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Getinge — Interim / Quarterly Report 2020
Jul 16, 2020
2917_ir_2020-07-16_ed7f25af-7f62-4f52-ba16-cb679b26f44e.pdf
Interim / Quarterly Report
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Interim report
GETINGE X
January - June 2020
Comments from Mattias Perjos, President & CEO
Making a real difference together with our customers
"During the second quarter, we continued to work closely with our hospital and pharmaceutical customers to support them in their efforts to combat COVID-19. This resulted in a large number of orders and deliveries of advanced ICU ventilators and ECMO therapy products for hospitals and Sterile Transfer products for the pharmaceutical industry. Our order intake increased organically by 17.5%, and sales rose by 9.1%, due to a very strong development in parts of Acute Care Therapies. The high volumes, combined with the productivity measures in recent years, resulted in increased profitability, strengthened free cash flow and lower net debt. We have received feedback from customers about the positive effect that our advanced ICU ventilators have had for treating COVID-19 patients, which is highly encouraging in our intensive efforts to gradually increase production of ventilators by 160% in 2020. Our greatest challenge remains ensuring access to components from our suppliers. Our cardiac and vascular surgery products were negatively impacted by COVID-19 because planned procedures were postponed, but we could see an improvement in this area in June when a rising number of hospitals started to work through the backlog that had accumulated during the pandemic. We expect a slow recovery of capital goods for hospitals, which has impacted sales and profitability for Surgical Workflows this quarter and will do so for the remainder of 2020. We continued to implement our strategy, with an intense focus on product development, growth and profitability, at a fast tempo despite COVID-19. I am very pleased with how Getinge has created new work methods internally and together with our customers. Finally, I would like to thank all hospital staff, our partners and all my colleagues around the world for the valuable cooperation during this crisis-you are making an incredible difference to overcome this pandemic!"
April - June 2020 in brief
- Net sales increased organically by 9.1% and the order intake rose by 17.5% organically.
- Adjusted gross profit amounted to SEK 3,723 M (3,101) and the margin was 53.4% (49.4).
- Adjusted EBITA amounted to SEK 1,218 M (591) and the margin was 17.5% (9.4).
- Adjusted earnings per share amounted to SEK 3.07 (1.12).
- Cash flow after net investments amounted to SEK 1,368 M (576).
- Decision on restructuring measures that will contribute to annual savings of SEK 130 M, gradually realized from autumn 2020.
January - June 2020 in brief
- Net sales increased organically by 6.6% and the order intake rose by 31.6% organically.
- Adjusted gross profit amounted to SEK 6,940 M (5,926) and the margin was 53.4% (50.1).
- Adjusted EBITA amounted to SEK 1,879 M (960) and the margin was 14.4% (8.1).
- Adjusted earnings per share amounted to SEK 4.48 (1.76).
- Cash flow after net investments amounted to SEK 2,357 M (715).
Outlook for organic growth in net sales 2020
Due to the continuing uncertainty caused by the COVID-19 pandemic, Getinge has decided not to present a forecast for the expected increase in net sales for the full-year 2020.
Summary of financial performance1)
| - SEKM |
Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Order intake | 8,081 | 6,787 | 17,533 | 12,960 | 26,832 |
| Organic change, % | 17.5 | 5.2 | 31.6 | 6.3 | 4.1 |
| Net sales | 6,971 | 6,277 | 13,004 | 11,825 | 26,559 |
| Organic change, % | 9.1 | 4.0 | 6.6 | 4.9 | 3.9 |
| Adjusted gross profit | 3,723 | 3,101 | 6,940 | 5,926 | 13,401 |
| Margin, % | 53.4 | 49.4 | 53.4 | 50.1 | 50.5 |
| Adjusted EBITDA | 1,669 | 1,002 | 2,745 | 1,769 | 4,986 |
| Margin, % | 23.9 | 16.0 | 21.1 | 15.0 | 18.8 |
| Adjusted EBITA | 1,218 | 591 | 1,879 | 960 | 3,310 |
| Margin, % | 17.5 | 9.4 | 14.4 | 8.1 | 12.5 |
| Adjusted EBIT | 1,091 | 466 | 1,622 | 713 | 2,813 |
| Margin, % | 15.7 | 7.4 | 12.5 | 6.0 | 10.6 |
| Operating profit (EBIT) | 757 | 324 | 1,261 | 462 | 2,372 |
| Margin, % | 10.9 | 5.2 | 9.7 | 3.9 | 8.9 |
| Profit before tax | 677 | 205 | 1,103 | 229 | 1,909 |
| Net profit for the period | 497 | 111 | 774 | 128 | 1,256 |
| Adjusted net profit for the period | 839 | 312 | 1,229 | 498 | 1,947 |
| Margin, % | 12.0 | 5.0 | 9.5 | 4.2 | 7.3 |
| Adjusted earnings per share, SEK | 3.07 | 1.12 | 4.48 | 1.76 | 7.02 |
| Earnings per share, SEK | 1.81 | 0.38 | 2.81 | 0.40 | 4.48 |
| Cash flow from operating activities | 1,638 | 891 | 2,883 | 1,278 | 3,832 |
1) See page 3 for calculations of adjusted performance measures.
Every care has been taken in the translation of this Financial Report. In the event of discrepancies, the Swedish original will supersede the English translation. Figures in tables and diagrams in Getinge's financial statements are not rounded off, as was done in the past so that the totals in tables and diagrams would tally. This change was made for practical reasons and has no material impact. Historical information has not been restated.
Group performance
Order intake
April - June 2020
Jan-Dec Order intake Apr-Jun Apr-Jun Jan-Jun Jan-Jun business areas, SEK M Org $\Delta$ , % Org $\Delta$ , % 2020 2019 2020 2019 2019 5,285 3,674 12,219 14,778 Acute Care Therapies 44.3 7,092 69.4 Life Science 824 705 $-1.2$ 1,477 1,350 $-6.8$ 2,640 Surgical Workflows 1,972 2,408 $-18.1$ 3,837 4,518 $-16.2$ 9,414 Total $8,081$ 6,787 $17.5$ 17,533 12,960 $31.6$ 26,832
| Order intake regions, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
|---|---|---|---|---|---|---|---|
| Americas | 2.970 | 2.768 | 5.7 | 6.714 | 5.300 | 22.2 | 10.723 |
| APAC | 1.722 | 1.512 | 9.4 | 3.817 | 2.741 | 33.3 | 6.037 |
| EMEA | 3.389 | 2.507 | 35.5 | 7.002 | 4.919 | 40.9 | 10,072 |
| Total | 8,081 | 6.787 | 17.5 | 17,533 | 12.960 | 31.6 | 26,832 |
Net sales
April - June 2020
| Net sales business areas, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
|---|---|---|---|---|---|---|---|
| Acute Care Therapies | 4,300 | 3.541 | 20.8 | 8.017 | 6,862 | 14.5 | 14.637 |
| Life Science | 698 | 601 | 0.6 | 1.302 | 1.109 | 0.8 | 2.487 |
| Surgical Workflows | 1.973 | 2.135 | $-7.8$ | 3.685 | 3.854 | $-5.8$ | 9.435 |
| Total | 6.971 | 6,277 | 9.1 | 13.004 | 11,825 | 6.6 | 26,559 |
| Net sales regions, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
| Americas | 2.654 | 2.574 | 0.8 | 5,216 | 5,000 | 0.2 | 10,635 |
| APAC | 1,422 | 1.428 | $-3.9$ | 2.710 | 2.497 | 3.4 | 5,877 |
| EMEA | 2.895 | 2.275 | 26.9 | 5,078 | 4.328 | 15.9 | 10,047 |
| Total | 6.971 | 6,277 | 9.1 | 13.004 | 11.825 | 6.6 | 26,559 |
| Net sales specified by capital goods & consumables, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
|---|---|---|---|---|---|---|---|
| Capital goods | 3.425 | 2.592 | 28.6 | 5.793 | 4.688 | 18.6 | 11.781 |
| Consumables | 3.546 | 3.685 | $-4.6$ | 7.211 | 7.137 | $-1.3$ | 14.778 |
| Total | 6,971 | 6.277 | 9.1 | 13.004 | 11.825 | 6.6 | 26,559 |
Net sales – bridge between April-June 2019 and April-June 2020
- The continued high organic order growth is clearly linked to Acute Care Therapies, in Critical Care, that reported sharp growth in all geographic markets.
- The order intake in Surgical Workflows and Life Science declined organically, related to capital goods
- The strong performance in EMEA was the result of an exceptionally strong order intake in ventilators, while the order intake in Americas and APAC was hampered by lower demand for capital goods in Surgical Workflows and low activity in planned surgery.
- Growth in net sales was primarily attributable to deliveries in Acute Care Therapies, in Critical Care and Cardiopulmonary.
- Net sales in Surgical Workflows were negatively affected by lower activity related to capital goods.
- Net sales in Life Science were positively impacted by the very high sales in Sterile Transfer and the slightly positive growth in sterilizers due to larger deliveries toward the end of the quarter.
- The strong performance in EMEA was the result of large deliveries of ventilators, while Americas and APAC were hampered by significantly lower volumes in planned surgery and reduced deliveries in Surgical Workflows.
- Net sales increased by SEK 694 M, corresponding to 11.1%.
- Acquired operations represented growth of SEK 86 M, corresponding to 1.4%.
- Exchange rates had a positive impact of SEK 35 M on sales, corresponding to almost 0.6%.
