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Sectra — Interim / Quarterly Report 2009
Mar 3, 2009
2967_10-q_2009-03-03_9c96dab4-2efd-4a7c-b097-76680ff22ab9.pdf
Interim / Quarterly Report
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Press release Linköping, Sweden, March 3, 2009
Interim report for the nine months, May 2008 – January 2009
Sectra continues to grow:
Digital mammography doubled in one year
For the third quarter, the Swedish IT and medical-technology company Sectra's net sales rose 20% to SEK 226.1 million compared with SEK 189.3 million the year-earlier period. Profit after financial net increased 10% to SEK 15.8 million (14.4), corresponding to a profit margin of 7% (8). Order bookings amounted to SEK 217.0 million (458.9).
The Group's net sales for the nine-month period rose 16% to SEK 599.5 million (518.4). Profit after financial net increased 71% to SEK 64.0 million (37.4), corresponding to a profit margin of 11% (7). Order bookings rose 10% to SEK 942.0 million (858.3).
"Increased numbers of customers, employees and partners have contributed to the continued international growth of the company," says Jan-Olof Brüer, President and CEO of Sectra AB. "However, the medical systems markets have not avoided being affected by the global economy and it is very difficult to assess how customer demand will be impacted in the short term. We are maintaining our long-term focus on building international distribution channels so that we can meet demand levels when they begin to rise again."
In the Medical Systems business area, the Mammography product division reported high growth for the current fiscal year. Expansion of the production capacity and the distribution channels for the mammography system Sectra MicroDose Mammography are prioritized activities.
"Sales of the mammography system now comprise more than ten percent of Medical Systems' net sales. Based on our activities in the mammography area, in the nine-month period we doubled the number of installations of Sectra MicroDose Mammography compared with the year-earlier period," says Jan-Olof Brüer.
The Secure Communication Systems business area reported stable sales with an operating margin of 15% (13) for the nine-month period.
For further information, please contact:
Jan-Olof Brüer, President and CEO, Sectra AB, ph: +46 (0)13-23 52 09
About the Sectra Group
Sectra successfully develops and sells cutting-edge products in the expansive niche segments of medical systems and secure communication systems. The company was founded in 1978 and has its roots in the Linköping University in Sweden. Today, Sectra has offices in twelve countries and operates through partners worldwide. Net sales in the 2007/2008 fiscal year totaled SEK 743 million. The Sectra share is listed on the NASDAQ OMX Stockholm AB exchange. For more information about Sectra visit www.sectra.com.
The information in this press release is such that Sectra AB (publ) is obligated to disclose in compliance with the Swedish Securities and Clearing Operations Act and/or the Financial Instruments Trading Act. The information was submitted for publication on March 3, 2009 at 08:30 (CET).
Sectra AB (publ)
Teknikringen 20 583 30 Linköping, Sweden
Tel: +46 (0)13 23 52 00
Fax: +46 (0)13 21 21 85
www.sectra.com
VAT reg.nr SE556064830401
1(11)
Interim report Sectra AB (publ) for May 2008 – January 2009
The figures for the preceding year are shown in parentheses.
The nine-month period in brief
- Order bookings rose 9.8% to SEK 942.0 million (858.3).
- Net sales increased 15.7% to SEK 599.5 million (518.4).
- Operating profit amounted to SEK 10.2 million (32.9), corresponding to an operating margin of 1.8% (6.3).
- Profit after financial net rose 71.2% to SEK 64.0 million (37.4), corresponding to a profit margin of 10.7% (7.2). The increase was primarily due to currency rate changes.
- Profit after tax increased 70.0% to SEK 46.4 million (27.3).
- Earnings per share amounted to SEK 1.26 (0.74).
The third quarter in brief
- Order bookings amounted to SEK 217.0 million (458.9). Comparative figures for the yearearlier period include an extensive agreement for support and maintenance of 25 public hospitals in London.
- Net sales rose 19.5% to SEK 226.1 million (189.3).
- Operating profit amounted to SEK 1.4 million (10.4), corresponding to an operating margin of 0.7% (5.5).
- Profit after financial net rose 9.8% to SEK 15.8 million (14.4), corresponding to a profit margin of 7.0% (7.6). The increase was primarily due to currency rate changes.
- Profit after tax increased 8.2% to SEK 12.0 million (11.1).
- Earnings per share amounted to SEK 0.32 (0.30).
Events during the quarter
- Sectra strengthened its product offering in the growing magnet resonance imaging (MRI) market by signing a distribution agreement with SyntheticMR.
- For the second consecutive year, US healthcare providers ranked Sectra's IT system for the management of radiology images (PACS) second in the KLAS Community Hospital PACS 2008 Report.
- Sectra signed a five-year agreement with Manatee Healthcare System, Inc. in Florida for the use of Sectra PACS, including support services.
