 2021.
2 October 31, 2022, vs April 30, 2022.
Segment reporting
Elekta applies geographical segmentation. Order intake, net sales and contribution margin for the respective regions are reported to Elekta's CFO and CEO (chief operating decision makers). The regions' expenses are directly attributable to the respective regions' reported figures including cost of products sold. Global costs for R&D, marketing, management of product supply centers and Parent Company are not allocated per region. Currency exposure is concentrated to product supply centers. The majority of exchange differences in operations are reported in global costs.
Elekta's operations are characterized by significant quarterly variations in volumes and product mix, which have a direct impact on net sales and profits. This is accentuated when the operation is split into segments, as is the impact of currency fluctuations between the years. Revenue from solutions are recognized at a point in time and revenue from services are recognized over time.
Q2 2022/23
| Other / | Group | % of net | ||||
|---|---|---|---|---|---|---|
| SEK M | Americas | EMEA | APAC | Group-wide | total | sales |
| Net sales | 1,327 | 1,332 | 1,421 | - | 4,081 | |
| Operating expenses | -800 | -914 | -961 | - | -2,675 | 66% |
| Contribution margin | 527 | 418 | 460 | - | 1,406 | 34% |
| Contribution margin, % | 40% | 31% | 32% | 34% | ||
| Global costs | - | - | - | -1,090 | -1,090 | 27% |
| Adjusted EBIT | 527 | 418 | 460 | -1,090 | 316 | 8% |
| Items affecting comparability1 | -31 | -10 | - 9 |
-67 | -117 | |
| Operating income (EBIT) | 496 | 409 | 452 | -1,157 | 199 | 5% |
| Net financial items | - | - | - | -40 | -40 | |
| Income after financial items | 496 | 409 | 452 | -1,197 | 160 |
Q2 2021/22
| Other / | Group | % of net | ||||
|---|---|---|---|---|---|---|
| SEK M | Americas | EMEA | APAC | Group-wide | total | sales |
| Net sales | 1,111 | 1,284 | 1,302 | - | 3,697 | |
| Operating expenses | -646 | -783 | -870 | - | -2,298 | 62% |
| Contribution margin | 465 | 501 | 433 | - | 1,399 | 38% |
| Contribution margin, % | 42% | 39% | 33% | |||
| Global costs | - | - | - | -866 | -866 | 23% |
| Adjusted EBIT | 465 | 501 | 433 | -866 | 533 | 14% |
| Items affecting comparability1 | - | - | - | - | - | |
| Operating income (EBIT) | 465 | 501 | 433 | -866 | 533 | 14% |
| Net financial items | - | - | - | -30 | -30 | |
| Income after financial items | 465 | 501 | 433 | -896 | 503 |
First six months 2022/23
| Other / | Group | % of net | ||||
|---|---|---|---|---|---|---|
| SEK M | Americas | EMEA | APAC | Group-wide | total | sales |
| Net sales | 2,365 | 2,522 | 2,520 | - | 7,408 | |
| Operating expenses | -1,477 | -1,710 | -1,710 | - | -4,898 | 66% |
| Contribution margin | 888 | 812 | 810 | - | 2,510 | 34% |
| Contribution margin, % | 38% | 32% | 32% | |||
| Global costs | - | - | - | -2,063 | -2,063 | 28% |
| Adjusted EBIT | 888 | 812 | 810 | -2,063 | 447 | 6% |
| Items affecting comparability1 | -34 | -12 | - 9 |
-76 | -131 | |
| Operating income (EBIT) | 855 | 800 | 801 | -2,139 | 316 | 4% |
| Net financial items | - | - | - | -79 | -79 | |
| Income after financial items | 855 | 800 | 801 | -2,218 | 237 |
First six months 2021/22
| Other / | Group | % of net | ||||||
|---|---|---|---|---|---|---|---|---|
| SEK M | Americas | EMEA | APAC | Group-wide | total | sales | ||
| Net sales | 1,938 | 2,427 | 2,341 | - | 6,707 | |||
| Operating expenses | -1,195 | -1,543 | -1,576 | - | -4,314 | 64% | ||
| Contribution margin | 743 | 885 | 765 | - | 2,393 | 36% | ||
| Contribution margin, % | 38% | 36% | 33% | |||||
| Global costs | - | - | - | -1,659 | -1,659 | 25% | ||
| Adjusted EBIT | 743 | 885 | 765 | -1,659 | 734 | 11% | ||
| Items affecting comparability1 | - | - | - | - | - | |||
| Operating income (EBIT) | 743 | 885 | 765 | -1,659 | 734 | 11% | ||
