Healthcare activity in Europe remains high
Activity remains high in the markets where AddLife's companies operate. Healthcare waiting times remain significant and the number of elective surgery procedures is increasing in most countries, a trend that is expected to continue. 

Several major product companies continue to modify their commercial strategies. This creates opportunities for AddLife's companies to broaden their offerings, take on new product portfolios and grow their market shares.

Long-term positive trends in the market, such as efforts to reduce waiting lists in healthcare, investments in research, and the necessity for effective management of growing healthcare needs, persist.

In the quarter, the combination of a solid sales performance and relentless efficiency improvement efforts led to positive margin development. Margin improvements in AddVision have materialized faster than expected. Continued improvements in profitability remain the top priority. 

Somewhat weaker demand in Labtech
Demand in Labtech was stable at the beginning of the quarter. Following a temporary decline in March, demand began to rise again at the start of April. Customers in diagnostics and academic research displayed somewhat cautious behaviour during the quarter. Uncertainty regarding publicly funded budgets was the key reason for this behaviour. This trend primarily affects larger investment projects, but has also delayed some of the instrument sales by AddLife companies. These deferred instrument sales are expected to be completed later in the year. In pharmaceutical research, a key customer segment, demand remains strong. The AddLife companies constantly focus on defending and improving profitability, and therefor the weaker sales did not have a significant impact on EBITA margin.  

Growth and improved margins in Medtech
The number of surgical procedures performed continued to rise over the quarter, leading to strong growth in Medtech. This was the case even though many clinics were closed during Easter, which occurred in March this year. Most of the Medtech companies saw their margins improve during the quarter. Sales of both instruments and disposable products were particularly robust in the UK and Ireland.

In eye surgery, the combination of stable sales and reduced costs resulted in a clear and fast improvement in profitability. The organisation has stabilised and the product portfolio has been updated and is now competitive. The companies in Poland and Switzerland are experiencing strong profitability. The dedicated efforts to improve profitability continue, while the companies remain fully focused on implementing their commercial plans.  

Cost efficiency efforts are also underway in Homecare. The closure of Camanio is progressing according to plan and the Camanio team is actively working to help existing customers migrate to alternative solutions. A restructuring cost of SEK 6 million was recognised in the quarter. The cost savings will be realised in the coming quarters and the decommissioning is expected to be completed by the end of the third quarter of 2024.

Long-term market trends support demand in AddLife's companies. In the quarter, the combination of a solid sales performance and relentless efficiency improvement efforts led to positive margin development. Continued improvements in profitability remain the top priority. Profitability in Labtech was steady, even with a slowdown in sales, while profitability trended positively in Medtech. The improvement in Medtech was fuelled by robust sales and margin growth for most of the companies, coupled with a clear improvement in eye surgery.

Efforts to improve cash flow efficiency remain a top priority. Cash flow from operating activities totalled SEK 97 million in the quarter. The long-term efforts to improve working capital efficiency, streamline inventory management and renegotiate supplier agreements continue to produce results by reducing inventory levels. Our ambition is to reduce net debt through internally generated cash flow and gradually resume an increased pace of acquisitions.

Our companies maintain strong customer relationships and do an outstanding job of handling both challenges and opportunities. AddLife is off to a good start in 2024.



Fredrik Dalborg

President and CEO

Latest updated: 4/23/2024 5:45:18 PM by Alexander Paziraei