Revenio Group Corporation Stock Exchange Release
October 21, 2014 at 9 am
Revenio Group Corporation's Interim Report January 1-September 30, 2014
Revenio Group Corporation is adopting the publication procedure enabled by the
Financial Supervisory Authority's Regulations and guidelines 7/2013 (Disclosure
obligation on issuers) and is publishing its Interim Report for January-
September 2014 as an appendix to this stock exchange release. This stock
exchange release is a summary of the Revenio Group Corporation's Interim Report
for January-September 2014. The Interim Report can be read in full in the PDF
appendix to this release. The Interim Report is also available on Revenio's
website: http://www.revenio.fi.
July-September 2014: Health Tech still on a growth track, challenges in
Technology and Services
Highlights for July-September 2014:
* The Group's continuing operations: net sales totaled EUR 5.0 million (4.5),
representing growth of 11.8%, while the operating result was EUR 1.1 million
(1.2), a fall of 7.4%.
* The net sales of the Revenio Health Tech segment rose by 25.3% to EUR 3.8
million (3.0). In spite of considerable investments in R&D and marketing,
the segment's operating result still increased by 10.4% to EUR 1.3 (1.2)
million.
* Probe sales continued to increase, with year-on-year growth of 19.7%.
* Sales growth in the Revenio Health Tech segment is expected to be more
vigorous during the last quarter due to the cyclical nature of the business.
* The third quarter was particularly challenging for the Revenio Technology
and Services segment. The segment's net sales fell by 16.0% to EUR 1.2
million (1.5). The operating result fell by 106.5% to EUR 0.0 million (0.2).
* During the review period on September 11, 2014, the entire share capital of
Midas Touch Oy, which represented the Technology and Services segment's
Contact Center business, was divested.
* Undiluted earnings per share, continuing operations EUR 0.10 (0,10) and
diluted earnings per share, continuing operations EUR 0.10 (0.10).
Highlights for January-September 2014:
* Very strong development was seen in the Revenio Health Tech segment in spite
of a challenging early year and the Group's all-time highest R&D
investments. The segment's net sales totaled EUR 11.1 million (EUR 9.4
million), representing growth of 17.9%. The operating result was EUR 3.8
million (3.6), a rise of 4.5%.
* The net sales of the Revenio Technology and Services segment fell clearly
short of last year, standing at EUR 4.3 million (5.1), down 15.7%. At EUR
0.3 million (0.4), the operating profit was also notably down on last year,
a fall of 28.3% on the corresponding period. Growth risks in this segment
have risen due to economic uncertainty.
Key Figures,
MEUR:
7-9/2014 7-9/2013 Change-% 1-9/2014 1-9/2013 Change-
%
Net sales,
parent company 5.0 4.5 11.8 15.4 14.5 6.1
Segment profit
margin, parent
company 1.1 1.2 -7.4 3.4 3.5 -0.9
Net sales,
Health Tech 3.8 3.0 25.3 11.1 9.4 17.9
Segment proft
margin ,
Health Tech 1.3 1.2 10.4 3.8 3.6 4.5
Net sales,
Technology and
Services 1.2 1.5 -16.0 4.3 5.1 -15.7
Segment profit
margin,
Technology and
Services 0.0 0.2 -106.5 0.3 0.4 -28.3
Net profit
from
discontinued
operations -1.5 0.3 -567.5 -1.4 0.7 -299.6
Diluted and
undiluted
earnings per
share
continuing
operations 0.10 0.10 0.5 0.36 0.29 22.1
Cash flow from
operating
activities 1.1 1.0 10.0 2.7 3.1 -12.9
30 Sept 30 June Change, 30 Sept 30 June Change,
2014 2014 %- 2013 2013 %-
point point
Equity ratio-% 77.2 72.6 4.6 73.4 69.8 3.6
Gearing-% -5.7 -5.7 0.0 -10.4 -17.2 6.8
Financial guidance
Revenio's financial guidance for 2014 remains unchanged: the net sales and
operating profit of continuing operations exclusive of non-recurring items are
expected to see year-on-year growth. Growth will focus on the Health Tech
segment. The growth risks in the Technology and Services segment have increased
due to financial uncertainty.
Olli-Pekka Salovaara, President & CEO comments third quarter results:
"During the third quarter, we continued to strengthen our market position in the
measurement intraocular pressure, and particularly in the United States and
Asia, where Japan and Australia are two of our strong areas. Distribution
channels and local sales permits play a key role in strengthening market
position. Icare is currently on sale in no less than 65 countries - a solid
foundation for our goal of becoming the global market leader in the measurement
of intraocular pressure. The new Icare HOME tonometer was completed in early
2014. Sales have been launched and the device has already been granted a sales
permit in 32 European countries, Canada, and Australia. The TA01 tonometer was
also granted a sales permit in Columbia, Argentina and Chile during the third
quarter. We are expecting sales permits in China and Brazil sometime next year.
