Starting the year with strong growth and solid profitability

First quarter January – March 2024

• Order intake totalled 91.6 (91.4) MSEK (0 percent in constant currencies).
• Order backlog amounted to 730.1 (649.3) MSEK.
• Revenue increased 40 percent to 118.0 (84.4) MSEK (39 percent in constant currencies).
• EBIT amounted to 14.2 (6.4) MSEK, corresponding to a margin of 12.0 (7.5) percent.
• Cash flow from operating activities amounted to 16.5 (-11.9) MSEK.
• Net earnings amounted to 16.0 (3.2) MSEK.
• Earnings per share amounted to 0.47 (0.10) SEK.

Significant events during the first quarter

• At the beginning of the quarter, C-RAD announced that the joint development project with Accuray has led to installation in a customer’s clinical environment.
• On 22 February, the Supreme Court announced that it would not grant leave to appeal in the dispute between C-RAD and a former employee. This decision upholds the ruling of the Patent and Market Court of Appeal on 30 June 2023. As a result of the Supreme Court’s decision, in the annual report for 2023 C-RAD has charged the Group’s profit for the year, as reported in the year-end report for 2023, with an additional -10.5 MSEK, which was paid during the second quarter. The amount relates to all periods up to 31 December 2023. See Note 33 of the Annual Report 2023 for how the various adjusting items have been accounted. For products that use the invention described in patent applications US12/632526 or PCT/SE2010/051338, C-RAD must compensate the counterparty with a 1% royalty on the net price of future sales until 7 December 2029.
• C-RAD won an order worth 12 MSEK to supply products to our Italian distributor, Tecnosan. The order is for several Catalyst+HD systems and relates to the previous successful tender in a national procurement process held in Italy in 2022.

Significant events after the quarter

• No significant events occurred after the end of the reporting period.

CEO Cecilia de Leeuw comments on the interim report:

The year is starting off with the best-ever revenue for a first quarter. Profitable growth continues to be our focus, also for 2024, and the EBIT for Q1 more than doubled to 14.2 MSEK. While the macro-economic situation continues to be challenging, we have a stable order intake of 92 MSEK. Surface Guided Radiation Therapy (SGRT) is increasingly becoming a given in the treatment workflow and we are seeing great interest across all our markets. Our continued and profitable growth is moving our operations and organisation towards the next level.

The revenue growth of 40 percent to 118 MSEK is our best first quarter so far, and we have growth in all markets. Order intake of 92 MSEK was at the same level as the first quarter of last year. The order backlog is 730 MSEK, an increase of 12 percent from Q1 last year. The cashflow from operations increased to 16.5 MSEK, supported by improved profitability and slightly lowered inventory levels. Our focus on profitable growth is shown in the EBIT of 14.2 MSEK, translating to an EBIT margin of 12 percent.

C-RAD has been growing rapidly in recent years, which has taken us to a new level of operations. To further strengthen our foundation and enhance our capability to deliver on the strategy to offer world-class products and services, we will make additional investments in the offering, reach and organisation during 2024. In the same spirit, we are strengthening our back-office, with process improvements and automation.

Strong demand in APAC
The interest in SGRT and our technology in the APAC markets is high. The first quarter of this year was no exception. Revenues increased by 57 percent to 35 MSEK. Order intake was 34 MSEK, a growth of 25 percent compared with the first quarter of last year. New orders in Australia from GenesisCare for their newest and most advanced facility in Western Sydney confirm our market-leading position. We participated in the ITEM conference in Yokohama, Japan, with our industry partners and the unmet demand for SGRT in Japan is evident. The market activity level and interest in SGRT in China continues to be high. I am pleased to announce that the important registration of our new generation of products in China was approved in April.

Americas is picking up
The US is starting to show signs of recovery. We can see that some investments that were on hold are now moving. The order intake of 25 MSEK is an increase of 20 percent. Revenue grew 41 percent to 25 MSEK, supported by a strong order backlog conversion. Ensuring satisfied customers is a priority for our Services organisation. Hence, a cross-functional customer outreach programme is being initiated in the Americas region to assess customer satisfaction and identify needs for customised training.

Strong revenue but softer order intake for EMEA
We received a 12 MSEK extension order from our partner and distributor Tecnosan, Italy, connected to the national tender awarded at the end of 2022. I am pleased with the SGRT adoption in Italy and that the C-RAD installed base is growing. EMEA revenue started the year well, growing 31 percent to 58 MSEK for the first quarter. Order intake had a softer start, with a decline of 25 percent to 33 MSEK. This is mainly due to the lack of larger tenders which we have seen during the last couple of years. In addition, there is an increased tendency to delay extensions of service contracts, with many clinics being under cost pressure. We are intensifying our market activity and will hold our second EMEA distributor meeting, this time in the Middle East.

Execution on strategy
Across our global team, we continue to build our capabilities in line with our Strategy Execution plan and our striving for profitable growth.
To capture the unmet demand for SGRT, we are strengthening the capabilities of our distributor network. This resonates well with our hybrid approach to improve our scalability and reach, with a combination of direct sales and partners. In early March, we held the first APAC face-to-face distributor meeting. Later in March, the EMEA distributors gathered for training and knowledge sharing.
The investment in the research and development organisation to secure our world-class portfolio today and tomorrow continues.
Services business is a priority for two main reasons, to ensure that our customers use our technology to its full potential. Building long-lasting relationships and a deeper understanding of our customers’ processes strengthens SGRT’s long-term position as the standard of care. Secondly, we want to secure a growing portion of recurring revenue. This requires hard work. In addition to strategic enhancements, e.g. in the Nordics, Central Eastern Europe and China, we have also launched important continuous improvement programmes to enhance spare part delivery as well as to implement an optimised installation process.
 
Presentation of the Interim Report

CEO Cecilia de Leeuw and interim CFO Jonas Reinhammar will present the interim report by webcast on Tuesday, May 14 at 11:00 CET. After the presentation, there will be time for questions. The presentation will be held in English. To participate in the presentation, please register using the link below:

https://us06web.zoom.us/webinar/register/WN_H3Sy-CIaQ9WSRZQwpC84kA