- Order bookings increased 14 percent to SEK 3,291 M (2,876) or 3 percent based on constant exchange rates.
- Net sales increased 10 percent to SEK 2,828 M (2,567) or decreased 1 percent based on constant exchange rates.
- EBITA amounted to SEK 444 M (397) before non-recurring items of SEK -18 M (0). Operating result was SEK 304 M (310).
- Net income amounted to SEK 189 M (200). Earnings per share was SEK 0.49 (0.52) before dilution and SEK 0.49 (0.52) after dilution.
- Cash flow after continuous investments amounted to SEK 147 M (173).
May – October
- Order bookings increased 12 percent to SEK 5,827 M (5,217) or decreased 1 percent based on constant exchange rates.
- Net sales increased 14 percent to SEK 5,067 M (4,432) or 1 percent based on constant exchange rates.
- EBITA amounted to SEK 485 M (359) before non-recurring items of SEK -48 M (-2). Operating result was SEK 211 M (188).
- Net income amounted to SEK 60 M (63). Earnings per share was SEK 0.15 (0.16) before dilution and SEK 0.15 (0.16) after dilution.
- Cash flow after continuous investments amounted to SEK -417 M (-497).
We expect growth in net sales to continue to be modest for the fiscal year, based on constant exchange rates, and that the EBITA margin, adjusted for non-recurring items, will continue to improve.
The outlook is adjusted from the previous: “We expect negative growth in net sales for the first half of 2015/16, while growth is expected to return during the second half of 2015/16.”
President and CEO comments
During the first half of our fiscal year, net sales grew 14 percent or 1 percent based on constant exchange rates. Gross margin increased 2.3 percentage points and EBITA improved by SEK 126* M. The improvements are mainly driven by growth in service and aftermarket sales and partly due to that deliveries scheduled for the third quarter now were completed already in the first half year. Order bookings in the second quarter increased 14 percent or 3 percent based on constant exchange rates. Growth was particularly strong in region Europe, Middle East and Africa.
Transformation program on track
The transformation program is proceeding according to plan, including the target to reach an EBITA margin improvement of more than 6 percentage points by the end of fiscal year 2017/18**. The cost reduction of SEK 450 M is on track with savings primarily in administration, supply chain and procurement. At the end of the quarter our workforce has been reduced with 91 employees.
Strong product offering and innovation portfolio
We continue to prioritize strategic R&D investments to improve cancer care, for example our software solutions and image guided radiation therapy. We are also improving our customer service network including training and education.
During the quarter, the new Leksell Gamma Knife Icon system received FDA clearance in the US. Our MRI-guided radiation therapy program, Atlantic, is progressing according to plan. The R&D consortium’s second non-commercial system was recently installed at MD Anderson Cancer Center in Houston, US. Installations at the five remaining consortium sites will take place during the 2016 calendar year.
Reducing net working capital
Cash flow after continuous investments improved by SEK 80 M for the first half year to SEK -417 M. Net working capital in relation to last 12 months net sales decreased to 11 percent (16), a level that we are not satisfied with. Programs for improvement have been initiated and will lower net working capital. The target is a reduction with over SEK 200 M by the end of 2016/17.
As previously communicated, there is an ongoing investigation in Italy where Elekta employees are suspected of interfering with public procurement processes. Elekta is providing all requested information to the Italian authorities. We have zero tolerance for any deviation from our code of conduct and clear corporate policies and procedures in place.
President and CEO
* Before non-recurring items
** Base year 2014/15, excluding currency effects
Elekta will host a telephone conference at 10:00-11:00 CET on December 4, with President and CEO Tomas Puusepp 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)8 566 426 64
UK dial-in number: +44 (0) 203 428 14 09
US dial-in number: + 1 855 753 22 36
The telephone conference will also be broadcasted over the internet (listen only). Please use the link: