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Sectra — Interim / Quarterly Report 2010
Sep 7, 2010
2967_10-q_2010-09-07_9a8d6e3a-d841-45b2-bf6f-a129369ad662.pdf
Interim / Quarterly Report
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Sectra's first-quarter interim report:
Number of mammography system deliveries doubled
For its first-quarter operations from May-July 2010, IT and medical technology company Sectra reported an increase in order bookings of 35.4% to SEK 206.0 million (152.2). Net sales rose 4.5% to SEK 206.7 million (197.8). Operating profit totaled SEK 0.2 million (10.1), corresponding to an operating margin of 0.1% (5.1).
Sectra experienced increased demand for the company's mammography products. The number of Sectra MicroDose Mammography system deliveries more than doubled to 21 (10) and contributed to the quarter's sales growth.
"During the quarter, we experienced major successes in Australia with our MicroDose system and our IT system for the processing of breast images. The latest orders make Sectra the largest company for breast imaging systems in the country," says Jan-Olof Brüer, President and CEO of Sectra AB.
Sectra is fully under way with upgrading existing customers' installations to the new generation of Sectra PACS, the company's principal product in medical IT. The product's excellent properties for linking geographically spread healthcare clinics was of core importance for the new orders Sectra secured during the quarter.
"We have received wide acclaim in the market for the user-efficiency enhancements to which our latest generation PACS products contribute, and during the quarter, we were entrusted with coordinating medical imaging operations in several major regions in Scandinavia," says Jan-Olof Brüer.
Sectra displays a seasonal variation whereby most invoicing and earnings are traditionally generated during the third and fourth quarters.
"During the quarter, operating profit was charged with increased operating costs since operations continued to grow by 11 employees, while depreciation was charged to capitalized development projects and Group-financed customer projects that have been completed and transitioned to the operational phases," says Jan-Olof Brüer.
After the close of the quarter, Sectra signed a framework agreement with the European Council in Brussels for the delivery of the product for secure telephony that is deployed in all EU countries. This is the result of the European Council's procurement process, in which the Sectra Tiger XS was selected.
"As a result of the agreement with the European Council, Sectra is achieving its goal of supplying all EU countries with easy-to-use products for secure telephony. A joint solution for secure telecommunications will contribute to increased security in Europe," concludes Jan-Olof Brüer.
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 September 7, 2010 at 07:30 a.m. (CET).
For further information, please contact:
Jan-Olof Brüer, President and CEO of Sectra AB, Tel: +46 (0)13-23 52 09
Presentation of the interim report
Sectra's CEO will present the report for analysts and the media today at 10:30 a.m. at a Capital Markets Day, which will be held at Sectra's head office in Linköping, Sweden.
Sectra AB (publ)
Teknikringen 20 SE 583 30 Linköping Tel: +46 (0)13 23 52 00
Fax: +46 (0)13 21 21 85
www.sectra.se
VAT reg. nr SE556064830401
About the Sectra Group
Sectra was founded in 1978 and conducts successful development and sales of high-technology products in the expansive niche segments of medical systems and secure communication systems. Sectra has offices in 12 countries and sells its products through partners worldwide. The head office is in Linköping, Sweden, and the company developed from research at Linköping University. Sales for the 2009/2010 full year amounted to SEK 848 million. Sectra is listed on the NASDAQ OMX Stockholm AB exchange. For more information about Sectra, visit our website at www.sectra.se.
Sectra AB (publ)
Teknikringen 20 SE 583 30 Linköping Tel: +46 (0)13 23 52 00 Fax: +46 (0)13 21 21 85 [email protected] www.sectra.se VAT reg. nr SE556064830401
Interim report Sectra AB (publ) for May– July 2010
The figures for the year-earlier period are shown in parentheses.
First quarter
- Order bookings rose 35.4% to SEK 206.0 M (152.2).
- Net sales increased 4.5% to SEK 206.7 M (197.8).
- Operating profit amounted to SEK 0.2 M (10.1), corresponding to an operating margin of 0.1% (5.1).
- Profit after net financial items totaled SEK 1.9 M (3.5), corresponding to a profit margin of 0.9% (1.8).
- Profit after tax amounted to SEK 1.8 M (2.6).
- Earnings per share before dilution were SEK 0.05 (0.07).
Events during the first quarter
- Three major mammography screening programs in Australia ordered Sectra's mammography products. The single largest order, valued at SEK 60 million, pertains to a multi-year contract with a mammography screening program in the state of Queensland. The contract encompasses the region-wide use of Sectra's PACS system for highly efficient reading of mammograms within the network of 11 mammography clinics, 19 satellite clinics and a large number of mobile units.