- Several Czech ministries and governmental offices procured Sectra's crypto product Tiger XS for the Czech EU presidency commencing on January 1, 2009.
Events after the end of the period
- Sectra signed a partnership agreement with Greek company Proton S.A, entailing that Proton will become a distributor of Sectra's medical systems in Greece and Cyprus.
- Sectra signed a long-term agreement with the VUmc University Hospital of Amsterdam for the use of Sectra's radiology IT solution for handling of patient information and radiology images (RIS/PACS).
- The Swedish Defense Materiel Administration (FMV) expanded its use of Sectra's crypto product Tiger XS to secure the communications of national secrets and international peacekeeping forces, such as the Nordic Battlegroup. The order is worth SEK 20 million.
Sectra AB (publ)
Teknikringen 20
583 30 Linköping, Sweden
Tel: +46 (0)13 23 52 00
Fax: +46 (0)13 21 21 85
www.sectra.com
VAT reg.nr SE556064830401
Order bookings, net sales and earnings
Nine-month period, May 2008 - January 2009
The Group's order bookings rose 9.8% to SEK 942.0 million (858.3). The increase is a result of successful sales in the market for medical systems.
Net sales for the period increased 15.7% to SEK 599.5 million (518.4). The sales of Sectra's medical systems on the European market accounted for the increase compared with the yearearlier period. International markets accounted for a total of 69.9% of the period's net sales.
Operating profit amounted to SEK 10.2 million (32.9), corresponding to an operating margin of 1.8% (6.3). The operating profit was impacted by costs for the expansion of distribution channels and production in the Medical Systems business area. Profit after financial net rose 71.2% to SEK 64.0 million (37,4), corresponding to a profit margin of 10.7% (7.2). The financial net made a favorable contribution to earnings of SEK 53.8 million (4.6), primarily as a result of currency rate changes. Profit after tax increased 70.0% to SEK 46.4 million (27.3). Earnings per share amounted to SEK 1.26 (0.74).
Third quarter, November 2008 – January 2009
The Group's order bookings amounted to SEK 217.0 million (458.9). Demand for Sectra's products has been strong, but order bookings fluctuate sharply between individual quarters. Order bookings from the European market during the third quarter did not achieve the same level as the very strong comparative figures for the corresponding quarter in the preceding year. The comparative quarter includes an order for support and maintenance of 25 public hospitals in London, one of the largest PACS installations in the world.
Net sales for the quarter rose 19.5% to SEK 226.1 million (189.3). Sectra's Medical Systems accounted for the increase compared with the year-earlier period.
The Group's operating profit amounted to SEK 1.4 million (10.4), corresponding to an operating margin of 0.7% (5.5). The operating profit was impacted by cost increases in Medical Systems. Profit after financial net rose 9.8% to SEK 15.8 million (14.4), corresponding to a profit margin of 7.0% (7.6). The financial net made a positive contribution to earnings of SEK 14.4 million (4.0), primarily as a result of currency rate changes. Profit after tax increased 8.2% to SEK 12.0 million (11.1). Earnings per share amounted to SEK 0.32 (0.30).
Seasonal variations
Variations in net sales, earnings and order volumes for individual quarters are essential. Traditionally, Sectra has seasonal variations in which the fiscal year begins with low sales. As a rule, most of the net sales occurs in the third and fourth quarters.
Sectra AB (publ)
Net sales by business segment
| (SEK million) | 3 months | 3 months | 9 months | 9 months | 12 months | Full year |
|---|---|---|---|---|---|---|
| Nov 2008 | Nov 2007 | May 2008 | May 2007 | Feb 2008 | May–Apr | |
| –Jan 2009 | –Jan 2008 | –Jan 2009 | –Jan 2008 | –Jan 2009 | 2007/2008 | |
| Medical Systems | 204.2 | 166.7 | 536.9 | 456.9 | 739.6 | 659.6 |
| Secure Communication | ||||||
| Systems | 23.9 | 24.2 | 66.0 | 68.4 | 93.0 | 95.3 |
| Other 1) | 6.3 | 6.1 | 19.1 | 15.7 | 26.3 | 22.9 |
| Group eliminations | -8.3 | -7.7 | -22.5 | -22.6 | -34.8 | -34.9 |
| Total | 226.1 | 189.3 | 599.5 | 518.4 | 824.1 | 742.9 |
Operating profit/loss by business segment
| (SEK million) | 3 months | 3 months | 9 months | 9 months | 12 months | Full year |
|---|---|---|---|---|---|---|
| Nov 2008 | Nov 2007 | May 2008 | May 2007 | Feb 2008 | May–Apr | |
| –Jan 2009 | –Jan 2008 | –Jan 2009 | –Jan 2008 | –Jan 2009 | 2007/2008 | |
| Medical systems | 0.4 | 8.2 | 9.3 | 26.8 | 47.5 | 65.0 |
| Secure communication | ||||||
| systems | 3.4 | 4.3 | 9.9 | 8.7 | 15.0 | 13.8 |
| Other 1) | -1.4 | -0.1 | -6.6 | 0.8 | -4.4 | 3.0 |
| Group eliminations | -1.0 | -2.0 | -2.4 | -3.4 | -1.1 | -2.1 |
| Total | 1.4 | 10.4 | 10.2 | 32.9 | 57.0 | 79.7 |
1) Other refers primarily to the Parent Company's debiting of Group-wide services and asset management.
