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My name is Kristina Willgard. I'm very happy to present to you the interim report. I think it's a very strong report for the first quarter. And if we look on the highlights for this quarter, we did right -- it was a successful quarter because still, I think we do a very good -- both sales growth but also a profit growth in this quarter. You see when you look into the report that the acquisitions are driving the sales in Medtech, which is actually exactly what we expected. You know that we have done a lot of acquisitions during the last 2 years within our MedTech business area. If we exclude the sales with COVID-19 products, we actually had an underlying organic growth of 5% in this quarter, which I think also is very strong. And both business areas actually had a positive growth, excluding COVID sales. We have completed 2 acquisitions in the quarter that was of MBA and Telia and another 2 was finalized after the quarter, and that was O’Flynn and BioCat.
So summarizing this quarter, we had sales of close to SEK 2.6 billion, which is plus 49%. EBITA ended at SEK 435 million, which is 34% growth, and our margin ended on 16.9% compared to 18.8%. And the EBITA margin actually increased in both business areas, which I think is very strong. But just to understand how come that the total margin decreases somewhat, this is actually because our Medtech business is a bigger portion of the total group compared to 1 year. This year, the Medtech profit is 33% of total EBITA. Last year, it was 15%. And the EBITA margin in our Medtech business is a bit lower than the rest of the Labtech.
In this quarter, I also want to emphasize that we actually put out a big donation of medical devices for surgeries to the awful war in Ukraine. So I really would like to thank all our companies and people at AddLife who made it possible for us to ship. I think it was 6 or 7 trucks filled with different devices. And the value of that was SEK 7 million.
I also want to say, which I think you all are aware about is that we have now appointed my successor. And Fredrik Dalborg will join as the new CEO of the AddLife Group, and he will start in the fourth quarter.
A few words still about the COVID. COVID pandemic, we feel it's really going down, which is obvious also in our figures. But I think we are all aware about that this winter time, it was still a lot of Omicron. So in the beginning of the quarter, actually January or February, it was a high part of PCR testing for the Omicron, mainly in the Nordic countries. But it was obviously much, much weaker in the month of March, which actually is exactly how we see that the infection rates are changing over time. And we foresee that the COVID testing, as we've said before, will slow down throughout the year.
If a new mutation doesn't come and will -- that we prove that is actually more aggressive. And during the last 2 years, I think, all of us have learned that when we thought this was over, it has been -- it has actually restarted many, many time. But right now, it looks rather promising. Restrictions are taken out in most countries in Europe. But I think we all follow how the situation is in China, especially in Shanghai, where all people are locked into their homes, and that actually affects our people who works in China because they are now just located in their homes, which makes their business life a little bit more complicated.
So the effect of this Omicron is still that the elective strategy was slow in the quarter, but in March, of course, it started up much more again. The main problem is that the health care professionals are affected. I would say, there is not financial constraints in health care, it's actually lack of personnel which makes this difficult.
So our coverage sales decreased 25% in the quarter to SEK 459 million compared to SEK 620 million. And we didn't have any sales of COVID-related products in our business area, Medtech. So in this picture, you see the bridges of the net sales between the years. As I said, 49% growth. Acquisitions added close to SEK 900 million. We also had non-COVID organic sales growth, and then we have a loss, of course, in the COVID sales.
EBITA is actually the same bridge. You see that the Labtech, we got a little bit of growth. We strengthened the margins in our Labtech business, which I think was very positive. But the main part of the profit growth comes from the acquisitions within our Medtech business. So summing up that to SEK 435 million.
Looking into Medtech -- Labtech, sorry, it's a really strong start of the year. I talked about the decreased coverage sales, but the organic growth was actually 8%, which I think is very strong. It was strengthening both in our diagnostics area but also in the research field. We did one acquisition after the end of the quarter, it was a smaller company named BioCat, so that was for us actually the first acquisition in the German market in the field of research.
So summarizing this quarter, sales up 4 percentage to SEK 1.28 billion and EBITA margin strengthened to 23.2%. And the strengthened margins, I would say, comes from that the companies within this group has been very active when it comes to price adjustments. We have a very favorable product mix. We don't have so much instruments, but we have more parts of reagents. And actually, it is the strong research March figures that actually adds on to the total margin in the group in this first quarter.
