TABY, Sweden, April 17, 2002 (PRIMEZONE) -- Ortivus AB:
Significant Events:
-- Sales increased by 13 percent to MSEK 41.8 (36.8 previous year).
-- Operating profit amounted to MSEK 5.3 (-5.3).
-- Net result after tax amounted to MSEK 3.7 (-4.1).
-- The subsidiary Sweet Computer Services, Inc., had very strong
growth during the first quarter with a 56 percent increase in
sales compared with the previous year.
-- Revenue from the cooperation agreement with Philips Medical
Systems increased during the period.
Financial Report
Sales and Result
The Group's net sales increased by 13 percent to MSEK 41.8 (36.8). Of this, revenue from sales to Philips Medical System amounted to MSEK 17.6 (13.2), revenue from sales in the subsidiary Sweet to MSEK 20.4 (13.1), sales of MobiMed to MSEK 3.2 (10.2) and other sales to MSEK 0.6 (0.3). Revenue from Philips was determined by the contractual minimum guarantee. Based on the agreement on technology and product development between Philips and Ortivus, MSEK 3.6 was taken up as revenue during the period.
Gross profit increased by 36 percent compared with previous year. The major reasons are the strong increase in revenue from the agreement with Philips and the favourable effects of exchange rates. The strong increase in sales of Sweet's products with high gross profit had a favourable affect on gross profits. Costs amounted to MSEK 32.0 (32.6), including depreciation and amortisation of MSEK 3.6 (5.2).
The result after financial items amounted to MSEK 5.6 (-3.3). Operating profit before depreciation, amortization and financial items amounted to MSEK 8.9 (0.0). The improvement in performance can be explained mainly through successful growth in the subsidiary Sweet, increased revenue from the cooperation agreement with Philips via the agreement on technology and product development, and the positive dollar exchange rate and hedging. Parent company costs and depreciation and amortization have decreased.
Total consolidated cash flow for the period amounted to MSEK -4.2 (-8.9). The negative cash flow is mainly the result of an increase in accounts receivables.
Consolidated equity during the period has increased to MSEK 165.4 from 161.9, profit for the period amounts to MSEK 3.5 and translation differences in subsidiaries MSEK 0.0.
Investments in tangible fixed assets amounted to MSEK 1.8 (0.4). The Group's liquid funds amounted to MSEK 61.8 (86.8). Interest-bearing liabilities amounted to MSEK 0.0 (1.0). The debt-to-equity ratio was 0 percent (1 percent). The Group's net financial items were MSEK 0.3 (1.9). The Group hedged estimated currency inflows in US dollars during the period. Without hedging, the reported result would have been MSEK 0.6 lower. The Group's tax expense of MSEK 2.2 is attributable to Sweet.
The parent company's revenue amounted to MSEK 20.5 (20.4) and the result after financial items and taxes amounted to MSEK 3.9 (-4.8). The Group has estimated accumulated tax loss carry-forwards of at least MSEK 135 for year 2002.
Market
MIDA
Cooperation Agreement with Philips Medical System
Ortivus' two agreements with Philips Medical System consist of a distribution agreement for MIDA technology and an industrial cooperation agreement. The two agreements include provisions for guaranteed minimum compensation totaling MUSD 32. Ortivus has recognised MUSD 14.8 as revenue, as guaranteed minimum compensation through first quarter 2002.
The industrial collaboration with Philips has become more extensive. New product launches are expected in 2002 that should include products such as Ortivus' system integrated in Philips' new patient monitoring system. By collaborating with a global company, Ortivus' technology and systems solutions can become components in a significantly larger range of products, and in substantially greater volumes.
MobiMed
Marketing and sales campaigns for the new generation MobiMed 300, launched in autumn 2001, have brought great attention to the system. During the period, ten MobiMed 300 have been sold to customers in the Nordic countries and Great Britain.
Discussions are currently in progress with distributors in several European countries. A test installation was implemented in France during the period.
Customers have been very enthusiastic about MobiMed 300. Discussions about purchases are in progress with several ambulance organisations. Sales of MobiMed in Great Britain were lower during the first quarter this year compared with previous year, as was expected. MobiMed sales are expected to be higher for the current twelve-month period, compared with 2001.
Sweet
Effective as of January 1, 2001, Ortivus acquired the American company Sweet, the market leader in the United States in the area of emergency management software.
Sweet has launched new software offering a complete management system for dispatching, invoicing and patient medical records, which has been well received. Sweet's existing sales and service organisation, as well as their customer base of 1,700 customers across the United States, pave the way for MobiMed in the American market. Together with Ortivus' clinical systems, a complete product program for ambulance health care can be offered in the United States.
Biosaca
Biosaca was recently launched via distributors to customers in the Nordic countries and Canada. Five Biosaca units were sold during the first quarter this year. Discussions are currently in progress with several distributors, which should result in increased sales during the year.
Organisation and Business Development
Goteborg operations were moved to the Stockholm office during the period. The lease agreement for the office in Goteborg was transferred to another company beginning in April, relieving Ortivus of all obligations to the property owner. By concentrating operations in one site, the company can realize substantial cost-savings and efficiency gains.
The strengthening of the sales and marketing organisation initiated last year has continued. The aim is to provide resources and skills to establish Ortivus on new markets, with a focus on building distributor networks in the larger European markets. At the same time, support and sales functions on existing markets have been strengthened in markets such as Scandinavia and Great Britain.
In early 2002, development concentrated on increasing functionality in the MobiMed system to better meet customer needs for follow-up and quality assurance of the operation. The new MobiMed 300 platform simplifies adaptation of the system to specific customer requests. In addition, the new platform makes it possible to expand the system with new functions in the future.
The industrial collaboration with Philips continues and will be further intensified during the year. In late autumn, several elements of Ortivus technology will be integrated in Philips' new patient monitoring system.
Ortivus is also running several remote-monitoring projects for patients in the home environment. For example, equipment and systems have been developed to monitor infants at home. Using this equipment, the physician can remotely monitor the child's vital signs (EKG, blood oxygen level, etc.) and even observe the child via a bed-mounted camera. The demonstration has been carried out in cooperation with JM Bygg in a model apartment for the future.
Future Prospects
Ortivus has built a strong position in Sweden and Great Britain in the field of ambulance and emergency health care services. MobiMed 300 and Biosaca have been launched and enjoyed a positive reception. The products are heading for an even broader launch in Europe. This means that MobiMed 300 and Biosaca are expected to continue growing rapidly in Europe and North America during the year, even though the first quarter of 2002, as was previously forecast, was somewhat lower than last year. Sweet holds a strong position in the United States with flourishing sales. At yearend, Philips is expected to launch its Viridia-system with integrated MIDA algorithms.
The 2001 annual report stated that strong sales growth would continue, with significantly improved operating profit compared with 2001, and this forecast remains unchanged.
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www.waymaker.net/bitonline/2002/04/17/20020417BIT00840/wkr0001.doc The full report www.waymaker.net/bitonline/2002/04/17/20020417BIT00840/wkr0002.pdf The full report
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