| Net financial items | - | - | - | -66 | -66 | |||
| Income after financial items | 743 | 885 | 765 | -1,725 | 668 | |||
| 1 | Items affecting comparability include mainly personnel costs attributable to the Cost-reduction Initiative w ithin the Resilience and Excellence Program. |
|||||||
Full year 2021/22
| Other / | Group | % of net | ||||
|---|---|---|---|---|---|---|
| SEK M | Americas | EMEA | APAC | Group-wide | total | sales |
| Net sales | 4,254 | 5,321 | 4,972 | - | 14,548 | |
| Operating expenses | -2,606 | -3,486 | -3,409 | - | -9,501 | 65% |
| Contribution margin | 1,648 | 1,835 | 1,563 | - | 5,047 | 35% |
| Contribution margin, % | 39% | 34% | 31% | |||
| Global costs | - | - | - | -3,403 | -3,403 | 23% |
| Adjusted EBIT | 1,648 | 1,835 | 1,563 | -3,403 | 1,643 | 11% |
| Items affecting comparability1 | - | - | - | - | - | |
| Operating income (EBIT) | 1,648 | 1,835 | 1,563 | -3,403 | 1,643 | 11% |
| Net financial items | - | - | - | -142 | -142 | |
| Income after financial items | 1,648 | 1,835 | 1,563 | -3,545 | 1,501 |
Rolling twelve months
| Other / | Group | % of net | ||||
|---|---|---|---|---|---|---|
| SEK M | Americas | EMEA | APAC | Group-wide | total | sales |
| Net sales | 4,681 | 5,417 | 5,151 | - | 15,248 | |
| Operating expenses | -2,888 | -3,654 | -3,543 | - | -10,084 | 66% |
| Contribution margin | 1,793 | 1,763 | 1,608 | - | 5,164 | 34% |
| Contribution margin, % | 38% | 33% | 31% | |||
| Global costs | - | - | - | -3,807 | -3,807 | 25% |
| Adjusted EBIT | 1,793 | 1,763 | 1,608 | -3,807 | 1,357 | 9% |
| Items affecting comparability1 | -34 | -12 | - 9 |
-76 | -131 | |
| Operating income (EBIT) | 1,760 | 1,750 | 1,600 | -3,884 | 1,226 | 8% |
| Net financial items | - | - | - | -155 | -155 | |
| Income after financial items | 1,760 | 1,750 | 1,600 | -4,038 | 1,071 | |
| 1 Items affecting comparability include mainly personnel costs attributable to the Cost-reduction Initiative w |
ithin the Resilience and Excellence Program. |
Second quarter and first six months Net sales by product type
Q2 2022/23
| SEK M | Other / | ||||||
|---|---|---|---|---|---|---|---|
| Americas | EMEA | APAC | Group-wide | Group total | |||
| Solutions | 572 | 732 | 1,019 | - | 2,322 | ||
| Service | 756 | 600 | 403 | - | 1,759 | ||
| Total | 1,327 | 1,332 | 1,421 | - | 4,081 |
Q2 2021/22
| SEK M | Other / | |||||
|---|---|---|---|---|---|---|
| Americas | EMEA | APAC | Group-wide | Group total | ||
| Solutions | 504 | 780 | 970 | - | 2,254 | |
| Service | 607 | 504 | 332 | - | 1,443 | |
| Total | 1,111 | 1,284 | 1,302 | - | 3,697 |
First six months 2022/23
| SEK M | Other / | |||||
|---|---|---|---|---|---|---|
| Americas | EMEA | APAC | Group-wide | Group total | ||
| Solutions | 912 | 1,363 | 1,753 | - | 4,028 | |
| Service | 1,453 | 1,159 | 768 | - | 3,380 | |
| Total | 2,365 | 2,522 | 2,520 | - | 7,408 |
First six months 2021/22
| SEK M | Other / | |||||
|---|---|---|---|---|---|---|
| Americas | EMEA | APAC | Group-wide | Group total | ||
| Solutions | 769 | 1,421 | 1,695 | - | 3,885 | |
| Service | 1,169 | 1,006 | 646 | - | 2,821 | |
| Total | 1,938 | 2,427 | 2,341 | - | 6,707 |
Full year 2021/22
| Other / | |||||||
|---|---|---|---|---|---|---|---|
| SEK M | Americas | EMEA | APAC | Group-wide | Group total | ||
| Solutions | 1,819 | 3,221 | 3,612 | - | 8,652 | ||
| Service | 2,435 | 2,100 | 1,360 | - | 5,896 | ||
| Total | 4,254 | 5,321 | 4,972 | - | 14,548 |
Rolling twelve months
| Other / | ||||||
|---|---|---|---|---|---|---|
| SEK M | Americas | EMEA | APAC | Group-wide | Group total | |
| Solutions | 1,962 | 3,164 | 3,669 | - | 8,795 | |
| Service | 2,719 | 2,253 | 1,482 | - | 6,454 | |
| Total | 4,681 | 5,417 | 5,151 | - | 15,248 |
Net sales from Solutions is taken point at time, net sales from Service is taken over time.
