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Medartis reports double-digit growth in all regions and segments in the 2018 financial year Dienstag, 02. April 2019 - 08:10
Medartis Holding AG / Key word(s): Annual Results
Medartis reports double-digit growth in all regions and segments in the 2018
financial year
02-Apr-2019 / 07:00 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 KR
The issuer is solely responsible for the content of this announcement.
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Medartis Holding AG
Hochbergerstrasse 60E
CH-4057 Basel
PRESS RELEASE
Medartis reports double-digit growth in all regions and segments in the 2018
financial year
Basel, Switzerland, 2 April 2019 - Medartis Holding AG (SIX: MED), a leading
manufacturer and provider of medical devices for surgical fixation of bone
fractures, in 2018 increased sales by 16% to CHF 121.3 million and reported
double-digit growth rates in all regions and segments. In addition to
completing the IPO, Medartis continued to invest judiciously in its
business. Adjusted for IPO costs, EBITDA was CHF 17.6 million and the
adjusted EBITDA margin was 15%. Medartis expects to see continued
broad-based double-digit growth in 2019 while making targeted investments in
its international presence and its product range.
Today, Medartis will hold a conference (in German) for analysts and media at
the Park Hyatt hotel, Beethoven-Strasse 21, Zurich, at 09:30 CEST, as well
as a telephone conference (in English) at 14:00 CEST.
CHFm 2017 2017 (1) 2018 2018 (1) Change (1)
(excl. IPO) (excl. IPO) (excl. IPO)
Sales 105.0 105.0 121.3 121.3 16%
Gross profit 87.6 87.6 101.0 101.2 16%
Opex 78.0 75.8 95.0 91.9 21%
Operating 9.6 11.8 6.1 9.3 -21%
profit (EBIT)
EBIT margin 9% 11% 5% 8% -3pp
EBITDA 16.9 19.0 14.4 17.6 -7%
EBITDA margin 16% 18% 12% 15% -3pp
Headcount 475 475 561 561 18%
1) Excluding capital market-related costs (IPO) of CHF 3.2 million in 2018
and CHF 2.2 million in 2017
In the 2018 financial year, Medartis achieved sales of CHF 121.3 million,
which corresponds to year-on-year growth of 16% (2017: +14%). In local
currencies, sales growth also amounted to 16%, an increase compared to the
13% reported in the previous year. Exchange rate movements had only a
minimal impact on the sales recorded for the year under review (local
currencies +0.4 percentage points).
In line with the company's growth strategy, profitability in 2018 reflected
higher operating expenses to further expand its international presence and
strengthen the business in key markets. Adjusted EBITDA (excluding IPO
costs) was CHF 17.6 million (previous year: CHF 19.0 million) with an
adjusted EBITDA margin of 15% (previous year: 18%). Including IPO costs,
EBITDA was CHF 14.4 million in 2018 (previous year: CHF 16.9 million) and
the EBITDA margin was 12% (previous year: 16%). Adjusted EBIT (excluding IPO
costs) was CHF 9.3 million, and EBIT including IPO costs was CHF 6.1
million.
As previously communicated, both sales growth in local currencies (forecast
to be in the high teens for 2018) and the adjusted EBITDA margin (forecast
to be between 15% and 16% for 2018) were at the lower end of the ranges
expected in mid-2018. This is mainly attributable to weaker than expected
growth in LATAM in the second half of 2018, while the growth rates reported
in the stronger sales regions EMEA, North America and APAC were in line with
expectations also in the second half of the year.
Overall, Medartis achieved a net profit of CHF 4.2 million in 2018, after
reporting a net profit of CHF 0.9 million in 2017 that had included a
negative effect of CHF 5.7 million in connection with the corporate tax
reform in the US. Cash flow from operating activities was CHF 6.5 million,
compared to CHF 11.0 million in the previous year.
Willi Miesch, CEO of Medartis: "In 2018, we made further progress in the
expansion of our business and reported double-digit growth rates in all of
our regions and business segments. In addition, with the completion of the
IPO, we have strengthened Medartis' strategic flexibility and market
profile. Our broad regional presence and innovative range of products
enabled us to once again increase our pace of growth year-on-year. We are
confident that we will also again achieve broad-based double-digit growth in
2019 as we continue to make further targeted investments in our business."