- Region Skåne in Sweden will implement Sectra PACS throughout the region's imaging and functional medical operations, thus converting a further six hospitals to Sectra's system.
- Skaraborg Hospital, a group of four Swedish hospitals, will implement Sectra's IT solutions for the processing of radiological images and patient information.
- Sectra signed an agreement with a Norwegian hospital chain regarding the implementation of a central IT solution that will facilitate physicians' access to all radiological images that are produced at four hospitals in the most densely populated region in Norway.
Events after the end of the period
- Through a four-year framework agreement with the EU Council in Brussels, Sectra is being entrusted with the delivery of the product for secure telephony that is deployed in all EU countries. This is the result of the European Council's procurement process, in which the Sectra Tiger XS was selected.
- The Board established new levels for the Group's profit and growth targets, which are as follows: - To achieve a profit margin of at least 15%. (Up from 10%)
- To grow an average of 15% annually during a seven-year period. (Lowered from 30%).
Teknikringen 20 SE 583 30 Linköping Tel: +46 (0)13 23 52 00 Fax: +46 (0)13 21 21 85 [email protected] www.sectra.se VAT reg. nr SE556064830401
Sectra AB (publ)
THE GROUP'S ORDER BOOKINGS, SALES AND EARNINGS First quarter May - July 2010
The Group's order bookings for the quarter rose 35.4% to SEK 206.0 million (152.2). This was attributable to Sectra's Medical systems business area.
The Group's net sales for the quarter increased 4.5% to SEK 206.7 million (197.8). Sectra's two business areas, Secure communications systems and Medical systems, reported growth. Sweden and Australia were the markets accounting for the largest sales increases for the period compared with the year-earlier period.
Operating profit for the quarter amounted to SEK 0.2 million (10.1), corresponding to an operating margin of 0.1% (5.1). The operating profit was charged with increased operating costs, since operations continued to expand with the addition of 11 employees, and higher depreciation on capitalized development expenditures and Group-financed customer projects that have been completed and transitioned to the operational phase.
Profit after net financial items amounted to SEK 1.9 million (3.5), corresponding to a profit margin of 0.9% (1.8). Currency fluctuations had an impact of SEK 1.9 million (loss: 3.8) on the Group's net financial items, primarily due to the SEK weakening against the USD during the quarter.
Profit after tax amounted to SEK 1.8 million (2.6). Earnings per share were SEK 0.05 (0.07).
Seasonal variations
Sectra is affected by seasonal variations, which means that most invoicing and earnings are traditionally generated during the third and fourth quarters. Variations in order volumes, in terms of individual quarters, can be significant.
Diagram
Bars - per quarter Line – 12-months rolling
Sectra AB (publ)
Teknikringen 20
SE 583 30 Linköping
Tel: +46 (0)13 23 52 00
Fax: +46 (0)13 21 21 85
www.sectra.se
VAT reg. nr SE556064830401
Comments
In recent years, operating profit has been affected by an extensive build-out of the proprietary international sales and support organization, and the development and launch of the Sectra MicroDose Mammography system. The mammography investment entails an increase in production operations. The current business mix, with a higher share of hardware-product deliveries, generated a lower operating margin than the previous mix, which was dominated by IT-system deliveries.
Currency fluctuations had a considerably adverse effect on the Group's net financial items from the fourth quarter of 2008/2009 until the second quarter of 2009/2010. Conversely, currency fluctuations had a highly favorable impact on net financial items from the first to the third quarter of 2008/2009.
