Optomed Plc Stock Exchange Release 18 Febryary 2021 at 9:00, Helsinki
Optomed Plc: Financial Statements Bulletin, January – December 2020
October – December 2020
·
Revenue decreased by 6.6 percent to EUR 4,041 (4,329) thousand
· Adjusted EBITDA amounted to EUR -62 (-211) thousand corresponding to –1.5 (
-4.9) percent of revenue
· The COVID-19 pandemic continued to negatively affect especially the OEM
sales of the Devices segment, whereas the Software segment continued its solid
performance
· Solid revenue growth in China
· Regulatory approval received for Optomed Aurora camera in China
· The US revenue continued to grow
· Successful launch of Aurora IQ, handheld fundus camera with seamless AI
integration in November 2020
January – December 2020
·
Revenue decreased by 13.1 percent to EUR 13,011 (14,977) thousand
· Adjusted EBITDA amounted to EUR -733 (-196) thousand corresponding to –5.6 (
-1.3) percent of revenue
· The COVID-19 pandemic has negatively affected the Devices segment whereas
the Software segment continues its solid performance
Key figures
EUR, thousand Q4/2020 Q4/2019 Change, % 2020 2019 Change, %
Revenue 4,041 4,329 -6.6% 13,011 14,977 -13.1%
Gross profit * 2,809 2,745 2,3% 8,955 9,944 -9.9%
Gross margin % * 69.5% 63.4% 68.8% 66.4%
EBITDA -62 550 -111.2% -733 -335 -118.8%
EBITDA margin *, % -1.5% 12.7% -5.6% -2.2%
Adjusted EBITDA * -62 -211 70.7% -733 -196 -274.6%
Adjusted EBITDA margin -1.5% -4.9% -5.6% -1.3%
*, %
Operating result -594 -33 -1677.9% -2,906 -2,596 -11.9%
(EBIT)
Operating margin -14.7% -0.8% -22.3% -17.3%
(EBIT) *, %
Adjusted operating -594 -794 25.1% -2,906 -2,457 -18.3%
result (EBIT) *
Adjusted operating -14.7% -18.3% -22.3% -16.4%
margin (EBIT margin)
*, %
Net profit/ loss -652 -58 -1016,5% -3,177 -2,875 -10.5%
Earnings per share -0.05 -0.01 -612.5% -0.24 -0.32 29.5%
Cash flow from 383 2,000 -80.8% -2,801 161 -1839.7%
operating activities
Net Debt -4,090 -8,940 -54.3% -4,090 -8,940 -54.3%
Net debt/ Adjusted 5.6 45.7 5.6 45.7
EBITDA (LTM)
Equity ratio * 64.6% 57.2% 64.6% 57.2%
R&D expenses personnel 395 443 -10.8% 1,406 1,540 -8.7%
R&D expenses other 83 66 25.6% 253 234 8.1%
costs
Total R&D expenses 479 509 -6.1% 1,659 1,774 -6.5%
*) Alternative performance measures, see section Alternative Performance
Measures for definitions and calculations.
CEO comments
Optomed's business developed towards a positive direction during the last
quarter of the year, even though revenue slightly declined. The overall demand
for our own branded fundus cameras and related software solutions increased,
despite the pandemic continued to negatively impact our business, particularly
in Europe and the United States.
Both revenue and profitability of our Software segment, which has performed well
during the pandemic, continued to grow. This growth came from increasing
recurring revenue from the existing customer base and new customer deliveries
made during the quarter.
For the Devices segment, 2020 was a year of significant change. Optomed's
strategy has been to expand its own distribution network and thus increase sales
of camera products and complete screening solutions under its own brand. Optomed
branded camera sales via our distribution network started to grow in the third
quarter and continued this strong growth during the fourth quarter, while sales
to our OEM customers declined. During 2020, the share of cameras sold under the
company's own brand significantly exceeded the number of products sold through
our OEM customers, growing our own installed base, and providing more
opportunities for additional software and other recurring revenue streams in the
coming years.