And I would also like to say that all the Labtech companies are very good on the strong cost control because we all know that markets are opening up, but still we are really controlling the cost to make sure that we don't sort of do a boost in the cost structure now when we sort of see that we can come out to the customers and get back a little bit more to the normal pace in our business.
A few details in the Labtech business, it's very high activity in the market, in the diagnostics field. Our big product blood gas analysis, and that is our Radiometer business, has had high activity, which proves that normal sort of medical surgeries, et cetera, is restarting in the hospitals. Pathology and other microbiology tests are really growing for the diagnostics companies.
And as I said, in the research and laboratory, we saw really a good end of the quarter, which means that March was very strong. And actually, for one of our oldest lab companies, they had an all-time high order intake in March, which was very positive. So we will say it's picking up, and we are looking forward to see what we can do with the companies in the research field. We had very robust sales for our own advanced instruments, and it was -- we were pleased to see that we got good sales in China in this quarter. But of course, we have a question marks now when most of our employees in China are locked into their homes. So it's a little bit more complicated in the second quarter.
Coming into the Medtech business. As expected, the strong sales growth came through the acquisitions, the main acquisitions Healthcare 21, AddVision and in this quarter, MBA as well. The market situation still very volatile. We expect it to continue to be a little bit volatile because we -- even though we have a lot of political focus on reducing the long queues, it takes a little bit time to reorganize in the hospitals, does not lack of financial resources, as I said, but it's lack of health care professionals.
And we actually saw that when we are looking forward, for example, in the Finnish market, 25,000 health care professional started the strike 1st of April because they want higher wages, which I think we all understand, but that gives the sort of restarting in the Finnish market, a little bit more a bumpy ride. We completed 2 acquisitions in the first quarter, and we did an add-on acquisition to Healthcare 21, which was O’Flynn. And I would say all the acquisitions that we have done has realized -- have been able to improve the margins in domestic areas. So summarizing Medtech first quarter, we had a growth of 154% to SEK 1.3 billion, and the EBITA margin was strengthened from 9.7% to 11.1 percentage.
A few words about our health services. The acquired companies are according to our expectation, delivering the results. We all knew that Healthcare 21 would have a good and strong first quarter, which they had. In U.K., NHS are closing their books in March. So this year, exactly as last year, the first quarter was really strong and good even though they had less sales in the surgery side, they could compensate that in other areas.
If we look at another big acquisition, AddVision, a vision ophthalmology group, we see that they have sales according to last year, and that is from the market expectation, again, exactly what we foresee. But for both these big acquisition, of course, we hope that the market now will open up a little bit more. So we really get the effect on the improvements that we saw was possible for a more long-term perspective.
Looking into the home care, we actually saw again that it was opening up, especially in March. We saw a long -- strong sort of interest for the digital solutions that we now have on board. And we're really pleased to see that the new company, Camanio, who now integrated Telia, they really did the first pilot in their platform in one Swedish municipality in the quarter. And as soon as that proves to be really good, we know that we will implement in more and more municipalities throughout the year. And I think the digital solutions we now have on board and the opportunities for digital solution in the home care, taking care of the elderly people will be a very important part of the AddLife's offering to the market going forward.
As I said, and you all know that we did, with acquisitions completed in April, totally 4 acquisitions, adding full year sales of SEK 830 million and 350 employees. And the plan, as I said in previous meeting is actually that if you look at 2022 going forward, this is a year for consolidation. It's a year for integration because we really need to get the possibilities we now have with all the new acquisitions on board, we really have to take a big grasp on those and make sure that we can see the fantastic networking opportunities and the sales opportunities inside this group to happen during this year.
So actually, we have just finalized the first MD meeting in 2 years. We have had 2 days with 80 people together discussing how we can work more together, how we can really get out the best of all these companies we now have in the European market and make sure that we collaborate and find business opportunities together. So this is a really big focus from the AddLife team right now to make sure we get our arms around everything now when we can meet and that we really can use the knowledge together in the group.