During the current year, we have also strengthened our distribution chain in the
United States in particular, and preparations for the opening of our own office
in North Carolina during autumn 2014 are progressing as planned.
In order to launch sales of the Icare HOME tonometer in the United States, a
sales permit is required from the FDA. We are therefore continuing to collect
results from clinical trials, as they are required as appendices to the
application. In spite of our continual efforts during the third quarter to make
the process more efficient, the daily flows of patients that meet the criteria
are smaller than estimated, which is why this key stage of the application
process is taking longer than expected. We want to complete these preparatory
measures for the permit application thoroughly, to ensure that the rest of the
process flows smoothly.
I am very pleased that the sales growth rate of Icare devices and probes in the
United States returned to normal during the third quarter of the year, and that
the dip caused by political challenges in early 2014 has leveled out. Icare
once again achieved recordbreaking sales in September. The strengthening of the
US dollar had a favorable effect on Icare's third quarter result. Political and
economic uncertainty in Russia did not really affect Icare, as US sales account
for about 40% of Icare's net sales.
The Oscare Sono(TM) - a device for the diagnosis, screening and monitoring of
osteoporosis - is one of Revenio's potential growth drivers. We have already
sold several devices, even though their commercial significance is still
relatively minor, as predicted.
It seems that the challenges posed by political uncertainty and the general
economic situation are being clearly reflected in the businesses in our
Technology and Services segment. 2014 has been very challenging for them. The
Software business in particular is falling considerably short of last year in
terms of both net sales and operating result. The major factor in this is the
political uncertainty in Russia, which has caused major challenges for our most
significant customers. During the third quarter of the year, the Rigid
Inflatable Boats business also fell short of its net sales and profit targets.
Slower decision-making was evident in demand for these boats, which are
primarily supplied for official use. The business's tender base is, however,
good.
In September, in line with our strategy, we divested the entire share capital of
Midas Touch Oy, which represented the Technology and Services segment's Contact
Center business. Revenio is focusing on health tech, and part of our growth
strategy is to divest businesses that fall outside the scope of our core
competence.
In spite of the challenging operating environment, we achieved a good result in
health tech during the third quarter of the year. Another of our goals is to
safeguard both our ability to pay dividends and our ability to invest in future
growth in the Health Tech segment - and we have made pleasing progress in this
area. Not all of our ongoing development projects involve the further
development of existing products - we are also making new inroads in health
tech. The common denominators in our projects are screening, follow-up and the
global need to make cost savings in healthcare with the means of preventive
health care. We believe that these innovations have the potential to create
interesting growth paths alongside our existing products."
Outlook
Revenio is increasingly focusing on its core business, that is, health tech. The
cost and availability of healthcare are posing greater and greater challenges
all across the world. Innovations that are easily available globally increase
the quality and productivity of healthcare. This is one of the key drivers that
we think will advance Revenio's long-term growth targets in health tech.
The Group has made its all-time highest strategic investments in R&D. They seek
to ensure Revenio's future growth potential. Ongoing R&D projects have already
generated interesting ideas, and not only for the further development of
existing projects. There is also the potential for innovations whose common
denominators are screening, follow-up and the global need for cost savings in
healthcare with the means of preventive healthcare.
In the near future, Revenio will be focusing on strengthening the global market
position of existing Icare products, expanding sales efforts for the Icare HOME
tonometer, and launching new, next-generation products. Revenio will also be
concentrating on launching extensive sales efforts for the Oscare Sono(TM)
osteoporosis measurement device.
General clause
This release contains certain forward-looking statements that are based on
management's current assumptions. Due to their nature, these statements involve
risks and uncertainty, and are sensitive to changes in the economy or industry.
Revenio Group Corporation
Board of Directors
For additional information, please contact
President & CEO Olli-Pekka Salovaara, tel. +358 40 567 5520
olli-pekka.salovaara@revenio.fi
http://www.revenio.fi
DISTRIBUTION:
NASDAQ OMX Helsinki
Financial Supervisory Authority (FIN-FSA)
Principal media
http://www.revenio.fi
Revenio in brief
Revenio is a Finnish health tech group whose core business is tonometers. The
Revenio Health Tech segment comprises the business operations of Icare Finland
Oy and Oscare Medical Oy. The widely patented Icare product family is the
current cornerstone of the Group's success. Revenio seeks vigorous growth in
health technology, both organically and through acquisitions and mergers.
The Revenio Group also includes other business operations, which are grouped
under the Technology and Services segment. This segment's operations have a
shared global market and represent the cutting edge of technology products and
services in their industry.
In 2013, the Revenio Group's net sales totaled EUR 25.7 million, with its
operating margin standing at 21.7%. The Revenio Group Corporation is listed on
NASDAQ OMX Helsinki.
[HUG#1863044]
Revenio Group Corporation: Interim Report January 1 - September 30, 2014: HEALTH TECH STILL ON A GROWTH TRACK, CHALLENGES IN TECHNOLOGY AND SERVICES
| Source: Revenio Group Oyj
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