Revenue of our Chinese subsidiary developed favorably, especially in the last
quarter of the year. The new product registrations and launches in 2020 are
expected to have a positive impact on our China sales in the current and future
years.
In the last quarter of 2020, the Devices segment’s revenue decreased but the
profitability increased. The decline in the revenue was caused by the Covid-19
pandemic constraints in traditional sales work to hospitals affecting our OEM
sales the most.
In the fourth quarter, we were especially pleased that we were able to sell and
deliver several complete diabetic retinopathy screening solutions, including
cameras, software and artificial intelligence services, for healthcare and
screening programs in Asia and the Middle East. We expect the number of complete
screening solution deliveries to increase further during 2021, especially when
the pandemic related travel restrictions begin to ease. The new Aurora IQ camera
with AI services launched in November has received very positive feedback from
the market, but due to logistics, the delivery volumes were not yet significant
in 2020. The Aurora IQ camera is expected to have a considerable impact on the
company’s growth from 2021 and onwards.
Overall, the company’s revenue in the fourth quarter decreased by 6.6 percent
due to the decline in camera sales to our OEM customers caused by the pandemic.
However, profitability improved because of increased software and higher margin
Optomed branded camera sales. The cash flow from operating activities was
positive.
The changes in our sales channel structure during 2020, establishment of our US
subsidiary, launch of the Aurora IQ camera, new product registrations in China
and Canada, and the positive market outlook in China give us a good starting
point for 2021. Several of our key markets are showing clear signs of recovery,
and therefore in the end of 2020, we started to significantly increase our sales
and marketing activities. Although the impact of the Covid-19 pandemic to the
market and our business is expected to continue going forward, we expect the
company’s revenue to grow during 2021.
CEO
Seppo Kopsala
Outlook 2021
Optomed expects its full year 2021 revenue to grow compared to 2020.
Telephone conference
A telephone conference for analysts, investors and media will be arranged on 18
February 2021 at 11.00 EET. The event will be held in English. The presentation
material will be available at www.optomed.com/investors 10.00 EET at the latest.
The participants are requested to register for the call in advance by email to
sakari.knuutti@optomed.com.
Please see the call-in numbers below:
FI +358 9 856 26300
SE +46 8 505 218 52
UK +44 20 3321 5273
US +1 646 838 1719
FR +33 1 70 99 53 92
The conference id is 554 810 399#.
Please note that by dialing into the conference call, the participant agrees
that personal information such as name and company name will be collected.
Group performance
October – December 2020
In October-December 2020, Group revenue decreased by 6.6 percent to EUR 4,041
(4,329) thousand. The Software segment’s solid performance continued, and its
revenue increased by 6.1 percent driven by stable recurring business from the
existing customers in addition to new global delivery projects. The Devices
segment OEM sales were still affected by the pandemic and the segment’s revenue
decreased by 19,5 percent. China, the US, and distribution sales channels
performed well. The Group gross margin increased to 69.5 from 63.4 percent last
year. The Group recorded other operating income of EUR 40 (11) thousand during
October-December. The October-December Group gross margin excluding other
operating income was 68.5 percent in 2020 and 63.2 percent in 2019.
In October-December 2020, Group EBITDA amounted to EUR -62 (550) thousand and
adjusted EBITDA totaled EUR -62(-211) thousand. The October-December 2019 was
affected by EUR 760 thousand of rebooked IPO expenses classified as items
affecting comparability. The main reasons for the positive adjusted EBITDA
variance versus 2019 were higher gross profit due to more software and Optomed
branded product sales and lower operating expenses because of the company’s
swift response to the pandemic and the related cost reduction actions. The Group
has since April cut travelling and postponed external events. EBIT was EUR -594
(-33) thousand and adjusted EBIT was EUR -594 (-794) thousand.
