Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Medistim ASA (FRA:MD1, Financial) reported a 7% growth in sales in Norwegian currency for the third quarter, with a total sales growth of 5.3% when accounting for currency effects.
- The Americas region showed a robust recovery with a 17.3% increase in sales, currency neutral, for the third quarter.
- Year-to-date, the Americas region has shown a 6.3% growth, and the EMEA region has shown the highest growth percentage at 6.8%.
- Third-party products experienced significant growth, with a 14% increase year-to-date.
- The company has a solid cash position, ending the period with NOK127.3 million in cash.
Negative Points
- Operating profit (EBIT) is slightly down compared to the previous year, largely due to product mix and costs from establishing new direct market operations.
- The Asia Pacific region experienced a decline in sales, particularly due to low sales to Japan and the transition in China.
- There is a declining trend in the unit sales of imaging systems, with 15 fewer units sold this quarter.
- Net finance is negative due to foreign currency effects, impacting the overall financial results.
- The earnings per share are down compared to the same period last year, reflecting weaker EBIT performance.
Q & A Highlights
Q: Can you elaborate on the reasons behind the decline in EBIT margin this quarter?
A: Kari Krogstad, President and CEO, explained that the decline in EBIT margin is largely due to the product mix and the costs associated with establishing new direct market operations, particularly in China, Canada, and Sweden. Additionally, the company has doubled shifts in production, which has increased operating costs.
Q: What factors contributed to the strong sales growth in the Americas region?
A: Kari Krogstad noted that the Americas region experienced a 17.3% growth in sales, currency neutral, primarily due to increased sales of MiraQ systems in the USA, where the company achieves the best prices. The region also benefited from a strong start to the year in Canada and good development in Latin America.
Q: How is the transition to direct operations in China impacting sales in the Asia Pacific region?
A: Kari Krogstad mentioned that the transition to direct operations in China has been challenging, but the company saw decent sales from its direct operation in China this quarter. However, weak sales to the distributor in Japan have negatively impacted the overall performance in the Asia Pacific region.
Q: What is the current status of Medistim's imaging systems sales?
A: Kari Krogstad highlighted that the sales of imaging systems have been declining due to the challenging macroeconomic environment. The company sold 15 fewer imaging units this quarter, with weaker sales primarily through distributors. However, there is an opportunity to upgrade flow-only systems to include imaging capabilities in the future.
Q: Can you provide more details on the growth in third-party product sales?
A: Thomas Jakobsen, CFO, stated that third-party product sales grew by 17% this quarter and 14% year-to-date. This growth is attributed to strong performances from agencies like Mentor, Icare, and A.M.I, as well as contributions from new agencies such as Peters Surgical and TisgenX.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
