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Mentice AB (publ)
5/9/2025
Good morning everyone. My name is Richard Engberg and I'm an equity research analyst here at Carnegie Investment Bank. With me I am Frans Fencker, CEO of Mentes and Ulrika Dros, CFO of Mentes. We're going to present the first quarter. Frans and Ulrika, welcome. Thank you Richard, thanks for having us.
So the scene is yours. Very good. Thank you Richard for us being here. What we have today is the quarterly results for the first quarter which we are happy to present to you and all of you. So what I have is four topics for today. First of all the highlights and also the interview, basically overview presented by me, the financial results by Ulrika Dros, concluding remarks by me and then we go towards questions and answers. Overall if we look at the quarterly summary what we see is that we had solid revenue growth year over year where the net sales was up by close to 20%. What we saw is that the EBITDA was negatively impacted by one-offs. That was due to restructuring but also due to currency effects. The revenue came from all three regions so we were positive from all three regions, specifically North America from an absolute standpoint, from a percentage point also we saw significant growth by APAC although from a lower base. What we are doing is currently addressing the weak developments in the healthcare systems market by addressing also our value proposition. So really the growth also from an order intake came from the medical device industry. Overall order intake increased by 15% year over year and it signalled also a strong interest for our mentors products going forward. Now if you then look at the business development activities. So first of all there are activities and we had put activities in place in order to streamline the organization to make sure that we're really focused towards the sales areas where we're driven, towards medical device industry as also the healthcare systems markets. We are consolidating the production currently what we had in Stony Brook towards the Denver Colorado office and make sure that we are going to produce in one location our physical simulation portfolio for the globe. We have continued focus also from the integration from acquisitions when it comes towards Anquiras as also indicated towards physical simulation and especially the latter part we saw continuous development and strong order intake also towards that portfolio. There's progress towards the next generation neurovascular simulation platform where it's linked of fist towards NV connect and Anquiras. We have especially for Anquiras we have approval in Latin America and Brazil in order to start selling and we are about to get good news also from the United States in order to have our next release also available for the US. So in overall the initial steps are being taken to improve and strengthen our value proposition not only in the medical device industry market but especially also in the healthcare systems market and we start focusing that clearly also on the neurovascular market in order to make an impact there. So with that I want to give it over to Rika Drots. That is it for the financial results and details.
Thank you Frans. So the Q1 highlights net sales increase with .5% to 54 million Swedish crowns and a 15% increase in order intake. The main impact comes from the region Americas and the region APAC and we will come back to that in a short while. EBTA level minus 19 million and as Frans mentioned this is affected by one of costs of 3.5 million related to the reorganization and 5 million as an effect of the ongoing thing in Corona which gives a negative impact on our effects. The order book 180 million with 75 million scheduled for 2025 and when comparing this to the first quarter 2024 I just want to mention what we said at the Q4 report that at the end of last year we reviewed our order book and we excluded some orders where we have a very unclear delivery time so that needs to be taken into account when you compare year over year. The Q1 has a operational cash flow that is negative on 3.3 million and as Frans has mentioned solid sales for MDI an increase of almost 26% during the first quarter and as we also see the somewhat weaker performance of the healthcare systems HCS and that is as Frans already mentioned being addressed with actions from us so we will see a different development going forward. Looking at net sales from a region perspective all regions exceeded last year both on a quarterly and on a rolling 12 months perspective. So the Americas region still represents the largest region and had a growth in net sales with 17% for the first quarter and the EMEA region increased with 4% for the first quarter and this is mostly related to the medical device industry and looking at the performance on a rolling 12 months perspective it's a 12% development. The APAC region has a from a percentage point of view a really good increase of 88% and looking at the numbers we have an increase of 4 million in sales and looking at the rolling 12 months perspective it's still an impressive increase of 49% in development. I should comment on the recurring revenue from software we see an increase during the first quarter and we also see the increase on a rolling 12 months basis. And finally a comment on the order intake for the quarter 15% above last year due to the increase in the medical device industry and again we see the somewhat weaker performance in the healthcare systems part again that will be addressed going forward.