Second quarter and first six months Financial instruments
The table below shows the fair value of the Group's financial instruments, for which fair value is different than carrying value. The fair value of all other financial instruments is assumed to correspond to the carrying value.
| Oct 31, 2022 | Oct 31, 2021 | Apr 30, 2022 | ||||
|---|---|---|---|---|---|---|
| SEK M | Carrying amount |
Fair value |
Carrying amount |
Fair value |
Carrying amount |
Fair value |
| Long-term interest-bearing liabilities | 4,138 | 4,177 | 3,050 | 3,208 | 4,099 | 4,251 |
| Short-term interest-bearing liabilities | 531 | 535 | 1,520 | 1,521 | 510 | 514 |
The Group's financial assets and financial liabilities, which have been measured at fair value, have been categorized in the fair value hierarchy. The different levels are defined as follows:
Level 1: Quoted prices on an active market for identical assets or liabilities
Level 2: Other observable data than quoted prices included in Level 1, either directly (that is, price
quotations) or indirectly (that is, obtained from price quotations)
Level 3: Data not based on observable market data
Financial instruments measured at fair value
| SEK M | Level | Oct 31, 2022 | Oct 31, 2021 | Apr 30, 2022 |
|---|---|---|---|---|
| FINANCIAL ASSETS | ||||
| Financial assets measured at fair value through income | ||||
| statement: | ||||
| Derivative financial instruments – non-hedge accounting | 2 | 20 | 64 | 16 |
| Short-term investments classified as cash equivalents | 1 | 3 | 3 | 3 |
| Financial assets measured at fair value through other | ||||
| comprehensive income: | ||||
| Equity instruments | 1 | - | 58 | - |
| Equity instruments | 3 | 0 | - | 15 |
| Derivatives used for hedging purposes: | ||||
| Derivative financial instruments – hedge accounting | 2 | 125 | 120 | 135 |
| Total financial assets | 148 | 244 | 168 | |
| FINANCIAL LIABILITIES | ||||
| Financial liabilities at fair value through income statement: | ||||
| Derivative financial instruments – non-hedge accounting | 2 | 42 | 20 | 55 |
| Contingent considerations | 3 | 33 | 97 | 32 |
| Derivatives used for hedging purposes: | ||||
| Derivative financial instruments – hedge accounting | 2 | 584 | 37 | 384 |
| Total financial liabilities | 658 | 153 | 471 |
The fair value of accounts receivables, other current and non-current receivables, cash and cash equivalents, accounts payable and other current and non-current liabilities is estimated to be equal to their carrying amount.
Second quarter and first six months Key figures and data per share
Key figures
| Full year | May - Oct | ||||||
|---|---|---|---|---|---|---|---|
| 2017/18 | 2018/19 | 2019/20 | 2020/21 | 2021/22 | 2021/22 | 2022/23 | |
| Gross order intake, SEK M | 14,493 | 16,796 | 17,735 | 17,411 | 18,364 | 8,025 | 8,468 |
| Net sales, SEK M | 11,573 | 13,555 | 14,601 | 13,763 | 14,548 | 6,707 | 7,408 |
| Order backlog, SEK M | 27,974 | 32,003 | 34,689 | 33,293 | 39,656 | 34,076 | 42,817 |
| Gross margin, % | 43.7 | 41.9 | 42.0 | 40.8 | 37.4 | 37.9 | 37.4 |
| Adjusted gross margin, % | 43.7 | 41.9 | 42.0 | 40.8 | 37.4 | 37.9 | 38.1 |
| Operating income, SEK M | 1,845 | 1,696 | 1,657 | 1,906 | 1,643 | 734 | 316 |
| Operating margin, % | 15.9 | 12.5 | 11.3 | 13.9 | 11.3 | 10.9 | 4.3 |
| Adjusted EBIT | 1,845 | 1,696 | 1,657 | 1,906 | 1,643 | 734 | 447 |
| Adjusted EBIT margin, % | 15.9 | 12.5 | 11.3 | 13.9 | 11.3 | 10.9 | 6.0 |
| Shareholders' equity, SEK M 1 | 6,987 | 7,779 | 8,113 | 8,197 | 8,913 | 8,143 | 9,128 |
| Return on shareholders' equity, % | 22 | 17 | 14 | 16 | 14 | 14 | 9 |
| Net debt, SEK M | 803 | 439 | 1,632 | 774 | 1,532 | 1,773 | 3,134 |
| Operational cash conversion, % | 95 | 61 | 35 | 82 | 69 | 19 | -30 |
| Average number of employees | 3,702 | 3,798 | 4,117 | 4,194 | 4,631 | 4,522 | 4,664 |