| Net sales by geographical market | ||||||
|---|---|---|---|---|---|---|
| (SEK million) | 3 months | 3 months | 9 months | 9 months | 12 months | Full year |
| Nov 2008 | Nov 2007 | May 2008 | May 2007 | Feb 2008 | May–Apr | |
| –Jan 2009 | –Jan 2008 | –Jan 2009 | –Jan 2008 | –Jan 2009 | 2007/2008 | |
| Sweden | 68.5 | 61.6 | 180.7 | 177.1 | 250.1 | 246.8 |
| Rest of Europe | 91.0 | 63.6 | 250.4 | 170.7 | 343.4 | 263.6 |
| North America | 61.7 | 63.4 | 154.3 | 157.8 | 201.0 | 204.2 |
| Rest of world | 4.9 | 0.7 | 14.1 | 12.8 | 29.6 | 28.3 |
| Total | 226.1 | 189.3 | 599.5 | 518.4 | 824.1 | 742.9 |
Medical Systems
Market
The market for Sectra's medical systems is growing as an increasing number of hospitals choose to improve the efficiency of their radiology operations by introducing IT systems for image and information processing. To meet demand on the market, Sectra continues with investments to expand the distribution network and service organization. The market is affected by the global economy and the effects reduce demand for IT systems and mammography products in the short term. The greatest impact to date was noted in the US market where industry surveys published in recent months show the customers are having difficulties in securing financing for their planned investments. This is also expected to affect Europe and other markets in the future.
More than 45 million radiology examinations are carried out in the company's system annually, making Sectra one of the world's leading suppliers of IT systems for managing radiology images (PACS). Most radiology clinics using Sectra's medical systems are found in North America, the world's largest market for medical IT.
Sectra AB (publ)
In pace with the increased number of installations, revenue from service and upgrade agreements is rising. At the same time, the percentage of agreements in which the customer commits to a longer period of continuous payments for using the system instead of purchasing the system is also rising. The agreement signed with Manatee Healthcare System, Inc. in Florida in the third quarter is an example of this type of long-term agreement.
The expansion of distribution channels and greater production capacity for Sectra MicroDose Mammograpy are prioritized activities in Medical Systems to meet future demand for digital mammography systems. As a result of the measures taken, the number of deliveries of Sectra MicroDose Mammography doubled during the year, compared with the year-earlier period. A total of 35 units (17) were installed during the nine-month period, of which 21 (8) pertain to the third quarter.
Changed business mix
During the past fiscal years, Sectra's Medical Systems operations have undergone two major changes that impact profit margins. One of these was the expansion of Sectra's international sales and support organization as a result of the phasing out of the cooperation with Philips Medical Systems, and the other was the launch of Sectra MicroDose Mammography, which results in a larger element of manufacturing operations.
Application for approval to sell Sectra MicroDose Mammography in the US
In June 2008, according to plan, Sectra submitted the final section of the application for the approval of the mammography system, Sectra MicroDose Mammography, to the American authority, FDA (Food and Drug Administration). The FDA is performing an extensive examination of the application and has requested some supplementary information, which Sectra is now producing.
Sales and earnings
Medical Systems' net sales for the nine-month period rose 17.6% to SEK 536.9 million (456,9). This was primarily due to the increase in direct sales of Sectra's medical IT systems and increased revenues from service and upgrade agreements. The Mammography product division accounted for the highest percentage of growth with an increase in net sales of 100.4% to SEK 55.7 million (27.8).
Operating profit for the period amounted to SEK 9.3 million (26.8), corresponding to an operating margin of 1.7% (5.9). The operating profit was affected by higher costs for the increase in production capacity in the Mammography product division, whose operating loss for the period amounted to SEK 76.0 million (53.2). The operating profit will continue to be influenced by the investments in the mammography operation.
Net sales in the business area increased 22.5% to SEK 204.2 million (166.7) for the third quarter. Sales in the European market accounted for the increase compared with the corresponding quarter the year-earlier period. The Mammography product divison accounted for SEK 30.6 million (13.0) of net sales in the third quarter.
Medical Systems' operating profit for the quarter amounted to SEK 0.4 million (8.2), corresponding to an operating margin of 0.2% (4.9). The operating profit was charged with higher costs in the Mammography product divison, which reported an operating loss of SEK 24.1 million (16.8) for the third quarter.