Thank you Eureka. So if we now look at the concluding remarks as also the outlook what we clearly see is a more challenging market conditions at this moment with a potential implementation of tariffs but also basically a strengthening Swedish crown towards a basket of currencies specifically the euro and the dollar and that also attributes to more macroeconomical factors that we need to take into account. What we see is that we're adjusting our production capabilities and supply chain also towards potential tariffs and making sure that we optimize accordingly as also if you look at the foreign exchange with the dollar where we have a lot of sales also coming from the US we need to make sure that we look at this and see whether we can get our call space also in line towards that. So there's continued high interest also from the medical device industry we see that going strong and we need to make sure that we focus and really getting our healthcare systems value proposition to really resonate with repeating sales that can also scale towards the larger in basically the device of basically delivery networks for hospitals. So it's really the capturing the opportunities when they arise and making sure that we drive sales accordingly. So key takeaways if I summarize also with respect to the business highlights. So we had a solid Q1 in terms of sales but also order intake, order intake with room for improvement EBITDA impacted by one-offs related to organizational restructuring cost but also foreign exchange effects but we do see a very strong continued momentum from the medical device industry with almost 24% increase in order intake year over year. So if we then look at the strategic priorities that we're focusing on is making sure that we drive the health systems markets with the integration of NV Connect platform with VIST as also ANTIA-RAS in order to be prepared for pre-procedure planning and this is an integral part of our strategy in order to address the hospital space. The second strategic priority is making sure that we reshape our organization and offerings to make sure that our value proposition really resonates not only with the medical device industry market but especially also the health systems market where the growth also will be going forward. So yeah that's our summary it's a streamlined business structure which strengthens our strategic focus for operational execution where we're currently addressing also the current market challenges and we continue to be a major player in a market segment where we really established ourselves with a strong organizational foundation an attractive product solid balance sheet but also attractive customers in order to work with. So Richard that's what we had so far.
Thank you Frans and Ulrike. So my first question is basically can please describe us what these extraordinary costs affecting EBITDA are consisting of? Ulrike you might want to say something?
Yes it's reorganization that we've done so that's it's cost related to that.
Okay great and also like if we can discuss the development within the healthcare systems especially -on-year what has been the reason for the weakness in growth and how have you been addressing it? So
it is what we see First of all Q1 is usually one of the smaller quarters. It's a year of a year and therefore the effects are also in that sense bigger but clearly what we see is that we need to provide propositions towards our healthcare systems market that we're able to scale and that is also what we're currently looking at to making sure that where the demand is and the needs is from our customers that we provide our simulation but also training capabilities exactly in that space and do that in such a way that we are also able to make this bigger as it is in healthcare systems and that's what we're going to address so it is simply in our control in order to make sure that we adjust our value proposition and get the impact that we're looking for.
Okay great and please describe the rationale of merging the strategic alliance segment with the medical device segments since you reported three segments before now you
Yeah an important question and also a change that we made. The strategic alliances remain a very important partnership for us and so our partnership is also stronger than ever with the imaging vendors going forward and what we see is that a lot of the activities that were happening with strategic alliances were already linked towards similar value propositions what we provided towards the medical device industry and for that reason also it made sense to consolidate it with the activities that we do within the MDI so it doesn't change our focus from a business standpoint where how we execute it's simply how we operate and report our results and make sure that we make that part of the medical device industry business going forward.
Okay great and we saw a really strong growth here we are above hardware and development for Mentes Vist. Is this a sign of like the software revenue will catch up and increase the parts of sales later during the year?
Yeah that's we expect that for sure so especially it's all about creating installed base of hardware for our customers both within the medical device industry as also within hospital networks and the more systems we have out there also we expect and also more recurring revenues if it comes towards software sales or licensing sales going forward and for that reason yeah that's a positive development what we expect for the outlook for
the year. Okay great and as a reminder there is an opportunity to ask questions via the chat on the web costs so wait just a couple of seconds to see if there anything on that as well. No I don't see any questions from the web then I might maybe end with one question and that is basically please describe opportunity in Latin America now with Ankyros.
It is it provides us the opportunity to really provide our next version of Ankyros towards our hospitals which is linked towards an improved user interface has also improved software capabilities and it will simply allow us to provide pre-procedure planning specifically in the neurovascular space towards our customers there so it's an opportunity for us in order to be more focused towards the neurovascular segment in Brazil but also grow from there and so we're very pleased with the approval and also we expect the approval the permanent approval also in the United States also there so that we not only grow with our Ankyros proposition within Brazil but that we can also do that within the US.
Okay great and I don't see any questions from the web so do you have any concluding remarks Frans and Rikka?
It is maybe concluding remarks how is it we are basically presenting in Q1 solid results we're off to a decent start when it comes to revenue but also order intake we are seeing a little bit of a more challenges towards the economical outlook macroeconomical basically outlook of the situation how does it in the world but clearly how does it we stick how does it towards our projections and growth projections what we have set for the year.
Okay
thank you and thank you everyone who's been listening. Thank you.