1 Attributable to Parent Company shareholders.
Data per share
| Full year | May - Oct | ||||||
|---|---|---|---|---|---|---|---|
| 2017/18 | 2018/19 | 2019/20 | 2020/21 | 2021/22 | 2021/22 | 2022/23 | |
| Earnings per share | |||||||
| before dilution, SEK | 3.53 | 3.14 | 2.84 | 3.28 | 3.02 | 1.33 | 0.47 |
| after dilution, SEK | 3.53 | 3.14 | 2.84 | 3.28 | 3.02 | 1.33 | 0.47 |
| Adjusted earnings per share | |||||||
| before dilution, SEK | 3.53 | 3.14 | 2.84 | 3.28 | 3.02 | 1.33 | 0.74 |
| after dilution, SEK | 3.53 | 3.14 | 2.84 | 3.28 | 3.02 | 1.33 | 0.74 |
| Cash flow per share | |||||||
| before dilution, SEK | 3.79 | 2.48 | -0.74 | 5.05 | 0.55 | -1.26 | -2.65 |
| after dilution, SEK | 3.79 | 2.48 | -0.74 | 5.05 | 0.55 | -1.26 | -2.65 |
| Shareholders' equity per share | |||||||
| before dilution, SEK | 18.29 | 20.36 | 21.23 | 21.45 | 23.33 | 21.31 | 23.89 |
| after dilution, SEK | 18.29 | 20.36 | 21.23 | 21.45 | 23.33 | 21.31 | 23.89 |
| Average number of shares | |||||||
| before dilution, thousands | 382,027 | 382,027 | 382,062 | 382,083 | 382,083 | 382,083 | 382,083 |
| after dilution, thousands | 382,027 | 382,027 | 382,062 | 382,083 | 382,083 | 382,083 | 382,083 |
| Number of shares at closing 1 | |||||||
| before dilution, thousands | 382,027 | 382,027 | 382,083 | 382,083 | 382,083 | 382,083 | 382,083 |
| after dilution, thousands | 382,027 | 382,027 | 382,083 | 382,083 | 382,083 | 382,083 | 382,083 |
1 Number of registered shares at closing excluding treasury shares (1,485,289 per October 31, 2022).
Second quarter and first six months Data per quarter
| 2020/21 | 2021/22 | 2022/23 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| SEK M | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | |
| Gross order intake | 3,627 | 3,954 | 5,379 | 3,980 | 4,045 | 4,441 | 5,897 | 3,871 | 4,598 | |
| Net sales | 3,534 | 3,581 | 3,667 | 3,009 | 3,697 | 3,602 | 4,239 | 3,327 | 4,081 | |
| Operating income | 559 | 468 | 545 | 201 | 533 | 340 | 570 | 117 | 199 | |
| Cash flow from operating activities | 535 | 690 | 1,114 | -81 | 325 | 573 | 1,040 | -198 | -55 |
Order intake growth based on constant exchange rates
| 2020/21 | 2021/22 | 2022/23 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| % | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 |
| Americas | -12 | 41 | 13 | - 7 |
16 | - 3 |
- 6 |
-43 | -13 |
| EMEA | 20 | -17 | 7 | 0 | 3 | 23 | 16 | 11 | - 9 |
| APAC | -12 | 8 | 46 | - 4 |
19 | - 3 |
- 5 |
9 | 2 |
| Group | - 2 |
2 | 18 | - 4 |
12 | 8 | 2 | -11 | - 6 |
Investments and amortization/depreciation
| Q2 | First six months | |||||
|---|---|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 2022/23 | 2021/22 | ||
| R&D, net | 217 | 178 | 455 | 254 | ||
| Capitalization | 326 | 288 | 674 | 513 | ||
| Amortization | -110 | -111 | -219 | -259 | ||
| Other, net | - 3 |
- 1 |
- 7 |
- 2 |
||
| Total, net | 213 | 176 | 448 | 253 |
No significant events after the quarter
Second quarter and first six months Alternative performance measures
Alternative Performance Measures (APMs) are measures and key figures that Elekta's management and other stakeholders use when managing and analyzing Elekta's business performance. These measures are not substitutes, but rather supplements to financial reporting measures prepared in accordance with IFRS. Key figures and other APMs used by Elekta are defined on ir.elekta.com/investors/financials. Definitions and additional information on APMs can also be found on pages 155-157 in the Annual Report 2021/22.