Secure Communication Systems
Market
The European market for secure communication systems is characterized by demand for crypto products that support international cooperation. An example of this is the order of Sectra's crypto product Tiger XS made by several Czech ministries during the quarter. The Czech Republic is the fourth country that has purchased Sectra's secure voice communication products for its EU presidency.
Sectra AB (publ)
Authorities and defense agencies cooperate increasingly across borders, and common norms and standards have developed to protect security classified EU information. Sectra is first in the market to supply EU-approved products for secure mobile voice communications. The products are used by customers in more than half of the EU's 27 member states. Sectra's Tiger XS has also been certified by NATO and with its dual security approval holds an exceptional position on the European market.
Net sales and earnings
Secure Communication Systems reported stable net sales and operating margin. Net sales for the nine-month period amounted to SEK 66.0 million (68.4). Operating profit rose 13.8% to SEK 9.9 million (8.7), corresponding to an operating margin of 15.0% (12.7).
Net sales in the business area amounted to SEK 23.9 million (24.2) for the third quarter. Operating profit amounted to SEK 3.4 million (4.3), corresponding to an operating margin of 14.2% (17.8).
Financial position
The equity/assets ratio at the end of the quarter was 60.7% (60.4) and liquidity was a multiple of 2.2 (2.4).
The Group's interest-bearing liabilities amounted at the end of the period to SEK 45.8 million (57.8), of which SEK 44.8 million (56.8) pertains to convertible debentures.
Investments
Group investments during the nine-month period amounted to SEK 38.4 million (36.3), of which SEK 15.0 million (13.7) pertains to the third quarter. The investments primarily pertain to capitalized development expenditures, which during the period were SEK 25.4 million (27.7), of which SEK 13.8 million (10.8) pertains to the third quarter. The capitalized development expenditures are primarily related to products within Medical Systems. At the end of the quarter, the capitalized development expenditures amounted to a total of SEK 196.8 million (158.5).
Depreciation during the nine-month period amounted to SEK 26.2 million (15.7), of which SEK 9.0 million (5.3) pertains to the third quarter. The increase was due to higher depreciation on capitalized development projects that were completed and transferred to the delivery phase.
Employees
The number of employees with full-time employment at Sectra increased during the quarter by 21 persons. At the end of the quarter, the number of employees totaled 567 (494) and the increase was mainly related to positions in sales and distribution.
The share
Sectra's share capital at the end of the period amounted to SEK 36,842,088. Full conversion and exercise of the incentive programs implemented will increase the number of shares by a maximum of 460,500, corresponding to 1.2% of the share capital and 0.8% of the voting rights. After full dilution, Sectra's share capital will amount to SEK 37,302,588. In calculating the dilution effect, it was taken into account that the convertible loan (266,800 convertibles) and employee stock options (80,000) issued in 2006/2007, which in the company's assessment will not be utilized during the exercise period May 26-30, 2009, since the conversion price of SEK 86.70 is substantially higher than the listed price at the end of the period.
2009 Annual General Meeting
The Annual General Meeting (AGM) of shareholders in Sectra AB will be held on Friday, June 26, in Linköping. Shareholders wishing to have an issue dealt with at the AGM may submit their proposal to the Board of Sectra, under the address Sectra AB, Teknikringen 20, SE-583 30 Linköping, Sweden, or by e-mail to [email protected]. To ensure that a request is properly received, the request must be delivered not later than May 1, 2009. The notive will be available on the company's website four weeks prior to the Meeting.
Sectra AB (publ)
The Nomination Committee, which has been appointed in accordance with a decision of the AGM, consists of the following members:
- Carl-Erik Ridderstråle, Chairman of the Board (convening authority)
- Jan-Olof Brüer, CEO and President of Sectra AB and the largest shareholder (Chairman)
- Günder Rentsch, representing Frithjof Qvigstad
- Thomas Ehlin, representing Nordea funds
The Nomination Committee will prepare and present the following proposals to the AGM:
- Election of and fees for the Chairman of the Board and other Board members
- Election of and fees for the auditor and deputy auditor (where applicable)
- Decisions regarding principles for the appointment of the Nomination Committee
- Chairman of the Meeting
Shareholders that wish to submit proposals can contact Jan-Olof Brüer at +46 (0)13-23 52 09.
Risks and uncertainties
Sectra is, through its operations, exposed to business risks such as dependence on major customers and partners, the effect of the exchange rate of the USD on pricing in the markets in which the Group is active, property and liability risks. In addition, Sectra is exposed to various types of financial risks such as currency, interest, loan and liquidity risks.
A detailed description of the risks and uncertainties, as well as Sectra's strategies and tactics for minimizing risk exposure and limiting adverse effects, is provided in the Group's Annual Report for 2007/2008 fiscal year, Note 28, page 46. No significant events have occurred that would alter the conditions reported therein.