In October-December 2020, net financial items amounted to EUR -69 (-67) thousand
and consisted mainly of interest payments to financial institutions and the
translation effect of Chinese RMB to EUR.
January – December 2020
In January-December 2020, Group revenue decreased by 13.1 percent to EUR 13,011
(14,977) thousand. The Software segment performed well considering the ongoing
COVID-19 situation, and its revenue growth was 3.2 percent driven by stable
recurring business from the existing customers. The Devices segment’s revenue
decreased by 30.3 percent. The decrease was a result of the COVID-19 pandemic
causing a decline in OEM sales. Optomed branded products performed well despite
pandemic and exceeded OEM sales. The gross margin increased to 68.8 percent from
66.4 percent of the comparison period. The company received other operating
income of EUR 157 (254) thousand for the full year of 2020 and 2019, which
increased the gross margin of both periods. The January-December gross margin
excluding other operating income was 67.6 percent in 2020 and 64.7 percent in
2019.
In January-December 2020 EBITDA amounted to EUR -733 (-335) thousand and
adjusted EBITDA totaled EUR -733 (-196) thousand. January-December 2019 was
affected by EUR 139 thousand of IPO expenses classified as items affecting
comparability. The main reasons for the adjusted EBITDA variance versus 2019
were lower revenue which was partly compensated by higher gross margin and lower
operating expenses due to the layoffs, lower level of corporate travelling, as
well as external events that had been cancelled or postponed due to the COVID-19
situation. EBIT was EUR -2,906 (-2,596) thousand and adjusted EBIT was EUR
-2,906 (-2,457) thousand.
Net financial items amounted to EUR -341 (-356) thousand in January-December
2020 and consisted mainly of interest payments to financial institutions and the
translation effect of Chinese RMB and USD to EUR.
Cash flow and financial position
October- December 2020
In October-December 2020, the cash flow from operating activities amounted to
EUR 383 (2,000) thousand. Net cash used in investing activities was EUR -651 (
-407) thousand and relates mainly to capitalized development expenses. Net cash
from financing activities amounted to EUR -34 (15,548) thousand. Financing
activities in the fourth quarter 2019 include share issue proceeds from the IPO
of EUR 20 million.
January- December 2020
In January-December 2020, the cash flow from operating activities amounted to
EUR –2,801 (161) thousand. Net cash in investing activities was EUR –1,820 (
-1,434) thousand and relates mainly to capitalized development expenses. Net
cash from financing activities amounted to EUR –3,698 in 2020 and include a loan
repayment of EUR 3,2 million in the first quarter of 2020. Net cash from
financing activities in 2019 amounted to EUR 18,123 thousand and include the
proceeds of two share issues. Optomed received proceeds of EUR 3,0 million in a
share issue conducted prior to the IPO in 2019 and proceeds of EUR 20 million in
the IPO.
Consolidated cash and cash equivalents at the end of the period amounted to EUR
10,608 (18,866) thousand. Interest-bearing net debt totaled EUR -4,090 (-8,940)
thousand at the end of the period.
Net working capital was EUR 3,440 (1,275) thousand at the end of the period.
Devices segment
Optomed has two synergistic business segments: Devices and Software.
The Devices segment develops, commercializes and manufactures easy-to-use, and
affordable handheld fundus cameras, that are suitable for any clinic for
screening of various eye diseases, such as diabetic retinopathy, glaucoma and
AMD (Age Related Macular Degeneration).
EUR, thousand Q4/2020 Q4/2019 Change, % 2020 2019 Change, %
Revenue 1,738 2,158 -19.5 % 5,097 7,309 -30.3 %
Gross profit * 990 1,113 -11.1 % 2,862 4,200 -31.9 %
Gross margin, 56.9 % 51.6 % 56.1 % 57.5 %
% *
EBITDA 1 -169 100.4 % -251 -408 38.5 %
EBITDA margin, 0.0 % -7.8 % -4.9 % -5.6 %
% *
Operating -384 - 539 28.9 % -1,820 -1,913 4.8 %
result (EBIT)
Operating -22.1 % -25.0 % -35.7 % -26.2 %
margin (EBIT),
% *
*) Alternative performance measures, see section Alternative Performance
Measures for definitions and calculations.