It was very positive, I would say, from all new companies also because they haven't been able to meet all of us before. So 2 days with a lot of spirit and discussion about our growth journey going forward. Hopefully, we will see now that we have a lot of internal collaborations opportunities coming up during the year.
This is the graph for the long-term financial goals. If you look at the profit growth, it really looks a bit awkward. We had, last year, fantastic rolling 12 EBITA growth of more close to 200 percentage. We are now down in this quarter rolling 12, 35 percentage, which is still a lot, lot more than the 15% target that we have.
We look at the profitability. It goes down a little bit, of course, both due to the EBITA figures are going down a little bit, but also actually, we have increased stock in a few companies during this quarter because we had to make sure that we could manage the complexity in the global sourcing and supply chain. It is, as you all know, quite complicated with freight, raw material price increases, et cetera. And we have just to make sure that we could deliver to the customer. So in a number of companies, we decided to increase a little bit of stock in the quarter.
So summarizing the income statement. I'm not sure if it's so much to say, we increased sales, 49%; EBITA 34%. Of course, depreciation of intangibles have increased quite substantially, and that is, of course, due to all the acquisitions the last year. And all these acquisitions has also meant, as you know, that we have taken on much more depth, which means that our financial cost has increased also during this quarter.
So going to the balance sheet, I would mostly like to mention that the financial net liabilities are now close to SEK 5 billion. But the ratio which we measure a lot in the Board, I think, it's very important for us is net debt to equity, and it's still 1.0. And for us, that is a ratio. We don't want to be long term more than 1.0. But right now, if we also look at financial net liabilities compared to EBITDA, it's 3.2%. We all realize it's a bit too high. So the rest of this year, we will use the cash flow we get out of the business to reduce liabilities, to strengthen the balance sheet a little bit before we take the next step in our growth journey with acquisitions. And the equity ratio still very good on 37 percentage.
Cash flow this quarter was good, SEK 332 million from operating activities. And as we showed specifically in this slide, the adjustment for noncash items is really the increased amortization that we have in the group.
So I think I will open up before -- for a lot of -- if you have any Q&A, but I would like to summarize this as a very good quarter. And as we see also our total margin decreases somewhat just as expected. Before COVID, AddLife had a margin of 8.8% actually in 2019, we are right now running at 16.9%. I think we foresee that the margin with all the acquisitions will be somewhere around 13%, 13-plus, where we have the existing product mix right now. Let's see how it ends up.
Now I will try to open for questions.
So I have a couple of questions, but maybe if we start with the boring COVID one. Just so we get some kind of information regarding the exit rate, I guess, in the quarter and maybe how April has looked because I think all the companies are basically saying that, and we can see it in infection rates, that it's going down quite dramatically now in Q2 and probably also going into the summer and spring. What can I say is, I guess, it's fair to assume a very dramatic drop in the COVID testing or what are you seeing right now?
Yes. Yes. That's exactly what we assume as well. So I would say, Q2, it will be a big drop exactly or the sales figure will be -- it's too early to say. We haven't got that. Of course, we see a few days of April. It has gone down quite a lot, which is expected. So you should foresee a big drop in the second quarter, yes.
Okay. Yes. And the COVID sales, is that mainly, I think, Q4 been mostly in the Nordics, not as much in Central Europe.
Yes, mainly in the Nordics. But actually, with the awful war that happens in Ukraine, we have a lot of refugees coming into some countries close by. So in those countries, we have some more infection spreads. And actually, they have opened up a little bit for more testing, but it's too early to say where that ends.
Yes, I see. And then maybe if we look more in the Medtech segment, it seems like organic growth has accelerated throughout the quarter when you were speaking, but you also highlighted the strike in Finland among nurses, and I guess a lot of surgeries have been postponed, we can read in the newspaper. What is it possible to give any kind of indication of how it will impact the growth? I mean it still sounds like home care is accelerating in the end of the quarter. So I guess we should expect organic growth underlying to accelerate from 1% organically in the upcoming quarters? Is that fair to assume?
