Mentice AB (publ)

Hello and welcome, everyone. My name is Richard Engberg, and I'm an equity research here at Carnegie Investment Bank. With me, I have Franz Venka, CEO of Mentis, and Lurica Drotz, CFO of Mentis, to present the Mentis Q4 results. Franz and Lurica, welcome.

The stage is yours. Thank you for having us. Thank you, Richard. Welcome to today's Q4 earnings call. And I'm here, as stated, also with Ulrike Drods as CFO, who requires no further introduction and has been in place for more than a year. I'm the new CEO of Mentus and I started January 1st. So effectively I have a long history, 25 years of history in the MedTech industry and global roles both across Asia, China, Europe, as also the United States. both in upstream roles as also downstream commercial roles and I'm really excited to be the new CEO of MENTUS. MENTUS is truly a partner in the triangle of both the medical device industry as also the healthcare delivery networks as also the imaging centers and it's a privilege to be the new CEO of MENTUS. I would also like to take the opportunity to thank Joran Amandberg, who led the company for 17 years and really put it and made it where it is today. And I'm honored in order to take the reins and bring it forward to the next chapter of further growth. What we have today is four topics. So first of all, as I said, it is the highlights and the overview what I will give. Then Ulrike Drotz will give the financial results. I will provide some concluding remarks and then we do questions and answers afterwards. In order to get started, so what we look at the financial summary, we had a strong Q4 basically in 2024 with net sales up 22.4% year over year. And it was also with lower operating expenses as also lower personnel costs. And that really drove a positive EBITDA. 19.1% margin as also a net profit of 2 million Swedish crowns for the quarter. If you look at the total year from a sales perspective, it was behind target, but we saw positive developments in both the Asia Pacific region as also the EMEA region and stable performance in North America. The positive was the operational cash flow, both for the full year as also in the quarter. And if I now look at the total results, it really sets us up well for 2025 for further growth and performance. If you then look at the business development aspects, if you look at the EMEA sales, it was up by more than 60%, APAC more than 27% for the full year, where we saw modest growth, we almost flat towards the North Americas. It was performing slower in North America and we're implementing measures in order to make sure that we get more order intake as also further operational execution. And our focus is there both on the medical device industry segment as also the hospital care delivery segment. What we see is that the medical device industry order intake increased by 24% in Q4, and we saw a strong demand for our solutions. Especially the introduction of what we call the integration between Neurovascular Connect and VIST Ankyros was received well, and also we saw the progress in that neurovascular segments in order to be in the treatment planning for hospital solutions. So in all, a good 2024 Q4. And I would like to hand it over for details to Ulrike Drots.

Thank you, Frans. So, as Frans mentioned, we ended the year with a strong Q4, and that gives a year that is more or less in line with 2023. So, net sales up 22.4% compared to the last quarter, 2023, and that gives us a total for the year of 290 million, which is a growth of 6%. Together with a higher gross margin, both in the quarter and the year as a total, we end up at an EBTA level of 19.1% on the margin level and an EBTA result of 16.6%. Sorry, a million Swedish crowns. And as you see, the full result for the year was created in the fourth quarter. And that is despite the fact that we took one of costs of around 7.5 million. So as Frans mentioned, yes, cost control. This leads to an operational cash flow of 13.4 million in the fourth quarter, which is far above the cash flow from last year. On a full year basis, we have an operational cash flow of almost 18 million Swedish crowns, which is approximately half of the operational cash flow that we did in 2023. And from an order intake point of view, we had an increase during the quarter of almost 5%, and for the full year, a decrease of 8%. So moving into more details around the net sales per region. As we have mentioned many times during these kind of calls, we are looking at our business on a rolling 12 months basis, which you see in the graph on the right upper hand corner. And there you can see that the Americas, which represents the largest region for us, had an increase during the quarter of 20%, but as there has been a lower performance up until the third quarter, this leaves a flat development for the full year. For the EMEA region, there was a really, really strong growth during the fourth quarter of almost 62%. And the fact that EMEA also had delivered weaker during the year up until the third quarter made the growth for the full year at almost 5%. For the Jemiya region, it's the opposite. It has been a very strong growth throughout the year and a decrease in the fourth quarter. And despite that, we end the year with a growth of 76%. Looking at the net sales from a product area perspective, we see a solid growth for the Vis products, which is our main product. For the quarter, it's an increase of 90% with the biggest part on hardware. But I want you to highlight that on a yearly full year basis, we see the biggest increase in software and licenses. Physical Sim had a good development during the fourth quarter compared to 2023, and this is also related to the acquisition of Biomodex at the end of 2023. Just mentioning shortly around the recurring revenues, there has been a flat development for the quarter and also on the rolling 12 months basis. What we do see is an increase in software licenses, which is what we are aiming for, and a somewhat decrease in system rentals. But the focus on software licenses is important for us. The order intake for the quarter was above last year, and that is related to the medical device industry within the EMEA region. And a total order intake of 109 million, as I mentioned previously, is an increase with 5% for the quarter, but a full year decrease of 8%. And finally, a comment on the order book, leaving the year with 138 million, whereof 96 million is related to revenues to be recognized in 2025. And as you can see, the majority of those revenues are related to software within the VIST product area.