Medtech

Companies in the Medtech business area provides medical device products within the medtech market and assistive equipment within Homecare.

For the quarter, Medtech’s net sales increased by 20 percent to SEK 1,494 m (1,246), of which organic growth was 10 percent and exchange rate fluctuations had a positive impact of 9 percent on net sales. EBITA decreased by 16 percent and amounted to SEK 150 m (179), corresponding to an EBITA-margin of 10.0 (14.3). EBITA in the previous year was positively affected by a reversal of a contingent consideration of SEK 85 m. Adjusted for this, the EBITA margin amounted to 7.5%. The investment in digital solutions for remote patient monitoring and healthcare solutions has had a negative impact on the result of SEK 12 m (12).

For the interim period, Medtech’s net sales increased by 18 percent to SEK 4,544 m (3,843), of which organic growth excluding exchange rate differences, amounted to 10 percent and acquired growth was 1 percent. Exchange rate fluctuations had a positive impact of 7 percent on net sales. EBITA increased by 22 percent to SEK 551 m (452) and EBITA margin amounted to 12.1 percent (11.8). The reversal of previously allowance for contingent consideration, primarily linked to the acquistion of AddVision, has had a positive impact on the result of SEK 86 m (85) and adjusted for this EBITA amounted to 10.3 percent (9.5). The investment in digital solutions for remote patient monitoring and healthcare solutions has had a negative impact on the result of SEK 43 m.

Growth in Medtech remained strong and elective surgery recovery continues to develop well, driving growth in the business area. Waiting lists for surgical procedures remain significant across Europe, and in some countries, such as the UK, waiting lists are still growing. Staffing shortage is slowing the pace of the recovery, and this is expected to lead to a longer period of increased surgical activity. Growth and profitability improvement is strong in all the Hospital companies, and the larger companies acquired the last years contribute to the positive development in a significant way. However, the profitability in AddVision continues to be low, and restructuring activities have been initiated, with an expected annual cost savings of approximately SEK 15 m starting next year and a restructuring cost of approximately SEK 5 m in the fourth quarter 2023.
Demand in the Homecare business is effected by demographic trends, shortage in healthcare staffing as well as user needs and preferences. The business is growing strongly and profitability is improving, supported by a number of initiatives. The digital development portfolio in Homecare has been reviewed and has resulted in a decision to focus the activities and discontinue the Camanio Health activities. The customer relationships will be handed over to another company in the sector. The change is expected to result in an annual cost reduction of SEK 11 m, starting at year end and a write down of an intangible asset amounting to SEK 25 m in the fourth quarter 2023.