Yes, it will accelerate. Absolutely, that's what we foresee that even though rates strike in Finland, I just wanted to mention that because -- yes, I fully understand that health care professionals after these 2 years want some extra wages. But still, I mean, there's a lot of different things happening in the world, but it is a big focus to restart all the surgeries. And I would say, in U.K., especially, they have done -- opened up specific clinics just to take down a few different illnesses where they're really focused to do so many surgeries a day as possible. So there's a lot of new opportunities to sell actually. But it takes some time to make this change in more of the administration in the hospitals. But of course, it will accelerate from this point.
Yes. Okay. And have you seen in -- for example, if you take U.K. and Spain, I guess, the 2 now large markets for your elective surgery business. Have you seen that, what do you say, the challenges, the operational challenges in hospitals, are they improving? Or what's your view there?
I mean the situation from our side is improving a lot. And we -- actually Spain, I would say, is the country where we see the largest progress. So they have really been able to change faster than, for example, the Nordic countries. So in Spain, we have seen a higher activity compared to what MBA had for the last year. So just in Spain, it is a really good and strong start.
Okay. That sounds good. And then maybe just a few more on the supply chain constraints and the price increases. Is it possible to say if you've had any material, let's say, impact on your deliveries in the quarter and approximately how much are you impacted by the higher costs for fear, et cetera?
So far, we have managed very well. I said that, I mean, we have strengthened our margins. So our companies have been very good at really taking care of the price adjustment so far. So, so far, I think, we have managed very good, and we didn't see any push right now on the margins. But for sure, after the war in Ukraine, the situation changes a little bit more in the world. So it's too early to say where it ends.
I mean now you have everything with gas and oil and all that stuff. So it is a complicated market situation for us as well as for everybody else. But I think we have managed so far very good. And from our perspective, I think, also the agility we have with our subsidiaries is quite unique here. So just looking back what our subsidiaries manage throughout the COVID pandemic, they are very fast in the market, finding solutions on differences and difficulties in the market. And I would say they are continuously doing that. So I'm not that worried, but of course, it could be a little complicated.
Yes. Because that was also my -- maybe my last question on the gross margin because it's rough around 200 basis points year-over-year. And I guess that also has to do a lot with acquisitions that maybe have higher gross margin. But is it possible to say like what the gross margin was year-over-year on a like-for-like basis? Or is that hard?
No. No, I don't have -- I actually don't have that figure. But yes, you are right. Our new acquisitions have higher margin, and that is actually the acquisition we did in the Medtech area. They have higher margins because they are really niche to focus in the elective surgery side, where we have this really add-on value to the customer. That's why we get higher margins. So -- and that is the anticipation we all had with the acquisition that it should be companies with higher margins that we add to the group.
So I would say, a big take off for many of our companies after these 2 days with all the MDs is actually to discuss with these new companies, okay, how do you manage to have these high margins. So I think it will be interesting to see how the colleagues within that life family starts to work even harder with the margins.
That sounds promising.
Thank you.
I see somebody else and if you have raised your hand, please, if you can change this so we can talk, so we can hear you.
Kristina, it's Anna from Handelsbanken. Just 3 follow-up questions from my side. So since you've in the quarter seen the trend going closer to new normal selling in the Labtech business, would you still think that the annual boost of around SEK 300 million would be reasonable to assume ahead compared to the pre-pandemic levels? Or have you shifted your estimates in this matter?
No, we haven't shifted any estimates.
And could you maybe talk a bit on how the experience of the first add-on acquisition in Healthcare 21 has been?
They've been on board for 2 weeks. So it's a bit difficult to say. So Anna, yes, I mean, this add-on was just sort of to talk about doing this. It was fantastic. I mean O’Flynn is a company that Healthcare 21 have known for many, many years. And it was actually on the list when we acquired Healthcare 21 because it was a fantastic match for them in the Irish market. And their business model is a lot about actually renting out products to the health care.
And I would say, if you look at the health care, we will probably see some change of the business model because instead of them always buying all the products they need, they perhaps would like to ramp. And what I like with that model with O’Flynn that is actually more a sustainable model. That means actually that they rent out instruments or beds or other stuff. When a new user should have it to take it out -- take it back, they decontaminate it and then send it out to the customer again. So the sustainability focus is really good in the business with O’Flynn. So I think that adds another end goal to our business to see opportunities with this rent take in, get out again. Long term, I think, it's very positive.