SEGMENT REPORTING
| Net sales by business segment | |||||
|---|---|---|---|---|---|
| (SEK M) | 3 months | 3 months | 12 months | Full-year | |
| Sectra AB (publ) | May - July | May - July | Aug 2009- | May - April | |
| Teknikringen 20 | 2010 | 2009 | July 2010 | 2009/2010 | |
| Medical Systems | 195.0 | 174.3 | 830.8 | 810.1 | |
| SE 583 30 Linköping | Secure Communication | ||||
| Tel: +46 (0)13 23 52 00 | Systems | 22.4 | 17.2 | 104.9 | 99.6 |
| Fax: +46 (0)13 21 21 85 | Other operations 1) | 16.2 | 29.2 | 68.4 | 81.5 |
| [email protected] | Group eliminations | -26.9 | -22.9 | -146.9 | -142.8 |
| www.sectra.se | Total | 206.7 | 197.8 | 857.2 | 848.4 |
| VAT reg. nr SE556064830401 |
Operating profit/loss by business segment
| (SEK M) | 3 months | 3 months | 12 months | Full-year |
|---|---|---|---|---|
| May - July | May - July | Aug 2009- | May - April | |
| 2010 | 2009 | July 2010 | 2009/2010 | |
| Medical Systems | -1.2 | 4.5 | 20.8 | 26.5 |
| Secure Communication | ||||
| Systems | 3.7 | 3.0 | 15.8 | 15.1 |
| Other operations 1) | -2.6 | 2.8 | -9.1 | -3.7 |
| Group eliminations | 0.3 | -0.2 | -3.2 | -3.7 |
| Total | 0.2 | 10.1 | 24.3 | 34.2 |
Net sales by geographic market
| (SEK M) | 3 months | 3 months | 12 months | Full-year |
|---|---|---|---|---|
| May - July | May - July | Aug 2009- | May - April | |
| 2010 | 2009 | July 2010 | 2009/2010 | |
| Sweden | 67.2 | 50.0 | 274.6 | 263.6 |
| Rest of Europe | 58.1 | 85.4 | 303.3 | 325.5 |
| North America | 54.9 | 54.0 | 226.5 | 224.6 |
| Rest of world | 26.5 | 8.4 | 52.8 | 34.7 |
| Total | 206.7 | 197.8 | 857.2 | 848.4 |
1) Other operations refer to Sectra's financing activities regarding customer projects and asset management, and to the Parent Company's internal debiting of Group-wide costs.
Medical systems
The market
A total of 52 million radiology examinations are conducted annually in Sectra's systems, which makes Sectra one of the world's leading suppliers of radiology image management systems (PACS). The market for medical systems continued to grow as a result of the substantial need for systems that enhance care efficiency. Sectra's largest markets for Medical systems are Scandinavia and the US. A significant portion of the business area's revenues derive from commitments to existing customers. Sectra focuses on further growth and capturing market share in the markets in which the business area has existing customers and partners.
During the quarter, Sectra's Medical systems business area experienced increased order bookings in Australia, the US and the UK. In Australia, which accounted for the greatest rise, major mammography screening programs in Australian Capital Territory, and the states of Victoria and Queensland ordered Sectra's mammography products. Through the new orders, Sectra's IT system for the management and storage of mammography images (PACS) is currently essentially used in all Australian states. The single largest order pertains to a multiyear contract with a screening program in the state of Queensland. The order value amounted to about SEK 60 million and the agreement involves the region-wide deployment of Sectra PACS at 11 mammography clinics, at 19 satellite clinics and in a considerable number of mobile units.
Sales and earnings for the first quarter
Medical systems' net sales for the quarter rose 11.9% to SEK 195.0 million (174.3). Revenues from Radiological IT products and services increased 6.6% to SEK 161.2 million (151.2), corresponding to 83% of Medical systems' total net sales. The Mammography product division accounted for SEK 33.8 million (23.1) of the business area's sales, up 46.3% year-onyear. A total of 21 units (10) of Sectra MicroDose Mammography were delivered during the quarter, up 110.0% compared with the year-earlier period.
Sectra AB (publ)
Teknikringen 20 SE 583 30 Linköping Tel: +46 (0)13 23 52 00 Fax: +46 (0)13 21 21 85 [email protected] www.sectra.se VAT reg. nr SE556064830401
Medical systems posted an operating loss for the quarter of SEK 1.2 million (profit: 4.5), corresponding to an operating margin of negative 0.6% (pos: 2.6). The results were charged with increased operating costs and higher depreciation on capitalized development projects and Group-financed customer projects that have been completed and transitioned into the operational phase. The Mammography product division posted an operating loss of SEK 8.3 million (loss: 16.8). Adjusted for losses in the Mammography division, the business area's operating profit was SEK 7.1 million (21.3), corresponding to an operating margin of 3.6%.
Secure communication systems
The market
Sectra is the leading supplier of crypto products to authorities and the Defense Forces in Sweden. In the EU, most member nations deploy Sectra's products to protect telephone calls from eavesdropping. This makes Sectra the leading supplier of encrypted telephony to European authorities and defense departments. Growth in the market for secure communication systems is driven by the fact that it is easier than ever to eavesdrop on telephone calls, which has prompted an increasing number of authorities to opt to protect their telephony. As a result of increased partnerships between authorities in European countries, customers require products that support cross-border partnerships. Sectra offers products that are approved by both the EU and NATO. Sweden and the Netherlands comprise Sectra's largest markets for crypto products.
