CellaVision AB : Year-end bulletin 2015

2015- A record year for CellaVision

October 1-December 31, 2015  Net sales decreased by 15 % to SEK 61.6 million (72.5) Operating profit was SEK 16.4 million (16.8). The operating margin was 26.7 % (23.2). Profit before tax was SEK 16.8 million (16.6). Earnings per share were SEK 0.64 (0.49) Significant events after the first quarter Launch of the new CellaVision® CDMS 6.0 software and an update of CellaVision® Remote Review.

January 1-December 31, 2015  · Net sales increased by 10 % to SEK 239.4 million (216.9). · Operating profit increased to SEK 65.5 million (42.8). · The operating margin increased to 27.3 % (19.7). · Profit before tax increased to SEK 65.6 million (43.4). · Earnings per share increased to SEK 2.22 (1.32). · The Board of Directors proposes an increased dividend of SEK 1.50 per share for 2015 (1.00)

CEO's comments

2015 was a record year for CellaVision with a very strong increase in profitability and sound sales growth. The major follow-up order for the veterinary market contributed to a ten percent sales increase in 2015 to SEK 239.4 million (216.9). This, together with our indirect scalable business model, meant that the operating profit grew by 53 percent to SEK 65.5 million (42.8), which correspond to an operating margin of 27.3 percent (19.7). All in all, this means that 2015 was CellaVision's best year yet, and in line with our previously announced expectations of an operating income of SEK 65 million.  
 The development should also be seen in the light of 2014 being a good year for us. Seen over the past two years CellaVision's sales increased from SEK 179.9 million to SEK 239.4 million and the operating profit has moved from SEK 25.9 million to SEK 65.5 million, implying an improved operating margin in excess of 150% over two years.
 Sales in the final quarter of the year were SEK 61.6 million (72.5). The main explanation for lower sales is the veterinary order we received in the fourth quarter of 2014 that affects the comparison between the two quarters.
Final delivery of the other large veterinary order for more than SEK 30 million, most of which was delivered in the third quarter, was made according to plan in the fourth quarter. Our focus is now to optimize the installation so that the veterinary laboratories can use all the advantages that CellaVision's solutions offer.
 In the fourth quarter we also initiated contacts with new potential customers in the veterinary market and continue to evaluate this market both in the Americas and EMEA. However, the veterinary market is at an early stage of development and thus it is not clear how fast CellaVision can penetrate it.
 In the Americas our sales to human laboratories grew somewhat after a period of falling figures. One milestone is that we have now also installed our equipment at all 17 of the foremost hospitals in the USA. In APAC we saw continued positive development in both our key markets, Japan and China, and the region as a whole grew by about 18 percent in the quarter. In EMEA progress was somewhat weaker after a strong first half year and in the fourth quarter sales fell by about 11 percent.
 CellaVision is now implementing a series of activities aimed at strengthening the company long-term, with an expanded focus of evaluating establishment in new markets and regions. On the marketing side these activities include a newly started market support office in Dubai that will be operational in the first half of 2016 and a gradual expansion to new markets in APAC, with Korea as the next market.
 As regards our products and solutions, we started the launching process for CDMS 6.0 in the fourth quarter. CDMS 6.0 and an updated CellaVision® Remote Review are our latest software generation offering entirely new possibilities to link different laboratories into networks and perform analyses remotely. This considerably strengthens our offer to the larger laboratory chains. In the area of innovation we continue to focus on developing a technology platform for the 100,000 or more small and mid-sized human laboratories and approximately 5,000 veterinary laboratories.
 2015 was a year that we are very proud of. Having said that, we are now turning our sights on the future to continue developing CellaVision into an even more successful company.

Zlatko Rihter, President and Chief Executive Officer

Key Ratios

(MSEK)	Oct-Dec 2015	Oct-Dec 2014	Full year 2015	Full year 2014
Net sales	61.6	72.5	239.4	216.9
Gross profit	46.4	50.5	174.2	145.1
Operating profit	16.4	16.8	65.5	42.8
Operating margin, %	26.7	23.2	27.3	19.7
Profit/loss before tax	16.8	16.6	65.6	43.4
Return on operating capital %	-	-	92.0	62.0
Equity ratio, %	83.0	75.0	83.0	75.0
Cash flow for the period	8.1	-6.6	54.8	-6.0

Questions concerning the report can be addressed to:
Zlatko Rihter, VD, CellaVision AB
Tel: 0733-62 11 06. E-post: zlatko.rihter@cellavision.se
Magnus Blixt, CFO, CellaVision AB
Tel: 0708-33 81 68. E-post: magnus.blixt@cellavision.se

Link text: CellaVision AB Year-end bulletin 2015

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