October- December 2020
In October-December 2020, the Devices segment revenue decreased by 19.5 percent
and was EUR 1,738 (2,158) thousand. The decrease was, as in the second and third
quarter, caused by the COVID-19 pandemic affecting personal sales work to
hospitals and clinics, seen as lower OEM sales. Optomed branded product sales
via distributors and our China and US business performed well despite pandemic
and exceeded OEM sales.
In October-December 2020, the gross margin increased to 56.9 percent from 51.6
percent in the previous year. The positive variance is mainly due to a higher
share of Optomed branded products sold with a higher gross margin compared to
OEM products.
In October-December 2020, EBITDA was EUR 1 (-169) thousand or 0.0 (-7.8) percent
of revenue. The key drivers for the increase in EBITDA were higher gross margin
and the COVID-19 outbreak affecting corporate traveling and external events.
January- December 2020
In January-December 2020, the Devices segment revenue decreased by 30.3 percent
and was EUR 5,097 (7,309) thousand caused by the COVID-19 pandemic affecting
mainly OEM sales.
In January-December 2020, the gross margin decreased to 56.1 percent from 57.5
percent in the previous year. The company received other operating income of EUR
101 (175) thousand in 2020. The gross margin excluding other operating income
was 54.1 percent in 2020 and 55.1 percent in 2019.
In January-December 2020, EBITDA was EUR -251 (-408) thousand or -4.9 (-5.6)
percent of revenue. In spite the revenue decreased by 30.3 percent, the EBITDA
was improved while cost saving measures started in response to the pandemic.
Software segment
Optomed has two synergistic business segments: Devices and Software.
The Software segment develops and commercializes screening software for diabetic
retinopathy and cancer screening for healthcare organizations. The segment also
distributes off-the-shelf products from selected partners to supplement its own
solutions and expertise and provides software consultation to support the
Devices segment screening solution projects.
EUR, thousand Q4/2020 Q4/2019 Change, % 2020 2019 Change, %
Revenue 2,303 2,171 6.1 % 7,913 7,668 3.2 %
Gross profit * 1,819 1,631 11.5 % 6,093 5,744 6.1 %
Gross margin, 79.0 % 75.2 % 77.0 % 74.9%
% *
EBITDA 635 476 33.3 % 1,926 1,667 15.6 %
EBITDA margin, 27.6 % 21.9 % 24.3 % 21.7%
% *
Operating 487 264 84.6 % 1,323 909 45.4 %
result (EBIT)
Operating 21.1 % 12.1 % 16.7 % 11.9 %
margin (EBIT),
% *
*) Alternative performance measures, see section Alternative Performance
Measures for definitions and calculations.
October – December 2020
In October-December 2020, the Software segment had another successful quarter
and the revenue increased by 6.1 percent and was EUR 2,303 (2,171) thousand. The
performance was driven by the stable recurring business with the current
customer base that was not affected by the pandemic and new delivery projects
abroad.
In October-December 2020, the gross margin was 79,0 (75.2) percent. Other
operating income was EUR 40 (11) thousand in 2020. The gross margin excluding
other operating income was 77.0 percent in 2020 and 74.9 percent in 2019. The
positive variance is due to favorable customer and product mix.
EBITDA stood at EUR 635 (476) thousand or 27.6 (21.9) percent of revenue,
respectively. The travel restriction due to the pandemic have slowed down the
global screening solution sales.
January – December 2020
In January-December 2020, the Software segment revenue increased by 3.2 percent
and was EUR 7,913 (7,668) thousand. The gross profit included other operating
income of EUR 56 thousand in 2020 compared to EUR 79 thousand in 2019. The gross
margin excluding other operating income was 76.3 percent in 2020 and 73.9
percent in 2019.