Sales and earnings for the first quarter
Secure communication systems reported continued strong growth and favorable earnings. Net sales for the quarter were up 30.2% to SEK 22.4 million (17.2). Operating profit rose 23.3% to SEK 3.7 million (3.0), corresponding to an operating margin of 16.5% (17.4).
Other operations
Other operations pertain to Sectra's operations for the financing of customer projects, asset management, and the Parent Company's functions for Group finances and stock exchange, share and investor relations activities.
Deliveries to customer projects that are internally financed in the Group were not made to the same extent as in the year-earlier period and net sales from Other operations for the quarter amounted to SEK 16.2 million (29.2). Other operations posted a loss for the quarter of SEK 2.6 million (profit: 2.8), corresponding to an operating margin of a negative 16.0% (pos: 9.6).
REVISED FINANCIAL OBJECTIVES
The Board regularly addresses issues concerning the company's targets, strategies, structure and focus areas. As a result of the changes that have occurred in Sectra's operations and in the niche markets in which the company operates, the Board has revised the Sectra Group's long-term profit and growth targets. The new levels are:
- To achieve a profit margin of not less than 15%. (Up from 10%)
- To grow an average of 15% annually during a seven-year period. (Lowered from 30%).
- To maintain an equity/assets ratio of at least 30%. (Unchanged)
The new profitability targets are on a par with the profit levels in sectors in which Sectra is active. The growth target is three times as high as the underlying average market growth in the niches in which Sectra operates. Sectra's Board deems that that company is favorably positioned to achieve the new target levels over a three-year horizon, provided that Sectra bolsters its sales volumes in its current and new markets, and continues business development in the Group's business areas.
Sectra AB (publ)
Teknikringen 20
SE 583 30 Linköping
Tel: +46 (0)13 23 52 00
Fax: +46 (0)13 21 21 85
www.sectra.se
VAT reg. nr SE556064830401
OTHER INFORMATION
Financial position
Consolidated cash flow from operations before changes in working capital amounted to a negative SEK 2.2 million for the quarter (neg: 12.7). Total cash flow for the quarter was a negative SEK 16.8 million (neg: 7.8). After adjustment for exchange-rate differences in cash and cash equivalents, consolidated cash and cash equivalents amounted to SEK 174.6 million (181.8).
The equity/assets ratio at the end of the quarter was 64.7% (65.1) and liquidity amounted to a multiple of 2.3 (2.2).
At the end of the period, the Group's interest-bearing liabilities amounted to SEK 17.3 million (22.3) and pertained to convertible debentures.
Investments
Group investments during the quarter totaled SEK 14.8 million (14.9). Investments for the quarter were primarily attributable to customer projects in the Group's financing activities and to capitalized development expenditures.
Investments in Group-financed customer projects during the quarter were SEK 10.2 million (8.4). At the close of the quarter, the Group's investments in customer projects totaled SEK 62.3 million (31.4).
During the quarter, capitalized development expenditures amounted to SEK 4.4 million (4.7). At the end of the quarter, capitalized development expenditures totaled SEK 183.8 million (197.3).
Depreciation/amortization during the quarter amounted to SEK 14.1 million (10.2). The increase was due to depreciation of Group-financed customer projects that have been completed and transitioned to the operational phase and on capitalized development projects that have been completed and transitioned to the delivery phase.
Employees
The number of full-time employees at Sectra increased by 11 during the quarter. At the close of the period, there were a total of 612 (590) employees.
The share
Sectra's share capital at the end of the period amounted to SEK 36,842,088. At full conversion and an exercise of the implemented incentive programs, the number of shares will increase by a maximum of 558,400, corresponding to 1.5% of the share capital and 0.9% of the voting rights. After dilution, the share capital will amount to SEK 37,400,488.
Incentive programs
During the quarter, the 2007/2010 convertible loan issued to the Group's employees and external Board members, and the 2007/2010 employee stock options issued to the Group's employees in the US matured. There was no conversion to shares and the convertible loan was repaid on the due date of June 15, 2010.
The Annual General Meeting, which was held during the quarter, resolved on the issue of convertibles to Group employees and external Board members. The conversion price shall correspond to 135% of the average volume weighted mean of the listed price for the company's share on NASDAQ OMX Stockholm for each trading day during the period August 3 – August 18, 2010, meaning SEK 45.80. The convertible loans can be subscribed for during the period September 27 – October 8, 2010 and conversion to Series B shares may occur during May 26 – 30, 2014. At full exercise, the dilution effect may amount to not more than 1% of the share capital.
