Elekta Ab Class B · OMXSTO:EKTA_B
Elekta Ab Class B — Q4 2022/23 Earnings Presentation
31 slides from Elekta Ab Class B's earnings presentation, May 25, 2023
Slide 1: Strong revenue growth and record cash flow
Strong revenue growth and record cash flow Year-end and Q4 report 2022/23 Gustaf Salford, President and CEO Tobias Hägglöv, CFO May 25, 2023
Slide 2: Agenda
Agenda • Delivering on our strategy • Q4 and full-year 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 Q4
Delivering on our strategy ACCESS 2025 in Q4 Drive Accelerate innovation partner integration with customer across the cancer utilization in mind A world where care eco-system everyone has access to the best cancer care Be the customer Drive adoption lifetime companion across the globe People Resilie
Slide 6: ACCESS 2025 highlights in FY 22/23
ACCESS 2025 highlights in FY 22/23 Drive adoption across the globe Direct presence in Thailand Giving access to >180 m people in underserved countries Customer lifetime companion Increasing value-added services by launch of Elekta Care 360 A world where everyone has access to the Accelerating innova
Slide 7: Strong book-to-bill ratio and backlog supporting future growth
Strong book-to-bill ratio and backlog supporting future growth Q4 FY 22/23 Elekta Group 0% -1% Strong order Book-to-bill Americas 0% -13% backlog of 1.24 EMEA -4% -1% SEK 43 B APAC 4% 10% Order development figures based on constant exchange rates. 7
Slide 8: Double-digit revenue growth – strong Solutions and Service
Double-digit revenue growth – strong Solutions and Service 10%in Q4 FY: 4% Installed base 5% Solutions Service 12% 7% FY: 3% FY: 6% Q4 21/22 Q4 22/23 Revenue development figures based on constant exchange rates. 8
Slide 9: Elekta Unity systems in clinical use on four continents
Elekta Unity systems in clinical use on four continents • 75 installed1 Elekta Unity systems • Clinical systems having 99% uptime • 100% treatments adapted • >40 indications treated, largest number being prostate treatments • >600 peer reviewed publications • >4,000 patients recruited in MOMENTUM 1
Slide 10: Strategic partnership in China to increase adoption of RT
Strategic partnership in China to increase adoption of RT • Joint venture with Sinopharm, with the largest sales and distribution network in China • Rational for JV: • Increase the adoption of radiotherapy across the country in underserved areas • Expand Elekta services offering • Improve clinical o
Slide 11: Launching Elekta ONE at ESTRO
Launching Elekta ONE at ESTRO Designed to do more A unified software experience designed to increase clinic’s productivity while facing constant need for more complex workflows and personalized care. Faster innovation Smoother UX with unified UI Streamlined workflows 11
Slide 12: Q4 and full-year financials
Q4 and full-year financials C@ Elekta
Slide 13: Strong revenue and margins improved
Strong revenue and margins improved Net sales increased by 10% with strong growth in (SEK M) Q4 22/23 Q4 21/22 Q3 22/23 APAC Net sales 5,125 4,239 4,337 Adj. EBIT margin improved substantially driven by Solutions 3,325 2,658 2,628 revenue growth, improved gross margin and positive Service 1,800 1,58
Slide 14: Improved adjusted gross margin driven by net sales growth and FX effect
Improved adjusted gross margin driven by net sales growth and FX effect Adj. gross margin development Impact vs. Q4 LY 40% Net sales growth +300 bps 30% Solution-Service and -280 37.0% 37.8% geographical mix bps 20% +80 bps FX impact +260 10% bps 0% Inflation and higher supply -200 -110 Q4 LY Q4 FY
Slide 15: Decreased expenses as a result of a successful Cost-reduction Initiative
Decreased expenses as a result of a successful Cost- reduction Initiative Quarterly expenses Selling expenses2 decreased y-o-y, but Expenses Q41 Q4 Growth2 Q31 Growth2 (SEK M) 22/23 21/22 Y/Y 22/23 Q/Q increased sequentially due to a high level of in-person activities and inflationary pressure Selli