EBITDA was EUR 1,926 (1,667) thousand or 24.3 (21.7) percent of revenue.
Organic growth
The following table shows the organic growth of the group and the segments. The
adjusted elements are related to exchange rate variances between EUR and Chinese
RMB and USD.
Organic growth, percentage Q4/2020 2020 2019
Devices segment* -18.9% -29.5% -2.5%
Software segment* 6.1% 3.2% 6.9%
Group* -6.3% -12.7% 1.5%
*) Alternative performance measures, see section Alternative Performance
Measures for definitions and calculations
Group-wide expenses
Group-wide expenses relate to functions supporting the entire group such as
treasury, group accounting, Marketing, legal, HR, IT and public listing
expenses.
October – December 2020
In October-December 2020, group-wide operating expenses amounted to EUR 697
(+242). The fourth quarter of 2019 includes reclassified IPO expenses of EUR 760
thousand. The increase in review period excluding the IPO expenses was EUR 179
thousand.
January – December 2020
In January-December 2020, group-wide operating expenses amounted to EUR 2,408
(1,593). The full year 2019 includes IPO expenses of EUR 139 thousand.
Personnel
Number of personnel at the end of the reporting period.
2020 2019
Devices 53 59
Software 38 36
Group 18 13
Total 109 108
Corporate Governance
Optomed complies with Finnish laws and regulations, Optomed’s Articles of
Association, the rules of Nasdaq Helsinki and the Finnish Corporate Governance
Code 2020 issued by the Securities Market Association of Finland. The code is
publicly available at http://cgfinland.fi/en/. Optomed’s corporate governance
statement 2019 is available on the company website www.optomed.com/investors/.
Annual General Meeting
The Annual General Meeting held on 11 June 2020 approved the financial
statements, adopted the Remuneration Policy for governing bodies and discharged
the responsible parties from liability for the financial period ended 31
December 2019.
The Annual General Meeting resolved in accordance with the proposal of the Board
of Directors that no dividend will be paid for the year 2019.
The number of members of the Board of Directors was confirmed as five:
·
Seppo Mäkinen, Petri Salonen, Reijo Tauriainen and Jun Wu were re-elected as
members of the Board
· Anna Tenstam was elected as a new member of the Board
The Annual General Meeting confirmed the annual Board remuneration as follows:
·
Chairman of the Board EUR 36,000
· Members of the Board EUR 18,000
In addition, a meeting fee in the amount of EUR 500 is paid to the Chairman of
the Audit Committee for each Audit Committee meeting. 40 percent of the Board
remuneration is paid in Optomed shares and 60 percent in cash. The remuneration
was paid in August, after Optomed’s H1 report was announced.
The Annual General Meeting decided that KPMG Oy Ab, authorized public
accountants is elected as the Company’s auditor. KPMG Oy Ab has informed the
Company that Authorized Public Accountant Tapio Raappana would continue as the
auditor with principal responsibility. Auditor’s remuneration will be paid in
accordance with an invoice approved by the Company.
The General Meeting approved the authorization for the Board of Directors to
accept as pledge and repurchase of Optomed’s own shares. Altogether no more than
1,400,314 shares may be repurchased or accepted as pledge. The authorization
will be valid until the earlier of the end of the next Annual General Meeting or
18 months from the resolution of the Annual General Meeting.
The General Meeting authorized the Board of Directors to decide on the issuance
of shares as well as the issuance of options and other special rights entitling
to shares referred to in chapter 10 section 1 of the Finnish Companies Act. The
number of shares to be issued based on this authorization may not
exceed 1,400,314. The Board of Directors is authorized to resolve on all terms
and conditions of the issuance of shares and special rights entitling to shares,
including the right to derogate from the pre-emptive right of the
shareholders. The authorization will be valid until the earlier of the end of
the next Annual General Meeting or 18 months from the resolution of the Annual
General Meeting.