Sectra AB (publ)
Teknikringen 20 SE 583 30 Linköping Tel: +46 (0)13 23 52 00 Fax: +46 (0)13 21 21 85 [email protected] www.sectra.se VAT reg. nr SE556064830401
The General Meeting also adopted the Board's proposal concerning the issue of not more than 100,000 employee stock options for the Group's employees in the US. If these employee stock options are fully exercised, employees will acquire shares in the company corresponding to approximately 0.3% of the share capital and 0.2% of the voting rights.
Authorization
The Annual General Meeting authorized the Board, for the period until the next Annual General Meeting, to decide on a rights issue of not more than 3,700,000 Series B shares for consideration in the form of cash payment, offset or contribution in kind. Such rights issue may occur with deviation from shareholders' preferential rights. If the authorization is fully exercised, the dilution effect will amount to approximately 10% of the share capital and approximately 6% of the voting rights.
Furthermore, the General Meeting resolved to authorize the Board, on one or more occasions, during the period until the next Annual General Meeting, to make decisions on acquisition and transfer of treasury Series B shares. The authorization is limited to the company's holding of treasury shares not at any time exceeding 10% of all shares in the company.
Risks and uncertainties
Through its operations, Sectra is exposed to such business risks as dependence on major customers and partners, the effect of the exchange rate of the USD and EUR on pricing in the markets in which the Group is active, and 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 the 2009/2010 fiscal year, Note 30, page 52. No significant events have occurred that would alter the conditions reported therein.
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.
PARENT COMPANY
The Parent Company Sectra AB
The Parent Company includes the head office's functions for Group finances, as well as stockexchange, share and investor relations activities.
Net sales in the Parent Company Sectra AB for the quarter amounted to SEK 5.8 million (6.6). Profit after net financial items was SEK 0.3 million (1.4).
The Parent Company's income statement and balance sheet are reported on page 11.
Sectra AB (publ)
Teknikringen 20 SE 583 30 Linköping Tel: +46 (0)13 23 52 00 Fax: +46 (0)13 21 21 85 [email protected] www.sectra.se
VAT reg. nr SE556064830401
7(12)
Consolidated Income Statements
| 3 months | 3 months | 12 months | Full-year | |
|---|---|---|---|---|
| SEK thousands | May 2010 | May 2009 | Aug 2009 | May - Apr |
| - July 2010 | - July 2009 | – July 2010 | 2009/2010 | |
| Net sales | 206,666 | 197,792 | 857,231 | 848,357 |
| Capitalized work for own use | 4,358 | 4,701 | 15,806 | 16,149 |
| Operating expenses | -196,783 | -182,193 | -795,140 | -780,550 |
| Depreciation and amortization | -14,070 | -10,236 | -53,592 | -49,758 |
| Operating profit after depreciation | 171 | 10,064 | 24,305 | 34,198 |
| and amortization | ||||
| Net financial items | 1,698 | -6,596 | -2,366 | -10,660 |
| Profit after net financial items | 1,869 | 3,468 | 21,939 | 23,538 |
| Taxes | -87 | -901 | -5,518 | -6,331 |
| Earnings for the period | 1,782 | 2,567 | 16,421 | 17,207 |
| Of which, attributable to: | ||||
| Parent Company owners | 1,782 | 2,567 | 16,421 | 17,207 |
| Minority interest | 0 | 0 | 0 | 0 |
| Earnings per share | ||||
| Before dilution, SEK | 0.05 | 0.07 | 0.45 | 0.47 |
| After dilution, SEK | 0.05 | 0.07 | 0.44 | 0.46 |
| No. of shares | ||||
| Before dilution | 36,842,088 | 36,842,088 | 36,842,088 | 36,842,088 |
| After dilution 1) | 37,400,488 | 37,302,588 | 37,400,488 | 37,400,488 |
| Average, before dilution 2) | 36,842,088 | 36,842,088 | 36,842,088 | 36,842,088 |
| Average, after dilution 1),2) | 37,400,488 | 37,302,588 | 37,569,421 | 37,544,946 |
1) Dilution is based on the convertible debentures programs issued in 2009/2010 (368,400) and on employee stock options issued in 2008/2009 (90,000) and 2009/2010 (100,000).
