Revenio Group Corporation, Stock Exchange Release, April 25, 2016 at 9:00 am
Revenio Group Corporation Interim Report January 1 - March 31, 2016
Due to an amendment to the Securities Market Act, which came into force on November 26, 2015, the descriptive sections of Revenio's interim reports Q1/2016 and Q1-Q3/2016 will be shorter and more concise than before. The table sections will be reported in accordance with previous practices. The figures are unaudited.
Revenio Group Corporation has adopted the publication procedure enabled by the Financial Supervisory Authority's Regulations and guidelines 7/2013 (Disclosure obligation on issuers) and is publishing its financial statements bulletin for January-March 2016 as an appendix to this stock exchange release. This release is a summary of Revenio Group Corporation's Interim Report Q1/2016, which is available in full in the pdf file attached to this stock exchange release, and on the company website at www.revenio.fi .
Sales grew in all key market areas. Operating profit fell slightly from the previous year.
January-March 2016 in brief, continuing Group operations:
Key figures, continuing operations, EUR million:
|Net sales, Group||5.2||4.6||12.9|
|Operating profit, Group||1.3||1.4||-6.2|
|Net sales, Health Tech||5.2||4.6||12.9|
|Operating profit, Health Tech||1.6||1.7||-5.8|
|Undiluted earnings per share||0.12||0.16||-23.0|
|Diluted earnings per share||0.12||0.15||-22.7|
|Cash flow from operating activities||0.5||3.1||-84.8|
|31 March 2016||31 March 2015||Change, %-point|
Financial guidance for 2016
Net sales growth is expected to remain strong. Profitability is expected to remain at a healthy level despite growth investments.
Business trends in Q1/2016, continuing operations
Revenio Group's net sales grew in all key market areas, amounting to EUR 5.2 million (EUR 4.6 million) and showing an increase of 12.9 per cent. Net sales were affected by the growth of sales in all key market areas, especially in the US.
Sales of the new generation Icare ic100 tonometer were successfully launched in Europe, which affected sales of the previous version, Icare TA01, to some extent.
A sales license application was filed for the Icare ic100 tonometer in the United States in December 2015. After the review period in April 20, 2016 the company received notification that the FDA has granted sales permit for Icare ic100 tonometer in the US. The company has readiness to launch Icare ic100 tonometer immediately and to deliver first lot of equipment for sale in the US markets.
Probe sales showed strong growth, up 23 per cent on the previous year, representing 28 per cent of net sales.
In March, the United States Food and Drug Administration FDA decided to reject the sales license application for Icare HOME. Icare has taken steps to initiate a new feasibility study; once this has been completed, the company will file a new sales license application with the FDA. The new application license is expected to be filed during 2016.
Revenio Research Oy's development projects on product concepts related to skin cancer and asthma are progressing as planned. Test measurements with the prototype of a device designed for skin cancer diagnostics will begin this spring.
Revenio Group's operating profit for the period amounted to EUR 1.3 million (EUR 1.4 million), falling 6.2 per cent short of the same period a year earlier. This can be primarily attributed to higher salary costs resulting from preparations for the global sales launch of Icare HOME and Icare ic100 tonometers and research and development related to asthma and skin cancer products. Recruitment focused on sales and marketing and product development personnel. Most of the recruited employees joined the company in late 2015, which has an impact on the salary costs for the period.
Olli-Pekka Salovaara, President and CEO, comments on the first quarter of 2016:
"Sales in the United States, our largest individual market area, developed as planned. Sales grew in all key market areas and organic growth continued.
An updated version of the Icare TA01i tonometer, the ic100, was granted a CE marking in Europe in late 2015 and thereby a sales permit in the EU. The market launch and sales of this new generation product in Europe began during the review period. The Icare ic100 has required significant investments, and while we expect it to gradually replace the Icare TA01i tonometer launched in 2003, we believe that the TA01 will continue to generate healthy sales for several years, particularly in developing countries. After the review period in April 20, 2016 we received notification that the FDA has granted sales permit for Icare ic100 tonometer in the US. Icare's marketing team is ready to launch this new generation product in the US market. This is a significant milestone for us.
Probe sales showed steady growth, but we expect sales to become more substantial following growth in device sales and increasingly active use of the devices.
We were very disappointed with the decision of the United States Food and Drug Administration in March to reject the sales license application for the Icare HOME tonometer, against our expectations and discussions with the authorities. After an analysis, we decided to take immediate action and to start making preparations for a new feasibility study. After this study has been completed, Icare will submit a new sales license application to the FDA, probably before the year-end.
The product concept development work carried out at Revenio Research on the detection, patient-led screening and follow up of asthma and skin cancer is proceeding as planned. Development work on the asthma detection product is progressing as planned and according to schedule. I believe we will be able to disclose more details this year on the global launch schedule for both products.
Oscare Medical has signed its first significant sales agreement with a Nordic pharmacy chain.
When assessing the development of operating profit in the second and third quarter of 2016, it is important to note that most of the twelve new employees recruited to support the global sales launches of the Icare HOME and Icare ic100, and the asthma and skin care product development projects, joined the company in the final quarter of 2015. Personnel required in support of our planned growth has now been recruited and salary costs are expected to remain at the current level throughout 2016."
Certain statements in this report are estimates based on the management's best knowledge at the time they were made. They therefore involve a certain amount of inherent risk and uncertainty. The estimates may change in the event of significant changes in general economic conditions.
Revenio Group Corporation
Board of Directors
For further information, please contact:
President & CEO Olli-Pekka Salovaara, tel. +358 40 567 5520
Financial Supervisory Authority (FIN-FSA)
The Revenio Group in brief
Revenio is a Finnish, globally operating health technology corporation whose worldwide success is based on a strongly patented intraocular pressure measurement technology. The Revenio Group consists of Icare Finland Oy, Revenio Research Oy and Oscare Medical Oy, in which Revenio holds a 53% interest. The common denominators of Revenio's business operations include screening, follow-up and the global need to make cost savings through preventive health care. Revenio seeks vigorous growth in health technology. Revenio aims to develop even more efficient and easily adopted methods for the early-stage detection of diseases with significance for public health. The focus of Revenio's screening technology is on the early detection of glaucoma, osteoporosis, skin cancer and asthma, and the monitoring of these during the treatment process.
In 2015, Revenio Group's net sales totaled MEUR 20.3, with its operating margin for continuing operations standing at 28.4 %. Revenio Group Corporation is listed on Nasdaq Helsinki.