-
· Volume, mix and other items positively affected sales by SEK 573 M, corresponding to growth of 9.1%
-
Currency effects impacted adjusted gross profit by SEK +46 M and adjusted EBITA by SEK-4 M.
- The gross margin continued to strengthen, mainly due to a sharp increase in sales of ventilators and ECMO products combined with the productivity measures carried out in recent years.
- Adjusted operating expenses declined 2.2% compared with Q2 2019, as a result of productivity improvements and adjusting work methods to COVID-19.
- Adjusted EBITA rose by SEK 626 M year-on-year and the margin increased by 8.1 percentage points to 17.5%.
- Acquisition and restructuring costs amounted to SEK-168 M, attributable to rationalization measures in Acute Care Therapies and Surgical Workflows, which are expected to contribute SEK 130 M in annual savings, gradually realized from the autumn of 2020. Other items affecting comparability amounted to SEK-167 M, comprising impairment related to primarily older R&D projects.
- Net financial items improved SEK 39 M as a result of lower net debt and interest expenses.
- The effective tax rate declined compared with the preceding quarter, mainly due to considerably higher earnings in Sweden.
- Acute Care Therapies increased its adjusted EBITA by SEK 589 M and the margin improved by 10.2 percentage points, due to a sharp increase in sales volumes.
- Life Science's adjusted EBITA rose by SEK 34 M and the margin increased by 3.4 percentage points, mainly due to a positive product mix.
- · Surgical Workflows' adjusted EBITA improved by SEK 4 M compared with Q2 2019 and the margin was unchanged despite a significant decline in sales.
Underlying earnings trend
| SEKM | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Net sales | 6,971 | 6,277 | 13,004 | 11,825 | 26,559 |
| Adjusted gross profit | 3,723 | 3,101 | 6,940 | 5,926 | 13,401 |
| Margin, % | 53.4 | 49.4 | 53.4 | 50.1 | 50.5 |
| Adjusted operating expenses | $-2.054$ | $-2,099$ | $-4,195$ | $-4,157$ | $-8.415$ |
| Adjusted EBITDA | 1,669 | 1,002 | 2,745 | 1,769 | 4,986 |
| Margin, % | 23.9 | 16.0 | 21.1 | 15.0 | 18.8 |
| Depreciation, amortization and write-downs of intangible assets and tangible assets 1) |
$-451$ | $-411$ | $-866$ | $-809$ | $-1,676$ |
| Adjusted EBITA | 1,218 | 591 | 1,879 | 960 | 3,310 |
| Margin, % | 17.5 | 9.4 | 14.4 | 8.1 | 12.5 |
| A Amortization and write-down of acquired intangible assets 1) |
$-126$ | $-125$ | $-257$ | $-247$ | $-497$ |
| Adjusted EBIT | 1,091 | 466 | 1,622 | 713 | 2,813 |
| Margin, % | 15.7 | 7.4 | 12.5 | 6.0 | 10.6 |
| B Acquisition and restructuring costs | $-168$ | $-107$ | $-170$ | $-216$ | $-324$ |
| C Other items affecting comparability 2) | $-167$ | $-35$ | $-190$ | $-35$ | $-117$ |
| Operating profit (EBIT) | 757 | 324 | 1,261 | 462 | 2,372 |
| Net financial items | $-80$ | $-119$ | $-158$ | $-233$ | $-463$ |
| Profit before tax | 677 | 205 | 1,103 | 229 | 1,909 |
| Adjusted profit before tax (adjusted for A, B and C) |
1,138 | 472 | 1,721 | 727 | 2,847 |
| Margin, % | 16.3 | 7.5 | 13.2 | 6.1 | 10.7 |
| Taxes | $-179$ | $-94$ | $-329$ | $-101$ | $-653$ |
| D Adjustment of tax 2) | $-119$ | $-66$ | $-162$ | $-128$ | $-247$ |
| Adjusted net profit for the period (adjusted for A, B, C and D) |
839 | 312 | 1,229 | 498 | 1,947 |
| Margin, % | 12.0 | 5.0 | 9.5 | 4.2 | 7.3 |
| Of which, attributable to Parent Company shareholders |
836 | 304 | 1,220 | 479 | 1,913 |
| Average number of shares, thousands | 272,370 | 272,370 | 272,370 | 272,370 | 272,370 |
| Adjusted earnings per share, SEK (adjusted for A, B, C and D) |
3.07 | 1.12 | 4.48 | 1.76 | 7.02 |
1) Excluding items affecting comparability (see Note 3 for depreciation, amortization and write-downs).
2) See Note 5.
Adjusted EBITA per business area1)
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | |
|---|---|---|---|---|---|
| SEKM | 2020 | 2019 | 2020 | 2019 | 2019 |
| Acute Care Therapies | 1,287 | 698 | 2,187 | 1.296 | 3,110 |
| Margin, % | 29.9 | 19.7 | 27.3 | 18.9 | 21.2 |
| Life Science | 97 | 63 | 145 | 109 | 323 |
| Margin, % | 13.9 | 10.5 | 11.1 | 9.8 | 13.0 |
| Surgical Workflows | $-70$ | $-74$ | $-273$ | $-269$ | 222 |
| Margin, % | $-3.5$ | $-3.5$ | $-7.4$ | $-7.0$ | 2.4 |
| Group functions and other (incl. eliminations) | $-96$ | $-96$ | $-181$ | $-176$ | $-345$ |
| Total | 1,218 | 591 | 1,879 | 960 | 3,310 |
| Margin, % | 17.5 | 9.4 | 14.4 | 8.1 | 12.5 |
1) See Note 3 for depreciation and write-downs and Note 5 for other items affecting comparability.
Adjusted EBITA - bridge between April-June 2019 and April-June 2020
- Adjusted operating expenses declined by 2.2%, compared with Q2 2019, and operating expenses fell organically by 5.8%.
- $\bullet$ The lower expenses are a result of previously implemented measures to enhance productivity. In addition, the organization introduced new work methods as a consequence of COVID-19, one of the results of which was lower travel costs.
- Adjusted gross profit was positively impacted by translation effects of SEK 14 M, and by SEK 32 M from transaction effects and the hedging outcome
- Adjusted EBITA was positively impacted by translation effects of SEK 8 M and negatively impacted with SEK 12M from the net of transaction effects, the hedging outcome and revaluation of operating receivables and liabilities
- Cash flow after net investments trended very positively, mainly due to improved earnings and continued efforts related to working capital.
- Liquidity increased and cash funds amounted to almost SEK 5.9 billion at the end of the quarter.
- Net debt in relation to adjusted EBITDA R12M continued to improve
Adjusted operating expenses
(excluding depreciation, amortization and write-downs and other items affecting comparability)1) Jan-Dec Apr-Jun Apr-Jun Jan-Jun Jan-Jun SFKM 2020 2019 2020 2019 2019 $-4,666$ Selling expenses $-1.037$ $-1.184$ $-2.245$ $-2.331$ Administrative expenses $-784$ $-735$ $-1,580$ $-1,465$ $-3,015$ $-169$ $-394$ $-206$ $-362$ $-688$ Research and development costs Other operating income and expenses $-28$ $-11$ 24 $-46$ $-2,054$ $-2,099$ $-4,195$ $-4,157$ $-8,415$ Total
1) See Note 3 for depreciation and write-downs and Note 5 for other items affecting comparability.
Currency impact
| SEKM | Apr-Jun 2020 |
Jan-Jun 2020 |
|---|---|---|
| Net sales | 35 | 239 |
| Adjusted gross profit | 46 | 235 |
| Adjusted EBITDA | 148 | |
| Adjusted EBITA | -4 | 135 |
| Adjusted EBIT | $-8$ | 125 |
Cash flow and financial position1)
| SEKM | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Cash flow before changes in working capital | 1.453 | 719 | 2.157 | 1.075 | 3,698 |
| Changes in working capital | 185 | 172 | 726 | 203 | 134 |
| Net investments in non-current assets | $-270$ | $-315$ | $-526$ | $-563$ | $-1,111$ |
| Cash flow after net investments | 1,368 | 576 | 2,357 | 715 | 2,721 |
| Net interest-bearing debt | 10,925 | 13,950 | 12,321 | ||
| In relation to adjusted EBITDA 1) R12M, multiple |
1.8 | 3.3 | 2.5 | ||
| Net interest-bearing debt, excl. pension | 7.432 | 8.766 | |||
| provisions | 10,537 | ||||
| In relation to adjusted EBITDA 1) R12M, multiple |
1.2 | 2.5 | 1.8 |
1) See Note 5 for items affecting comparability and Note 7 for alternative performance measures.
Research and development
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec 2019 |
|---|---|---|---|---|
| $-1.261$ | ||||
| 6.8 | 5.2 | 6.0 | 5.5 | 4.7 |
| 122 | 135 | 228 | 252 | 499 |
| 1.7 | 2.2 | 1.8 | 2.1 | 1.9 |
| $-353$ | $-190$ | $-552$ | $-394$ | $-762$ |
| $-270$ | $-136$ | $-398$ | $-261$ | $-539$ |
| $-117$ | $-10^{-}$ | $-117$ | $-10$ | $-31$ |
| 2020 $-474$ |
2019 $-325$ |
2020 $-780$ |
2019 $-646$ |
- Gross expenses for R&D increased by SEK 149 M, of which SEK 117 M refers to write-downs.
- Capitalized development costs declined by 9.6% compared with the year-earlier period.
