Slide 1: Elekta – Nine month report 2014/15
Elekta – Nine month report 2014/15 Niklas Savander President and CEO Håkan Bergström Chief Financial Officer 1
Slide 2: Introduction
Introduction • Third quarter affected by − Timing of large orders − Product mix − Temporary slower growth in certain markets • Outlook full-year reiterated − Strong large order pipeline − Sales momentum of Leksell Gamma Knife • Strategic Agenda: long term upside 2
Slide 3: Market development
Market development • Elekta viable player for large health systems • Service business is growth opportunity • EMEA improving • APAC declined • RNA low growth, but positive for Leksell Gamma Knife 3
Slide 4: Performance YTD
Performance YTD • Order bookings -10%* − EMEA returned as anticipated − Asia Pacific declined due to weaker market conditions in China and Japan − North America affected by volatility • Net sales -3%* − Lower shipment volumes − Product mix − Slower growth in China, Japan, Russia and USA • EBITA decr
Slide 5: Portfolio progress
Portfolio progress Fiscal year 2014/15 Main Elekta R&D programs: Brachytherapy • Atlantic Neuroscience 9% • Information Guided Cancer Care™ 14% • Next generation Gamma Knife 42% Oncology • Vision 2020 for Brachytherapy Software 35% R&D expenditures 15% of net sales 5
Slide 6: Strategic agenda for growth
Strategic agenda for growth Innovation Leadership Grow the Pie Customers Commercial Lifecycle Transformation Management Patients 6
Slide 7: Elekta – Nine month report 2014/15
Elekta – Nine month report 2014/15 Håkan Bergström CFO
Slide 8: Financial performance
Financial performance • Order bookings -10%* • Net sales -3%* • Gross margin of 39% • EBITA of SEK 705 (895)** M • Cash flow from operating activities improved to SEK 158 M (44) • Continuous investments increased 18 % to SEK 700 M. The main driver is the ongoing R&D program. − Cash conversion 33% (1
Slide 9: Drivers for improvement in free cash flow
Drivers for improvement in free cash flow 2013/14 2014/15 change Operating cash flow excl. depreciation and amortization 1,278 >350 Change in net working captial -417 >350 FY 2014/15 Free cash flow: SEK Continous investments minus depreciation and amortization -367 -100 >1,100 M Free cash flow =494
Slide 10: Net working capital to sales
Net working capital to sales Year-end drivers NWC / sales Net working capital • Lower inventories 20% − Shipment of finished goods − Stricter control of spare parts levels 15% − Centralizing purchasing Target 12% 10% • DSO – slightly improved 5% • Seasonal - higher net sales 0% -5% 08/09 09/10 10/11
Slide 11: DSO improving
DSO improving DSO* development 180 140 Regional split: North America: -43 days 102 101 Europe & AFLAME: 171 days 95 100 82 Asia Pacific: 85 days 60 20 • Public deals in Europe with extended 2011/12 2012/13 2013/14 YTD 2014/15 payment terms -20 • Longer lead times in emerging markets DSO calculation
Slide 12: Favorable currency development
Favorable currency development Reported currency effect for YTD: • Net sales +7% FX exposure SEK M 6 000 Operating expenses • Positive effect on EBITA by SEK 40 M Revenues 4 000 including hedges 2 000 Estimated positive currency effect* for FY 2014/15: 0 • Net sales ~9 percentage points -2 000 USD E
Slide 13: Outlook for 2014/15
Outlook for 2014/15: Outlook 2014/15 Net sales growth 4%* EBITA growth ~6%* Cash flow after >SEK 1.1bn continuous investments Growth drivers in Q4: • Strong pipeline of large orders • Strong deliveries of Leksell Gamma Knife • Strong year-end execution • Favorable FX 13 *Based on constant exchange r
Slide 14: Elekta
G ELEKTA