OPFIKON, Switzerland, April 28, 2005 (PRIMEZONE) -- Nobel Biocare (Other OTC:NBCHF) (Stockholm:NOBE) continues to outgrow the market and continues on high profitability level: revenue in local currencies up 25%, North America up 35%, EBIT margin now at 31.5%.
Nobel Biocare has again posted record quarterly growth.
-- Continued strong expansion across all regions drove revenue up 25% in local currencies to EUR 108.0 million. North America recorded growth of 35% in local currencies. Europe grew by 17% in local currencies.
Profitability continues to improve.
-- Gross margin marks a new high of 81.3%.
-- Profit from operations (EBIT) rose 54% from EUR 22.1 million(a) to EUR 34.0 million. Operating (EBIT) margin climbed from 25.2%(a) to 31.5%.
-- Net profit more than tripled from EUR 17.5 million(a) to EUR 56.6 million, boosted by the increased profit from operations and the one-time net impact from the divestiture of Entific Medical Systems AB.
-- Basic earnings per share climbed to EUR 2.20. Positioning for the future continues to be of particular importance.
Positioning for the future continues to be of particular importance.
-- The fast growing demand for esthetic dental solutions has been addressed with the opening of Nobel Biocare's North American Ceramics Center and the launch of NobelRondo(tm) Zirconia dental ceramic porcelain.
-- 123 talented new people, of whom 85 are sales representatives, will ensure future innovation and that growth continues to outpace the market.
-- The Board of Directors has approved a buy-back of up to 4% of the share capital to fund a new option program for employees, directors and officers of the Company.
Selected Income Statement figures Restated
Jan-Mar Jan-Mar Change
In EUR M 2005 2004(a)
--------------------------------------------------------------
Revenue 108.0 87.7 23.1%
Growth in local currencies 24.6% 19.7%
Gross profit 87.8 68.8 27.6%
Gross margin 81.3% 78.4%
Profit from operations (EBIT) 34.0 22.1 53.8%
Operating (EBIT) margin 31.5% 25.2%
Net profit 56.6 17.5 223.4%
Net profit margin 52.4% 20.0%
Basic earnings per share, EUR 2.20 0.69 218.8%
Basic earnings per share, CHF 3.41 1.01 237.6%
Note(a)2004 numbers have been restated
reflecting implementation of
IFRS 2 (Share-Based Payments).
Revenue by region Jan-Mar Jan-Mar Change in %
in EUR M 2005 2004 EUR local curr
------------------------------------------------------------------
Europe 53.4 45.6 17.1 16.8
Proportion of
total revenue 50% 52%
North America 36.8 28.2 30.5 34.8
Proportion of
total revenue 34% 32%
Asia/Pacific 12.2 10.1 20.8 23.9
Proportion of
total revenue 11% 12%
Rest of the World 5.6 3.8 47.4 45.3
Proportion of
total revenue 5% 4%
-----------------------------------------------------------------
Total 108.0 87.7 23.1 24.6
Rapid expansion across all regions
Nobel Biocare kept up the high growth momentum in the first quarter. Total revenue rose by 25% in local currencies to EUR 108.0 million. For the fourth consecutive quarter, Nobel Biocare expanded by more than 20% in local currencies, outgrowing the market and clearly confirming the Company's leadership position globally as well as regionally.
Growth was driven by strong volume expansion and mix changes, while the impact of the price increases contributed some 3.4% to growth.
With growth of 35% in local currencies, North America recorded an extraordinarily strong performance. This is a direct result of a broad and innovative portfolio, increased sales and marketing initiatives and the strengthened sales force.
All major countries across Asia/Pacific and Rest of the World continued to expand rapidly.
In Europe, strong revenue growth in France, Spain, Belgium, The Netherlands and Switzerland compensated moderate growth in Germany, where confusion surrounding the healthcare reform negatively affected the market.
Second Ceramics Center opened and NOBELESTHETICS(tm) enhanced
Worldwide rapidly growing demand for esthetic dental solutions is driving the need for greater access to training and technology. In early April 2005, the Company inaugurated its North American Ceramics Center in Mahwah, New Jersey. It features a Procera(r) manufacturing facility and a dental training institute. This expansion follows the recently opened European Ceramics Center in Stockholm. The 3,700 m2 (40,000 plus square feet) building combines state-of-the-art facilities and interactive technology to deliver comprehensive educational programs to clinicians and lab technicians. The facility includes a laboratory training area that accommodates up to 40 lab technicians, and a lecture hall for up to 120 clinicians.
The NOBELESTHETICS(tm) portfolio was further enhanced with the introduction of NobelRondo(tm) Zirconia, a highly esthetic and exceptionally strong dental ceramic porcelain.
Sustainable profitability improvement
Gross profit climbed to EUR 87.8 million, up from prior year's EUR 68.8 million(a). Continued volume growth, combined with favorable mix change and increased prices on existing products, resulted in a record gross margin of 81.3% compared to 78.4%(a) in the first quarter of 2004.
In line with the trend seen in the second half of 2004, obsolescence cost related to inventory rationalization, recorded under cost of sales, amounted to EUR 0.2 million compared to EUR 0.8 million a year ago.
Despite expanded headcount and extended marketing initiatives, operating cost was reduced to 49.8% of revenue (53.2%(a) prior year). Operating expenses amounted to EUR 53.8 million up from EUR 46.7 million(a). Social charges related to the staff option program were EUR 2.7 million compared to EUR 2.4 million a year ago.