Slide 16: Continued strong investments in innovation
Continued strong investments in innovation Quarterly development of gross R&D1 R&D expenses1 as % of net sales (RTM) SEK M 20% Gross R&D as % of net sales 600 Net R&D as % of net sales 15% 13.3% 400 10% 200 5% 0 0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 20/21 21/22 22/23 20/21 21/22 2
Slide 17: Gradually improved margins during the year as revenue came back
Gradually improved margins during the year as revenue came back and Cost-reduction Initiative progressed (SEK M) FY 22/23 FY 21/22 Net sales increased by 4% 1 • Americas 5%, EMEA 3%, APAC 5% Net sales 16,869 14,548 • Solutions 3%, Service 6% Solutions 9,981 8,652 Service 6,889 5,896 Adj. gross margi
Slide 18: Strong performance in H2 after weak start of the year
Strong performance in H2 after weak start of the year Net sales Adj.EBIT margin SEK M 6 000 3% -5% 8% 10% 20,0% 5 125 5 000 16,2% 4 337 4 239 15,0% 4 081 (13.4%) 4 000 3 697 3 602 3 327 3 009 3 000 10,7% 10,0% (9.4%) 2 000 7,7% (14.4%) 5,0% 1 000 4,0% (6.7%) 0 0,0% Q1 Q2 Q3 Q4 xx Y-o-Y growth 2022/2
Slide 19: Cost-reduction Initiative has successfully lowered our spend
Cost-reduction Initiative has successfully lowered our spend Yearly run-rate reduction end Estimated spend reduction, SEK M 2022/23 of 2022/23E Increase productivity in operations and service (COGS) 50 ~150 Optimize innovation pipeline and leverage global product organization (Gross R&D) 110 ~200 Dr
Slide 20: Strong improvement in net working capital
Strong improvement in net working capital Q4 NWC changes (SEK M) NWC as % of net sales (RTM) 21/22 22/23 Assets -248 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1% -2% -3% -2% -4% -4% -6% -7% -8% Decreased inventory following the high sales at the Liabilities end of Q3 and Q4 Accounts receivable and accrued income d
Slide 21: Record strong cash flow driven by high earnings and lower net working capital
Record strong cash flow driven by high earnings and lower net working capital Q4 Cash flow (SEK M) Operational cash conversion, RTM 120% 3 000 82% 100% 77% -417 71% 76% 80% 71% 69% 2 000 67% 1,045 60% 1,991 60% 43% -123 1,574 40% 1 000 1,069 20% 0% 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 21/22 22/23 EBITDA Tax
Slide 22: Strong available funds with low refinancing risk
Strong available funds with low refinancing risk Net debt1)/EBITDA ratio 0.94 SEK bn Maturity profile 3 Sustainability RCF of EUR 250 M after Q4 (May) Social KPI 2 • Linear accelerators in underserved markets Environmental KPI 1 • Scope 1 & 2 greenhouse gas emissions 0 • Suppliers setting science-ba
Slide 23: Proposed dividend for 2022/23
Proposed dividend for 2022/23 Dividend, SEK per share Pay-out ratio 2.40 in two install- 2.40 ments 2.20 1.80 1.80 97% of net income Dividend policy of >50% 18/19 19/20 20/21 21/22 22/23 High level of dividend maintained 23
Slide 24: Outlook
Outlook CjElekta
Slide 25: New outlook from 2022/23 until 2024/25
New outlook from 2022/23 until 2024/25 Net sales EBIT margin Dividend policy >7% ≥50% CAGR expansion of annual net income 25
Slide 26: Outlook
Outlook • Uncertain macroeconomic environment remains, but expecting our improvement trend to continue in Q1 • Long-term market trends to support growth and investment in high-end radiotherapy equipment and margin expansion
Slide 27: Summary Q4
Summary Q4 • Delivering double-digit revenue growth • Record cash flow driven by low net working capital and high earnings • Successfully implemented Cost-reduction Initiative driving margins • Launch of Elekta One software suite at ESTRO strengthening comprehensive product portfolio
Slide 28: We don’t just build technology, we build hope.
We don’t just build technology, We build hope.
Slide 29: Welcome to our CMD, June in Crawley, UK
Welcome to our CMD, June 20 in Crawley, UK
Slide 30: Q&A
Q&A
Slide 31: CElekta
CElekta