- Amortization and write-downs increased by SEK 134 M compared with the preceding year, due to write-downs related to older R&D projects.
Acute Care Therapies
Acute Care Therapies offers world-leading solutions for life support in acute health conditions. The offering includes solutions for cardiovascular procedures and a broad selection of products and therapies for intensive care. The addressable market, excluding the effects of the COVID-19 pandemic, amounts to SEK 85 billion with expected long-term organic growth of 2-4% per year.
Order intake and net sales
| Order intake regions, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
|---|---|---|---|---|---|---|---|
| Americas | 2.196 | 1.841 | 19.5 | 5,223 | 3.590 | 41.9 | 7.404 |
| APAC | 1.039 | 767 | 34.4 | 2.538 | 1.401 | 76.7 | 3,138 |
| EMEA | 2.051 | 1.066 | 94.6 | 4.458 | 2.101 | 112.0 | 4,236 |
| Total | 5.285 | 3.674 | 44.3 | 12.219 | 7.092 | 69.4 | 14.778 |
| Net sales | Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec |
| Jan-Dec 2019 |
|
|---|---|
| 1.916 3.712 5.6 1.792 3.506 Americas 2.9 |
7,288 |
| 791 1.618 APAC 735 1.357 6.0 15.4 |
3.044 |
| EMEA 1.594 58.9 2.686 1.999 1.014 34.5 |
4.305 |
| Total 3.541 8.017 6.862 4.300 20.8 14.5 |
14,637 |
| Net sales specified by capital goods & consumables, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
|---|---|---|---|---|---|---|---|
| Capital goods | 1.755 | 913 | 92.3 | 2.843 | 1.772 | 58.6 | 4.207 |
| Consumables | 2.546 | 2.628 | -4.1 | 5.174 | 5.090 | -0.9 | 10,430 |
| Total | 4.300 | 3.541 | 20.8 | 8.017 | 6.862 | 14.5 | 14,637 |
Underlying earnings trend1)
| SEKM | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Net sales | 4.300 | 3,541 | 8,017 | 6.862 | 14,637 |
| Adjusted gross profit | 2,715 | 2,082 | 5,001 | 4,028 | 8,660 |
| Margin, % | 63.1 | 58.8 | 62.4 | 58.7 | 59.2 |
| Adjusted EBITDA | 1,550 | 922 | 2.679 | 1.740 | 4,026 |
| Margin, % | 36.0 | 26.0 | 33.4 | 25.4 | 27.5 |
| Depreciation, amortization and write-downs of | |||||
| intangible assets and tangible assets | $-263$ | $-224$ | $-492$ | $-444$ | $-916$ |
| Adjusted EBITA | 1,287 | 698 | 2,187 | 1.296 | 3,110 |
| Margin, % | 29.9 | 19.7 | 27.3 | 18.9 | 21.2 |
1) See Note 3 for depreciation and write-downs and Note 5 for other items affecting comparability.
Events in the business area
- · In May, Getinge introduced Advanta V12 balloon expandable covered stent, a larger diameter size to offer customers increased treatment options within vascular procedures. The larger diameter Advanta V12 balloon expandable covered stent is CE marked and TGA approved for restoring and improving the patency of iliac arteries.
- The newly updated and expanded digital platform Getinge Online can enable hospitals to improve efficiency by using product data to gain insights, enable rapid remote error detection and maximize uptime. Of the acute care products, the first ones to be connected to the new portal are the Getinge Flow Family anesthesia machines and the Servo-u, Servo-n and Servo-air ventilators. The enhanced platform is designed in close collaboration with customers and the feedback has been very positive.
- Acute Care Therapies initiated the planned consolidation of the operations in Mahwah and Fairfield to the closely located plant in Wayne, USA, which is expected to be completed in 2021. In total, the relocation is expected to generate annual savings of SEK 40 M, with gradually increasing realization from Q4 2020. This measure gave rise to restructuring costs of SEK 54 M in the second quarter. In addition to these savings, the consolidation will increase the concentration of skills and result in a higher degree of control in, for example, quality management and production.
• Very strong growth in ventilator orders for the quarter.
- Lower activity in scheduled cardiac and vascular surgery had a negative effect on the order intake, mainly in Americas. However, the trend bottomed out in May, followed by recovery in June.
- Intense efforts to deliver ventilators and FCMO products to hospitals contributed to an increase in sales, despite a decline in other categories.
- Disruptions to production and logistics had a limited impact on deliveries in the quarter.
- Lower activity in scheduled cardiac and vascular surgery had a negative effect predominantly in Americas and APAC.
- Sales of capital goods increased significantly as a result of large deliveries of ventilators.
- The adjusted gross margin rose 4.3 percentage points in relation to the year-earlier quarter, primarily as a result of volumes effects from the sharp increase in sales of ventilators and ECMO products, geographic mix and increased productivity due to previously implemented rationalizations.
- Adjusted operating expenses increased by 0.5%, due to negative currency effects. Operating expenses fell organically by 2.5%.
- Higher sales and operational leverage contributed to an increase in the adjusted EBITA margin of 10.2 percentage points compared with the preceding year.
- Currency effects impacted sales by SEK +24 M, adjusted gross profit by SEK +36 M and adjusted EBITA by SEK-3M.
Life Science
Life Science offers a comprehensive range of equipment, technical expertise and consultation to prevent contamination in pharmaceutical and medical device production and with the aim to strengthen integrity of results in biomedical research. The addressable market, excluding the effects of the COVID-19 pandemic, amounts to SEK 23 billion with expected long-term organic growth of 3-5% per year.
Order intake and net sales
APAC
EMEA
Total
Total
Net sales specified by
consumables, SEK M
capital goods &
Capital goods
Consumables
| Order intake regions, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
|---|---|---|---|---|---|---|---|
| Americas | 361 | 303 | 3.3 | 629 | 540 | $-0.2$ | 988 |
| APAC | 138 | 91 | $-3.6$ | 234 | 168 | $-5.9$ | 408 |
| EMEA | 324 | 311 | $-4.8$ | 613 | 642 | $-12.7$ | 1,244 |
| Total | 824 | 705 | $-1.2$ | 1.477 | 1.350 | $-6.8$ | 2,640 |
| Net sales | Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | ||
| regions, SEK M | 2020 | 2019 | Org $\Delta$ , % | 2020 | 2019 | Org $\Delta$ , % | 2019 |
| Americas | 267 | 201 | 15.4 | 566 | 393 | 23.2 | 887 |
98
302
601
Apr-Jun
2019
389
212
601
$-24.1$
$-1.2$
$0.6$
$2.8$
$-3.5$
$0.6$
Org $\Delta$ , %
182
555
1,302
Jan-Jun
2020
900
402
$1,302$
$-27.3$
$-6.7$
$0.8$
$5.1$
$-6.3$
$0.8$
Org $\Delta$ , %
167
549
$1,109$
Jan-Jun
2019
691
418
1,109
367
1,233
2,487
Jan-Dec
2019
1,635
852
2,487
| • Strong organic sales growth in | |
|---|---|
| Sterile Transfer products and | |
| slightly positive growth in sterilizers | |
| due to larger deliveries toward the | |
| end of the quarter. |
• The slight organic decline in order intake for the quarter was mainly attributable to delays to new projects as a result of the COVID-19
• Healthy growth in Americas in Sterile Transfer (BetaBags)-Getinge is world leader in this
pandemic.
product area.
- Fewer deliveries in washerdisinfectors and service due to precautionary measures related to COVID-19.
- The adjusted gross margin strengthened by 4.5 percentage points, primarily as a result of a favorable product mix and increased productivity.
- Adjusted operating expenses increased by 20.0% due to currency effects and acquisitions. Organically the adjusted operating expenses declined by 9.1%.
- Adjusted EBITA rose by SEK 34 M year-on-year and the margin improved to 13.9%.
- Currency effects impacted sales by SEK +7 M, adjusted gross profit by SEK +7 M and adjusted EBITA by SEK 0 M.
Underlying earnings trend1)
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | |
|---|---|---|---|---|---|
| SEKM | 2020 | 2019 | 2020 | 2019 | 2019 |
| Net sales | 698 | 601 | 1,302 | 1.109 | 2,487 |
| Adjusted gross profit | 285 | 219 | 538 | 422 | 962 |
| Margin, % | 40.9 | 36.4 | 41.3 | 38.1 | 38.7 |
| Adjusted EBITDA | 130 | 89 | 210 | 159 | 432 |
| Margin, % | 18.6 | 14.8 | 16.1 | 14.3 | 17.4 |
| Depreciation, amortization and write-downs of | |||||
| intangible assets and tangible assets | $-33$ | $-26$ | $-65$ | $-50$ | $-109$ |
| Adjusted EBITA | 97 | 63 | 145 | 109 | 323 |
| Margin, % | 13.9 | 10.5 | 11.1 | 9.8 | 13.0 |
1) See Note 3 for depreciation and write-downs and Note 5 for other items affecting comparability.
112
319
698
Apr-Jun
2020
490
207
698
Events in the business area
- . The development of a new vaccine and drug against COVID-19 is driving needs for Getinge's DPTE BetaBag that is used for aseptic filling of ampoules. To meet the requirements of larger scale production, the DPTE Transfer Trolley was launched in April – a smart and ergonomic transfer platform for easy handling of DPTE BetaBags.