Based on the implementation of the international financial reporting standard 2 (IFRS 2, Share-Based Payments), cost for staff options have to be recorded in the income statement, amounting to EUR 1.0 million in the first quarter of 2005. The restatement for the prior year is EUR 0.6 million.
In line with implementing IFRS 3 (Business Combinations), Nobel Biocare ceased to amortize goodwill as of 1 January 2005. In the first quarter of the prior year, the respective goodwill amortization was EUR 2.1 million.
Thanks to improved gross profit and controlled operating cost, profit from operations (EBIT) expanded to EUR 34.0 million (EUR 22.1 million(a)) in the first quarter. This translates into an EBIT margin of 31.5%, up from 25.2%(a) a year ago. Financial income was greatly boosted by the divestiture of the participation in Entific Medical Systems AB. After consideration of all related costs, this divestiture added a financial gain of EUR 30.6 million in the first quarter of 2005. Net profit increased to EUR 56.6 million (EUR 17.5 million(a)).
Total capital expenditure on property, plant and equipment in the first quarter remained on the same level as last year, amounting to EUR 4.6 million.
(a)2004 numbers have been restated reflecting implementation of IFRS 2 (Share-Based Payments).
Strong balance sheet
Inventories increased slightly to EUR 18.9 million compared to EUR 17.6 million at year-end. In line with the trend seen in 2004, days of sales outstanding at the end of March 2005, in local currencies, were slightly reduced.
Cash and cash equivalents totaled EUR 251.9 million (31/12/2004: EUR 194.9 million).
In addition to an increased dividend of CHF 2.65 per share (up from CHF 1.30 in 2004), the Company's Board of Directors announced a share buy-back program of up to 4% or 1,100,000 shares over the next two years to fund a new staff option program for employees, directors and officers of the group.
Annual General Meeting
The Annual General Meeting will be held in Zurich, Switzerland, today at 10.30 am, and an information meeting for Swedish shareholders will be held in Gothenburg, Sweden, on 2 May 2005 at 5 pm.
Nobel Biocare World Conference
On 5-9 June 2005, Nobel Biocare will host its second World Conference in Las Vegas. The conference theme will be "The best evidence-based solutions for your patients", emphasizing minimally invasive dental solutions. In pre-conference, arena and focus session programs, attendees will be able to enroll in university-oriented courses offered by an outstanding faculty of more than 160 world-renowned dental lecturers. The accompanying satellite transmissions will feature live surgeries and clinical demonstrations of Nobel Biocare Crown & Bridge & Implant (C&B&I) procedures.
Outlook
The company is confident that it will achieve its financial objectives of improving annual revenue growth and profitability.
NOBEL BIOCARE HOLDING AG
A telephone conference will be held today 28 April 2005 at 15.00 CET. (For more details, see our homepage: www.nobelbiocare.com)
The dial-in numbers for the telephone conference are: +41 91 610 5600 (in CH) +44 20 7107 0611 (in the U.K.) +46 8 5069 2105 (in Sweden) +1 866 291 4166 (toll free number in the USA)
A Digital Playback service will be available after the conference from 17.30 CET on Thursday 28 April, until 17.30 CET on Monday 2 May.
Please dial any of the numbers below and enter ID code 385 followed by the No. (pound) sign.
+41 91 612 4330 (in Europe) +44 20 7108 6233 (in the U.K.) +1 866 416 2558 (in the USA) Financial Report Calendar 2005: Annual General Meeting 2005 28 April Interim Report 2, 2005 11 August Interim Report 3, 2005 21 October All reports are available in English, German and Swedish
Disclaimer:
This report may contain forward-looking statements including, but not limited to, projections of future performance of materials and products, financial conditions, results of operations and cash flows, containing risks and uncertainties. These statements are subject to change based on unknown risks and other factors that could cause the actual results or performance to differ materially from the statements made herein.
Nobel Biocare is a medical devices group and the world leader in innovative esthetic dental solutions with its brands Branemark System(r), Replace(r) Select, NOBELPERFECT(tm), NOBELDIRECT(tm) (dental implants) and Procera(r) (individualized dental prosthetics). Nobel Biocare is a one-stop shop for restorative esthetic dentistry, offering a wide range of innovative Crown & Bridge & Implant products, as well as training and education and clinically documented treatment concepts. Nobel Biocare has 1 553 employees and recorded revenue of EUR 388 million in 2004. The company is domiciled in Zurich, Switzerland with headquarters in Zurich and in Gothenburg, Sweden. Production takes place at four production sites located in Sweden and the USA. Nobel Biocare has direct sales organizations in 29 countries. The shares of the parent company Nobel Biocare Holding AG are listed on the SWX Swiss Exchange and on the Stockholm Stock Exchange, Sweden.
Celebrating 40 years of scientific heritage. In 1965, the first patient was treated with the original scientific dental implant system, the Branemark System(r). This event marked a breakthrough in modern dental implant therapy. Since then, millions of people have been helped with dental implants, enjoying improved function, appearance and quality of life. The original fixtures that were placed in the first patient 40 years ago are still in place, providing the individual with firm bridge support. The Branemark System(r) has been scientifically documented in 1,500 articles.
www.nobelbiocare.com
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