*Adjusted for items affecting comparability (restructuring costs and costs for legal processes, see details on pages 18-19) and bad debt losses.
We delivered a strong order growth of 34 percent in the third quarter and 11 percent for the first nine months. MR-linac, the next generation of radiation therapy systems, continued to break new ground. Our activities related to the transformation program are progressing and delivering in line with defined targets for cost savings and margins. We are honored that our MOSAIQ® Oncology Information System has been recognized as Category Leader for the sixth time by KLAS, an independent research firm specializing in the performance of healthcare vendors.
Order growth was strong during the quarter and we moved our positions forward in all product areas. Europe, Middle East and Africa showed very strong performance with significant order bookings such as two MR-linac systems and New Karolinska Solna, Sweden. The development in Asia Pacific was solid and we saw continued strong growth in China. Our activities to strengthen the operations in the US are showing progress, but I am not satisfied and have initiated additional measures for improved performance.
The interest in our paradigm shifting MR-linac continues to grow. We already have agreements for 12 systems. This is in accordance with our plan and I am convinced that we will reach our target of 75 orders before the end of the 2019 calendar year.
This was the first quarter after fully implementing our produce-to-order process. Net sales increased by 5 percent in SEK and by 1 percent based on constant exchange rates. Linear accelerator shipments were lower compared with last year and approximately SEK 100 M of planned linac revenues were shifted into the fourth quarter. This was due to our strict implementation of the produce-to-order process.
Gross margin increased slightly in the quarter. Currency effects were lower than expected as a result of the recent strengthening of SEK and GBP. The effect in the third quarter was SEK 30 M, which can be compared with SEK 95 M in the second quarter. We are well on our way to reaching our savings target and currently we have realized an annualized rate of SEK 535 M. On 12-month rolling, our EBITA-margin was 16 (14) percent and we reiterate the ambition to reach an EBITA-margin exceeding 20 percent for next fiscal year.
Our cash flow has improved further through activities for working capital reduction. Compared to last year cash flow has increased by SEK 650* M and the net working capital to sales ratio is now at 1 percent.
We have a strong order backlog going into the fourth quarter and compared with the same period last year we plan to deliver substantially more from the backlog.
We continue to strengthen our management team and the organization. Karin Svenske Nyberg has joined us as Executive Vice President Human Resources and Ioannis Panagiotelis joined us as Chief Marketing Officer.
The transformation program is well under way and we do what we say by continuously improving our processes. Our global Elekta team is deeply committed to providing our customers with highly innovative radiation treatment solutions that help them improve the lives of people with cancer or brain diseases.
President and CEO
*Cash flow after continuous investments. Adjusted for items affecting comparability of SEK 358 M (refer to page 4), related to cash outflow attributable to legal processes and the transformation program.
Elekta will host a telephone conference at 10:00-11:00 CET on March 1, with president and CEO Richard Hausmann and CFO Håkan Bergström.
To take part in the conference call, please dial in about five minutes in advance.
Swedish dial-in number: +46 (0) 2 00 88 38 17
UK dial-in number: +44 (0) 203 008 98 01
US dial-in number: +1 646 502 51 18
The telephone conference will also be broadcasted live online (listen only). Please use the link:
This is information that Elekta AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication at 07:30 CET on March 1, 2017.
Elekta AB (publ)
+46 8 587 25 547
Director Investor Relations
Elekta AB (publ)
+46 8 587 25 415
Director Financial Communications
Elekta AB (publ)
+46 8 587 25 734
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Elekta is proud to be the leading innovator of equipment and software used to improve, prolong and save the lives of people with cancer and brain disorders. Our advanced, effective solutions are created in collaboration with customers, and more than 6,000 hospitals worldwide rely on Elekta technology. Our treatment solutions and oncology informatics portfolios are designed to enhance the delivery of radiation therapy, radiosurgery and brachytherapy, and to drive cost efficiency in clinical workflows. Elekta employs 3,600 people around the world. Headquartered in Stockholm, Sweden, Elekta is listed on NASDAQ Stockholm. www.elekta.com.