Strong finances a strength in the turbulence of the financial markets
Sectra can finance existing operations with its own liquid assets and, accordingly, is not dependant on lenders or capital contributions. The niche markets in which the company is active are less sensitive to the economy than many other industries.
Outlook
Sectra has a strong technical platform. The products and system solutions that Sectra develops are aimed at markets with high growth potential. The company's strong position in the home market provides a solid platform for ongoing international expansion.
Sectra's profitability target is to achieve a profit margin of more than 10% and the Board's assessment is that in the long-term, Sectra will continue to expand with favorable profitability. However, the Board assesses that profitability will continue to be influenced by increased costs resulting from higher direct sales and the company's investments in expanding the sales and support organization internationally and by the investment in the mammography operations.
The market for Sectra's medical systems is affected by the global economic situation, but it is very difficult to assess how customer demand will change in the short term.
Parent Company Sectra AB
The Parent Company includes head office functions such as Group finance and data administration as well as exchange, share and investor-related operations.
Net sales in the Parent Company Sectra AB for the first nine months amounted to SEK 17.9 million (17.2). Profit after net financial items amounted to SEK 21.9 million (16.7).
For the third quarter, net sales in the Parent Company amounted to SEK 5.8 million (6.0). Earnings after financial net amounted to SEK 5.5 million (7.0).
The Parent Company's income statement and balance sheet are reported on page 10.
Sectra AB (publ)
Condensed income statement for the Group
| 3 months | 3 months | 9 months | 9 months | 12 Months | Full-year | |
|---|---|---|---|---|---|---|
| SEK thousands | Nov 2008 | Nov 2007 | May 2008 | May 2007 | Feb 2008 | May–Apr |
| – Jan 2009 | – Jan 2008 | – Jan 2009 | – Jan 2008 | – Jan 2009 | 2007/2008 | |
| Net sales | 226,124 | 189,321 | 599,544 | 518,395 | 824,072 | 742,923 |
| Capitalized work for own use | 9,477 | 10,786 | 25,378 | 27,651 | 55,574 | 57,847 |
| Operating expenses | -225,206 | -184,387 | -588,505 | -497,406 | -790,832 | -699,733 |
| Depreciation and amortization | -8,995 | -5,331 | -26,206 | -15,766 | -31,778 | -21,338 |
| Operating profit | 1,400 | 10,389 | 10,211 | 32,874 | 57,036 | 79,699 |
| Net financial items | 14,390 | 4,021 | 53,768 | 4,573 | 49,275 | 80 |
| Profit after financial items | 15,790 | 14,410 | 63,979 | 37,447 | 106,311 | 79,779 |
| Tax on earnings for the period | -3,832 | -3,293 | -17,536 | -10,136 | -36,715 | -29,315 |
| Net profit | 11,958 | 11,117 | 46,443 | 27,311 | 69,596 | 50,464 |
| Profit attributable to equity holders | ||||||
| of the: | ||||||
| Parent Company | 11,958 | 11,117 | 46,443 | 27,311 | 69,596 | 50,464 |
| Minority interest | 0 | 0 | 0 | 0 | 0 | 0 |
| Earnings per share | ||||||
| Before dilution. SEK | 0.32 | 0.30 | 1.26 | 0.74 | 1.89 | 1.37 |
| After dilution. SEK | 0.32 | 0.30 | 1.24 | 0.73 | 1.85 | 1.34 |
| No. of shares at end of period | ||||||
| Before dilution | 36,842,088 | 36,842,088 | 36,842,088 | 36,842,088 | 36,842,088 | 36,842,088 |
| After dilution 1) | 37,302,588 | 37,664,588 | 37,302,588 | 37,664,588 | 37,302,588 | 37,559,388 |
| Average. before dilution 2) | 36,842,088 | 36,842,088 | 36,842,088 | 36,828,999 | 36,842,088 | 36,832,271 |
| Average. after dilution 1) 2) | 37,533,788 | 37,691,255 | 37,533,788 | 37,571,177 | 37,593,855 | 37,594,096 |
1) Dilution is based on the convertibles program issued in 2007/2008 (270,500) and employee stock options issued in 2007/2008 (100,000) and 2008/2009 (90,000). In calculating the dilution effect, it was taken into account that the convertible loan 2006/2007 (266,800) and employee stock options 2006/2007 (80,000), which in the company's assessment will not be utilized during the exercise period May 26-30, 2009, since the conversion price of SEK 86.70 is substantially higher than the listed price at the end of the period.
2) Average number of shares has been adjusted for implemented share splits and share issues.
Earnings before tax
the line 12 months earnings before tax.
