Earnings Call: Q1 2021

Apr 28, 2021

Hello, everybody. Today, we have reported our 1st quarter report of 2021. And I'm delighted to show you some information about what we have managed to do in the group so far this year. Look at the quarter in total, we had really a record quarter. Once again, I must say, we have, for The last full year actually had fantastic results in the group. So this in this quarter, we have exceptional strong organic growth in the Lab Tech business area, and I will come back to that. If you look at the sales side, we have sales of SEK 1 point SEK7 billion, which is 65% better than the same quarter last year. We had a result EBITDA of SEK 326 1,000,000. It's actually 2 0 9 percent better than compared to the same quarter last year. And actually, SEK 326 is even more than the full year result we had in 2019. So we are doing fantastic job within our organization. The EBITA margin ended up at 18.8 percentage. So you should all be very proud of being part of this journey together with us. I will also now talk a little bit later on about the 2 strategic acquisitions that we have done early in April. Talking about the Q1, of course, we have to talk about the COVID pandemic. The pandemic is still here and we had a 3rd wave in this quarter. And it has actually been very tough in most of the countries where we have our business. The sales on the COVID side were SEK 620,000,000 Swedish krona in the quarter, which was very high. It was intensive COVID-nineteen testing in all countries. So the diagnostics company had really good sales due to that. We also have seen very high activity around virus research. And that is mostly when you're looking at gene sequencing on the different mutations of the COVID-nineteen. In the medtech field, we have seen, of course, a setback in elective surgeries. We all see and read about there is less procedures taking place in all hospitals around the world. The hospitals really have to reallocate the resources and work within the COVID pandemic instead. Coming into the lab tech, we saw a sales growth of 84 percentage. Everything was organic. It's a fantastic quarter. If we take away the strong COVID-nineteen sales, we actually had an organic underlying sales of 8 percentage, which is still even higher than the normal average we have had on the organic side for a number of years. So summarizing the Labtech business, we had sales of SEK1.1 billion in the quarter. EBITA ended up on 2.62 and the margin was 23.2 percentage. That is exceptional high. So, very well done by all of you working in these companies in our group. If you look at the MedTech figures, we had a very good sales growth of 38%. Most of that was driven by the extra PPE sales we had in Central Europe. We didn't actually have so much PPE sales in this quarter in the Nordics. And as we all know, it was a setback in elective surgery. So organic underlying, we had 2 percentage growth in the quarter. In the medtech area, we also have our home care companies And they have still difficulties to go out to the elderly homes due to all the difficulties with meeting elderly people in the pandemic. Sales for MedTech in the quarter ended up at CHF 611,000,000 that was plus 38%, EBITA of €64,000,000 and the margin ended up at 10.6 percentage. So that is more or less summarizing the quarter. It has been a very good quarter, especially in lab tech, but a little bit tougher in the medtech. But I think we all see that elective surgery hopefully will come back now when more vaccination has been done of all of us actually in the countries. So, Directly after the quarter, we did 2 really large acquisitions adding into Adlife Group. The first of them is a company named Vision Ophthalmology Group. It has business in Switzerland, Germany, UK and Poland. And they are focusing surgery, eye surgery, you could say, or ophthalmology surgery. It's a niche Company in a very attractive segment where we didn't have any business before. And this segment is, of course, growing because we are getting older and older And the technology is just developing very fast. Vision Ophthalmology Group has 190 employees and they had last year sales of €700,000,000 Looking into the other acquisition that came just 5 days later, it was Healthcare 21. That is a group with a headquarter in Ireland, but also have business in the U. K. So it's more or less split fifty-fifty between these two countries. Net sales last year was SEK 1,700,000,000 and they have 4.50 employees. Healthcare 'twenty one is very much look alike, the medtech business that we have in Adlife, but they also have some businesses within diagnostics and research and actually home care as well. Both these companies, Of course, a very good and big add on to the Adlife Group. If we summarize and look at these companies coming into our organization and said, if we take the figures for 2020 and put these on top, we would actually have had 1800 employees And we would have had 70 subsidiaries in the group. And you can see the difference. Labtech, somewhat smaller now because These two companies are coming into the MedTech segment. But sales would have been SEK 7,600,000,000 in 2020 and the EBITDA would have been SEK 1,100,000,000. So this is really a big change to our group. Another change to our group is actually where the markets are, where we now do our business. If you look at the left side here, you see the sales per market that we had in 2020, where we had some 35% of sales outside of the Nordic countries. But with these 2 new bigger groups into our organization, we should have had more than 55% sales outside of the Nordics in 2020. So you see, it's a big shift from being a Nordic player to a more European player. And this is actually the new ad life that we now develop together for the future. And what will happen with the new ad life? Well, We are actually now an European player in life science. We have a very strong market presence in a lot of geographies, And that is a fantastic platform for us to develop for the future. We will continue with the decentralized model that we have had for so many years because we have seen that the small scale business, large scale wise, have been very good for us, and we think this is a superior model for the future. We will continue to focus on our vision and corporate philosophy. And of course, we will do much more work also within the Adlife Academy. We will get access to larger markets, more customers and more niches. And this is a great opportunity for us to broaden our internal network in the group. We will also, by this, get stronger supplier relationships that could give synergies of selling products between the companies in the group. We therefore see that we can increase a lot of internal opportunities and we also get opportunities to sell our own branded products in new markets with these expansions. And even after we have done these two acquisitions, we have still very strong financials. So we can continue our growth strategies. I hope this gives you a little bit of a flavor of where Ad Life has moved over the last 3 months. We have a very good foundation. And you guys, you do a fantastic job in our companies. And we're all looking forward to the future within the new life. Have a really good day. Thank you very much.