CellaVision AB

Interim report January-March 2019

Good performance in all regions generated strong organic growth

January 1-March 31, 2019

• Net sales increased by 34% to SEK 103.9 million (77.6).
• Organic growth was 31% (-20).

Operating profit increased to SEK 34.9 million (23.2).

The operating margin increased to 33.6% (29.9).

Profit before tax increased to SEK 34.8 million (23.6).

Earnings per share before and after dilution increased to SEK 1.15 (0.80).

Cash flow from operating activities was SEK 51.1 million (6.4).

CEO's comments

The first quarter of 2019 was a good quarter for CellaVision, with sales of SEK 103.9 million (77.6) after strong organic growth in the Americas and in EMEA. Compared with the same period in 2018, sales increased organically by 31 percent, which means our sales have grown organically by more than 30 percent for three quarters in a row. It is worth noting that there is no single major order behind the quarter's performance. CellaVision's sales are volatile by nature, with fluctuations between individual quarters and between our three regions.

Profitability also progressed well during the quarter, with an operating profit of SEK 34.9 million (23.2), corresponding to an operating margin of 33.6 percent (29.9). The profitability growth is a result of CellaVision's effective indirect business model, continued sound cost control and good gross margins. Cash flow for the quarter strengthened to SEK 45.0 million (-2.4). One contributing factor to the cash flow is that high accounts receivable from the previous quarter are past due and paid-in. Exchange rate impact in the quarter was about three percent.

Market development

In Americas, sales grew by 28 percent to SEK 52.5 million (40.8) in the quarter. In the US and Canada, the number of end-user installations continues to increase and the market is developing at a steady pace. Brazil, where we established our own organization for local market support in 2018, is now also reporting rising sales.

EMEA grew by 57 percent to 38.5 million (24.6) in the quarter. Our increased activities in EMEA as of 18 months ago, with establishments of local market support organizations in key markets, are reflected in the rate of sales.

APAC had a stable quarter with six percent growth. Sales were SEK 12.9 million (12.2) and we continue to see a high level of marketing activities in all our key markets, not least China and Japan. In Australia sales are expected to pick up speed in the coming years.