Sectra’s three-month interim report 2022/2023: Contracted order bookings for the quarter exceed SEK 2 billion
Press release – Linköping, September 2, 2022 – International medical imaging IT and cybersecurity company Sectra’s (STO: SECT B) contracted order bookings amounted to SEK 2.2 billion during the quarter, which is the highest ever level for a single quarter. The result includes two major multiyear customer contracts for subscriptions for enterprise imaging. A growing customer base and recurring revenue contributed to consolidated sales growth during the quarter. To increase transparency regarding the strategic transition to service sales and cloud deliveries, Sectra’s financial reporting has been complemented with a performance measure for recurring revenue from cloud-based services.
May–July 2022 period in figures
Contracted order bookings rose 468.5% to SEK 2,235.4 million (393.2), of which SEK 705.3 million (393.2) pertained to guaranteed order bookings. Of the guaranteed order bookings, 12% were recognized during the quarter and a further estimated 36–46% pertains to revenue within 12 months after the end of the quarter.
Net sales increased 19.3% to SEK 484.1 million (405.7). Based on unadjusted exchange rates, the increase was 10.7%.
Recurring revenue accounted for SEK 310.4 million (253.0) of net sales, up 22.7%. Based on unadjusted exchange rates, the increase was 15.1%. Cloud recurring revenue (CRR) increased 19.3% to SEK 50.0 million (41.9).
Operating profit declined 28.5% to SEK 64.4 million (90.1), corresponding to an operating margin of 13.3% (22.2). Based on unadjusted exchange rates, operating profit decreased 41.9%. The change in the outcome compared with the comparative quarter was primarily attributable to strengthened delivery capacity, the transition to cloud deliveries and an accumulated need for sales and marketing activities.
Profit after financial items amounted to SEK 68.2 million (92.1).
Cash flow from operations amounted to a negative SEK 64.1 million (pos: 9.8) and was mainly attributable to a settlement of current liabilities.
Comments from Torbjörn Kronander, President and CEO of Sectra AB
“Sectra offers critical components for modern healthcare, medical education and increased cybersecurity in society. Our success is the result of longstanding relationships with satisfied customers who expand their use of our solutions and recommend Sectra to others. Customer confidence is the foundation of our strong order bookings.
“Sales are growing in all operating areas, and we delivered favorable profit for a first quarter, despite an exceptional comparative quarter. This was mainly attributable to an improved gross margin as well as positive currency effects from the USD. The trend for recurring revenue and cloud deliveries is positive, which shows that the transition to supplying products and software as a service is progressing.
“Sectra allows customer needs, combined with our knowledge of trends and technology, to govern the renewal of our customer offerings. We have therefore chosen to expand our offering in diagnostics to include IT support for genomics, an area that is undergoing rapid growth in cancer care. We are doing so in collaboration with the University of Pennsylvania Health System, which is an existing customer and one of the most prominent US hospitals in cancer care. We will work together to drive innovation and product development of IT support that will help to manage the dramatic increase in volumes of genetic analyses. Sectra is carrying out this initiative in a new business unit in the incubator Business Innovation.”
Read the attached interim report for further CEO comments and information.
Presentation of the interim report
Torbjörn Kronander, President and CEO of Sectra AB, and Jessica Holmquist, CFO of Sectra AB, will present the financial report and answer questions. The presentation will be held in English.
Time: September 2, 2022 at 10:00 a.m. CEST
Follow live or listen to the recording afterward: https://investor.sectra.com/Q1report2223
This information constitutes information that Sectra AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and/or the Swedish Securities Markets Act. The information was submitted for publication, through the agency of the contact person set out below, at 08:15 a.m. (CEST) on September 2, 2022.