- Getinge launched two new products in the quarter as another step in assisting laboratory customers to meet their sustainability targets. The first is an ECO program together with our updated Ultima laboratory washers product line. The second is a water-saving system for Getinge's LSS laboratory steam sterilizers. Water consumption can be reduced by up to 95% depending on the load and type of cycle used. The system can also be applied to previously installed machines.
Surgical Workflows
Surgical Workflows offers products and solutions to serve as an end-to-end partner for optimizing the quality, safety and capacity usage of the sterile supply departments and operating rooms. The addressable market, excluding the effects of the COVID-19 pandemic, amounts to SEK 62 billion with expected long-term organic growth of 2-4% per year.
Order intake and net sales
| Order intake regions, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
|---|---|---|---|---|---|---|---|
| Americas | 412 | 624 | -34.0 | 861 | 1.170 | $-27.8$ | 2,331 |
| APAC | 546 | 654 | -18.0 | 1.045 | 1.172 | $-13.1$ | 2.491 |
| EMEA | 1.014 | 1.130 | $-9.3$ | 1.932 | 2.176 | $-11.6$ | 4.592 |
| Total | 1.972 | 2.408 | $-18.1$ | 3.837 | 4.518 | $-16.2$ | 9.414 |
| Net sales regions, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
|---|---|---|---|---|---|---|---|
| Americas | 472 | 581 | $-19.2$ | 938 | 1.101 | $-16.7$ | 2,460 |
| APAC | 519 | 595 | $-12.9$ | 909 | 973 | $-8.2$ | 2.466 |
| EMEA | 982 | 959 | 2.2 | 1.837 | 1.780 | 2.3 | 4.509 |
| Total | 1.973 | 2,135 | $-7.8$ | 3,685 | 3,854 | $-5.8$ | 9.435 |
| Net sales specified by capital goods & consumables, SEK M |
Apr-Jun 2020 |
Apr-Jun 2019 |
Org $\Delta$ , % | Jan-Jun 2020 |
Jan-Jun 2019 |
Org $\Delta$ , % | Jan-Dec 2019 |
|---|---|---|---|---|---|---|---|
| Capital goods | 1.180 | 1.290 | $-8.8$ | 2.050 | 2.225 | $-9.1$ | 5.939 |
| Consumables | 793 | 845 | $-6.4$ | 1.635 | 1.629 | $-1.3$ | 3,496 |
| Total | 1,973 | 2.135 | $-7.8$ | 3.685 | 3,854 | $-5.8$ | 9.435 |
Underlying earnings trend1)
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | |
|---|---|---|---|---|---|
| SEKM | 2020 | 2019 | 2020 | 2019 | 2019 |
| Net sales | 1,973 | 2.135 | 3,685 | 3,854 | 9,435 |
| Adjusted gross profit | 722 | 800 | 1,400 | 1,476 | 3,779 |
| Margin, % | 36.6 | 37.5 | 38.0 | 38.3 | 40.1 |
| Adjusted EBITDA | 83 | 84 | 31 | 41 | 863 |
| Margin, % | 4.2 | 3.9 | 0.8 | 1.1 | 9.1 |
| Depreciation, amortization and write-downs of | |||||
| intangible assets and tangible assets | $-152$ | $-158$ | $-304$ | $-310$ | $-641$ |
| Adjusted EBITA | $-70$ | $-74$ | $-273$ | $-269$ | 222 |
| Margin, % | $-3.5$ | $-3.5$ | $-7.4$ | $-7.0$ | 2.4 |
1) See Note 3 for depreciation and write-downs and Note 5 for other items affecting comparability.
Events in the business area
- · Maquet Moduevo Bridge, launched in June, is Getinge's latest space-saving and cost-effective ceiling supply unit. The horizontal solution is designed to accommodate architectural constraints, enhance interactions between patient and medical staff and foster a healing environment in intensive care units, recovery and emergency departments.
- In May, Getinge introduced a new range of consumables for sterile reprocessing. Getinge Assured Superfast 20 Biological Indicator speeds up the ability of the Central Sterile Supply Department (CSSD) to release loads safely, ensuring that the sterile instruments can be in the right place, at the right time.
-
During the quarter, continued productivity improvements were implemented in accordance with plan, including in Rastatt (Germany) and Växjö (Sweden). In addition, discussions were initiated with employee representatives to move the turnkey Operations Room project management division (Getinge Hospital Solutions) to newly established hubs in South Asia and the Middle East, with the aim of getting closer to end customers and establishing a more competitive supplier platform. The measures are expected to result in annual savings of SEK 90 M, with gradually increasing realization from autumn 2020. Restructuring costs amount to SEK 114 M.
-
The order intake declined significantly in all product categories as a result of COVID-19.
- The decline was particularly noticeable in Americas since hospitals prioritized investments in intensive care.
- Net sales were not impacted to the same extent as the order intake since many deliveries were made on orders placed in previous quarters. Infection Control products in EMEA withstood the decline the best. mainly due to high sales in the Middle East.
- · Sales in Surgical Workplaces were tangibly impacted by fewer deliveries in Americas as a result of lower activity in the relevant areas of health care in both North and South America.
- The adjusted gross margin fell by 0.9 of a percentage point mainly as a result of lower sales. Enhanced productivity contributed to offsetting the negative effect.
- Adjusted operating expenses declined by 10.7% and fell organically by 10.8% compared with Q2 2019. This was attributable to previously implemented rationalizations combined with lower selling expenses (travel and participation at trade fairs) as a result of COVID-19.
- Adjusted EBITA improved by SEK 4 M and the margin was unchanged compared with Q2 2019 despite lower sales.
- Currency effects impacted sales by SEK +5 M, adjusted gross profit by SEK +3 M and adjusted EBITA by SEK +2M
Other information
Financial impact of COVID-19
The outbreak of COVID-19 was characterized by the WHO as a pandemic on March 11, 2020. In this situation, Getinge is prioritizing the health and safety of its employees and is taking measures to limit the spread of the virus by following the instructions of the relevant authorities. In addition, Getinge has taken measures and made preparations to safeguard production of critical and life support products.
Getinge has worked intensively together with hospitals around the world to help as many patients as possible since the outbreak of COVID-19. This contributed to a 44.3% organic increase in the order intake for the Acute Care Therapies business area for the quarter as a result of the sharp increase in demand for ventilators and cardiopulmonary products. Demand declined for the other product segments in the business area since non-urgent operations were postponed. Clear signs of a recovery in these product segments could be seen toward the end of the quarter and the decline in the order intake slowed down. Demand in other areas of the operations declined due to the economic downturn resulting from the pandemic. Primarily the Surgical Workflows business area was negatively impacted, with its order intake falling organically by 18.1% in the second quarter. The order intake for the Life Science business area declined organically by 1.2%.
The Group's sales and earnings improved as a result of the outbreak of the virus and the increase in the order intake for ventilators and cardiopulmonary products in the first quarter could be increasingly converted to net sales. It has been possible to continue work on the installation and servicing of products, and this was not negatively affected by restrictions in key markets. Minor disruptions occurred in the production operations in the form of sick leave among employees and problems with deliveries of components, which were possible to resolve without any significantly negative consequences arising. Major efforts were made to enhance production capacity for ventilators. This took place in close cooperation with subcontractors and both authorities and companies in several countries have assisted Getinge in this important task.
The sharp increase in activity in the areas of Acute Care Therapies that are directly linked to treating patients with COVID-19 contributed to the improvement in sales and earnings for the business area despite a decline in other product segments. Both sales and earnings fell in Surgical Workflows due to a lower level of activity in the areas of health care that are not related to the outbreak of the virus. Sales and earnings for Life Science were not generally impacted by the outbreak of the virus to any significant extent.
As time passes, the situation regarding the pandemic could result in negative financial effects due to lower demand, a shortage of components and disruptions to production. It also cannot be ruled out that installation and service of products at hospitals and care facilities could be limited by restrictions to reduce the spread of the virus. The Group's cash flow could decline as a result of investments in higher production capacity, inventory build-up and impaired payment discipline among the Group's customers. Getinge is closely following developments regarding the pandemic and is continuously evaluating the operational and financial effects. Some minor measures to adjust costs were carried out and plans have been made to further adjust costs if necessary.
Since there is currently significant uncertainty regarding the future course of events, Getinge does not provide a forecast for organic sales growth for the full-year 2020. The year-end report for 2019 stated that organic sales growth for 2020 was expected to amount to 2-4%.
| . . |
|||
|---|---|---|---|
| SEKM | June 30 2020 |
June 30 2019 |
December 31 2019 |
| Provision at beginning of period | 234 | 382 | 382 |
| Used amount | $-61$ | $-67$ | $-154$ |
| Provisions | $\overline{\phantom{a}}$ | $\sim$ | $\overline{\phantom{a}}$ |
| Translation differences | 10 | 6 | |
| Provision at close of period | 174 | 325 | 234 |
1
and the business operations. The Compliance and the Internal Audit functions assist with support and ongoing monitoring as well as investigations and internal auditing.
Research and development
Getinge's future growth also depends on the company's ability to develop new and successful products. Research and development efforts are costly and it is impossible to guarantee that developed products will be commercially successful. As a means of maximizing the return on investments in research and development efforts, the Group applies a structured selection and planning process that includes careful analyses of the market, technological progress, choice of production method and selection of subcontractors. The actual development work is also conducted in a structured manner and each project undergoes a number of fixed control points.
