Slide 1: Strong margin expansion
Strong margin expansion Q1 report 2023/24 Gustaf Salford, President and CEO Tobias Hägglöv, CFO Aug 24, 2023
Slide 2: Agenda
Agenda • Delivering on our strategy • Q1 financials • Outlook • Q&A
Slide 3: Important information
Important information This presentation includes forward-looking statements including, but not limited to, statements relating to operational and financial performance, market conditions, and other similar matters. These forward-looking statements are based on current expectations about future event
Slide 4: Delivering on our strategy
Delivering on our strategy CjElekta
Slide 5: Delivering on our strategy ACCESS 2025 in Q1
Delivering on our strategy ACCESS 2025 in Q1 Drive partner integration Accelerate innovation with A world across the cancer care eco- customer utilization in mind where everyone system has access to the best Be the customer lifetime cancer care Drive adoption across the companion globe People Resili
Slide 6: Strategy execution well under way to drive strong shareholder value
Strategy execution well under way to drive strong shareholder value second half of ACCESS 2025 Second half of ACCESS 2025 •Back to strong revenue growth and margin expansion •Continued Product launches to accelerate order growth FY 23/24 & 24/25 KEY TARGETS •Market leading product portfolio with Uni
Slide 7: Gaining market shares globally in a slower market
Gaining market shares globally in a slower market Americas EMEA APAC 1% -38% 18% Good growth in Latin America, Tough comparables in Europe after LY Double-digit growth driven by weaker development in the U.S. large South European tenders, China, India and Thailand and Canada continued macro economic
Slide 8: Third consecutive quarter of good revenue growth
Third consecutive quarter of good revenue growth Installed base 8% in Q1 Solutions 9% Service 7% 5% • Good backlog conversion • Installation of Italian and Spanish orders Q1 22/23 Q1 23/24 Revenue development figures based on constant exchange rates. 8
Slide 9: 18th MR-Linac Consortium highlights advances with Unity
18th MR-Linac Consortium highlights advances with Unity Facts & figures Some highlighted research • 600+ physicians, physicists and Efficiency gains • Radiation therapist-led adaptive workflow for prostate cancer radiographers (>300 in person) using Unity has reduced the treatment times by 10 to 15
Slide 10: Elekta ONE offers a strong SaaS commercial model
Elekta ONE offers a strong SaaS commercial model Elekta ONE: Business implications SaaS accounts for Long-term stable revenue and margin expansion 15% • Increased value and revenue per customer – 80% revenue increase per of OIS software customer converting to SaaS orders • Increased customer retenti
Slide 11: Q1 financials
Q1 financials CjElekta
Slide 12: Continuing the momentum from H2 22/23
Continuing the momentum from H2 22/23 Net sales growth (RTM, YoY) Adj. EBIT margin (RTM) 10% 12% 8% 10% 6% 4% 8% 2% 0% 6% Q1 Q2 Q3 Q4 Q1 2022/23 2023/24 Net sales growth Adj. EBIT margin Note: Net sales growth based on constant exchange rates compared to the same period the previous year. Margin exc
Slide 13: Strong revenue and well improved margins
Strong revenue and well improved margins Net sales increased by 8%1) (SEK M) Q1 23/24 Q1 22/23 Q4 22/23 • Double-digit growth in EMEA and APAC • Good growth in both emerging and mature markets Net sales 3,828 3,327 5,125 Solutions 1,995 1,706 3,325 Strong margin improvement Service 1,833 1,621 1,800
Slide 14: Margin improvement supported by revenue growth and Cost-reduction Initiative
Margin improvement supported by revenue growth and Cost-reduction Initiative Adjusted gross margin increase Q1 Q1 (SEK M) Operations FX 23/24 22/23 Leverage from revenue growth Net sales 3,828 275 226 3,327 Cost-reduction Initiative Growth, % 15.1% 8.3% 6.8% - Decreased logistic expenses Adj. gross
Slide 15: Lower expenses after Cost-reduction Initiative
Lower expenses after Cost-reduction Initiative Quarterly expenses Positive impact from last year’s Cost-reduction initiative Expenses Q11 Q1 Growth2 despite inflationary pressure (SEK M) 23/24 22/23 Y/Y Selling expenses2 increased due to more customer Selling 425 390 6% events Administrative 309 317
Slide 16: Continued selected investments while maintaining cost control
Continued selected investments while maintaining cost control Quarterly development of R&D1 R&D expenses1 as % of net sales (RTM) SEK M 700 20% 600 15% 12.4% 500 400 10% 7.9% 300 200 5% 100 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 21/22 22/23 23/24 21/22 22/23 23/24 Gross R&D Gross
Slide 17: Seasonable stable NWC ratio to net sales
Seasonable stable NWC ratio to net sales Net working capital (NWC) as share of net sales in line NWC as % of net sales (RTM) with Q1 previous year Seasonal build up of inventories and inflation-based 21/22 22/23 23/24 revaluation Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Higher accounts receivable as a result of m
Slide 18: Following the record strong Q4, cash flow was impacted by seasonal build-up of NWC
Following the record strong Q4, cash flow was impacted by seasonal build-up of NWC Q1 Cash flow (SEK M) Operational cash conversion, RTM SEK M 80% 76% 2 000 67% 60% 55% 60% 1 500 -2,094 -551 -348 -900 43% -195 693 40% 1 000 -1,049 693 -551 20% 500 -348 -900 0% 0 Q1 22/23 Q2 Q3 Q4 Q1 23/24 EBITDA Tax
Slide 19: Outlook
Outlook CjElekta
Slide 20: Outlook until 2024/25
Outlook until 2024/25 Net sales EBIT margin Dividend policy >50% >7% of annual CAGR expansion net profit Focus on driving shareholder value
Slide 21: Outlook
Outlook • Revenue growth and EBIT margin expansion is expected to continue in the next quarter • Continued inflationary pressure • Long-term market trends to support growth and investment in high-end radiotherapy equipment and margin expansion
Slide 22: Summary Q1
Summary Q1 • Delivering on our strategy ACCESS 2025 • Gaining market share in the quarter • Third consecutive quarter with strong revenue growth. • Strong improvements in margins
Slide 23: We don't just build technology, we build hope
We don’t just build technology, we build hope
Slide 24: Q&A
Q&A
Slide 25: CjElekta
CjElekta