Order and sales growth based on constant exchange rates
Elekta's order intake and sales are, to a large extent, reported in subsidiaries with other functional currencies than SEK, which is the group reporting currency. In order to present order and sales growth on a more comparable basis and to show the impact of currency fluctuations, order and sales growth based on constant exchange rates are presented. The schedules below present growth based on constant exchange rates reconciled to the total growth reported in accordance with IFRS.
Change gross order intake
| Group | ||||||||
|---|---|---|---|---|---|---|---|---|
| Americas EMEA APAC |
total | |||||||
| % | SEK M | % | SEK M | % | SEK M | % | SEK M | |
| Q2 2022/23 vs. Q2 2021/22 | ||||||||
| Change based on constant exchange rates | -13 | -147 | - 9 |
-138 | 2 | 33 | - 6 |
-253 |
| Currency effects | 21 | 229 | 10 | 223 | 18 | 353 | 16 | 806 |
| Reported change | 8 | 82 | 1 | 85 | 20 | 386 | 10 | 553 |
| Q2 2021/22 vs. Q2 2020/21 | ||||||||
| Change based on constant exchange rates | 16 | 148 | 3 | 45 | 19 | 246 | 12 | 440 |
| Currency effects | 1 | 13 | - 2 |
-27 | - 1 |
- 8 |
- 1 |
-22 |
| Reported change | 17 | 161 | 1 | 19 | 19 | 238 | 12 | 418 |
| May - Oct 2022/23 vs. May - Oct 2021/22 | ||||||||
| Change based on constant exchange rates | -31 | -778 | 1 | 25 | 5 | 144 | - 8 |
-609 |
| Currency effects | 15 | 373 | 9 | 239 | 16 | 439 | 14 | 1,052 |
| Reported change | -16 | -405 | 10 | 264 | 21 | 583 | 6 | 443 |
| May - Oct 2021/22 vs. May - Oct 2021/20 | ||||||||
| Change based on constant exchange rates | 1 | 20 | 2 | 47 | 7 | 185 | 3 | 252 |
| Currency effects | - 5 |
-121 | - 3 |
-96 | - 3 |
-88 | - 4 |
-305 |
| Reported change | - 4 |
-102 | - 2 |
-48 | 4 | 97 | - 1 |
-53 |
Change net sales
| Group | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Americas | EMEA | APAC | total | ||||||
| % | SEK M | % | SEK M | % | SEK M | % | SEK M | ||
| Q2 2022/23 vs. Q2 2021/22 | |||||||||
| Change based on constant exchange rates | - 3 |
-38 | - 7 |
-94 | - 5 |
-72 | - 5 |
-204 | |
| Currency effects | 22 | 254 | 4 | 142 | 11 | 191 | 12 | 587 | |
| Reported change | 19 | 216 | - 3 |
48 | 6 | 119 | 7 | 383 | |
| Q2 2021/22 vs. Q2 2020/21 | |||||||||
| Change based on constant exchange rates | 24 | 219 | 6 | 70 | - 2 |
-34 | 7 | 256 | |
| Currency effects | - 2 |
-14 | - 4 |
-48 | - 2 |
-31 | - 3 |
-93 | |
| Reported change | 23 | 205 | 2 | 22 | - 5 |
-64 | 5 | 163 | |
| May - Oct 2022/23 vs. May - Oct 2021/22 | |||||||||
| Change based on constant exchange rates | 1 | 20 | - 1 |
-36 | - 3 |
-78 | - 1 |
-95 | |
| Currency effects | 21 | 407 | 5 | 131 | 11 | 257 | 11 | 796 | |
| Reported change | 22 | 427 | 4 | 95 | 8 | 179 | 10 | 701 | |
| May - Oct 2021/22 vs. May - Oct 2021/20 | |||||||||
| Change based on constant exchange rates | 10 | 179 | 6 | 146 | 7 | 156 | 7 | 481 | |
| Currency effects | - 5 |
-91 | - 4 |
-88 | - 5 |
-109 | - 4 |
-289 | |
| Reported change | 5 | 88 | 2 | 57 | 2 | 47 | 3 | 192 |
EBITDA
EBITDA is used for the calculation of operational cash conversion and the net debt/EBITDA ratio.