So the -- I mean, actually, it's the people in Healthcare 21 who have done all of the work with this acquisition and us in Stockholm have, of course, talked a lot with them, but they have finalized the full deal themselves. So it's been a great journey. And I think it was very good both for Healthcare 21, in fact, for you guys as well to see that what we have discussed so much that we should have new platforms where we can add on acquisitions. Yes, this is the first one we did. And I foresee that we -- I'm not sure during this year, but later on, we will add a few add-on acquisition in this size because it's very good. And for those companies like Healthcare 21, they really have the capacity to do that.
Perfect. And sort of detailed question. You mentioned that some companies you have seen an inventory buildup. Do you expect this to continue any further? Or do you think that from now on you were already at a stable level?
I mean it's from time to time. And the problem is actually sometimes we get more or less containers with products from China or somewhere in Asia. And instead of just taking one, perhaps we took 3 because we would secure -- because a few years ago, we knew that the shipment time or the freight time the product was perhaps 6 weeks or 8 weeks. And now it could be 12 or it could be 5 or it could be 15. So the freight time has changed dramatically due to the shortage, especially in the sea freight. So therefore, we decided, in some cases, let's make sure to put in some extras, just so we can sort of send the products to the customer. We don't have any ambition to long term, of course, increase our inventory. But short term, in different cases, I think, it's good for the business to do it because then we can -- yes, competition again, if we can deliver, it's better for us.
Okay. Perfect. That's all my questions.
Thank you, Anna. Okay. I don't see any more hands out there right now. So Karl, again.
So just a question on -- I think, you announced in the quarter, but not maybe a press release, but I saw it that AddVision is entering Sweden with a greenfield, let's say, expansion. It would be interesting if you could maybe explain a bit more on the strategy for AddVision, how you expand their offering into new markets, maybe both organically but also with -- or inorganic growth?
Yes. The same for AddVision as we had with Healthcare 21. When they came on board, they had a list of interesting companies to add to the group. We, of course, review that. We had a few -- for the Nordic market, we had a few candidates, but when we reviewed them, we saw that exactly in the segment or the niche where AddVision is strongest, those companies were not so strong as we wanted. So we thought it was easier because they actually have European contracts for their suppliers in many cases.
So therefore, even though it takes a little bit longer time, we actually employ to very well skilled and experienced salespeople who are now opening up the Swedish market. So we've been doing a lot of market research before going in. So that was a typical greenfield, which we decided. We are also looking into some other markets and especially now when you see with the new acquisitions we have like MBA or companies in Italy, et cetera, we're discussing with our AddLife companies in the group to see what do they see in these markets, either we go for an acquisition there or perhaps we open up in existing other AddLife companies.
So this is really a discussion ongoing right now. So it's too early to explain to you guys, but we are really going through each and every market and say, "How should we do it?" Because they are, for sure, ophthalmic surgery with age explosion is something that is very important for the future. So I think what we've seen from the segment and opportunities, we will find a solution for each and every country.
Yes. And then just maybe a question on you acquired BioCats in the beginning of Q2. I think it's quite interesting because you are acquiring, let's say, maybe, you're entering into segments with, let's say, higher growth rates, I guess, genomics, cell biology, et cetera, is growing quite much faster than the, let's say, average Medtech or diagnostic market in Europe. So I'm just wondering how the prices are looking on these acquisitions like this.
The multiples on these acquisitions are -- I mean, it's quite small companies. The average, I would say is 7, the multiple right now on these smaller acquisitions. And BioCat, for example, they have a lot in common with the company Bio-Connect that we bought in Benelux last year. They have a lot in common with our BioNordika companies in the Nordics that we have had for ages and with EuroClone that we now have since 2 years in Italy. So these companies have actually a lot of comments that they all work within these interesting areas. So they are a new segment where we really together can build much more in more markets.
So for us, we are not going into any new research segment because we had it, but it's for us, it was the first time we had that research segment in Germany, for example. But the group and the knowledge in the group has been here for many, many years.
So it's 5 past -- yes, 10:36. I think we are ending this meeting. But if you have more questions, I'm available for a chat or a mail or whatever. Thank you very much for listening in and I wish you a great day. Bye-bye.