Ion Beam Applications SA

Hello, everybody. My name is Olivier Le Chien. I'm head of communications at IBA. I sit here together with Olivier Legrain, CEO, and Soumya Chandramouli, our CFO. At this time, all participants are in listen-only mode. Question and answer will follow the formal presentation. I would like now to turn the conference over to Olivier Legrain.

Thank you. Thank you, Olivier. Good afternoon and thank you for joining us on our full year result. And with me today, Soumya, our CFO. Before we start, I would like to draw your attention to the company disclaimer on forward-looking statements as usual. Moving on to the agenda. I'd like first to start today by thanking the entire IBA team for their continued hard work over the course of the past year. We're pleased to see all that hard work paying off with the incredible resilience of our business. And I'm delighted to report on our positive progress over the year. As always, I will give an overview of our business and run through our outlook for the future. Soumeya and I will then summarize our financial statement and we will then be happy to take any questions. I will start with providing an overview of the business. As you know, the group is founded on our world leading expertise in particle beam technology, which falls across four core business lines, proton therapy, radiopharma solution, industrial solutions and dosimetry. Each of these business lines performed extremely well and they were all profitable in 2021. As shared previously, IBA's long-term strategy leans on three key pillars. We will capitalize on and develop our market leading position across all of our four businesses. We'll give more details on specific business units on the next slide. We will invest. in new technologies and products to ensure the group retains its competitive edge and provides solutions that are tailored to customer needs. Finally, we will ensure excellent operational execution across all business with a focus on delivering the backlog and enhancing recurring revenue streams. In the light of the long-term strategy, you can see here the specific drivers related to each of the business units, and I'll pick out a few details here. Clearly, we have record high backlog, and we're confident on being able to translate this into future revenue. Patient QA is growing in importance, and our dosimetry unit is looking to gain market share here. Within proton therapy, we have a number of drivers, including customer service enhancement, and investing in technologies for the future. Within radiopharma solutions, alongside the Terranostic focus partnership with SCKCEN, we are looking at growing opportunities in existing and new markets such as chemistry and targetry. On the industrial side, we are targeting a strong increase in e-beam X-ray penetration as market adoption of this technology continues. And maybe last but not least, we have been B Corp certified. Moving on, let's take a look at some of our key highlights from the past years as adjustment. I will highlight a few of what did happen in 2021. As previously announced, we were delighted to receive the B Corp certification in recognition of our commitment to our stakeholder approach. In line with this, we are focused on impactful ESG goals. For example, we are targeting carbon neutrality by 2030. We have seen a strong performance across all business units, with one five-room Proteus Plus deal agreed in China and four Proteus One contracts agreed in the US and Europe. There was a record order intake for other accelerators with 31 systems sold. Dosimetry has also seen a solid order intake on par with full year 2020. Our strong cost control measures are still in place, partially offsetting the remaining impact of COVID-19, while allowing for strategic investment in research and development. On the broader corporate side, we are pleased to achieve a number of milestones, including a strategic research and development partnership announced with SCKCEN for the production of Actinium-225, a novel therapeutic radioisotope, which has significant potential in the treatment of cancer, the so-called Theranostic. In addition, during the year, we launched the Cyclone Icon, new high energy and high capacity cyclotron which offers the largest energy spectrum for PET and SPECT isotopes. We also announced the creation of a global dynamic arc consortium preparing for the clinical rollout of the dynamic arc treatment modality with the proton therapy community using the Proteus platform. All of this underpinned by a very strong balance sheet with net cash position of €130 million, doubling from €65 million last year. Finally, the Board has proposed a dividend of €0.19 per share in line with the new dividend policy. Here are some of our post-period highlights. In early 2022, we received a loan payment for our Rodotron, as well as having a contract signed and received the down payment for a Proteus one. More recently, we announced a partnership agreement with Tractebel to support IBS customers with their proton therapy design and construction project. We also completed the share buyback program we launched in December with 400,000 shares bought back under the program and around 1 million shares bought back to date. I now pass to Soumya to talk through the summary of the financials.