| SEK M | Q2 2021/22 | Q3 2021/22 | Q4 2021/22 | Q1 2022/23 | Q2 2022/23 |
|---|---|---|---|---|---|
| Operating income/EBIT | 533 | 340 | 570 | 117 | 199 |
| Amortization intangible assets: | |||||
| Capitalized development costs | 113 | 113 | 119 | 113 | 114 |
| Assets relating business combinations | 29 | 32 | 33 | 35 | 36 |
| Depreciation tangible assets | 105 | 106 | 112 | 114 | 117 |
| EBITDA | 780 | 591 | 833 | 379 | 465 |
Return on capital employed
Return on capital employed is a measure of the profitability after taking into account the amount of total capital used unrelated to type of financing. A higher return on capital employed indicates a more efficient use of capital. Capital employed represents the value of the balance sheet net assets that is the key driver of cash flow and capital required to run the business. It is also used in the calculation of return on capital employed.
| SEK M | Oct 31, 2021 | Jan 31, 2022 | Apr 30, 2022 | Jul 31, 2022 | Oct 31, 2022 |
|---|---|---|---|---|---|
| Income after financial items (12 months rolling) | 1,525 | 1,405 | 1,501 | 1,414 | 1,071 |
| Financial expenses (12 months rolling) | 245 | 238 | 200 | 211 | 230 |
| Income after financial items plus financial expenses | 1,770 | 1,644 | 1,702 | 1,625 | 1,301 |
| Total assets | 23,843 | 27,577 | 26,303 | 26,322 | 27,225 |
| Deferred tax liabilities | -482 | -443 | -549 | -483 | -503 |
| Long-term provisions | -218 | -235 | -215 | -207 | -199 |
| Other long-term liabilities | -82 | -144 | -120 | -133 | -151 |
| Accounts payable | -1,111 | -1,187 | -1,352 | -1,280 | -1,464 |
| Advances from customers | -3,802 | -4,267 | -4,161 | -4,392 | -4,686 |
| Prepaid income | -1,946 | -2,238 | -2,342 | -2,373 | -2,335 |
| Accrued expenses | -1,603 | -1,754 | -1,901 | -1,606 | -1,835 |
| Current tax liabilities | -199 | -277 | -114 | -164 | -100 |
| Short-term provisions | -181 | -187 | -149 | -142 | -200 |
| Derivative financial instruments | -40 | -351 | -361 | -395 | -516 |
| Other current liabilities | -401 | -365 | -429 | -367 | -395 |
| Capital employed | 13,777 | 16,129 | 14,610 | 14,781 | 14,840 |
| Average capital employed (last five quarters) | 14,490 | 14,722 | 14,638 | 14,638 | 14,828 |
| Return on capital employed | 12% | 11% | 12% | 11% | 9% |
Return on shareholders' equity
Return on shareholders' equity measures the return generated on shareholders' capital invested in the company.
| SEK M | Q2 2021/22 | Q3 2021/22 | Q4 2021/22 | Q1 2022/23 | Q2 2022/23 |
|---|---|---|---|---|---|
| Net income (12 months rolling) Average shareholders' equity excluding |
1,173 | 1,079 | 1,154 | 1,087 | 826 |
| non-controlling interests a (last five quarters) | 8,185 | 8,375 | 8,515 | 8,529 | 8,842 |
| Return on shareholders' equity | 14% | 13% | 14% | 13% | 9% |
Operational cash conversion
Cash flow is a focus area for management. The operational cash conversion shows the relation between cash flow from operating activities and EBITDA.
| from operating activities and EBITDA. | |||||
|---|---|---|---|---|---|
| SEK M | Q2 2021/22 | Q3 2021/22 | Q4 2021/22 | Q1 2022/23 | Q2 2022/23 |
| Cash flow from operating activities |
325 | 573 | 1,040 | -198 | -55 |
| EBITDA | 780 | 591 | 833 | 379 | 465 |
| Operational cash conversion | 42% | 97% | 125% | -52% | -12% |
Working capital
In order to optimize cash generation, management focuses on working capital and reducing lead times between orders booked and cash received.
