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Getinge overview An expanding Medical-Technology group with focus on comprehensive solutions for infection control, surgical systems and care of elderly and disabled people CustomersAcute care Long term care Industry / Laboratories Net Sales8.6 billion SEK Associates5 600 Manufacturing18 production units in 9 countries Distribution70 sales companies in 25 countries Distributors in 100 countries (ex Jostra and LSS)
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Business Scope Industry I0 % Acute Care 60 % Long Term Care 30 % Extended Care 31 % Infection Control 40% Surgical Systems 29 % Surgical Systems 29 % B u s i n e s s A r e a s C u s t o m e r S e g m e n t s (ex Jostra and LSS)
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3 Group objectives & focus
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4 Getinge Group ObjectivesStrategic To develop world leading positions in prioritized To develop world leading positions in prioritized niches of the health care industry niches of the health care industry
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Strong Global Positions BA Infection ControlSterilization# 124 % Disinfection# 127 % BA Surgical SystemsSurgical Tables# 140 % Surgical Lights# 138 % Ventilators# 128 % Cardiopulmonary # 322 % Ceiling Service Units# 315 % Anaesthesia# 36 % BA Extended CareHygiene Systems# 160 % Patient Handling# 140 % Wound Care# 45 % Business unit Market shares Position
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6 Getinge Group ObjectivesFinancial To increase profit before tax with an average of I5% To increase profit before tax with an average of I5% per annum per annum Internally generated cash flow to sustain an external Internally generated cash flow to sustain an external growth rate of I0% per annum growth rate of I0% per annum Strategic To develop world leading positions in prioritized To develop world leading positions in prioritized niches of the health care industry niches of the health care industry
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7 The Getinge Group CAGR 24 %
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The Getinge Group - Focus & Development Surgical Systems External Growth Extended Care Organic Growth Infection Control Improved Operating Performance
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9 Review of Business Areas
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Infection Control Create a customer focused group from a number of companies acquired over the last 10 years
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1990 - 2000 2003 2000 - 2002 Growth through acquisition Restructuring Business development - Improve production structure - Organisational focus - Brand identity - Organic growth - Product development - Integrated solutions - Logistics / distribution - Service provider concept INFECTION CONTROL
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Infection Control Orders received M SEK 20032002Adj curr20032002Adj curr per market Q 3 flucs & acqs9 mon flucs & acqs Western Europe 38635811%1 134 2% USA and Canada 33131330%8631 0623% Asia and Australia 107999%2922789% Rest of the world 665913%19214238% Business area tot. 89082918%2 4812 6165%
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Infection Control Results MSEK 2003200220032002 Q 3 9 mon F Y Net sales 745 2,3022,2883,359 Gross margin % 37.7%34.3%39.2%35.0%36.2% Operating cost -199-215-630-679-910 Operating profit 8240273121306 Operating margin % 11.0%5.4%11.9%5.3%9.1%
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Extended Care Focus on growth from a solid platform through product innovation, market penetration and geographical expansion
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HIGHLIGHTS 2003 GROWTH Market penetration Strong product pipeline Geographical expansion COMPETITIVENESS Global sourcing Improved production structure Improved logistics
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Extended Care Orders received MSEK 20032002Adj curr20032002Adj curr per market Q 3 flucs & acqs9 mon flucs & acqs Western Europe 380406-1%1 2351 2186% USA and Canada 199248-7%577734-5% Asia and Australia 1920-1%56 7% Rest of the world 56-2%1320-34% Business area tot. 603680-3%1 8812 0282%
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Extended Care Results MSEK 2003200220032002 Q 3 9 mon F Y Net sales 5836401,7981,9812,720 Gross margin % 47.2%50.0%47.8%50.4%51.0% Operating cost -181-223-595-682-900 Operating profit 9598265317488 Operating margin % 16.2%15.3%14.7%16.0%17.9%
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Surgical Systems Create a global leader in the field of Surgical workstations as a platform for further growth in the surgical systems market