At its meeting held after the Annual General Meeting, the Board of Directors
elected from among its members Petri Salonen as its Chairman. The committee
members were elected as follows:
Audit Committee:
Reijo Tauriainen (chairman)
Seppo Mäkinen
Anna Tenstam
Remuneration Committee:
Seppo Mäkinen (chairman)
Reijo Tauriainen
Anna Tenstam
Shares and shareholders
The company has one share series with all shares having the same rights. At the
end of the review period Optomed Plc's share capital consisted of 14,003,144
shares and the company held 740,378 shares in the treasury which corresponds
approximately 5.3 percent of the total amount of the shares and votes.
Additional information with respect to the shares, shareholding and trading can
be found on the company’s website www.optomed.com/investors/.
Risks and uncertainties
The key risks and uncertainties are described in the company’s annual report
2019 which was published on 20 March 2020. The complete report is available at
https://www.optomed.com/investors/. In this financial report, the company
describes only the changes to the complete risks and uncertainties described in
the annual report.
The COVID-19 coronavirus risk as disclosed in the previous financial report has
been updated as follows:
COVID-19 coronavirus
The COVID-19 outbreak has turned into a pandemic the length and prolonged effect
of which are uncertain.
The company’s software segment continues to be largely unaffected due to
recurring nature of the business and long-term customer agreements, however, the
Devices segment sales have been negatively affected by the pandemic. The medical
sector as a whole is concentrated on addressing the immediate pandemic and other
supplier meetings and purchases are postponed. This has an effect on the
company’s ability to sell its devices and increase its customer base especially
because face-to-face meetings are market standard for fundus camera sales.
Currently, it seems like the People’s Republic of China and the Asia-Pacific
have recovered from the pandemic and demand is back to normal in key countries
of the area. However, Europe and the US have been hit by a new wave of
infections which may have a negative effect on both the European sales and the
US operations that are in the ramp-up phase. In spite the vaccinations are
progressing, Optomed recognizes the risk of a prolonged pandemic which may cause
additional restrictions and other negative effects globally. Further, the
pandemic has increased the risk of component sourcing issues. The company has
taken precautions to protect its currently strong cash position and to secure
alternative components.
Flagging notifications
In October-December 2020, Optomed received two major shareholder notifications
from OP-Rahastoyhtiö Oy. According to the latest notification, the total
holdings in Optomed shares and votes held by OP-Rahastoyhtiö has decreased to
4.99 per cent of all of the registered shares in Optomed on 16 November 2020.
Events after the review period
On 12 January 2021, Optomed announced that it has been awarded a contract to
develop an advanced IT system for the automation and evaluation of outcomes in
ophthalmic care. The system is developed for the Finnish University Eye Clinics.
On 14 January 2021, Optomed announced the proposal of the Nomination Board to
the next Annual General Meeting. The Nomination Board proposed that Seppo
Mäkinen, Petri Salonen, Reijo Tauriainen and Anna Tenstam are re-elected as
Board members and Haohao Zhang is elected as a new Board member. The Board
remuneration was proposed to remain as-is.
On 28 January, Optomed announced that it has established an international
scientific advisory board. The board consists of globally recognized and
scientifically merited medical doctors specializing in ophthalmology and neuro
-ophthalmology, with advanced experience on artificial intelligence applied to
detection of ophthalmic conditions.
The Board’s proposal for the distribution of profit
The parent company’s non-restricted equity on December 31, 2020 was EUR
19,442,899.33 and the net loss for the financial year was EUR 2,142,670.91. The
Board of Directors proposes to the Annual General Meeting that no dividend will
be paid and the non-restricted equity on the outstanding 14,003,144 shares shall
be retained and carried forward.
Audit review
This financial report has been audited by the company's auditors.