| Oct 31 | Oct 31 | Apr 30 | |
|---|---|---|---|
| SEK M | 2022 | 2021 | 2022 |
| Working capital assets | |||
| Inventories | 3,216 | 2,416 | 2,533 |
| Accounts receivable | 3,666 | 3,037 | 3,647 |
| Accrued income | 2,047 | 1,988 | 1,796 |
| Other operating receivables | 1,696 | 1,310 | 1,459 |
| Sum working capital assets | 10,625 | 8,751 | 9,435 |
| Working capital liabilities | |||
| Accounts payable | 1,464 | 1,111 | 1,352 |
| Advances from customers | 4,686 | 3,802 | 4,161 |
| Prepaid income | 2,335 | 1,946 | 2,342 |
| Accrued expenses | 1,835 | 1,603 | 1,901 |
| Short-term provisions | 200 | 181 | 149 |
| Other current liabilities | 395 | 401 | 429 |
| Sum working capital liabilities | 10,915 | 9,044 | 10,333 |
| Net working capital | -290 | -292 | -898 |
| % of rolling12 months net sales | -2% | -2% | -6% |
Days Sales Outstanding (DSO)
Days Sales Outstanding was negative 31 days on October 31, 2022 (negative 19 days per October 31, 2021).
| Oct 31 | Oct 31 | Apr 30 | |
|---|---|---|---|
| SEK M | 2022 | 2021 | 2022 |
| Americas | -69 | -63 | -66 |
| EMEA | 38 | 52 | 39 |
| APAC | -62 | -54 | -57 |
| Group | -31 | -19 | -27 |
Net debt and net debt/EBITDA ratio
Net debt is important for understanding the financial stability of the company. Net debt and net debt/EBITDA ratio are used by management to track the debt evolvement, the refinancing need and the leverage for the Group.
| SEK M | Oct 31, 2021 | Jan 31, 2022 | Apr 30, 2022 | Jul 31, 2022 | Oct 31, 2022 |
|---|---|---|---|---|---|
| Long-term interest-bearing liabilities | 3,050 | 4,625 | 4,099 | 4,112 | 4,138 |
| Short-term interest-bearing liabilities | 1,520 | 1,446 | 510 | 528 | 531 |
| Cash and cash equivalents and short-term investments | -2,796 | -4,366 | -3,077 | -2,423 | -1,535 |
| Net debt | 1,773 | 1,705 | 1,532 | 2,217 | 3,134 |
| EBITDA (12 months rolling) | 2,871 | 2,703 | 2,682 | 2,582 | 2,268 |
| Net debt/EBITDA ratio | 0.62 | 0.63 | 0.57 | 0.86 | 1.38 |
Items affecting comparability
Items affecting comparability include cost attributable to the Cost-reduction Initiative within the Resilience and Excellence Program. The costs are adjusted in order to track the underlying profitability of the Group's products and services.
Q2 2022/23
| SEK M | Americas | EMEA | APAC | Other / Group-wide |
Group total |
|---|---|---|---|---|---|
| Items affecting comparability: | |||||
| Personnel related cost | 31 | 9 | 9 | 67 | 115 |
| Other cost | 0 | 1 | 0 | 1 | 2 |
| Sum | 31 | 10 | 9 | 67 | 117 |
First six months 2022/23
| Other / | Group | ||||
|---|---|---|---|---|---|
| SEK M | Americas | EMEA | APAC | Group-wide | total |
| Items affecting comparability: | |||||
| Personnel related cost | 34 | 11 | 9 | 76 | 129 |
| Other cost | 0 | 1 | 0 | 1 | 2 |
| Sum | 34 | 12 | 9 | 76 | 131 |
Gross margin
Gross margin is used to track operational performance and efficiency.
| Q2 | First six months | ||||
|---|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 2022/23 | 2021/22 | |
| Net sales | 4,081 | 3,697 | 7,408 | 6,707 | |
| Cost of products sold | -2,602 | -2,270 | -4,641 | -4,164 | |
| Gross income | 1,479 | 1,427 | 2,767 | 2,543 | |
| Gross margin (Gross income/ Net sales) | 36.2% | 38.6% | 37.4% | 37.9% |
Adjusted gross margin
Adjusted gross margin is used to track the underlying operational performance, i.e. excluding items affecting comparability.
| Q2 | First six months | |||
|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 2022/23 | 2021/22 |
| Net sales | 4,081 | 3,697 | 7,408 | 6,707 |
| Cost of products sold | -2,602 | -2,270 | -4,641 | -4,164 |
| Gross income | 1,479 | 1,427 | 2,767 | 2,543 |
| Items affecting comparability | 45 | 0 | 52 | 0 |
| Adjusted gross income | 1,524 | 1,427 | 2,819 | 2,543 |
| Adjusted gross margin (Adjusted gross income/ Net sales) | 37.3% | 38.6% | 38.1% | 37.9% |
Adjusted EBIT
Adjusted EBIT is used to track the underlying operational performance, i.e. excluding items affecting comparability.