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SURGICAL WORKSTATIONS Growth opportunities Japan and USA Product development AWIGS / VIWAS New Pendant generation New Light technology Cross selling Heraeus integration
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OPERATING THEATRE
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EXTERNAL GROWTH Surgical Systems Surgical instruments Ancillary Equipment Radiology Patient monitoring Disposables Life Support
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22 Acquisition of Jostra - business unit Cardiopulmonary
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Jostra in brief Sales approx 90 M EUR in 2002 Associates ~ 600 Sales in 100 countries, own sales companies in: DE, FR, IT, JP, CA, ES, GB, NL, SE, CN, HK Production: Germany (2 sites), Sweden and Denmark Products: Heart-lung machines, Oxygenators, Centrifugal pumps, related Disposables, Minimal Invasive on-pump Equipment Excellent technology and product pipeline, 55 issued patents Good track record of organic growth 10% +
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Jostra Integration and Restructuring New management team from 1st August 2003 Integration of Jostra’s sales and marketing organisation with that of Surgical Systems Consolidation of Jostra production structure from 4 to 2 sites Reinforce sales and marketing organisation to drive market penetration in Europe and emerging markets Focus the R&D pipeline to deliver new technologies in a speedy and timely manner
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Jostra Acquisition Financials The target is to improve Jostra’s EBIT margin to 12 - 15% within 3 years after goodwill amortization Contribution to group earnings in 2003 will be slightly negative to neutral Contribution to group pre-tax profit including goodwill amortization and related financial charges will be in the range of EUR 5 - 6 million in 2004
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26 Acquisition of Siemens LSS - business unit Critical Care
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Key Data of LSS LSS is one of the world’s leading providers of ventilation and anaesthesia products in the critical care equipment market In 2002/03, LSS have projected revenues of around 205 MEUR The worldwide ventilation and anaesthesia hospital markets account for approx 550 MEUR annual sales volume each, with an expected annual growth of approx. 5% p.a. Life Support Systems (LSS) LSS-Ventilation LSS-Anaesthesia Sales of 175 MEUR Global market shares 27% Sales of 30 MEUR Global market shares 6%
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Total LSS Sales in 2002 by Region
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F i n a n c i a l sF i n a n c i a l s LSS will contribute with 10 - 12 MEUR to pretax profit in fiscal 2004 LSS will contribute with 17 - 20 MEUR to pretax profit in fiscal 2005 Operating margins after goodwill depreciation is targeted at 15% longterm
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Surgical Systems Orders received MSEK 20032002Adj curr20032002Adj curr per market Q 3 flucs & acqs9 mon flucs & acqs Western Europe 446387-12%1 2341 0543% USA and Canada 136154-23%3663814% Asia and Australia 1227533%35428415% Rest of the world 663251%128129-20% Business area tot. 770648-6%2 0821 8483%
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Surgical Systems Results MSEK 2003200220032002 Q 3 9 mon F Y Net sales 7546602,1011,7432,521 Gross margin % 49.7%50.5%48.7%49.1%47.6% Operating cost -296-283-782-694-946 Operating profit 7851241162255 Operating margin % 10.4%7.7%11.4%9.3%10.1%
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32 Results Q3 2003
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Getinge AB Results MSEK 20032002Change20032002Change 2002 Q 3 9 mon FY Net sales 2 0912 0542%6 2316 0413%8 640 EBITDA 36128925%1 08089421%1 438 Operating profit 25518836%77960130%1 050 Operating margin 12,2%9,2%12,5%9,9%12,1% Profit before tax 21614648%66447141%876
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Getinge AB Balance sheets MSEK Assets 2003-09-302002-09-302002-12-31 Fixed assets4,7514,5774,564 Current assets4,7354,8224,852 Total assets9,4869,3999,416 Shareholders' equity & liabilities Shareholders' equity3,2302,8933,158 Provisions1,9552,0841,943 Long-term liabilities1,3832,8352,441 Current liabilities2,9181,5871,874 Total Equity & Liabilities9,4869,3999,416 Key figures Net debt/equity, multiple 1.011.321.07 Equity/Assets ratio, per cent 34.1%30.8%33.5%
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Getinge AB Key figures Q3 9 mon FY Operating Cash Flow, MSEK 4953651,4241,1071,784 Net debt, MSEK 3,2593,8173,376 Equity / Assets ratio, % 34.0%30.8%33.5% Net debt / Equity ratio, multiple 1.011.321.07 Interest cover, multiple 7.75.35.9
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