Product liability and damage claims
Health care suppliers run a risk, like other players in the health care industry, of being subject to product liability and other legal claims. Such claims can involve large amounts and significant legal expenses. Getinge cannot provide any guarantees that its operations will not be subject to compensation claims. Getinge carries the customary indemnity and product liability insurance, but there is a risk that Getinge's insurance coverage may not fully cover product liability and other claims.
Protection of intellectual property rights
Getinge is a market leader in the areas in which it operates and invests significant amounts in product development. To secure returns on these investments, Getinge actively upholds its rights and monitors competitors' activities closely. There is the risk when new products are developed that other companies may claim a patent infringement, which could result in disputes. If required, Getinge will protect its intellectual property rights through legal processes.
Financial risk management
Getinge is exposed to a number of financial risks in its operations. Financial risks principally pertain to risks related to currency risks, interest-rate risks, and credit and counterparty risks. Risk management is regulated by the finance policy adopted by the Board and a Treasury directive decided by the Getinge Executive Team based on the finance policy. The ultimate responsibility for managing the Group's financial risks and developing methods and principles of financial risk management lies with the Getinge Executive Team and the treasury function. For more detailed information concerning these risks, refer to the Group's Annual Report. The Group has a number of participations in foreign operations whose net assets are exposed to currency risks. Currency exposure that arises from net assets in the Group's foreign operations is primarily managed by borrowing in said foreign currency.
Seasonal variations
Getinge's sales and earnings are affected by seasonal variations. The highest net sales are usually generated in the fourth quarter, followed by the second, third and first quarters. The shares of sales derived from capital goods and consumables also normally changes during the year, with a higher share of sales of capital goods toward the end of the year.
Transactions with related parties
Getinge carried out normal commercial transactions with Arjo, which was distributed to shareholders in December 2017, for the sale and purchase of goods and services. In addition, no other significant transactions with related parties occurred during the period other than transactions with subsidiaries.
Forward-looking information
This report contains forward-looking information based on the current expectations of company management. Although management deems that the expectations presented by such forwardlooking information are reasonable, no guarantee can be given that these expectations will prove correct. Accordingly, the actual future outcome could vary considerably compared with what is stated in the forward-looking information, due to such factors as changed conditions regarding finances, market and competition, changes in legal and regulatory requirements and other political measures, and fluctuations in exchange rates.
Getinge's financial targets
- Average annual organic growth in net sales: 2-4% $\bullet$
- Average earnings per share growth: >10%
- Getinge's dividend policy is to pay dividends of 30-50% of net profit to shareholders.
Assurance
The Board of Directors and CEO assure that the interim report provides a true and fair review of the Parent Company and the Group's operations, position and earnings and describes the material risks and uncertainties faced by the Parent Company and the Group.
GETINGE *
Consolidated financial statements
Consolidated income statement
| SEKM | Note | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|---|
| Net sales | 2 | 6,971 | 6,277 | 13,004 | 11,825 | 26,559 |
| Cost of goods sold | $-3,513$ | $-3,408$ | $-6,570$ | $-6,359$ | $-14,104$ | |
| Gross profit | 2, 3 | 3,458 | 2,869 | 6,434 | 5,466 | 12,455 |
| Selling expenses | $-1,259$ | $-1,373$ | $-2,680$ | $-2,700$ | $-5,411$ | |
| Administrative expenses | $-893$ | $-839$ | $-1,794$ | $-1,670$ | $-3,443$ | |
| Research and development costs | $-353$ | $-190$ | $-552$ | $-394$ | $-762$ | |
| Acquisition expenses | $\mathbf{0}$ | $-1$ | $-2$ | $-2$ | $-45$ | |
| Restructuring costs | $-168$ | $-106$ | $-168$ | $-214$ | $-279$ | |
| Other operating income and expenses | $-28$ | $-36$ | 24 | $-24$ | $-143$ | |
| Operating profit (EBIT) | 2,3 | 757 | 324 | 1,261 | 462 | 2,372 |
| Net financial items | 2 | $-80$ | $-119$ | $-158$ | $-233$ | $-463$ |
| Profit after financial items | $\overline{2}$ | 677 | 205 | 1,103 | 229 | 1,909 |
| Taxes | $-179$ | $-94$ | $-329$ | $-101$ | $-653$ | |
| Net profit for the period | 497 | 111 | 774 | 128 | 1,256 | |
| Attributable to: | ||||||
| Parent Company shareholders | 494 | 103 | 765 | 109 | 1,222 | |
| Non-controlling interests | 3 | 8 | 9 | 19 | 34 | |
| Net profit for the period | 497 | 111 | 774 | 128 | 1,256 | |
| Earnings per share, SEK I) | 1.81 | 0.38 | 2.81 | 0.40 | 4.48 | |
| Weighted average number of shares for calculation of earnings per share (000s) |
272,370 | 272,370 | 272,370 | 272,370 | 272,370 |
1) Before and after dilution
Consolidated statement of comprehensive income
| SEKM | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Net profit for the period | 497 | 111 | 774 | 128 | 1,256 |
| Other comprehensive income | |||||
| Items that cannot be restated in profit for the period | |||||
| Actuarial gains/losses pertaining to defined-benefit pension | |||||
| plans | $-136$ | $-133$ | 50 | $-318$ | $-526$ |
| Tax attributable to items that cannot be restated in profit | 39 | 38 | $-18$ | 92 | 142 |
| Items that can later be restated in profit for the period | |||||
| Translation differences and hedging of net investments | $-1,433$ | 26 | $-31$ | 676 | 600 |
| Cash flow hedges | $-27$ | 38 | $-81$ | 79 | 168 |
| Tax attributable to items that can be restated in profit | $-22$ | -4 | 19 | $-17$ | $-24$ |
| Other comprehensive income for the period, net after tax | $-1,579$ | $-35$ | $-60$ | 512 | 360 |
| Total comprehensive income for the period | $-1,081$ | 76 | 714 | 640 | 1,616 |
| Comprehensive income attributable to: | |||||
| Parent Company shareholders | $-1,060$ | 61 | 705 | 604 | 1.567 |
| Non-controlling interests | $-21$ | 15 | 9 | 36 | 49 |
| Total comprehensive income for the period | $-1,081$ | 76 | 714 | 640 | 1,616 |
Consolidated balance sheet
| SEKM | Note | June 30 2020 |
June 30 2019 |
December 31 2019 |
|---|---|---|---|---|
| Assets | ||||
| Intangible assets | 24,672 | 24,539 | 24,283 | |
| Tangible assets | 3,131 | 3,195 | 3,146 | |
| Right-of-use assets | 940 | 1,017 | 941 | |
| Financial assets | 1,660 | 2,093 | 1,849 | |
| Inventories | 5,628 | 5,261 | 4,691 | |
| Accounts receivable | 5,098 | 5,259 | 6,344 | |
| Other current receivables | 2,357 | 2,552 | 2,205 | |
| Cash and cash equivalents | 6 | 5,850 | 1,158 | 1,254 |
| Total assets | 49,337 | 45,074 | 44,713 | |
| Equity and liabilities | ||||
| Equity | 21,272 | 20,014 | 20,973 | |
| Provisions for pensions, interest-bearing | 6 | 3,493 | 3,413 | 3,555 |
| Lease liabilities | 6 | 912 | 981 | 908 |
| Other interest-bearing liabilities | 6 | 12,370 | 10,714 | 9,112 |
| Other provisions | 3,599 | 3,772 | 3,588 | |
| Accounts payable | 2,038 | 1,939 | 1,995 | |
| Other non-interest-bearing liabilities | 5,653 | 4,241 | 4,582 | |
| Total equity and liabilities | 49,337 | 45,074 | 44,713 |
Changes in equity for the Group
| SEKM Opening balance at January 1, 2019 |
Share capital 136 |
Other capital provided 6,789 |
Reserves 1) 1,235 |
Retained earnings 11.041 |
Total 19.201 |
Non- controlling interests 454 |
Total equity 19,655 |
|---|---|---|---|---|---|---|---|
| Total comprehensive income for the period | $\overline{\phantom{a}}$ | $\sim$ | 730 | 837 | 1,567 | 49 | 1,616 |
| Dividend | $\overline{\phantom{a}}$ | $\overline{\phantom{a}}$ | $-272$ | $-272$ | $-26$ | $-298$ | |
| Closing balance at December 31, 2019 | 136 | 6,789 | 1.965 | 11,606 | 20,496 | 477 | 20,973 |
| Opening balance at January 1, 2020 | 136 | 6.789 | 1.965 | 11,606 | 20,496 | 477 | 20,973 |
| Total comprehensive income for the period | and the | $-92$ | 797 | 705 | 9 | 714 | |
| Dividend | ×. | ۰ | ٠ | $-409$ | $-409$ | $-6$ | $-414$ |
| Closing balance at June 30, 2020 | 136 | 6.789 | 1.873 | 11.995 | 20,793 | 480 | 21,272 |
1) Reserves pertain to cash flow hedges, hedges of net investments and translation differences.