Thanks Olivier. You'll see a snapshot here of the financial highlights as announced this morning. Maybe a few points to pick out here. Group revenue of $313 million was broadly flat versus last year. mostly due to the 63.5 million euro contribution from CGNNT in 2020. However, if you look at year-on-year revenue growth, it would have been more than 24%, highlighting the strong uptick in activity and backlog conversion, coming mostly from the proton therapy business, but also well supported by the other accelerator business and asymmetry. The group rebate of euro 14.5 million and net profit of euro 3.9 million reflect the strong performance of the business and ongoing cost control measures. There was a very high equipment order intake of 228 million euros, with nine PT rooms sold, that was five systems, and 31 other accelerator rooms sold across the geographies. It's also worth highlighting the increase in PT and other accelerator service revenue, which was up 6%. Services now make up 46% of the PT and other accelerator revenue line, as this recurring revenue stream continues to grow on an annual basis. Now looking at some of the numbers in more detail, The decrease in PT revenue was due to the CGNNT effect, as I mentioned previously, which offset the strong backlog conversion in the year. However, if we exclude CGNNT, then the year-on-year revenue growth, as I mentioned, would have been around 24%, with strong backlog conversion as we continue to build and install systems around the world. Other accelerators performed very strongly with revenue up 26%, thanks to high order intake and backlog conversion in that area too. And the rebate margin of 4.6% reflects the top line growth and flat cost structure. As Olivier mentioned earlier, the board has proposed a dividend of 0.19 euros per share to the AGM that will be held on June 8. Turning to the balance sheet now, our cash position has really never been stronger with our net cash position of euro 150 million versus euro 65 million at the end of 2020. We also have euro 37 million on Ron's short-term credit line still available and have complied with all our bank covenants. As such, the strength of our balance sheet provides us with significant stability and optionality through which to continue to support and grow the business. Now moving on to proton therapy and accelerators. Overall sales were flat from 2020, but again, reflecting the CGN deal in 2020, they were actually up 30% excluding the revenue recognized from that deal and driven by intensive construction of machines to be delivered over 2022 and mostly in 2023. Other accelerator revenues were also up 26% thanks to the record intake and strong backlog conversion, as well as an increase of service revenues. To continue, we saw strong impact of the licensing revenues last year with 63.5 million recognized in 2020. We've had five new orders for PT equipment. That's the nine rooms I mentioned earlier. A five-room system in China and one Proteus one in Italy and three Proteus ones in the U.S. Other accelerator equipment also had a very strong year with revenue up 35%, reflecting that record order intake. And finally, our service business has also seen strong performance with revenues up 6%, stemming from geographical expansion, new applications, and also strong industry interest in X-ray technology-based sterilization. Coming back to the order intake, we can see the 2021 figures were very strong for both PT and other accelerators in spite of the pandemic challenges. We sold nine PT rooms in the year, up from five in 2020 and back to the 2019 levels. Other accelerators also had an excellent year with 31 systems sold, up from 17 in the prior year and 25 in 2019. Our regional strategic focus remains on Asia with more than half the systems sold in that region. However, at the same time, we also sold several machines in the growing markets of South America and Africa. In addition, we see exciting new opportunities with the launch of two new machines for the radiopharmaceutical market, as mentioned by Olivier earlier, as well as a strong growth potential in the industrial business as the industry is ramping up adoption of X-ray technology for medical sterilization. Looking more specifically now at backlog, which we define as contracts for which we have signed contracts, but where we have not yet recognized revenue. This has increased to an all-time high of €449 million, up from €382 million in 2020, and this despite the high level of backlog conversion in 2021. Of this, Proteus One represents around 46% and other accelerators 24%. On the services front, revenues are also up more than 6% to €19 million, with PT service revenues now approaching the €100 million mark. Services backlog is now at €727 million, with 39 IBAPT sites now generating revenues worldwide, and two new centers in service since 2021. As we previously communicated, services are a very important recurring revenue stream for the group, and we continue to invest in R&D to enhance the performance and efficiency of our service offering. Now taking a look at our dosimetry business, Order intake was slightly down from 2020, but remained strong at Euro 50 million, despite pandemic-related effects. Backlog increased by 5% to reach 16.3 million, and Revit is now up to Euro 4.9 million, practically doubling from 2020, with strong contribution from investment in patient QA as well as sales in Asia. I now hand back to Olivier to take you through a more in-depth business update.