Surgical Science Sweden AB (publ)

Welcome to today's report comment. With me in the studio today is Anna Ahlberg, she is CFO at Certical Science. Welcome Anna. Thank you. And congratulations on a strong quarter. Thank you so much. The net turnover rose to about 95 million, an increase of 282%. What do you think has been the key to this progress?

We are very happy and satisfied with both the sales and the start of the collaboration in the new group. We made a large acquisition this summer of Symbionics, which does a lot of the same things as us, but has a much broader product portfolio and was about three and a half times as big as us. And they are included in the figures for part of the quarter, so it's a mixed quarter. for about a month. But even if we look at comparable units and compare this quarter with the same quarter last year, as if we also had been the same group, we increase by over 30%. And we are very pleased with that. And that is the increase in both of our two business areas.

We are going to talk more about the integration of Symbionics, but your internal motto is to keep the engine running. What has this meant to you?

Of course, when there is such a big collaboration as it is for us, there are a lot of internal issues, processes, projects that start and that we have to work on. But the important thing is to keep the balance and to really keep customer focus. And that's what we mean by keeping the flag high for customers and really not losing everything else that needs to be done. And that's what we're very happy with, in the way that we have succeeded with it.

And you mentioned the integration of Symbionics. How has this process been? How is the work going?

Good, as I said, it's not that long, it's about three months since the acquisition went through, so we are in the middle of it and in many projects. We have mentioned earlier that there are large IT projects that we need to do and we are in the middle of them. But the important thing in all of this is that you have that positive energy and we really have that and we really like to work together. It became significantly bigger, 270 employees. Yes, about 220 people arrived with the acquisition of of Symbionics and three major sites in Tel Aviv, Israel, the USA and Sweden. So we have about 150 people in each place. Many new names to learn.

If we talk about different business areas, you have Industry OEM. What are the latest new areas?

Industry OEM, we define it as our sales to medical technology companies. Then we have our business area, education and products, which we define as sales to hospitals, more the academy. So it is more the customer group that defines. But within Industry OEM, we have a larger share of software delivery. Within Educational Products, we have our own simulators where surgeons can train on different types of interventions, both hardware and software. And we have a part of that also within Industry OEM. But within Industry OEM, we often talk about robotic surgery. It is our largest area and the fastest growing. And there, the delivery is entirely of software. So that's the difference. With Symbionics, we have a slightly larger share of hardware also in this area. We have been through laparoscopy and have had the sale of laparoscopy simulators in the area, but now there is also a lot of vascular surgery through Symbionics.

What do you think about the outlook for industry OEM? Will you continue in this pace?

A lot is happening in this area. As I said, robot surgery is our strongest growing segment and the most important segment in this area. And a lot is happening there. During the quarter, we can mention that Medtronic, a huge pharmaceutical technology company, has worked on its the new robot Hugo and it received CE approval during the quarter and there we deliver the software to train the surgeon in how they should use the robot before they start using it on humans.

Exciting, as you mentioned these educational products and there now stood the revenue for 60% of the quarter's total sales. Is your ambition that it should be 50-50 in these two areas or?

No, we want both of them to grow as much as possible. But before the acquisition, it was about the opposite for the old Surgical Science. Then it was 60-65% within Industry OEM. But Surgical Science also comes from Educational Products. That's where we do the development and have worked for more than 20 years in order to create credibility about what we do and so on, which we then use against the pharmaceutical technology companies. So education and products is an incredibly important area. And now, as I said, with the acquisition of Symbionics, we have a much broader product portfolio. We have previously been in laparoscopy and endoscopy mainly, and now we have many more areas to work in.

Do you see the same strong future demand for educational products?

We do not have any forecasts for the future. However, we have said, with the acquisition of Symbionics, that we will come up with new financial goals for the company. The financial goals that we had, we have actually gone over now when it comes to revenue. So we will come up with new ones, and in the report we mentioned that we will do that before the next report, that is, before the book release communication in February. So then we will discuss more about how we see it in the long run.

You can simply wait until then. And in the contract it also says that this acquisition has created a certain turbulence, the acquisition of Symbionics then. What do you mean by that?

In what way? Yes, what we meant then is when it comes to distributors. Distributor management. The old Surgical Science and the old Symbionics, which are now one, were competitors. That is to say, we had different distributors on the same market or different distribution channels. And that is a job that is ongoing right now to see how it will look in the future. But we also say that we see it as which is very positive. We are a big player, we have a broad product portfolio of incredibly high quality products and we see that people want to work with us. So we see it positive in the future.

And finally, Anna, what are you focusing on right now?

Continue what we have talked about. As I said, we are a part of the integration. There is a lot going on. Continue to keep the engine running. Incredibly important. Customer focus. Q4 is a very important quarter for us. It is usually our strongest quarter. There are some seasonal variations. Keep moving forward. Absolutely. Thank you very much, Anna, for coming to the studio today.