Consolidated cash flow statement
| SEKM | Note | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|---|
| Operating activities | ||||||
| Operating profit (EBIT) | 757 | 324 | 1,261 | 462 | 2,372 | |
| Add-back of depreciation, amortization and write-downs | 3 | 744 | 556 | 1.290 | 1.092 | 2,223 |
| Other non-cash items | 3 | 3 | $\overline{7}$ | 6 | 54 | |
| Add-back of restructuring costs 1) | 168 | 96 | 168 | 188 | 249 | |
| Paid restructuring costs | $-57$ | $-104$ | $-131$ | $-171$ | $-369$ | |
| Financial items | $-69$ | $-113$ | $-161$ | $-226$ | $-474$ | |
| Taxes paid | $-93$ | $-43$ | $-277$ | $-276$ | $-357$ | |
| Cash flow before changes in working capital | 1,453 | 719 | 2,157 | 1,075 | 3,698 | |
| Changes in working capital | ||||||
| Inventories | $-546$ | $-142$ | $-964$ | $-595$ | $-107$ | |
| Operating receivables | 237 | $\overline{4}$ | 1,232 | 878 | $-109$ | |
| Operating liabilities | 494 | 310 | 458 | $-80$ | 350 | |
| Cash flow from operating activities | 1,638 | 891 | 2,883 | 1,278 | 3,832 | |
| Investing activities | ||||||
| Acquisition of operations | 8 | $-6$ | $-6$ | $-829$ | $-6$ | $-6$ |
| Investments in intangible assets and tangible assets | $-284$ | $-315$ | $-546$ | $-568$ | $-1.220$ | |
| Divestment of non-current assets | 14 | $\theta$ | 20 | 5 | 109 | |
| Cash flow from investing activities | $-276$ | $-321$ | $-1,355$ | $-569$ | $-1,117$ | |
| Financing activities | ||||||
| Change in interest-bearing liabilities | 2,550 | $-130$ | 3.126 | $-587$ | $-2,477$ | |
| Change in long-term receivables | $-10$ | 1 | $-13$ | 6 | 3 | |
| Dividend paid | $-6$ | $-281$ | $-6$ | $-281$ | $-298$ | |
| Cash flow from financing activities | 2,534 | $-410$ | 3,107 | $-862$ | $-2,772$ | |
| Cash flow for the period | 3,896 | 160 | 4,634 | $-153$ | $-57$ | |
| Cash and cash equivalents at the beginning of the period | 1,989 | 993 | 1,254 | 1,273 | 1,273 | |
| Translation differences | $-36$ | 5 | $-39$ | 38 | 38 | |
| Cash and cash equivalents at the end of the period | 5,850 | 1.158 | 5,850 | 1,158 | 1,254 |
1) Excluding write-downs on non-current assets
Note 1 Accounting policies
The Group's interim report has been prepared in accordance with IAS 34 Interim Financial Reporting and the Swedish Annual Accounts Act. For the Parent Company, the report has been prepared in accordance with the Swedish Annual Accounts Act and RFR 2. The accounting policies adopted are consistent with those applied for the 2019 Annual Report and should be read in conjunction with that Annual Report.
For practical reasons, the figures in this interim report have not been rounded off, which is why notes and tables may not total correct amounts. Unless otherwise specified, all figures pertain to SEKM and figures in parentheses pertain to the year-earlier period. The interim report provides alternative performance measures for monitoring the Group's operations.
Note 2 Segment overview
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | |
|---|---|---|---|---|---|
| Net sales, SEK M | 2020 | 2019 | 2020 | 2019 | 2019 |
| Acute Care Therapies | 4,300 | 3,541 | 8,017 | 6,862 | 14,637 |
| Life Science | 698 | 601 | 1.302 | 1.109 | 2,487 |
| Surgical Workflows | 1,973 | 2,135 | 3,685 | 3,854 | 9,435 |
| Total | 6,971 | 6,277 | 13,004 | 11,825 | 26,559 |
| Gross profit, SEK M | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
| Acute Care Therapies | 2,543 | 1,942 | 4,687 | 3,749 | 8,085 |
| Life Science | 267 | 205 | 501 | 395 | 900 |
| Surgical Workflows | 648 | 722 | 1.246 | 1.322 | 3,470 |
| Total | 3,458 | 2,869 | 6,434 | 5,466 | 12,455 |
| Operating profit (EBIT), SEK M | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
| Acute Care Therapies | 1,013 | 515 | 1,783 | 934 | 2,402 |
| Life Science | 90 | 58 | 132 | 97 | 309 |
| Surgical Workflows | $-250$ | $-153$ | $-471$ | $-393$ | 49 |
| Group functions and other (incl. eliminations) 1) | $-96$ | $-96$ | $-182$ | $-176$ | $-388$ |
| Operating profit (EBIT) | 757 | 324 | 1,261 | 462 | 2,372 |
| Net financial items | $-80$ | $-119$ | $-158$ | $-233$ | $-463$ |
| Profit after financial items | 677 | 205 | 1,103 | 229 | 1,909 |
1) Group functions and other refer mainly to central functions such as finance, communication, HR and other items, such as eliminations.
Note 3 Depreciation, amortization and write-downs
| SEKM | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Acquired intangible assets | $-157$ | $-125$ | $-288$ | $-247$ | -497 |
| Intangible assets | $-343$ | $-209$ | $-544$ | $-416$ | -846 |
| Right-of-use assets | $-99$ | $-93$ | $-192$ | $-183$ | $-377$ |
| Tangible assets | $-145$ | $-129$ | $-266$ | $-246$ | $-503$ |
| Total | $-744$ | $-556$ | $-1.290$ | $-1.092$ | $-2,223$ |
| of which write-downs | $-167$ | -20 | $-167$ | -36 | -70 |
| SEKM | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Cost of goods sold | $-265$ | $-232$ | $-501$ | $-460$ | -946 |
| Selling expenses | $-223$ | $-189$ | $-416$ | $-369$ | $-745$ |
| Administrative expenses | $-110$ | $-104$ | $-214$ | $-205$ | $-428$ |
| Research and development costs | $-147$ | $-21$ | $-158$ | $-32$ | $-74$ |
| Restructuring costs | $-10$ | $-26$ | $-30$ | ||
| Total | $-744$ | $-556$ | $-1,290$ | $-1.092$ | $-2,223$ |
| of which write-downs | $-167$ | $-20$ | $-167$ | $-36$ | -70 |
Note 4 Quarterly results
| Apr-Jun | Jan-Mar | Oct-Dec | Jul-Sep | Apr-Jun | Jan-Mar | Oct-Dec | Jul-Sep | |
|---|---|---|---|---|---|---|---|---|
| SEKM | 2020 | 2020 | 2019 | 2019 | 2019 | 2019 | 2018 | 2018 |
| Net sales | 6,971 | 6,033 | 8,498 | 6,236 | 6,277 | 5.548 | 7.890 | 5,683 |
| Cost of goods sold | $-3.513$ | $-3.057$ | $-4,442$ | $-3.303$ | $-3.408$ | $-2.951$ | $-4.315$ | $-3,263$ |
| Gross profit | 3.458 | 2,976 | 4,056 | 2,933 | 2,869 | 2,597 | 3,575 | 2,420 |
| Operating expenses | $-2.701$ | $-2.470$ | $-2,579$ | $-2,500$ | $-2.545$ | $-2,459$ | $-2,367$ | $-4,156$ |
| Operating profit (EBIT) | 757 | 505 | 1,477 | 433 | 324 | 138 | 1,208 | $-1,736$ |
| Net financial items | $-80$ | $-78$ | $-112$ | $-118$ | $-119$ | $-114$ | $-104$ | $-41$ |
| Profit after financial items | 677 | 427 | 1.365 | 315 | 205 | 24 | 1.104 | $-1,777$ |
| Taxes | $-179$ | $-150$ | $-455$ | $-97$ | $-94$ | $-7$ | $-389$ | 333 |
| Net profit for the period | 497 | 277 | 910 | 218 | 111 | 17 | 715 | $-1.444$ |
Note 5 Adjustment items
| Adjusted EBITA, SEK M | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Acute Care Therapies | 1,287 | 698 | 2.187 | 1.296 | 3,110 |
| Life Science | 97 | 63 | 145 | 109 | 323 |
| Surgical Workflows | $-70$ | $-74$ | $-273$ | $-269$ | 222 |
| Group functions and other (incl. eliminations) | $-96$ | $-96$ | $-181$ | $-176$ | $-345$ |
| Total | 1,218 | 591 | 1,879 | 960 | 3,310 |
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | |
| Adjustments of EBITA, SEK M | 2020 | 2019 | 2020 | 2019 | 2019 |
| Specification of items affecting comparability that impact EBITA | |||||
| Acquisition and restructuring costs, Acute Care Therapies | $-54$ | $-46$ | $-55$ | $-108$ | $-132$ |
| Acquisition and restructuring costs, Life Science | $\overline{0}$ | $-4$ | 0 | $-10$ | $-9$ |
| Acquisition and restructuring costs, Surgical Workflows | $-114$ | $-57$ | $-114$ | $-98$ | $-140$ |
| Write-down of R&D, Acute Care Therapies 2) | $-73$ | $-10$ | $-73$ | $-10$ | $-20$ |
| Write-down of R&D, Surgical Workflows 2) | $-63$ | $-63$ | ÷ | ||
| Impairment av receivables, Acute Care Therapies 3) | $-7$ | $-7$ | $-79$ | ||
| Impairment av receivables, Surgical Workflows 3) | $-18$ | $-18$ | $-18$ | ||
| Other, Acute Care Therapies 1) | $-2$ | ä, | |||
| Other, Surgical Workflows 1) | $-3$ | ä, | |||
| Other, Acute Care Therapies 2) | $-7$ | ||||
| Other, Surgical Workflows 2) | $-11$ | ||||
| Group functions and other (incl. eliminations) | $\Omega$ | $-2$ | $-43$ | ||
| Total | $-303$ | $-142$ | $-329$ | $-251$ | $-441$ |
| Items affecting comparability per segment | |||||
| Acute Care Therapies | $-127$ | $-63$ | $-136$ | $-125$ | $-231$ |
| Life Science | $\Omega$ | $-4$ | $\Omega$ | $-10$ | $-9$ |
| Surgical Workflows | $-176$ | $-75$ | $-191$ | $-116$ | $-158$ |
| Group functions and other (incl. eliminations) | $\Omega$ | $-2$ | $-43$ | ||
| Total | $-303$ | $-142$ | $-329$ | $-251$ | $-441$ |
1) Reported in Cost of goods sold
2) Reported in Operating expenses
3) Reported in Other operating income and operating expenses
| EBITA, SEK M | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Acute Care Therapies | 1,160 | 635 | 2,051 | .171 | 2,879 |
