COMMENTS BY THE CEO
Significant improvements in all prioritised areas
“The companies within AddLife have done a fantastic job over the past year, achieving significant improvements in all priority areas. A focused effort to improve margins has yielded clear results. Our organic growth exceeds market growth, confirming our leading positions in rapidly growing market niches, our continuous development of the product portfolio, and our ability to gain market share. Efficient working capital management is one of the strengths of AddLife’s business model, and a dedicated effort throughout the year has resulted in higher cash flow and reduced debt. With a strengthened balance sheet, a well-established and clear strategy, further developed processes, and a strengthened organization, AddLife is now ready to increase the acquisition rate gradually. We look forward with confidence to a strong 2025 !”
Improved margins
A continuous focus on efficiency improvements, cost control, and ongoing product portfolio development toward more profitable segments is crucial to AddLife’s business model. This work has produced clear results across our companies. Additionally, several major improvement initiatives have been implemented, such as the divestment of Camanio, completed in Q3 2024, and the restructuring of AddVision. Altogether, these efforts have significantly improved margins in the Medtech business area and for AddLife as a whole.
Continued strong organic growth
Securing leading positions in fast-growing and profitable market niches is another key component of AddLife’s business model. Our companies continuously develop their product portfolios toward more profitable products, leveraging strong customer relationships, innovative thinking, and a deep understanding of current and future customer needs. Our decentralized model—with local accountability and authority and simple and fast decision-making processes—allows us to be agile. This approach has resulted in strong organic growth throughout the year. The larger platform companies in the UK, Ireland, and Spain have developed their organizations, operational methods, and product portfolios, delivering robust growth and significant improvements in results. Today, these markets are among the largest and fastest growing for AddLife.
Significantly improved cash flow
Cash flow gradually improved throughout 2024 compared with the previous year, primarily driven by structured efficiency efforts, particularly within the larger Medtech companies. In the fourth quarter, cash flow improved markedly, even compared with the strong Q4 performance of the previous year. A dedicated effort is continuously underway across all companies, as a vital part of our business model to generate long-term profitable growth through self generated cash flow.
Preparing for increased acquisition activity
During 2023 and 2024, most of our increased cash flow was used to reduce the Group’s debt, resulting in a significantly lower debt level in line with our targets. Also, in 2025, we plan to allocate the majority of cash flow to loan amortization, but the capacity for acquisitions is increasing. In parallel with efficiency improvements, strategies, and processes, the organization has been prepared for a gradual increase in acquisitions.
In Q3 2024, we acquired BonsaiLab, a company operating in one of our priority growth segments, with strong profitability and solid growth. This is a great example of the type of acquisitions we aim to pursue going forward. We are pleased to warmly welcome the BonsaiLab team to the AddLife family.
In 2025, we plan to make a small number of carefully chosen acquisitions in line with our strategy and our acquisition criteria. Furthermore, structured work on identifying acquisition candidates for the coming years is underway, with expectations to accelerate the acquisition pace further in 2026.
Market development brings opportunities
The major market trends are expected to persist in 2025. The demand for healthcare continues to grow steadily, independent of changes in the business cycle. Patient waiting lists remain long, and many countries have announced measures to address this issue in 2025. Staffing shortages remain a challenge, particularly for customers within healthcare and diagnostics. This has increased demand for more advanced products and services that improve the efficiency of care processes and deliver better clinical outcomes. Meanwhile, global manufacturers continue to focus their product offerings and reduce direct sales operations. These trends create numerous opportunities for AddLife’s companies.
The developments in global trade is expected to be a factor of uncertainty in 2025. However, AddLife is well-positioned to manage such challenges, with over 90 percent of sales occurring in Europe. More than 80 percent of our products are sourced from European suppliers, less than 10 percent from North America, and under 5 percent from China.
Summary and outlook
The positive development in our market remains stable, while performance and cash flow improvement measures will continue to provide a positive contribution in 2025. Strengthened cash flow enabled debt reduction of approximately half a billion SEK in 2024, in line with our ambition. Simultaneously, improved operational performance creates the opportunity to gradually accelerate acquisition activities, in line with our long-term strategy.
Throughout the year, I have had the opportunity to visit many of our companies and meet customers. All of our companies have highly skilled and dedicated employees who maintain strong customer relationships and share a passion for improving people’s lives. AddLife’s core values - responsibility, commitment, simplicity, and innovation - underpin all our activities. The professional and dedicated support our employees provide to customers and patients is highly appreciated, and efforts to enhance our customer offering with new, innovative products and services in line with accelerating technological advancements are continuously ongoing.
AddLife has developed a well-structured sustainability and climate strategy during the year, which is aligned with our vision to improve people's lives. Moving forward, the focus will be on implementing measures to further develop sustainable health solutions in collaboration with our customers, strengthening our culture and organisation, and enhancing sustainability throughout our supply chain.
I want to extend a warm thank you to all our employees for your incredible dedication and hard work throughout 2024 and congratulate you on your fantastic results. It brings great joy to see all this dedicated effort translate into tangible outcomes: improved lives for patients and users, satisfied customers, as well as profitability, growth, and strong cash flow. With improved operational efficiency, a strengthened financial position, and a solid organizational foundation, we look forward with confidence to a strong 2025!
Stockholm, April 1, 2025
President and CEO