Condensed consolidated balance sheet
| SEK thousands | Jan 31, | Jan 31, | April 30, |
|---|---|---|---|
| 2009 | 2008 | 2008 | |
| Assets | |||
| Intangible assets | 228,061 | 178,716 | 217,637 |
| Tangible assets | 32,489 | 25,393 | 24,060 |
| Financial assets | 26,595 | 71,008 | 45,515 |
| Total fixed assets | 287,145 | 275,117 | 287,212 |
| Other current assets | 458,267 | 269,424 | 410,370 |
| Cash and bank balances | 229,870 | 342,809 | 288,358 |
| Total current assets | 688,137 | 612,233 | 698,728 |
| Total assets | 975,282 | 887,350 | 985,940 |
| Equity and liabilities | |||
| Equity (including profit for the period) | 591,681 | 536,099 | 560,670 |
| Provisions | 7,882 | 15,455 | 17,718 |
| Deferred tax liabilities | 28,789 | 25,154 | 28,659 |
| Long-term liabilities | 22,625 | 46,098 | 51,859 |
| Current liabilities | 324,305 | 264,544 | 327,034 |
| Total equity and liabilities | 975,282 | 887,350 | 985,940 |
Change in equity
| 9 months | 9 months | Full-year | |
|---|---|---|---|
| SEK thousands | May 2008 | May 2007 | May–Apr |
| – Jan 2009 | – Jan 2008 | 2007/2008 | |
| Equity at start of period | 560,670 | 519,406 | 519,406 |
| New issue/conversion | - | 4,197 | 4,197 |
| Dividend paid | -18,421 | -18,421 | -18,421 |
| Change in translation difference | 1,823 | 890 | 1,370 |
| Share-based payments | 1,166 | 2,717 | 3,655 |
| Net earnings for the period | 46,443 | 27,310 | 50,463 |
| Equity at end of period | 591,681 | 536,099 | 560,670 |
Condensed consolidated cash-flow statement
| 9 months | 9 months | Full-year | |
|---|---|---|---|
| SEK thousands | May 2008 | May 2007 | May–Apr |
| – Jan 2009 | – Jan 2008 | 2007/2008 | |
| Cash flow from operations before changes in working capital | 76,119 | 38,740 | 84,704 |
| Cash flow from operations after changes in working capital | 15,238 | 28,653 | 8,677 |
| Investing activities | -38,448 | -36,312 | -82,152 |
| Financing activities | -12,356 | -38,943 | -30,054 |
| Change in cash and bank balances | -35,566 | -46,602 | -103,529 |
| Cash and bank balances. opening balance | 288,358 | 385,150 | 385,150 |
| Exchange-rate difference in liquid assets | |||
| -22,922 | 4,261 | 6,737 | |
| Cash and cash equivalents. closing balance | 229,870 | 342,809 | 288,358 |
Key figures
| 9 months | 9 months | 12 months | Full year | |
|---|---|---|---|---|
| Jan 31, | Jan 31, | Jan 31, | Apr 30, | |
| 2009 | 2008 | 2009 | 2008 | |
| Order bookings, SEK M | 942.0 | 858.3 | 1 100.3 | 1 016.6 |
| Equity/assets ratio, % | 60.7 | 60.4 | 60.7 | 56.9 |
| Liquidity, multiple | 2.2 | 2.4 | 2.2 | 2.2 |
| Profit margin % | 10.7 | 7.2 | 12.9 | 10.7 |
| Return on shareholders' equity, % | - | - | 12.3 | 9.3 |
| Return on capital employed, % | - | - | 17.4 | 13.8 |
| Return on total capital, % | - | - | 11.6 | 8.9 |
| Value added, SEK M | - | - | 456.1 | 429.6 |
| Average number of employees | 534 | 473 | 522 | 477 |
| Equity per share, SEK | 16.06 | 14.55 | 16.06 | 15.22 |
| Equity per share after dilution, SEK | 15.86 | 14.23 | 15.86 | 14.93 |
| Cash flow per share, SEK | 2.07 | 1.05 | 3.31 | 2.31 |
| Cash flow per share after dilution, SEK | 2.04 | 1.03 | 3.27 | 2.26 |
| P/E ratio, multiple | - | - | 20.1 | 42.7 |
| Share price at end of period, SEK | 37.9 | 60.5 | 37.9 | 58.5 |
Consolidated income statement, quarterly
| 2008/2009 | 2007/2008 | 2006/2007 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| SEK M | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Net sales | 226.1 | 199.4 | 174.0 | 224.5 | 189.3 | 179.2 | 149.9 | 204.7 | 169.4 | 163.5 | 134.9 |
| Capitalized work for own use | 9.5 | 11.6 | 4.3 | 30.1 | 10.8 | 10.1 | 6.8 | 10.6 | 12.3 | 11.6 | 8.1 |
| Operating expenses | -225.2 | -194.4 | -168.9 | -202.3 | -184.4 | -162.8 | -150.2 | -186.4 | -154.1 | -158.4 | -132.7 |
| Depreciation | -9.0 | -8.7 | -8.5 | -5.5 | -5.3 | -5.3 | -5.2 | -6.6 | -5.2 | -5.2 | -5.3 |
| Operating profit | 1.4 | 7.9 | 0.9 | 46.8 | 10.4 | 21.2 | 1.3 | 22.3 | 22.4 | 11.5 | 5.0 |
| Net financial items | 14.4 | 34.1 | 5.3 | -4.5 | 4.0 | -1.6 | 2.2 | 1.1 | 3.8 | 4.1 | 0.0 |