| Life Science | 97 | 59 | 145 | 99 | 314 |
| Surgical Workflows | $-246$ | $-149$ | $-463$ | $-385$ | 64 |
| Group functions and other (incl. eliminations) | $-96$ | $-96$ | $-182$ | $-176$ | $-388$ |
| Total | 914 | 449 | 1,550 | 709 | 2,869 |
| Adjustments of EBIT, SEK M | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Items affecting comparability that impact EBITA (according to above) |
$-303$ | $-142$ | $-329$ | $-251$ | $-441$ |
| Items affecting comparability that impact EBIT but not EBITA (according to above) |
$-31$ | $-31$ | |||
| Total | $-334$ | $-142$ | $-360$ | $-251$ | $-441$ |
| Adjustment of tax, SEK M | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Amortization and write-down of acquired intangible assets 1) | 126 | 125 | 257 | 247 | 497 |
| Items affecting comparability | 334 | 142 | 360 | 251 | 441 |
| Adjustment items, total | 461 | 267 | 617 | 498 | 938 |
| Tax effect on adjustment items 2) | 119 | -66 | 162 | $-128$ | $-247$ |
| Adjustment for tax items affecting comparability | $\overline{\phantom{a}}$ | ||||
1) Excluding write-downs classified as items affecting comparability
2) Tax effect on tax deductible adjustment items
Note 6 Consolidated net interest-bearing debt
| SEKM | June 30 2020 |
June 30 2019 |
December 31 2019 |
|---|---|---|---|
| Other interest-bearing liabilities | 12,370 | 10.714 | 9,112 |
| Provisions for pensions, interest-bearing | 3,493 | 3.413 | 3.555 |
| Lease liabilities | 912 | 981 | 908 |
| Interest-bearing liabilities | 16,775 | 15,108 | 13,575 |
| Less cash and cash equivalents | $-5,850$ | $-1.158$ | $-1.254$ |
| Net interest-bearing debt | 10,925 | 13,950 | 12,321 |
Note 7 Key figures for the Group
| Financial and operative key figures | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Key figures based on Getinge's financial targets | |||||
| Organic growth in net sales, % | 9.1 | 4.0 | 6.6 | 4.9 | 3.9 |
| Earnings per share 1 ), SEK | 1.81 | 0.38 | 2.81 | 0.40 | 4.48 |
| Other operative and financial key figures | |||||
| Organic growth in order intake, % | 17.5 | 5.2 | 31.6 | 6.3 | 4.1 |
| Gross margin, % | 49.6 | 45.7 | 49.5 | 46.2 | 46.9 |
| Selling expenses, % of net sales | 18.1 | 21.9 | 20.6 | 22.8 | 20.4 |
| Administrative expenses, % of net sales | 12.8 | 13.4 | 13.8 | 14.1 | 13.0 |
| Research and development costs, % of net sales | 6.8 | 5.2 | 6.0 | 5.5 | 4.7 |
| Operating margin, % | 10.9 | 5.2 | 9.7 | 3.9 | 8.9 |
| EBITDA, SEK M | 1,501 | 880 | 2,552 | 1,554 | 4,595 |
| Average number of shares, thousands | 272,370 | 272,370 | 272,370 | 272,370 | 272,370 |
| Number of shares at the end of the period, thousands | 272,370 | 272,370 | 272,370 | 272,370 | 272,370 |
| Interest-coverage ratio, multiple | 18.9 | 10.8 | 12.3 | ||
| Net debt/equity ratio, multiple | 0.51 | 0.70 | 0.59 | ||
| Net debt/Rolling 12m adjusted EBITDA, multiple | 1.8 | 3.3 | 2.5 | ||
| Operating capital, SEK M | 33,979 | 33,347 | 33,735 | ||
| Return on operating capital, % | 11.0 | 7.0 | 8.3 | ||
| Return on equity, % | 9.0 | $-3.0$ | 6.2 | ||
| Equity/assets ratio, % | 43.1 | 44.4 | 46.9 | ||
| Equity per share, SEK | 78.10 | 73.48 | 77.00 | ||
| Number of employees | 10,788 | 10,409 | 10,538 |
1) Before and after dilution
Alternative performance measures
Alternative performance measures refer to financial measures used by the company's management and investors to evaluate the Group's earnings and financial position and that cannot be directly read or derived from the financial statements. These financial measures are intended to facilitate analysis of the Group's performance. Accordingly, the alternative performance measures should be considered a supplement to the financial statements prepared in accordance with IFRS. The financial me similar measures used by other companies.
| Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|
|---|---|---|---|---|---|
| Adjusted gross profit, SEK M | |||||
| Gross profit | 3,458 | 2,869 | 6,434 | 5,466 | 12,455 |
| Add-back of: Depreciation, amortization and write-downs of intangible assets |
|||||
| and tangible assets | 265 | 232 | 501 | 460 | 946 |
| Other items affecting comparability | 5 | ||||
| Adjustment for write-downs included in other | |||||
| items affecting comparability | |||||
| Adjusted gross profit | 3,723 | 3,101 | 6,940 | 5,926 | 13,401 |
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | |
| Adjusted EBITDA, SEK M | 2020 | 2019 | 2020 | 2019 | 2019 |
| Operating profit (EBIT) | 757 | 324 | 1,261 | 462 | 2,372 |
| Add-back of: | |||||
| Depreciation, amortization and write-downs of intangible assets and | |||||
| tangible assets | 587 | 431 | 1,002 | 845 | 1,726 |
| Amortization and write-down of acquired intangible assets | 157 | 125 | 288 | 247 | 497 |
| Other items affecting comparability | 35 | 23 | 35 | 117 | |
| Acquisition and restructuring costs | 168 | 107 | 170 | 216 | 324 |
| Adjustment for write-downs included in other items affecting | |||||
| comparability and restructuring costs | $-20$ | $-36$ | $-50$ | ||
| Adjusted EBITDA | 1,669 | 1,002 | 2,745 | 1,769 | 4,986 |
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | |
| Adjusted EBITA, SEK M | 2020 | 2019 | 2020 | 2019 | 2019 |
| Operating profit (EBIT) | 757 | 324 | 1,261 | 462 | 2,372 |
| Add-back of: | |||||
| Amortization and write-down of acquired intangible assets | 157 | 125 | 288 | 247 | 497 |
| Other items affecting comparability | 136 | 35 | 159 | 35 | 117 |
| Acquisition and restructuring costs | 168 | 107 | 170 | 216 | 324 |
| Adjustment for write-downs of acquired intangible assets included in | |||||
| other items affecting comparability and restructuring costs | ÷, | ||||
| Adjusted EBITA | 1,218 | 591 | 1,879 | 960 | 3,310 |
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | |
| Adjusted EBIT, SEK M | 2020 | 2019 | 2020 | 2019 | 2019 |
| Operating profit (EBIT) | 757 | 324 | 1,261 | 462 | 2,372 |
| Add-back of: | |||||
| Other items affecting comparability | 167 | 35 | 190 | 35 | 117 |
| Acquisition and restructuring costs | 168 | 107 | 170 | 216 | 324 |
| Adjusted EBIT | 1,091 | 466 | 1,622 | 713 | 2,813 |
| Apr-Jun | Apr-Jun | Jan-Jun | Jan-Jun | Jan-Dec | |
| Adjusted net profit for the period, SEK M | 2020 | 2019 | 2020 | 2019 | 2019 |
| Net profit for the period | 497 | 111 | 774 | 128 | 1,256 |
| Add-back of: | |||||
| Amortization and write-down of acquired intangible assets | 157 | 125 | 288 | 247 | 497 |
| Other items affecting comparability | 167 | 35 | 190 | 35 | 117 |
| Acquisition and restructuring costs | 168 | 107 | 170 | 216 | 324 |
| Adjustment for write-downs of acquired intangible assets included in | |||||
| other items affecting comparability and restructuring costs | $-31$ | ÷ | $-31$ | ÷, | |
| Tax items affecting comparability | $\overline{a}$ | $\overline{a}$ | |||
| Tax on add-back items | $-119$ | -66 | $-162$ | $-128$ | -247 |
| Adjusted net profit for the period | 839 | 312 | 1,229 | 498 | 1,947 |
Note 8 Acquisitions
Acquisition of Applikon Biotechnology B.V.
| Net assets acquired, SEK M | Jan 3, 2020 |
|---|---|
| Intangible assets | 370 |
| Tangible assets | 11 |
| Inventories | 78 |
| Other current receivables | 134 |
| Cash and cash equivalents | 16 |
| Other provisions | $-5$ |
| Other interest-bearing liabilities | $-11$ |
| Accounts payable | $-34$ |
| Other non-interest-bearing liabilities | $-177$ |
| Identifiable net assets | 382 |
| Goodwill | 457 |
| Total purchase price | 839 |
| Less: | |
| Unpaid purchase prices | |
| Cash and cash equivalents in the acquired company | $-16$ |
| Impact on the Group's cash and cash equivalents | 823 |
On January 3, 2020, the acquisition of 100 percent of Applikon Biotechnology B.V. was completed. The acquired company has annual sales of approximately SEK 400 M and 180 employees. The purchase price paid amounted to SEK 839 M. In addition, a maximum of EUR 60 M may be paid in so-called additional purchase prices in 2021-2022 if certain financial targets are met. Acquisition expenses charged to 2019's profit amounted to SEK 23 M. The goodwill that arose in connection with the acquisition has not been finally determined since the acquisition analysis is still preliminary but is expected to amount to SEK 457 M, and is primarily attributable to strategic advantages in the form of growth opportunities and a broader product range. After the acquisition, the company generated sales of SEK 159 M and EBITA of SEK 10 M.
