Elekta - Interim report May – October 2015/16

Second quarter
-      Order bookings increased 14 percent to SEK 3,291 M (2,876) or 3 percent
based on constant exchange rates.
-      Net sales increased 10 percent to SEK 2,828 M (2,567) or decreased 1
percent based on constant exchange rates.
-      EBITA amounted to SEK 444 M (397) before non-recurring items of SEK -18 M
(0). Operating result was SEK 304 M (310).
-      Net income amounted to SEK 189 M (200). Earnings per share was SEK 0.49
(0.52) before dilution and SEK 0.49 (0.52) after dilution.
-      Cash flow after continuous investments amounted to SEK 147 M (173).

May – October
-      Order bookings increased 12 percent to SEK 5,827 M (5,217) or decreased 1
percent based on constant exchange rates.
-      Net sales increased 14 percent to SEK 5,067 M (4,432) or 1 percent based
on constant exchange rates.
-      EBITA amounted to SEK 485 M (359) before non-recurring items of SEK -48 M
(-2). Operating result was SEK 211 M (188).
-      Net income amounted to SEK 60 M (63). Earnings per share was SEK 0.15
(0.16) before dilution and SEK 0.15 (0.16) after dilution.
-      Cash flow after continuous investments amounted to SEK -417 M (-497).

Outlook
We expect growth in net sales to continue to be modest for the fiscal year,
based on constant exchange rates, and that the EBITA margin, adjusted for non
-recurring items, will continue to improve.

The outlook is adjusted from the previous: “We expect negative growth in net
sales for the first half of 2015/16, while growth is expected to return during
the second half of 2015/16.”

President and CEO comments
During the first half of our fiscal year, net sales grew 14 percent or 1 percent
based on constant exchange rates. Gross margin increased 2.3 percentage points
and EBITA improved by SEK 126* M. The improvements are mainly driven by growth
in service and aftermarket sales and partly due to that deliveries scheduled for
the third quarter now were completed already in the first half year. Order
bookings in the second quarter increased 14 percent or 3 percent based on
constant exchange rates. Growth was particularly strong in region Europe, Middle
East and Africa.

Transformation program on track
The transformation program is proceeding according to plan, including the target
to reach an EBITA margin improvement of more than 6 percentage points by the end
of fiscal year 2017/18**. The cost reduction of SEK 450 M is on track with
savings primarily in administration, supply chain and procurement. At the end of
the quarter our workforce has been reduced with 91 employees.

Strong product offering and innovation portfolio
We continue to prioritize strategic R&D investments to improve cancer care, for
example our software solutions and image guided radiation therapy. We are also
improving our customer service network including training and education.

During the quarter, the new Leksell Gamma Knife Icon system received FDA
clearance in the US. Our MRI-guided radiation therapy program, Atlantic, is
progressing according to plan. The R&D consortium’s second non-commercial system
was recently installed at MD Anderson Cancer Center in Houston, US.
Installations at the five remaining consortium sites will take place during the
2016 calendar year.

Reducing net working capital
Cash flow after continuous investments improved by SEK 80 M for the first half
year to SEK -417 M. Net working capital in relation to last 12 months net sales
decreased to 11 percent (16), a level that we are not satisfied with. Programs
for improvement have been initiated and will lower net working capital. The
target is a reduction with over SEK 200 M by the end of 2016/17.

Zero tolerance
As previously communicated, there is an ongoing investigation in Italy where
Elekta employees are suspected of interfering with public procurement processes.
Elekta is providing all requested information to the Italian authorities. We
have zero tolerance for any deviation from our code of conduct and clear
corporate policies and procedures in place.

Tomas Puusepp
President and CEO

* Before non-recurring items
** Base year 2014/15, excluding currency effects


Shareholder information

Conference call
Elekta will host a telephone conference at 10:00-11:00 CET on December 4, with
President and CEO Tomas Puusepp and CFO Håkan Bergström.

To take part in the conference call, please dial in about five minutes in
advance.

Swedish dial-in number: +46 (0)8 566 426 64
UK dial-in number: +44 (0) 203 428 14 09
US dial-in number: + 1 855 753 22 36

The telephone conference will also be broadcasted over the internet (listen
only). Please use the link:

http://event.onlineseminarsolutions.com/r.htm?e=1096935&s=1&k=195FCFCFA7C622F68F
0 
4F81204962886

For further information, please contact:

Håkan Bergström
CFO, Elekta AB (publ)
+46 8 587 25 547,
hakan.bergstrom@elekta.com

Johan Andersson
Director Investor Relations, Elekta AB (publ)
+46 8 587 25 415
johan.andersson@elekta.com