Careium reports second quarter results 2024

The quarter in summary

• Net sales amounted to SEK 229.4 million (213.8), an increase of 7.3 percent. Service sales amounted to 163.3 million (158.9), an increase of 2.8 percent. Product sales amounted to 66.1 million (54.9), an increase of 20.5 percent.
• Gross margin amounted to 41.7 percent (42.2).
• Operating profit (EBIT) amounted to SEK 21.8 million (14.6), corresponding to an operating margin of 9.5 percent (6.8).
• Free cash flow amounted to SEK 0.5 million (7.7).
• Earnings per share amounted to SEK 0.54 (0.59).

 

January-June in summary

• Net sales amounted to SEK 440.2 million (407.8), an increase of 7.9 percent. Service sales amounted to 318.3 million (301.4), an increase of 5.6 percent. Product sales amounted to 121.9 million (106.5), an increase of 14.5 percent.
• Gross margin amounted to 42.2 percent (40.6).
• Operating profit (EBIT) amounted to SEK 40.9 million (22.0), corresponding to an operating margin of 9.3 percent (5.4).
• Free cash flow amounted to SEK 17.1 million (35.9).
• Earnings per share amounted to SEK 1.10 (0.82).

 

CEO’s commentary

Careium delivers a solid quarter with an innovative launch, despite slowdown of infrastructure transition in Sweden and UK.

Careium delivered sales of SEK 229.4 million (213.8), an increase by 7.3 percent. Extension of grace-periods to switch to modern digital equipment were introduced in the period impacting sales of both products and services. Careium delivered an EBITDA of SEK 37.6 million (33.0), a corresponding EBIDTA-margin of 16.4 percent (15.5) and EBIT of SEK 21.8 million (14.6) generating a margin of 9.5 percent (6.8). EBITDA growth amounted to 14 percent and EBIT growth to 49 percent, compared to the second quarter 2023. Free cash flow was positive, if low, in the period mainly due to inventory build-up following delays in infrastructure transition.

During the quarter, sales in the Nordic amounted to SEK 103.9 million (96.5), growing 7.7 percent and reaching a gross margin of 39.8 percent (40.3) despite governmental extension of 2G/3G infrastructure with an additional year. UK and Ireland delivered sales of SEK 79.3 million (90.2), a decrease of 12.1 percent, due to the additional 1-year delay of analogue closedown announced in mid-May. Gross margin was 38.8 percent (38.6). The Netherlands delivered sales of SEK 20.4 million (17.9), growing 14.0 percent with a gross margin of 55.1 percent (60.7). Sales in Other markets (Germany and France) were SEK 25.8 million (9.2), growing 180.4 percent with a gross margin of 53.1 percent (45.7), reflective of our efforts to succeed in these key markets.

In June, we released the rSIM – “resilient SIM” - for the Eliza family, an innovation in technology enabled care, putting intelligence and dual SIM profiles on the same SIM card giving our devices unparalleled connectivity resilience. This has vast implications for customers and seniors by guaranteeing an unparalleled service level via Careium’s integration and implementation of the technology. The benefits are immense: Minimising the risk of critical incidents and risk to lives while saving tremendous effort and resources during infrastructure failings. Without this technology customers would be forced to activate their crisis plans and ensure communication with all people in their care.

The rSIM is backwards compatible with the 100,000 Elizas out in our current markets lending itself well to after sales in select markets and will be the standard solution for the Eliza family, further enhancing the Careium position as the innovation and quality leader in the industry.

With organic sales growth of 8 percent over the first half of the year and an EBIT improvement of 86 percent for the same period, we maintain our guidance. While reaching our target growth might be challenging, we are committed to achieving higher growth in the second part of the year, and in Q4 in particular.

Christian Walén,

President and CEO

Webcast

Careium will publish the report for the second quarter of 2024 on Friday 12 July 2024 at 8am (CEST).

A live broadcast report presentation will be held the same day at 12pm (CEST) when President and CEO Christian Walén will present the report. The webcast is accessed at

https://www.youtube.com/live/-a5NvD6RY0w

The presentation material is available on Careium’s financial website at https://www.careium.com/en-gb/investors/financial-information/presentations2/.