Straumann Holding AG

  • WKN: 914326
  • ISIN: CH1175448666
  • Land: Schweiz

Nachricht vom 12.08.2004 | 06:37

Straumann lifts first-half sales by 33% to CHF 217 million (Part 2 of 3)

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----- Download the full media release, including additional financial tables: Straumann lifts first-half sales by 33% to CHF 217 million (Part 2 of 3) EBIT margin expands to 31% Continued optimization of inventory and supply-chain management contributed to an overall reduction in the cost of goods sold from 20% to 18% of sales. This and a slightly positive currency effect on sales expanded the gross margin to 82%. Overall operating costs decreased to 69% of sales compared with 72% in the first half of last year. Selling costs rose from 36% of sales in the first half of 2003 to 38%, reflecting the Group's growth strategy. Owing to the integration of Biora and the reorganization of administrative functions, certain items have been reallocated from research and development to general administrative costs both in the period under review and in the corresponding first half of 2003. General administrative costs remained constant at 9% of sales, whereas research and development costs decreased 2% points to 6% of sales but were maintained at the 2003 first-half level of CHF 13 million, underscoring Straumann's commitment to scientific innovation. As a result of the favorable overall development of costs, operating profit grew faster than sales, rising 45% to CHF 67 million. The EBIT margin improved to 31%. 102 new jobs created To absorb and sustain the current high level of growth, the Group has continued to invest in talent recruitment. In line with the Company's growth ambitions, 102 new positions were created in the first six months of 2004, bringing the total number of employees worldwide to 1,005 at the end of June. Approximately half of the new recruitments were in sales force positions, strengthening the field force by 22% to 247 representatives worldwide to support future growth. Consequently, personnel costs were up 40% from the previous first half to CHF 63 million. In relation to sales, however, personnel costs increased only slightly over proportionally by 1% point to 29%, while sales per employee still rose by CHF 15,000 to CHF 424,000. Depreciation constant as a proportion of sales Operating profit before depreciation and amortization (EBITDA) improved considerably by 43% to CHF 81 million, reflecting the aforementioned improvements in operating efficiency. As a result, the EBITDA margin expanded 2% points to 37% by comparison with the previous first half. Operating profit before amortization (EBITA) rose 49% to CHF 72 million, with the EBITA margin improving 4% points to 33%, despite an additional write-down of CHF 3 million on the Waldenburg site as part of the Company's planned relocation to Basel at the end of 2004. Goodwill amortization charged in the first half came to CHF 3 million, most of which was related to the Biora acquisition. Net profit up 42% Financial expenses came to just less than CHF 1 million and were offset almost exactly by financial income. The fact that the overall financial result was a negative CHF 2 million was due to unfavorable currency developments. The first-half tax rate was reduced to 17% owing to a one-time tax effect related to the acquisition and restructuring of Biora. The tax rate would otherwise have been 22%. Due to the good operating result and the lower tax level, first-half net profit climbed 42% to a record CHF 54 million. As a result, the net profit margin increased 2% points to 25%, while earnings per share rose 42% to CHF 3.49. High dividend and repayment of loans First-half cash flow from operating activities rose 14% to CHF 65 million leading to an operating cash flow margin of 30%. Capital expenditure totaled CHF 22 million, corresponding to 10% of sales, and was mainly due to capacity expansion (CHF 15 million) and the new headquarter project in Basel (CHF 7 million). The first-half free cash flow of CHF 43 million, the inflow of CHF 3 million from the Company's staff equity compensation scheme, and excess liquidity were used to pay dividends of CHF 48 million (including the exceptional 50th anniversary dividend), to repay outstanding short-term loans for the Biora acquisition (CHF 15 million) and to repay the mortgage on the Waldenburg site (CHF 14 million). With the above total cash outflow from financial activities of CHF 74 million, net liquidity stood at CHF 70 million on June 30, 2004. Return on capital further improves to 42% From December 31, 2003 to June 30, 2004, the Straumann Group's total assets decreased slightly to CHF 349 million, while the return on assets (ROA) improved from 27% to 31%. Thanks to enhanced inventory management resulting in a reduction of stocking levels from CHF 35 million to CHF 33 million, net working capital increased only slightly from CHF 31 million to CHF 34 million, but decreased as a proportion of sales from 9% to 8% over the first half of 2004. Despite the increase in the equity ratio to 75%, return on equity (ROE) improved from 36% to 42%. Based on the weighted average cost of capital of 9%, Straumann further improved its first-half economic profit by CHF 14 million to CHF 43 million. With the Group's capital employed at CHF 262 million, return on capital employed (ROCE) rose from 41% to 51%. Outlook (barring unforeseen circumstances) The growth effect from the Biora acquisition discontinued at the end of June and will not contribute to the second half of the current year. Nevertheless, the Group's first-half sales performance provides a basis for increasing its full- year sales growth expectation from 23-24% to around 26% in local currencies compared with 2003. Linked to this, full-year operating margin is expected to be not less than 30%. With a foreseen tax rate of 22% for the full year, the net profit margin is expected to be in the region of 23%. End part 2 of 3 end of message, (c)DGAP 12.08.2004
----- WKN: 914326; ISIN: CH0012280076; Index: Listed: Freiverkehr in Berlin-Bremen, Frankfurt, München und Stuttgart; SWX Swiss Exchange 120636 Aug 04

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