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ADVA unveils path to higher profitability at 2021 capital markets day - Seite 3

The company introduced a cost improvement program in 2019 with the clear goal to keep OPEX stable in 2020. In the financial year 2020, OPEX was EUR 165.2 million, even EUR 5.3 million below the EUR 170.6 million the company saw in 2019. "Our cost improvement measures showed the expected effects, but, like many other companies, we also saw cost savings from lower travel activities due to the ongoing pandemic. However, the new normalized cost base will contribute to higher margin levels going forward," Uli Dopfer emphasized. The CFO reported that gross margins in 2020 already benefited from the investments made in recent years.

The company improved its free cash flow from EUR 7 million to EUR 39 million in 2020 and reduced its debt from EUR 81 million to EUR 62.6 million year-over-year. "Without applying IFRS 16, which includes lease liabilities, ADVA is once again cash positive. With gross leverage of only 0.7x, we have a very solid balance sheet and investment-grade capital structure that gives us flexibility for strategic investments," Uli Dopfer said. Higher volumes, the acceleration of ADVA's transformation strategy, Covid-19 recovery and the OPEX improvement measures will set the path for new profitability levels and cash improvements. "Our clear goal is to reach a pro forma operating income of 10% of revenues by 2023," Uli Dopfer stated.

ADVA has set clear priorities for capital allocation and driving shareholder value. "We will continue to translate our higher profitability into cash flow. Sustainability forms an integral part of our strategy, growth plans and management remuneration. Our solid balance sheet lets us think about strategic opportunities - but let's do it step by step," concluded Uli Dopfer as he finished the presentation.

Learn more about ADVA's 2021 capital markets day here: https://www.adva.com/en/about-us/investors/capital-markets-day

Forward-looking statements
The economic projections and forward-looking statements contained in this document relate to future facts. Such projections and forward-looking statements are subject to risks that cannot be foreseen and that are beyond the control of ADVA. ADVA is therefore not in a position to make any representation as to the accuracy of economic projections and forward-looking statements or their impact on the financial situation of ADVA or the market in the shares of ADVA.