Double-digit growth in all regions
EMEA APAC LATAM North America Total
Sales, CHFm
2018 66.4 22.8 12.9 19.3 121.3
2017 57.8 20.7 9.2 17.4 105.0
Growth, %
in CHF 15% 10% 41% 11% 16%
in local currencies 12% 15% 53% 12% 16%
Medartis' biggest region, EMEA, grew 12% in 2018 in local currencies and
therefore achieved continued, solid high-level growth. Both the markets in
which Medartis has subsidiaries as well as its distributor markets
contributed to this result. Volatility in the ordering behavior in the
distributor markets was flat for the full year, although in some strong
sales markets, products were already purchased in the first half for the
second half of the year. With the introduction of sterile packaging
solutions for implants in November 2018, Medartis is keeping abreast of the
growing requirements in this area in European markets such as the UK.
In North America, sales increased 12% in local currency. The measures
introduced to strengthen management capacity and the sales force are
beginning to take effect. Client education programs have also been further
expanded and the regional collaboration with IBRA (International Bone
Research Association), which serves as a scientific partner, has been
intensified. An important element in achieving the envisaged further
expansion of the company's market position remains the recruitment of sales
professionals with a high level of expertise, who are highly sought after in
the North American market.
Solid growth of 15% in local currencies was achieved in APAC in 2018. The
two key markets Australia and Japan continued to develop very well.
Following a strong second half in 2017, they once again reported
double-digit growth in the second half of 2018. In Japan, the new subsidiary
began operations in the foot segment in the fourth quarter of 2018.
In LATAM, Medartis achieved growth of 53% in local currencies. Organic
growth - excluding the inorganic growth effect following the acquisition of
the Brazilian distributor Extera in August 2017 - was 10%. The LATAM region
continued to have the strongest growth momentum in 2018. However, the market
environment in the second half of the year was challenging and a number of
distributor markets experienced significantly less growth than in the first
half. Overall, the distributor markets performed more or less in line with
the previous year. The performance of the subsidiaries in Brazil and Mexico
was below expectations, however, compared to the first half of 2018, sales
further increased in the second half of the year.
Solid development of business segments
Upper Lower CMF and Total
Extremities Extremities Others
Sales, CHFm
2018 87.2 16.4 17.8 121.3
2017 76.8 12.8 15.4 105.0
Growth, %
in CHF 13% 28% 16% 16%
in local currencies 14% 29% 16% 16%
Medartis' three business segments all achieved double-digit growth rates in
2018.
Upper Extremities, Medartis' largest business segment, recorded a sales
increase of 13% compared to the previous year. The hand, wrist and elbow
product lines all contributed to this strong result. The market launch of
the proximal humerus plates for the treatment of shoulder fractures began in
the fourth quarter of 2018, and further complements the product portfolio
for the upper extremities segment.
Lower Extremities, Medartis' youngest business segment, again developed
dynamically in 2018 and saw a rise in sales of 28%. In collaboration with
medical societies, the educational offering for surgeons was further
expanded specifically for products in this segment.
Sales in the CMF and Others business segment, which comprises solutions for
the craniomaxillofacial region as well as instruments and containers, grew
16% in 2018. In 2018, further progress was made in the development of a new
generation of the CMF product line, which is planned to be introduced in
2020.
Strengthening of the Executive Management Board
The Board of Directors appointed Anthony Durieux-Menage as Chief Human
Resources Officer and Member of the Executive Management Board effective 1
June 2019. The aim of positioning the HR function at the Executive
Management Board level is to further strengthen company-wide strategic
personnel management and talent development in line with the needs of the
company. Anthony Durieux-Menage has long-standing experience in human
resources management and product engineering and development in the pharma
and life sciences sector. He joins Medartis from the Swiss pharma company
Acino, where he was Group HR Director and a member of the Executive
Committee. Prior to this, he held management roles in HR and Operational
Excellence at Novartis and was a production engineer at Ajinomoto in France.
Anthony Durieux-Menage is a French citizen and holds a master's degree in
biochemistry from the Institut National des Sciences Appliquées in Toulouse.