Financial reporting in 2021
Week 10 at the latest Annual Report 2020
6 May 2021 Interim Report for 1 January – 31 March
2021
5 August 2021 Half-Year Financial Report for 1 January – 30
June 2021
4 November Interim Report for 1 January – 30 September
2021
For more information, contact
Lars Lindqvist, CFO
Tel: +46 702 59 57 89
E-mail: lars.lindqvist@optomed.com
Seppo Kopsala, CEO
Tel.: +358 40 555 1050
E-mail: seppo.kopsala@optomed.com
About Optomed
Optomed is a Finnish medical technology company and one of the leading providers
of handheld fundus cameras. Optomed combines handheld screening devices with
software and artificial intelligence with the aim to transform the diagnostic
process of blinding eye-diseases such as rapidly increasing diabetic
retinopathy. In its business Optomed focuses on eye-screening devices and
software solutions related R&D in Finland and sales through different channels
in over 60 countries. The company has an extensive portfolio of 56 international
patents protecting the technology. In 2020, Optomed’s revenue reached EUR 13
million and in 2019 revenue amounted to EUR 15 million. At the end of 2020,
Optomed employed 109 professionals.
Alternative Performance Measures
Optomed uses certain alternative performance measures (APMs) with the purpose to
provide a better understanding of how the business develops. These APMs, as
defined, cannot be fully compared with other companies’ APMs.
Alternative Definition
Performance
Measures
Gross profit Revenue + Other
operating income –
Materials and
services expenses
Gross margin, % Gross profit /
Revenue
EBITDA Operating result
before depreciation,
amortisation and
impairment losses
EBITDA margin, % EBITDA / Revenue
Operating result Profit/loss after
depreciation,
amortisation and
impairment losses
Operating margin, % Operating result /
Revenue
Adjusted operating Operating result
result excluding items
affecting
comparability
Adjusted operating Adjusted operating
margin, % result / Revenue
Adjusted EBITDA EBITDA excluding
items affecting
comparability
Adjusted EBITDA Adjusted EBITDA /
margin % Revenue
Items affecting Material items
comparability outside ordinary
course of business
including
restructuring costs,
net gains or losses
from sale of
business operations
or other non-current
assets, strategic
development
projects, external
advisory costs
related to capital
reorganisation,
impairment charges
on non-current
assets incurred in
connection with
restructurings,
compensation for
damages and
transaction costs
related to business
acquisitions.
Net Debt Interest-bearing
liabilities
(borrowings from
financial
institutions,
government loans and
subordinated loans)
– cash and cash
equivalents (excl.
lease liabilities
according to IFRS
16)
Net Debt / Adjusted Net Debt / Adjusted
EBITDA (LTM), times EBITDA (for the last
twelve months, LTM)
Earnings per share Net result / Number
of outstanding
shares (reflecting
changes in the
number of shares
following the
resolution of the
EGM to split the
shares of the
company with a ratio
of 1:20)
Equity ratio, % Total equity / Total
assets
R&D expenses Employee benefit
expenses for R&D
personnel and other
operational expenses
related to R&D
activities
Organic growth, % Organic growth
refers to revenue
growth excluding (i)
growth attributable
to acquisitions and
divestments; and
(ii) growth
attributable to
fluctuations in
exchange rates. The
various components
in organic growth
are calculated as
follows:Acquisitions
and divestments:
Show how
acquisitions and
divestments
completed during the
relevant period have
affected the
reported revenues.
To estimate the
impact of
acquisitions on
reported revenue,
the revenue from the
contributions of the
acquired units for
the current period
is subtracted from
the total revenue
for the same period.
To estimate the
impact of
divestments on
reported revenue,
the revenue from the
contributions from
the divested units
for the current
period is subtracted
from the total
revenue from the
previous respective
comparison period.
Currency
fluctuations: Shows
how the reported
revenue has been
affected by the
translation of
revenue generated in
other currencies
than the euro (which
is the Group's
accounting currency)
when there are
exchange rate
differences between
the current period
and the
corresponding
comparative period.
Income in currencies
other than euro for
the comparative
period is
recalculated using
the applicable
exchange rate for
the current period
to eliminate the
effects of exchange
rate fluctuations
for the relevant
period.