| Profit after financial items | 15.8 | 42.0 | 6.2 | 42.3 | 14.4 | 19.6 | 3.5 | 23.4 | 26.2 | 15.6 | 5.0 |
| Tax on earnings for the period |
-3.8 | -11.9 | -1.8 | -19.1 | -3.3 | -6.1 | -0.8 | -9.4 | -7.7 | -4.7 | -1.1 |
| Net profit for the period | 12.0 | 30.1 | 4.4 | 23.2 | 11.1 | 13.5 | 2.7 | 14.0 | 18.5 | 10.9 | 3.9 |
Five-year summary
| 2007/2008 | 2006/2007 | 2005/2006 | 2004/2005 | 2003/2004 | |
|---|---|---|---|---|---|
| Order bookings, SEK M | 1 016.6 | 684.7 | 613.7 | 570.1 | 375.1 |
| Net sales, SEK M | 742.9 | 672.5 | 564.4 | 455.9 | 495.3 |
| Earnings before tax 1), SEK M | 79.8 | 70.2 | 80.7 | 80.4 | 27.6 |
| Earnings after tax, SEK M | 50.5 | 47.2 | 60.4 | 52.8 | 21.0 |
| Profit margin, % | 10.7 | 10.4 | 14.3 | 17.6 | 5.6 |
| Return on equity, % | 9.3 | 9.4 | 13.2 | 12.8 | 5.8 |
| ROCE, % | 13.8 | 13.0 | 16.0 | 17.1 | 8.8 |
| Return on total capital, % | 8.9 | 8.6 | 10.9 | 12.6 | 6.1 |
| Earnings per share before dilution, SEK | 1.37 | 1.28 | 1.64 | 1.45 | 0.63 |
| Earnings per share after dilution, SEK | 1.34 | 1.26 | 1.61 | 1.42 | 0.61 |
| Equity per share before dilution, SEK | 15.22 | 14.12 | 13.24 | 11.79 | 10.96 |
| Equity per share after dilution, SEK | 14.93 | 13.84 | 12.97 | 11.54 | 10.52 |
| Equity/assets ratio, % | 56.9 | 60.8 | 58.9 | 61.5 | 61.7 |
| Dividend per share, SEK | 0.50 | 0.50 | 0.50 | 0.50 | 0.50 |
| Stock market price at year end, SEK | 58.5 | 76.0 | 58.8 | 74.0 | 58.5 |
| P/E ratio | 42.7 | 59.2 | 35.7 | 49.7 | 92.9 |
1) A non-recurring write-down of capitalized development costs within Sectra Mamea AB had a negative effect of SEK 70.9 million on operating profit for full-year 2003/2004.
Parent Company condensed income statement
| 3 months | 3 months | 9 months | 9 months | 12 Months | Full-year | |
|---|---|---|---|---|---|---|
| SEK thousands | Nov 2008 | Nov 2007 | May 2008 | May 2007 | Feb 2008 | May–Apr |
| – Jan 2009 | – Jan 2008 | – Jan 2009 | – Jan 2008 | – Jan 2009 | 2007/2008 | |
| Net sales | 5,833 | 5,950 | 17,856 | 17,201 | 24,830 | 24,175 |
| Operating expenses | -6,928 | -5,775 | -23,651 | -17,562 | -26,822 | -20,733 |
| Depreciation | -45 | 151 | -262 | -366 | -413 | -517 |
| Operating profit after depreciation | -1,140 | 326 | -6,057 | -727 | -2,405 | 2,925 |
| Net financial items | 6,637 | 6,695 | 27,948 | 17,397 | 196,752 | 186,201 |
| Profit after financial items | 5,497 | 7,021 | 21,891 | 16,670 | 194,347 | 189,126 |
| Untaxed reserves | - | - | - | - | -10,221 | -10,221 |
| Profit before tax | 5,497 | 7,021 | 21,891 | 16,670 | 184,126 | 178,905 |
| Tax on earnings for the period | -1,239 | -1,958 | -5,829 | -4,660 | -51,155 | -49,986 |
| Net profit for the period | 4,258 | 5,063 | 16,062 | 12,010 | 132,971 | 128,919 |
Condensed Parent Company balance sheet
| SEK thousands | Jan 31, | Jan 31, | April 30, |
|---|---|---|---|
| 2009 | 2008 | 2008 | |
| Assets | |||
| Tangible fixed assets | 1,862 | 1,437 | 1,543 |
| Financial fixed assets | 141,359 | 82,366 | 140,566 |
| Total fixed assets | 143,221 | 83,803 | 142,109 |
| Other current assets | 677,377 | 564,601 | 662,881 |
| Cash and cash equivalents | 185,624 | 221,417 | 202,823 |
| Total current assets | 863,001 | 786,018 | 865,704 |
| Total assets | 1,006,222 | 869,821 | 1,007,813 |
| Equity and liabilities | |||
| Equity (including profit for the period) | 516,571 | 472,255 | 518,930 |
| Provisions | - | - | - |
| Deferred tax liabilities | 28,801 | 25,939 | 28,801 |
| Long-term liabilities | 37,243 | 45,066 | 44,854 |
| Current liabilities | 423,607 | 326,561 | 415,228 |
| Total equity and liabilities | 1,006,222 | 869,821 | 1,007,813 |
Definition of key figures
| Adjusted equity | Reported shareholders' equity increased by 72% of untaxed reserves. |
|---|---|
| Capital employed | Total assets reduced by non interest-bearing debts. |
| Cash flow per share | Cash flow divided by the number of shares at the end of the period. |
| Earnings per share | Profit/loss after tax divided by the average number of shares. |