Q2 2022/23
| SEK M | Americas | EMEA | APAC | Other / Group-wide |
Group total |
|---|---|---|---|---|---|
| Operating Income (EBIT) | 496 | 409 | 452 | -1,157 | 199 |
| Items affecting comparability | 31 | 10 | 9 | 67 | 117 |
| Adjusted EBIT | 527 | 418 | 460 | -1,090 | 316 |
First six months 2022/23
| SEK M | Americas | EMEA | APAC | Other / Group-wide |
Group total |
|---|---|---|---|---|---|
| Operating Income (EBIT) | 855 | 800 | 801 | -2,139 | 316 |
| Items affecting comparability | 34 | 12 | 9 | 76 | 131 |
| Adjusted EBIT | 888 | 812 | 810 | -2,063 | 447 |
Adjusted earnings per share
Adjusted earnings per share is used to track the underlying operational performance, i.e. excluding items affecting comparability.
| Q2 | First six months | |||
|---|---|---|---|---|
| SEK M | 2022/23 | 2021/22 | 2022/23 | 2021/22 |
| Net income for the period attributable to: | ||||
| Parent Company shareholders | 122 | 383 | 181 | 509 |
| Items affecting comparability | 117 | 0 | 131 | 0 |
| Tax on Items affecting comparability | -27 | 0 | -30 | 0 |
| Adjusted net income | 211 | 383 | 282 | 509 |
| Average number of shares, before and after dilution | 382 | 382 | 382 | 382 |
| Adjusted earnings per share (adjusted net income/average number of | ||||
| shares) | 0.55 | 1.00 | 0.74 | 1.33 |
Second quarter and first six months Shareholder information
Conference call
Elekta will host a web conference at 10:00-11:00 CET on November 24 with President and CEO Gustaf Salford, and CFO Tobias Hägglöv. To take part of the presentation please dial the numbers or watch via the web link below.
| Sweden: | +46 8 5051 0031 |
|---|---|
| United Kingdom: +44 207 107 0613 | |
| United States: | +1 631 570 5613 |
https://elekta-qreports.creo.se/221124/
Financial calendar
| Interim report, Q3, May-Jan 2022/23 | Feb 24, 2023 |
|---|---|
| Year-end report, Q4, May-Apr 2022/23 | May 25, 2023 |
| Annual General Meeting 2023 | Aug 24, 2023 |
About Elekta
Elekta is a global leader in radiotherapy solutions to fight cancer and neurological diseases. In fact, we are the only independent radiotherapy provider of scale. We have a broad offering of advanced solutions for delivering the most efficient radiotherapy treatments. Elekta's offering allows clinicians to treat more patients with increased quality, both with value-creating innovations in solutions and AI-supported service based on a global network.
Purpose
Elekta's purpose is to inspire hope for anyone dealing with cancer, be that patients, clinicians, or relatives.
Mission
Our mission is to improve patients' lives by working together with our customers. We use our precision radiation expertise to work hand in hand with clinicians and our partners to continuously develop innovative, outcome-driven and cost-efficient solutions that provide lasting clinical difference in a sustainable way.
Vision
Elekta's vision is a world where everyone has access to the best cancer care. Our strategy, called ACCESS 2025, is the first part of our journey towards the vision.
Strategy – ACCESS 2025
Through our strategy, ACCESS 2025, we improve patient access to the best cancer care by:
- Accelerating innovation with customer utilization in mind
- Driving partner integration across the cancer care ecosystem
- Being the customer lifetime companion
- Driving market adoption across the globe
For further information, please contact:
Tobias Hägglöv
CFO +46 76 107 4799 [email protected]
Cecilia Ketels
Head of Investor Relations +46 76 611 7625 [email protected]
Kira Haapanen
IR Manager +46 73 719 4622 [email protected]
Elekta AB (publ) 556170-4015
Kungstensgatan 18 Box 7593 SE 103 93 Stockholm Sweden