Continued strong growth – adjusted EBITA increased by 13 percent

SECOND QUARTER APRIL–JUNE                

The Group’s net sales amounted to SEK 457.7 (386.1) million, an increase of 19 percent.

The Group’s EBITA was SEK 90.1 (72.2) million, an increase of 25 percent. Adjusted for items affecting comparability, the increase was 13 percent.

The EBITA margin was 19.7 (18.7) percent. Adjusted for items affecting comparability, the margin was 17.8 percent.

Profit after tax amounted to SEK 57.1 (46.8) million.

Earnings per share amounted to SEK 3.8 (3.2).

Cash flow from operating activities was SEK 70.9 (39.7) million.

HALF-YEAR JANUARY–JUNE

The Group’s net sales amounted to SEK 919.4 (766.3) million, an increase of 20 percent.

The Group’s EBITA was SEK 178.6 (117.5) million, an increase of 52 percent. EBITA adjusted for items affecting comparability amounted to 169.9 (132.9) million, an increase of 28 percent.

The EBITA margin was 19.4 (15.3) percent. Adjusted for items affecting comparability, the EBITA margin was 18.5 (17.3) percent.

Profit after tax amounted to SEK 113.2 (71.6) million.

Earnings per share amounted to SEK 7.6 (4.8).

Cash flow from operating activities was SEK 163.4 (92.3) million.

Second quarter

The Group continued to deliver strong growth and increased earnings in the second quarter of the year.Sales increased by 19 percent, which included organic growth of 8 percent.

The Assistive Tech business area showed the strongest growth, followed by MedTech, which also performed well in the quarter, while Specialty Pharma had a weaker quarter. Demand and market conditions are still generally favourable for the Group’s companies.

The Assistive Tech business area developed very strongly and delivered a strong increase in sales, driven by high demand in the cognition area, increased sales in several of the business area’s subsidiaries and completed acquisitions. Business development initiatives in several acquired entities also showed good results. During the quarter, Abilia received approval of the product MEMOplanner as a prescription aid in Germany, which is a milestone in its efforts for growth in a new market in the long-term.

MedTech also had strong sales growth in the quarter, with all companies showing good organic growth and acquisitions also contributing. Multi-Ply and Cardiolex reported the largest increase in sales. During the quarter, Inpac relocated most of its operations to the new production facility, which had a negative impact on the quarter. At the same time, it is pleasing to note that the move went well and according to plan.

Specialty Pharma had a weaker quarter. Competition in the UK market for Melatonin has had a negative impact, as expected. To some extent, the quarter was also negatively affected by delivery problems both with external suppliers and in our own manufacturing, which, although resolved, have created delays and a loss of sales. The important work on business development has continued unabated and we now see concrete opportunities for both in- and out-licensing of products to broaden the portfolio. We see good potential to grow the specialty pharma platform and again achieve higher margin.

Overall, the Group delivered a strong second quarter with good sales growth and an increase in earnings. EBITA increased by 25 percent and, adjusted for items affecting comparability, the increase was 13 percent despite unsatisfactory results for specialty pharma. The Group also has a strong focus on capital efficiency and delivered a strong cash flow in the quarter.

Acquisitions

We are in continuous dialogue with companies that can join the MedCap Group and we are also actively engaged in initiating new contacts and dialogues with Life Science companies in Europe.

MedCap’s strong balance sheet and low net debt to EBITDA ratio provide significant financial capacity for further acquisitions. The prospects of finding interesting acquisition opportunities are still considered good.

In summary

Overall, the Group’s companies performed very well in the second quarter, both financially and operationally, although one business area was weaker. Demand continues to be generally favourable for our businesses and, operationally, several important milestones have been achieved in sales, business development and production. Together with acquisition opportunities, this creates good opportunities for the Group’s continuing growth.

Anders Dahlberg, CEO, Stockholm 24 July 2024

This disclosure contains information that MedCap AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014) and the Swedish Securities Markets Act (2007:528). The information was submitted for publication, through the agency of the contact person, on 24-07-2024 06:30 CET.