Additional purchase price for the acquisition of Simm Company and Surgeon Aids
In the second quarter of 2020, an additional purchase price of SEK 6 M was paid for the acquisition of the Thai company Simm Company and Surgeon Aids, which was completed in 2017.
GETINGE *
Parent Company financial statements
Parent Company's income statement
| SEKM | Apr-Jun 2020 |
Apr-Jun 2019 |
Jan-Jun 2020 |
Jan-Jun 2019 |
Jan-Dec 2019 |
|---|---|---|---|---|---|
| Administrative expenses | 54 | -66 | $-47$ | $-182$ | $-234$ |
| Other operating income and expenses | 38 | 38 | $-43$ | ||
| Operating result | 92 | -66 | $-9$ | $-182$ | $-277$ |
| Result from participations in Group companies | 34 | 405 | 34 | 888 | 979 |
| Interest income and other similar income | $\overline{0}$ | ||||
| Interest expenses and other similar expenses | 122 | -98 | $-310$ | $-441$ | $-783$ |
| Profit/loss after financial items 1) | 248 | 241 | $-285$ | 265 | $-80$ |
| Appropriations | $\qquad \qquad -$ | 493 | |||
| Taxes | $-51$ | 28 | 51 | 124 | 15 |
| Net profit/loss for the period 2) | 197 | 269 | $-234$ | 389 | 428 |
1) Interest income and other similar income and interest expenses and other similar expenses include exchange-rate gains and losses attributable to the translation of financial receivables and liabilities measured in forei
Parent Company's balance sheet
| SEKM | June 30 2020 |
June 30 2019 |
December 31 2019 |
|---|---|---|---|
| Assets | |||
| Intangible assets | 29 | 41 | 34 |
| Tangible assets | $\overline{7}$ | 9 | 7 |
| Participations in Group companies | 28,429 | 28,190 | 28,431 |
| Deferred tax assets | 170 | 209 | 112 |
| Long-term receivables | 30 | ||
| Receivables from Group companies | 1,120 | 925 | 587 |
| Current receivables | 70 | 151 | 64 |
| Cash and cash equivalents | 1,494 | 0 | 0 |
| Total assets | 31,319 | 29,555 | 29,235 |
| Equity and liabilities | |||
| Equity | 20,669 | 21,273 | 21,312 |
| Long-term liabilities | 1,578 | 1.456 | |
| Long-term liabilities to Group companies | 742 | 745 | |
| Other provisions | 48 | 20 | 29 |
| Current liabilities to Group companies | 7,202 | 605 | 3,197 |
| Current liabilities | 3,400 | 5,337 | 2,496 |
| Total equity and liabilities | 31,319 | 29,555 | 29,235 |
Definitions
Financial terms
Operating capital. Average total assets with add-back of cash and cash equivalents, other provisions, accounts payable and other non-interest-bearing liabilities.
Return on operating capital. Rolling 12 months' adjusted EBIT in relation to operating capital.
Return on equity. Rolling 12 months' profit after tax in relation to average equity.
Gross margin. Gross profit in relation to net sales.
Adjusted gross profit. Gross profit with addback of depreciation, amortization and write-downs and other items affecting comparability.
EBIT. Operating profit.
Adjusted EBIT. Operating profit with addback of acquisition and restructuring costs and other items affecting comparability.
EBITA. Operating profit before depreciation and write-down of acquired intangible assets.
Adjusted EBITA. EBITA with add-back of acquisition and restructuring costs and other items affecting comparability.
EBITA margin. EBITA in relation to net sales.
EBITDA. Operating profit before depreciation, amortization and write-downs.
Adjusted EBITDA. EBITDA with add-back of acquisition and restructuring costs and other items affecting comparability.
EBITDA margin. EBITDA in relation to net sales.
Equity per share. Equity in relation to the number of shares at the end of the period.
Cash flow after net investments. Cash flow from operating activities and investing activities, excluding acquisitions and divestment of operations.
Adjusted earnings per share. Adjusted net profit for the period attributable to Parent Company shareholders in relation to average number of shares.
Net debt/equity ratio. Net interest-bearing debt in relation to equity.
Organic change. A financial change adjusted for currency, acquisitions and divestments.
Adjusted net profit for the period. Net profit for the period with add-back of amortization and write-down of acquired intangible assets, acquisition and restructuring costs, other items affecting comparability and tax effect of add-back of income-statement items
Adjusted profit before tax. Profit before tax for the period with add-back of amortization and write-down of acquired intangible assets, acquisition and restructuring costs and other items affecting comparability.
Earnings per share. Net profit attributable to Parent Company shareholders in relation to average number of shares.
Interest-coverage ratio. Rolling 12 months' adjusted EBITDA in relation to rolling 12 months' net interest.
Operating margin. Operating profit (EBIT) in relation to net sales.
Equity/assets ratio. Equity in relation to total assets.
Currency transaction effect. Exchange of current year's volumes of foreign currency at this year's exchange rates, compared with the exchange rates in the preceding year.
Medical terms
Sterilizer. A device to eliminate microorganisms on surgical instruments, usually by high temperature with steam.
ECMO Extracorporeal membrane oxygenation, meaning oxygenation outside the body through a membrane. Put simply, a modified cardiac and respiratory machine that exchanges oxygen and carbon dioxide, like an artificial lung.
Endoscope. Equipment for visual examination of the body's cavities, such as the stomach.
Endovascular. Vascular treatment using catheter technologies.
EU MDR. A new regulatory framework for medical devices which ensures a high level of safety and health whilst supporting innovation.
Cardiopulmonary. Pertaining or belonging to both heart and lung.
Cardiovascular. Pertaining or belonging to both heart and blood vessels.
Artificial grafts. Artificial vascular implants.
Low temperature sterilization. A device used to sterilize surgical instruments which cannot be sterilized with high temperature steam. It i mainly used for instruments used in the minimal invasive and robotic surgery.
Stent. A tube for endovascular widening of blood vessels.
Vascular intervention. A medical procedure conducted through vascular puncturing instead of using an open surgery method.
Ventilator. Medical device to help patients breathe.
Geographic areas
Americas. North, South and Central America. APAC. Asia and Pacific. EMEA. Europe, Middle East and Africa.
Teleconference
Teleconference with President & CEO Mattias Perjos and CFO Lars Sandström on July 16, 2020 at 10:00-11:00 a.m. CEST. Please see dial in details below to join the conference:
SE: +46 8 505 583 59 UK: +44 33 33 009 273 US: +1833 526 8347
A presentation will be held during the telephone conference. To access the presentation, please use this link: https://tv.streamfabriken.com/getinge-g2-2020
Alternatively, use the following link to download the presentation: https://www.getinge.com/int/about-us/investors/reportspresentations/
A recording will be available for three years via the following link: https://tv.streamfabriken.com/getinge-q2-2020
Financial information
Updated information on, for example, the Getinge share and corporate governance is available on Getinge's website www.getinge.com. The Annual Report, year-end report and interim reports are published in Swedish and English and are available for download at www.getinge.com. The preliminary dates for future financial communication are provided below:
October 16, 2020 Q3 Report 2020 January 28, 2021 Q4 Report 2020 March 2021 2020 Annual Report
Contact
Lars Mattsson, Head of Investor Relations +46 (0)10 335 0043 [email protected]
Jeanette Hedén Carlsson, Executive Vice President, Communications & Brand Management +46 (0)10 335 1003 [email protected]
This information is such that Getinge AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Market Act. The information was submitted for publication, through the agency of the contact person set out above, on July 16, 2020 at 8:00 a.m. CEST.
With a firm belief that every person and community should have access to the best possible care, Getinge provides hospitals and life science institutions with products and solutions that aim to improve clinical results and optimize workflows. The offering includes products and solutions for intensive care, cardiovascular procedures, operating rooms, sterile reprocessing and life science. Getinge employs over 10,000 people worldwide and the products are sold in more than 135 countries. Getinge has been listed on Nasdaq OMX Stockholm, Nordic Large Cap since 1993 and is included in the OMXS30 index of the 30 most actively traded shares.
Getinge AB (publ) | Lindholmspiren 7, 417 56 Gothenburg, Sweden | Tel: +46 (0)10 335 0000 | E-mail: [email protected] | Corp. Reg. No.: 556408-5032 | www.getinge.com