Consolidated Statement of Comprehensive Income
| 3 months | 3 months | 12 months | Full-year | |
|---|---|---|---|---|
| SEK thousands | May 2010 | May 2009 | Aug 2009 | May - Apr |
| - July 2010 | - July 2009 | – July 2010 | 2009/2010 | |
| Earnings for the period | 1,782 | 2,567 | 16,421 | 17,207 |
| Other comprehensive income | ||||
| Change in translation differences from translating foreign subsidiaries |
-1,005 | -7,231 | -10,018 | -16,244 |
| Total other comprehensive income | -1,005 | -7,231 | -10,018 | -16,244 |
| for the period | ||||
| Total comprehensive income for the | 777 | -4,664 | 6,403 | 963 |
| period |
Consolidated Balance Sheets
| SEK thousands | July 31, | July 31, | Apr 30, |
|---|---|---|---|
| 2010 | 2009 | 2010 | |
| Assets | |||
| Intangible assets | 206,898 | 224,344 | 211,079 |
| Tangible assets | 77,602 | 50,961 | 72,780 |
| Financial assets | 5,231 | 4,529 | 3,931 |
| Total fixed assets | 289,731 | 279,834 | 287,790 |
| Other current assets | 469,541 | 455,699 | 487,861 |
| Cash and cash equivalents | 174,564 | 181,752 | 193,024 |
| Total current assets | 644,105 | 637,451 | 680,885 |
| Total assets | 933,836 | 917,285 | 968,675 |
| Equity and liabilities | |||
| Equity (including earnings for the period) | 604,066 | 596,789 | 602,568 |
| Provisions | 6,587 | 6,019 | 6,354 |
| Deferred tax liabilities | 15,909 | 18,546 | 16,141 |
| Long-term liabilities | 17,315 | 0 | 17,315 |
| Current liabilities | 289,959 | 295,931 | 326,297 |
| Total equity and liabilities | 933,836 | 917,285 | 968,675 |
No changes have occurred in pledged assets and contingent liabilities since the 2009/2010 Annual Report.
Consolidated Statement of Changes in Equity
| 3 months | 3 months | Full-year | |
|---|---|---|---|
| SEK thousands | May 2010 | May 2009 | May - Apr |
| – July 2010 | – July 2009 | 2009/2010 | |
| Equity at start of period | 602,568 | 599,114 | 599,114 |
| Comprehensive income for the period | 777 | -4,664 | 963 |
| Tax effect due to changed tax rate | 0 | 2,339 | 0 |
| Share-related payments | 721 | 0 | 2,491 |
| Dividend paid | 0 | 0 | 0 |
| Equity at the end of the period | 604,066 | 596,789 | 602,568 |
Consolidated Cash-flow Statements
| 3 months | 3 months | Full-year | |
|---|---|---|---|
| SEK thousands | May 2010 | May 2009 | May - Apr |
| – July 2010 | – July 2009 | 2009/2010 | |
| Cash flow from operations before changes in working capital | 10,399 | 2,193 | 37,631 |
| Cash flow from operations after changes in working capital | -2,235 | -12,661 | 47,780 |
| Investing activities | -14,760 | -14,872 | -66,807 |
| Financing activities | 206 | 19,685 | 13,196 |
| Change in cash and cash equivalents | -16,789 | -7,848 | -5,831 |
| Cash and cash equivalents, opening balance | 193,024 | 184,282 | 184,282 |
| Exchange-rate difference in cash and cash equivalents | -1,671 | 5,318 | 14,573 |
| Cash and cash equivalents, closing balance | 174,564 | 181,752 | 193,024 |
Key Figures
| 3 months | 3 months | 12 months | Full-year | |
|---|---|---|---|---|
| July 31 | July 31 | July 31 | Apr. 30 | |
| 2010 | 2009 | 2010 | 2010 | |
| Order bookings, SEK M | 206.0 | 152.2 | 914.6 | 861.3 |
| Equity/assets ratio, % | 64.7 | 65.1 | 64.7 | 62.2 |
| Liquidity, multiple | 2.3 | 2.2 | 2.3 | 2.1 |
| Operating margin, % | 0.1 | 5.1 | 2.8 | 4.0 |
| Profit margin, % | 0.9 | 1.8 | 2.6 | 2.8 |
| Return on equity, % | 0.3 | 0.4 | 2.7 | 2.9 |
| Return on capital employed, % | 0.3 | 1.6 | 2.8 | 3.9 |