| Equity/assets ratio | Equity as a percentage of total assets. |
| Equity per share | Equity divided by the number of shares at the end of the period. |
| Liquidity | Current assets divided by current liabilities. |
| P/E ratio | Share price at the end of the period in relation to the twelve-month period's earnings per share. |
| Profit margin | Profit before tax as a percentage of sales. |
| Return on equity | Profit after tax as a percentage of average adjusted equity. |
| Return on capital employed (ROCE) | Profit before tax plus financial expenses as a percentage of average capital employed. |
| Return on total capital | Profit after net financial items plus financial expenses as a percentage of average total assets. |
| Value added | Operating profit plus labor costs. |
Accounting principles
This interim report was prepared in accordance with IAS 34, Interim Financial Reporting, and RR31, Interim Reporting for Groups. The same accounting principles and calculation methods apply as in the most recent Annual Report. This means that the consolidated accounts were prepared in accordance with International Financial Reporting Standards (IFRS) and statement form International Financial Reporting Interpretations Committee (IFRIC) that were approved by the EU Commission for application within the EU. A description of the accounting principles is found in the Annual Report for the 2007/2008 fiscal year.
| Financial calendar | |
|---|---|
| Year-end report, 2008/2009: | May 26, 2009 |
| For further information, contact: | |
| Jan-Olof Brüer. CEO and President. | Tel. +46 (0)13 23 52 09 |
The Board of Directors and the President of Sectra AB (publ) hereby assure that the nine-month interim report for the period May 2008 – January 2009 provides a true and fair view of the Parent Company's and Group's operations, financial position and earnings and describes the significant risks and uncertainty factors facing the Parent Company and other companies in the Group.
Linköping, Sweden, March 3, 2009
| Jan-Olof Brüer President and CEO |
Carl-Erik Ridderstråle Board Chairman |
||
|---|---|---|---|
| Erika Johnson Board member |
Anders Persson Board member |
Christer Nilsson Board member |
Torbjörn Kronander Board member |
| Karin Partain Employee representative |
Mats Björnemo Employee representative |
Audit report
We have conducted a review of the report for Sectra AB (publ), 556064-8304, for the period May 1, 2008 to January 31, 2009. The Board of Directors and the Chief Executive Officer are responsible for preparing and presenting this interim report in accordance with IAS 34 and the Annual Accounts Act. Our responsibility is to express a conclusion on this interim financial information based on our review.
We conducted our review in accordance with the Standard on Review Engagements (SÖG) 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of interim financial information 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 the Standards on Auditing in Sweden (RS) and other generally accepted auditing practices. The procedures performed in a review do not enable us to obtain a level of assurance that would make us aware of all significant matters that might be identified in an audit. Therefore, the conclusion expressed based on a review does not give the same level of assurance as a conclusion expressed based on an audit.
Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim report is not prepared, in all material respects, in accordance with IAS 34 and the Swedish Annual Accounts Act, and for the parent company, in accordance with the Swedish Annual Accounts Act.
Linköping, Sweden, March 3, 2009
Grant Thornton Sweden AB Ivar Verner Authorized Public Accountant
The information in this report is such that Sectra AB (publ) is obligated to disclose in compliance with the Securities and Clearing Operations Act and/or the Financial Instruments Trading Act. This information was released to the media for public disclosure on March 3, 2009 at 8:30 am (CET).