Slide 1: Arjo year-end report 2022
Arjo year-end report 2022 January 25, 2023 Joacim Lindoff, President & CEO Daniel Fäldt, CFO 1
Slide 2: Agenda
Agenda 1. Business update – FY & Q4 2022 2. Financials in detail 3. Key takeaways 4. Q&A Page 2
Slide 3: Business Update
Business Update 3
Slide 4: Q4 2022 Highlights
Q4 2022 Highlights Continued solid underlying business – growth held back by the US Net sales Gross margin • Lower Critical Care rental volumes and slower capital investments in the US amounted to amounted to • Continued positive global Core Rental trend – high implementation rate in the US end of q
Slide 5: Full year 2022 highlights
Full year 2022 highlights Managing short-term challenges – long-term plans remain intact • Solid underlying business growth in a challenging macro Net sales Gross margin amounted to amounted to environment • Growth held back by significantly lower critical care rental volumes -0.2% 42.2% in the US –
Slide 6: North America Q4 2022
North America Q4 2022 Q4 org. net sales Growth held back by market related challenges in the US • Significantly lower Critical Care Rental in the US vs. Q4 2021 -9.1% • Lower capital goods investments in the US due to effects from staff shortages and financial uncertainty among healthcare providers
Slide 7: Global Sales Q4 2022 - Western Europe
Global Sales Q4 2022 Q4 org. net sales Western European markets (+0.6% in Q4, +3.0% FY) +2.6% • Demand for capital equipment aligned with plans • Continued healthy net sales growth across major markets, i.e. UK, France, Germany and Austria • Strong demand for Service and Rental • SEM scanner introdu
Slide 8: Global Sales Q4 2022 - Rest of the World
Global Sales Q4 2022 Q4 org. net sales Rest of the World markets (+10.5% in Q4, +7.9% FY) +2.6% • Strong growth across many markets • Continued positive development in many markets, incl. Australia, UAE, and Japan • Good demand for capital equipment on most markets • Rental and service developing we
Slide 9: Financials in detail
Financials in detail 9
Slide 10: Q4 gross profit
Q4 gross profit Impact from unfavorable product mix and higher material costs Gross profit bridge – Q4 2022 vs. Q4 2021 (MSEK) Margin effect: Margin development x Margin (Percent) x • Unfavorable product mix due to lower Critical Care (Percentage point) Rental volumes, lower Patient Handling volumes
Slide 11: Q4 adjusted EBIT
Q4 adjusted EBIT High activity level and activities for long-term profitability improvements Adj. EBIT bridge – Q4 2022 vs. Q4 2021 (MSEK) • Good cost control throughout the value chain x Margin (Percent) – OPEX decrease vs. Q4 2021 in comparable currencies 12.3% 8.1% • R&D spend according to plan a
Slide 12: Q4 working capital and operating cash flow
Q4 working capital and operating cash flow Starting to see working capital improvements In turn improving operating cash flow vs Q1-Q3 Working capital days – Q1.19-Q4.22 Operating cash flow – Q1.19-Q4.22 Working capital days Operating cash flow (MSEK) 843 112 110 110 106 108 106 100 102 102 613 639
Slide 13: Q4 net debt and leverage
Q4 net debt and leverage Debt level down vs. previous quarter Decrease in leverage during the quarter Net debt – Q1.19-Q4.22 Leverage – Q1.19-Q4.22 Net debt, incl. IFRS16 (BSEK) Net debt / Adj EBITDA, multiple (R12) Net debt / Adj EBITDA, multiple (R12) adjusted for IFRS16* 6.0 6.1 5.9 5.9 3.6 5.8 3
Slide 14: Outlook 2023
Outlook 2023 Organic net sales growth for 2023 is expected to be within the Group’s target interval of 3-5% Page 14
Slide 15: Key takeaways
Key takeaways 15
Slide 16: Key takeaways
Key takeaways • 2022 a challenging year, but which also accentuates the strength in the underlying business • Growth and profitability mainly held back by significantly lower Critical Care rental volumes in the US • Healthy customer demand in many main markets and continued positive development in S
Slide 17: Q&A
Q&A 17
Slide 18: Financial calendar and further questions
Financial calendar Annual Report 2022 March 2023 Interim Report Jan-Mar 2023 April 20, 2023 Annual General Meeting 2023 April 20, 2023 Interim Report Jan-Jun 2023 July 14, 2023 Interim Report Jan-Sep 2023 October 19, 2023 Further questions Maria Nilsson Acting EVP, Communication & Public Relations +
Slide 19: Forward looking information
Forward looking information This document contains forward-looking information based on the current expectations of Arjo’s management. Although management deems that the expectations presented by such forward-looking information are reasonable, no guarantee can be given that these expectations will
Slide 20: Empowering Movement
aifJjJoO EMPOWERING MOVEMENT