Outlook 2019
Medartis expects to see continued broad-based double-digit growth in 2019
while making targeted investments in its international presence and its
product range. The company plans to provide more detailed full-year 2019
financial guidance with the announcement of the 2019 half-year results.
With regard to the regions, further strengthening the company's market
position in the US remains an important area of focus in 2019. In Japan, the
new subsidiary began to build its sales force for the lower extremities
segment at the end of 2018, and will continue to do so in 2019. In China,
Medartis has applied for the registration of key products in the upper
extremities segment; it expects this to be approved at the latest in the
second half of 2019 and, in a next step, to be able to begin collaboration
with distributors. The expansion of Medartis' presence in Brazil with own
sales forces has been launched and is to be further intensified in the
coming months - developments in the regional market situation will be taken
into consideration on an ongoing basis when determining the pace and scope
of this expansion.
The recently introduced shoulder system, which is being rolled out more
broadly since the beginning of 2019, is also expected to generate growth
momentum, as is an expanded arthrodesis set for the treatment of the carpal
bone for patients suffering from arthritis, envisioned to be introduced to
the market during the second quarter of 2019. Further to this, Medartis
expects to continue to benefit from its well-established position in EMEA,
its strongest sales region. The implementation of the new Medical Device
Regulation (MDR), which will come into force in the European Union in May
2020, is proceeding according to plan and is expected to be concluded by the
end of 2019 - primarily using existing resources and by prioritizing
in-house projects accordingly.
Documents 2018 annual results
The press release and the presentation for the 2018 full-year results are
available at:
https://www.medartis.com/investor-media-relations/#page-78
The 2018 Annual Report in PDF is also available online and can be found at:
https://www.medartis.com/fileadmin/user_upload/Investor_Relations/Financial_Reports_2018_DE/00_medartis_2018_annual_report.pdf
Investor, analyst and media conference in Zurich (in German)
Date: Tuesday, 2 April 2019
Time: 09:30 CEST
Speakers: Willi Miesch, CEO; Dominique Leutwyler, CFO
Location: Park Hyatt, Beethoven-Strasse 21, 8002 Zurich
Telephone conference (in English)
Date: Tuesday, 2 April 2019
Time: 14:00 CEST
Speakers: Willi Miesch, CEO; Dominique Leutwyler, CFO
Join with PC, Mac, Linux, iOS or Android:
https://medartis.zoom.us/j/297475790
Dial-in numbers by telephone:
Switzerland +41 31 528 0988
UK +44 203 695 0088
US +1 669 900 6833
For other international numbers go to: https://zoom.us/u/anVhFKhdr
Meeting ID: 297 475 790
Financial calendar
10 May 2019 Annual General Meeting
20 August 2019 Publication of 2019 half-year results
03 March 2020 Publication of 2019 full-year results
Contact
Patrick Christ
Head Corporate Services
Medartis Holding AG
Phone: +41 61 633 34 70
patrick.christ@medartis.com
About Medartis
Founded in 1997 and headquartered in Basel, Switzerland, Medartis is one of
the world's leading manufacturers and providers of medical devices for
surgical fixation of bone fractures for upper and lower extremities as well
as for the craniomaxillofacial region. Medartis employs over 570 individuals
across its 12 locations, with products offered in over 50 countries
globally. Medartis is committed to providing surgeons and operating theater
personnel with the most innovative titanium implants and instruments as well
as best in class service. For more information, please visit
www.medartis.com.
Disclaimer
This communication does not constitute an offer or invitation to subscribe
for or purchase any securities of Medartis Holding AG. This publication may
contain certain forward-looking statements and assessments or intentions
concerning the company and its business. Such statements involve certain
risks, uncertainties and other factors which could cause the actual results,
financial condition, performance or achievements of the company to be
materially different from those expressed or implied by such statements.
Readers should therefore not place reliance on these statements,
particularly not in connection with any contract or investment decision. The
company disclaims any obligation to update these forward-looking statements,
assessments or intentions. Further, neither the company nor any of its
directors, officers, employees, agents, counsel or advisers nor any other
person makes any representation or warranty, express or implied, as to, and
accordingly no reliance should be placed on, the accuracy or completeness of
the information contained herein or of the views given or implied.
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End of ad hoc announcement