| Return on total capital, % | 0.2 | 1.0 | 1.9 | 2.5 |
| Value added, SEK M | 114.0 | 113.3 | 479.3 | 478.5 |
| Average number of employees | 606 | 577 | 590 | 584 |
| Equity per share, SEK | 16.40 | 16.20 | 16.40 | 16.36 |
| Equity per share after full dilution, SEK | 16.15 | 16.00 | 16.15 | 16.11 |
| Cash flow per share, SEK | 0.28 | 0.06 | 1.24 | 1.02 |
| Cash flow per share after full dilution, SEK | 0.28 | 0.06 | 1.23 | 1.01 |
| P/E ratio, multiple | 74.7 | 79.9 | ||
| Share price at end of period, SEK | 33.3 | 35.2 | 33.3 | 37.3 |
Quarterly consolidated income statements and key figures
| 2010/2011 | 2009/2010 | 2008/2009 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| SEK M | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 |
| Net sales | 206.7 | 255.4 | 201.2 | 193.9 | 197.8 | 263.7 | 226.1 | 199.4 | 174.0 |
| Capitalized work for own use | 4.4 | 1.8 | 3.6 | 6.0 | 4.7 | 13.7 | 9.5 | 11.6 | 4.3 |
| Operating expenses | -196.8 | -224.0 | -193.3 | -180.9 | -182.2 | -247.3 | -225.2 | -194.4 | -168.9 |
| Depreciation and amortization | -14.1 | -13.0 | -14.0 | -12.6 | -10.2 | -18.9 | -9.0 | -8.7 | -8.5 |
| Operating profit after depreciation | 0.2 | 20.2 | -2.5 | 6.4 | 10.1 | 11.2 | 1.4 | 7.9 | 0.9 |
| and amortization | |||||||||
| Net financial items | 1.7 | -3.6 | 5.1 | -5.5 | -6.6 | -3.8 | 14.4 | 34.1 | 5.3 |
| Profit after net financial items | 1.9 | 16.6 | 2.6 | 0.9 | 3.5 | 7.4 | 15.8 | 42.0 | 6.2 |
| Tax on earnings for the period | -0.1 | -6.3 | -0.9 | 1.8 | -0.9 | -3.4 | -3.8 | -11.9 | -1.8 |
| Earnings for the period | 1,8 | 10.3 | 1.7 | 2.7 | 2.6 | 4.0 | 12.0 | 30.1 | 4.4 |
| Equity/assets ratio, % | 64.7 | 62.2 | 62.6 | 65.6 | 65.1 | 59.4 | 60.7 | 61.5 | 60.4 |
| Operating margin, % | 0.1 | 7.9 | -1.2 | 3.3 | 5.1 | 4.2 | 0.6 | 4.0 | 0.5 |
| Return on equity, % | 0.3 | 1.7 | 0.3 | 0.1 | 0.4 | 0.7 | 2.0 | 5.3 | 0.8 |
| Return on capital employed, % | 0.3 | 2.6 | 0.5 | 0.2 | 1.6 | 1.2 | 2.6 | 7.1 | 1.1 |
| Equity per share, SEK | 16.40 | 16.36 | 16.24 | 16.09 | 16.20 | 16.26 | 16.06 | 15.74 | 14.94 |
| Earnings per share, SEK | 0.05 | 0.28 | 0.05 | 0.07 | 0.07 | 0.11 | 0.32 | 0.82 | 0.12 |
| Cash flow per share, SEK | 0.28 | 0.49 | 0.37 | 0.10 | 0.06 | 1.36 | 0.87 | 0.93 | 0.27 |
Five-year summary
| 2009/2010 | 2008/2009 | 2007/2008 | 2006/2007 | 2005/2006 | |
|---|---|---|---|---|---|
| Order bookings, SEK M | 861.3 | 1,149.7 | 1,016.6 | 684.7 | 613.7 |
| Net sales, SEK M | 848.4 | 863.3 | 742.9 | 672.5 | 564.4 |
| Profit after net financial items, SEK M | 23.5 | 71.4 | 79.8 | 70.2 | 80.7 |
| Profit after tax, SEK M | 17.2 | 50.5 | 50.5 | 47.2 | 60.4 |
| Operating margin, % | 4.0 | 2.5 | 10.7 | 9.1 | 13.4 |
| Profit margin, % | 2.8 | 8.3 | 10.7 | 10.4 | 14.3 |
| Return on equity, % | 2.9 | 8.7 | 9.3 | 9.4 | 13.2 |
| Return on capital employed, % | 3.9 | 11.6 | 13.8 | 13.0 | 16.0 |
| Return on total capital, % | 2.5 | 7.4 | 8.9 | 8.6 | 10.9 |
| Earnings per share before dilution, SEK | 0.47 | 1.37 | 1.37 | 1.28 | 1.65 |
| Earnings per share after dilution, SEK | 0.46 | 1.35 | 1.34 | 1.26 | 1.61 |
| Equity per share before dilution, SEK | 16.36 | 16.26 | 15.22 | 14.12 | 13.24 |
| Equity per share after dilution, SEK | 16.11 | 16.06 | 14.93 | 13.84 | 12.97 |
| Equity/assets ratio, % | 62.2 | 59.4 | 56.9 | 60.8 | 58.9 |
| Dividend per share, SEK | 0.00 | 0.00 | 0.50 | 0.50 | 0.50 |
| Share price at year end, SEK | 37.3 | 38.8 | 58.5 | 76.0 | 58.8 |
| P/E ratio, multiple | 79.9 | 28.3 | 42.7 | 59.2 | 35.7 |
