Interim Report June 2002
- Heraeus acquisition concluded
during Q2 – significant synergy effects
- The Q2 profit before tax rose
by 22%
- The profit before tax was SEK
324.6 million (313.5)
- Good profit improvement in
Extended Care and Surgical Systems
- Orders received in Q2 climbed
organically by 5.3%
- Orders received stood at SEK
4,355.9 million (4,099.5)
- Strong inflow of orders for
Infection Control and Extended Care
- Net sales amounted to SEK 3,987.4
million (3,845.1)
The quarter
Orders received in Q2 climbed organically by 5.3%.
Demand continued to be particularly good for Infection Control.
The Extended Care business area noticeably improved its orders
received. Orders received for Surgical Systems fell back in
comparison to a very strong Q2 last year.
The profit before tax rose by 22%
compared to the same period last year. The improvement is due to
increased invoicing and lower net financial items in Q2. The
Surgical Systems and Extended Care business areas have seen a
very good profit trend in Q2, while Infection Control’s
profit trend has been weaker.
Outlook
Good demand for the Group’s products and services is
expected to continue in all business areas and on all the most
important markets.
Improving and strengthening
Infection Control’s competitiveness is continuing according
to plan and is laying a solid platform for sound and long-lasting
profitability. Extended Care is well-positioned and has a strong
product portfolio, which will take advantage of the sector’s
growth opportunities. Surgical Systems, which is today an
important and integrated part of the Group, concluded the
acquisition of the German company Heraeus Med Tec during Q2 and
this will improve the business area’s already strong
position. The acquisition will significantly contribute to the
earnings trend from 2003 for business area Surgical Systems.
To sum up, the profit outlook for
the current year remains good, and the measures and activities
now being carried out are also laying a stable foundation for
continued, good profit growth next year.
Surgical Systems business area
Market development
| |
2002 |
2001 |
Change |
2002 |
2001 |
Change |
| Orders
received per market |
Q 2 |
Q 2 |
|
H1 |
H1 |
|
| USA and
Canada |
115.1 |
106.9 |
7.7% |
226.8 |
206.4 |
9.9% |
| Great
Britain |
24.9 |
19.1 |
30.4% |
79.5 |
65.3 |
21.7% |
| Germany |
109.5 |
166.5 |
-34.2% |
246.7 |
315.5 |
-21.8% |
| Other
Western Europe |
172.1 |
213.5 |
-19.4% |
340.6 |
339.9 |
0.2% |
| Rest of the
world |
118.7 |
134.0 |
-11.4% |
305.9 |
254.2 |
20.3% |
| Business
area total |
540.3 |
640.0 |
-15.6% |
1,199.5 |
1,181.3 |
1.5% |
| adjusted
for currency flucs.& corp.acqs |
|
|
-15.3% |
|
|
-0.1% |
| |
|
|
|
|
|
|
Orders received during Q2 have
slipped back when compared with the same period last year. The
reduction in the inflow of orders is particularly noticeable on
the German market and can be explained by the fact that volumes
last year rose spectacularly in both Q1 and Q2. Surgical table
sales in Germany are at a similar level to last year and the
reduction can be attributed to fewer orders for the module-built
operating room (Variop).
The Other Western Europe region
also reported sluggish orders received in Q2, but for the six-month
period the level was the same as last year. In France, which is
responsible for a significant amount of the region’s sales,
public funds have been made available for investments later than
usual. Orders received are expected to improve in the coming
quarters.
For the Rest of the world, orders
received were weak in Q2, but for Q1 and Q2 combined the figure
is at a very good level.
Volumes in North America have
progressed well, but are not at a satisfactory level yet. Coupled
with Japan, the US has the most significant expansion potential
for the business area.
Results
| |
2002 |
2001 |
Change |
2002 |
2001 |
Change |
2001 |
| |
Q 2 |
Q 2 |
|
H1 |
H1 |
|
FY |
| Net sales,
SEK Million |
565.7 |
533.9 |
6.0% |
1,083.5 |
1,090.0 |
-0.6% |
2,223.4 |
| adjusted
for currency flucs.& corp.acqs |
|
6.5% |
|
|
-1.7% |
|
| Gross profit |
286.2 |
269.7 |
6.1% |
524.1 |
535.7 |
-2.2% |
1,108.9 |
| Gross
margin % |
50.6% |
50.5% |
0.1% |
48.4% |
49.1% |
-0.7% |
49.9% |
| Operating
cost, SEK Million |
-207.5 |
-207.2 |
0.1% |
-412.8 |
-412.4 |
0.1% |
-880.5 |
| Operating
profit |
78.7 |
62.5 |
25.9% |
111.3 |
123.3 |
-9.7% |
228.4 |
| Operating
margin % |
13.9% |
11.7% |
2.2% |
10.3% |
11.3% |
-1.0% |
10.3% |
The earnings trend has been very
good in Q2. Greater volumes have improved the factory utilisation
level and enhanced the gross margin compared with Q1. Costs are
at last year’s level and mean that the business area can
show a good operating margin of 14% for the period.
Sale of ALM´s surgical tables
business
As announced in an earlier press release, France's national
competition authority has instructed Getinge to sell ALM's
surgical tables business. Negotiations with potential buyers
continue and it is thought the sale will be completed during the
second half of 2002.
Acquisition of Heraeus Medical
Technology
The acquisition of the German company Heraeus Medical Technology
was concluded during Q2. Heraeus Med Tec has annual sales of
around SEK 500 million and means a considerable strengthening of
the business area’s market position for surgical lights and
ceiling service units.
The drawn out administrative
process of the German national competition authorities, means
that Heraeus Med Tec will be consolidated in the Group’s
activities from 1 July 2002. As a consequence of the postponed
integration, the planned synergy gains will be insignificant in
the current year. It has been assessed that next year Heraeus
will contribute an operating profit after goodwill amortisation
of at least SEK 50 million.
Other activities
The business area’s recently developed surgical tables for
image-guided surgery, AWIGS and VIWAS, continue to progress well
and important reference orders have been secured in Japan during
Q2.
Product development resources for
the surgical table sector are aimed at strengthening the mobile
table range, which is important for successful expansion in North
America and Japan. The AXCEL project, which is a new family of
surgical lights for simpler surgical requirements and for
developing markets, will be launched during the latter half of
the year. Modulis, which is the business area’s new
generation of Ceiling Service Units, has been very well received
by the markets and is a significant improvement on the previous
product range.
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