Elekta AB Class B · OMXSTO:EKTA_B
Elekta AB Class B — FY2014/15 Earnings Presentation
19 slides from Elekta AB Class B's earnings presentation, 2015
Slide 1: Elekta – Full-year report 2014/15
Elekta – Full-year report 2014/15 Tomas Puusepp President and CEO Håkan Bergström Chief Financial Officer 1
Slide 2: Performance
Performance • Results significantly below expectations and guidance − Action program initiated to return to growth, improve profitability, reduce costs and continue to focus on cash flow • Weak order performance in US − Fewer large orders than anticipated • Net sales +1% in SEK, -8%* in local curren
Slide 3: Prioritized areas for efficiency improvement
Prioritized areas for efficiency improvement • Short-term turnaround of sales organization President & CEO Tomas Puusepp • Drive sales with service and software to installed base Commercial Solutions Finance & Governance • Align product development Ian Alexander, CCO Johan Sedihn, COO Håkan Bergströ
Slide 4: Market development
Market development • North America – replacement market. Hospital consolidation drives large and complex orders with long sales process • Western Europe – stable and growing in line with GDP • Emerging Markets – increased risk in some markets due to political development, war and civil unrest • Asia
Slide 5: Regional performance
Regional performance • Order bookings -3% in SEK, Gross order –8%*in local currencies • US: large orders did not close as anticipated – loss of market share • Europe: Western Europe robust. Weak in Middle East and North Africa. Good growth in Russia and Sub-Sahara Africa • Asia Pacific: 23%* growth
Slide 6: Superior portfolio
Superior portfolio • Atlantic. Targeted commercial launch in 2017 Brachytherapy - 75 orders expected until 2019 Neuroscience 9% • Leksell Gamma Knife® Icon™ 14% launched 42% Oncology • Information Guided Cancer Software 35% Care™ R&D costs per product area 6 Leksell Gamma Knife® Icon™ is not approve
Slide 7: Long-term growth agenda
Long-term growth agenda • Market fundamentals − Aging population − Growing cancer incidence − Capacity gap − Increased usage of RT • Favorable long-term growth prospects − Growing medical need − Leading product portfolio − Superior R&D program • Long-term strategic agenda − Innovation leadership − C
Slide 8: Elekta – 2014/15 Full-year report
Elekta – 2014/15 Full-year report Håkan Bergström CFO
Slide 9: Financial performance
Financial performance • Net sales -8%* − Gross margin of 40% (43) − Lower volumes − Price pressure in some emerging markets − Less software in North America • EBITA of SEK 1,472 (2,183)** M − Realized and anticipated bad debt losses of SEK 166 M – not included • Cash flow after continuous investment
Slide 10: Bad debt losses
Bad debt losses Realized losses in FY14/15 66 mkr Increased bad debt provisions 100 mkr • Libya: Distributor left the country • Customer operations are financed either • Macedonia - bankruptcy directly or indirectly by public funds – low historic losses • Iraq: Project canceled due to war • FY 15/16
Slide 11: Current order backlog
Current order backlog Order backlog duration, SEK bn and % Order backlog development, SEK bn 17,1 2015/16 6.7 40% 13,6 2016/17 4.3 25% 11,9 10,5 8,1 8,1 2017/18 2.7 15% After 2017/18 3.4 20% Total: 17.1 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 11
Slide 12: Decline in large orders vs. last year
Decline in large orders vs. last year Booked large orders and share of total 3000 40% 35% 30% • Good value with software/services 2000 25% • Higher complexity in negotiating/closing 20% 15% • Higher demand on organization 1000 10% • Driving higher volatility 5% 0 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 13/14 13/
Slide 13: Improvement in free cash flow – cash conversion 81%
Improvement in free cash flow – cash conversion 81% 2014/15 Delta vs. 2013/14 Operating cash flow excl. depreciation and amortization +787 -491 Change in net working captial +524 +941 Continous investments minus depreciation and amortization -444 -77 Free cash flow =867 +373 13
Slide 14: Significant reduction of net working capital
Significant reduction of net working capital Net working capital / net sales 20% 15% 10% 8% 5% 0% -5% 08/09 09/10 10/11 11/12 12/13 13/14 14/15 • Inventory still at high level • Improvement mainly related to North America *DSO calculation based on: Accounts receivables, Accrued income, 14 advances f
Slide 15: R&D investments for future growth
R&D investments for future growth SEK M % of net sales 1 600 14% 1 400 12% • 2014/15: step change in R&D 1 200 10% investments 1 000 8% − MRI-guided radiation therapy system 800 6% 600 4% 400 200 2% 0 0% 08/09 09/10 10/11 11/12 12/13 13/14 14/15 R&D expenditures R&D expenditures, % of sales R&D afte
Slide 16: Favorable currency development
Favorable currency development Currency effect in FY 2014/15: FX exposure SEK M 6 000 • Net sales +9% Operating expenses Revenues • EBITA – neutral effect 4 000 2 000 Positive effect in FY 2015/16 expected 0 with current exchange rates -2 000 USD EUR JPY GBP CNY SEK Other • On net sales +7 % -4 000
Slide 17: Summary
Summary • Short-term market growth: currently low to mid-single digit • Measures taken and new organization • Favorable long-term growth prospects 17
Slide 18: Welcome to Elekta's Capital Markets Day
Welcome to Elekta’s Capital Markets Day June 11 - Stockholm
Slide 19: G ELEKTA
G ELEKTA