Parent Company Income Statements
| SEK thousands | 3 months May 2010 - July 2010 |
3 months May 2009 - July 2009 |
12 months Aug 2009 – July 2010 |
Full-year May - Apr 2009/2010 |
|---|---|---|---|---|
| Net sales | 5,785 | 6,550 | 25,039 | 25,804 |
| Operating expenses | -9,080 | -8,344 | -32,790 | -31,807 |
| Depreciation and amortization | -60 | -132 | -487 | -558 |
| Operating loss after depreciation and | -3,355 | -1,926 | -8,238 | -6,561 |
| amortization | ||||
| Net financial items | 3,618 | 3,311 | 107,293 | 106,739 |
| Profit after net financial items | 263 | 1,385 | 99,055 | 100,178 |
| Appropriations | - | - | 15,700 | 15,700 |
| Profit before tax | 263 | 1,385 | 114,755 | 115,878 |
| Tax on earnings for the period | -70 | -360 | -31,143 | -31,433 |
| Earnings for the period | 193 | 1,025 | 83,612 | 84,445 |
Parent Company Balance Sheets
| SEK thousands | July 31, 2010 |
July 31, 2009 |
Apr 30, 2010 |
|---|---|---|---|
| Assets | |||
| Tangible assets | 728 | 1,783 | 1,878 |
| Financial assets | 167,050 | 200,552 | 167,862 |
| Total fixed assets | 167,778 | 202,335 | 169,740 |
| Other current assets | 324,081 | 243,087 | 340,934 |
| Cash and cash equivalents | 721,544 | 704,740 | 729,260 |
| Total current assets | 1,045,625 | 947,827 | 1,070,194 |
| Total assets | 1,213,403 | 1,150,162 | 1,239,934 |
| Equity and liabilities | |||
| Equity (including earnings for the period) | 558,767 | 559,224 | 559,704 |
| Deferred tax liabilities | 25,731 | 29,860 | 25,731 |
| Long-term liabilities | 17,315 | 5,932 | 17,315 |
| Current liabilities | 611,590 | 555,146 | 637,184 |
| Total equity and liabilities | 1,213,403 | 1,150,162 | 1,239,934 |
Definition of key figures
| Adjusted equity | Reported shareholders' equity increased by 73.7% of untaxed reserves. |
|---|---|
| Capital employed | Total assets reduced by non interest-bearing liabilities. |
| 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 12-month period's earnings per share. |
| Profit margin | Profit after net financial items as a percentage of net 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, the Annual Accounts Act and the Swedish Securities Markets Act. The consolidated accounts were prepared in accordance with the International Financial Reporting Standards (IFRS) and statements from the International Financial Reporting Interpretations Committee (IFRIC) that were approved by the EU Commission for application within the EU.
The accounting policies and calculation methods are unchanged compared with those applied in the 2010/2011 Annual Report with the following exceptions. From the first quarter of the 2010/2011 fiscal year, IFRS 3, Business Combinations, and IAS 27, Consolidated and Separate Financial Statements, are applicable. New policies and amendments that have come into effect as of the 2010/2011 fiscal have had no impact on the financial statements.
Financial calendar
| Six-month report | December 7, 2010 |
|---|---|
| Nine-month report | March 8, 2011 |
| Year-end report | May 24, 2011 |
For further information, please contact:
The Board of Directors and the President of Sectra AB (publ) hereby assure that the interim report for the period May– July 2010 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.
This interim report has not been reviewed by the company's auditors.
Linköping September 7, 2010
Board of Directors Sectra AB
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 September 7, 2010 at 07:30 a.m. (CET).