Reconciliation of Alternative Performance Measures
In thousands of euro Q4/2020 Q4/2019 2020 2019
Revenue 4,041 4,329 13,011 14,977
Other operating income 40 11 157 254
Material and services -1,272 -1,595 -4,213 -5,287
Gross profit 2,809 2,745 8,955 9,944
Operating profit/loss -594 -33 -2,906 -2,596
(EBIT)
Items affecting
comparability
IPO related expenses 0 -760 0 139
Adjusted EBIT -594 -794 -2,906 -2,457
Depreciation, 533 583 2,173 2,261
amortization and
impairment losses
Adjusted EBITDA -62 -211 -733 -196
Organic growth for the Group
Q4/2020 Q4/2019 2020 2019
Revenue 4,041 4,329 13,010 14,977
Acquisitions (elimination of 0 0 0 0
revenues for comparability)
Revenue excluding 4,041 4,329 13,010 14,977
acquisitions
Currency effects 0 -14 0 -82
Revenue excluding 4,041 4,315 13,010 14,895
acquisitions and currency
effects
Organic growth, percent -6.3 % -12.7 %
Organic growth for the Q4/2020 Q4/2019 2020 2019
Devices segment
Revenue 1,738 2,158 5,097 7,309
Acquisitions (elimination of 0 0 0 0
revenues for comparability)
Revenue excluding 1,738 2,158 5,097 7,309
acquisitions
Currency effects 0 -14 0 -82
Revenue excluding 1,738 2,144 5,097 7,227
acquisitions and currency
effects
Organic growth, percent -18.9 % -29.5 %
Organic growth for the Q4/2020 Q4/2019 2020 2019
Software segment
Revenue 2,303 2,171 7,913 7,668
Acquisitions (elimination of 0 0 0 0
revenues for comparability)
Revenue excluding 2,303 2,171 7,913 7,668
acquisitions
Currency effects 0 0 0 0
Revenue excluding 2,303 2,171 7,913 7,668
acquisitions and currency
effects
Organic growth, percent 6.1 % 3.2 %
Consolidated income statement
In thousands of euro Q4/2020 Q4/2019 2020 2019
Revenue 4,041 4,329 13,011 14,977
Other operating income 40 11 157 254
Materials and services -1,272 -1,595 -4,213 -5,287
Employee benefit expenses -2,161 -2,143 -7,319 -7,299
Depreciation, amortisation -533 -583 -2,173 -2,261
and Impairment losses
Other operating expenses -710 -52 -2,369 -2,980
Operating result -594 -33 -2,906 -2,596
Finance income 197 40 452 8
Finance expenses -266 -107 -794 -365
Net finance expenses -69 -67 -341 -356
Profit (loss) before income -663 -101 -3,247 -2,952
taxes
Income tax expense 11 42 70 77
Loss for the period -652 -58 -3,177 -2,875
Loss for the period
attributable to
Owners of the parent company -652 -58 -3,177 -2,875
Loss per share attributable
to owners of the parent
company
Weighted average number of 13,262,766 8,935,654 13,262,766 8,935,654
shares
Basic loss per share (euro) -0.05 -0.01 -0.24 -0.32
Consolidated condensed comprehensive income statement
In thousands of euro Q4/2020 Q4/2019 2020 2019
Loss for the period -652 -58 -3,177 -2,875
Other comprehensive income
Items that may be subsequently
reclassified to profit or loss
Foreign currency translation 9 -4 77 14
difference
Other comprehensive income, net of 9 -4 77 14
tax
Total comprehensive income for the -643 -63 -3,100 -2,862
period
Total comprehensive loss -643 -63 -3,100 -2,862
attributable to Owners of the
parent company
Consolidated balance sheet
In thousands of euro Dec 31, 2020 Dec 31, 2019
ASSETS
Non-current assets
Goodwill 4,256 4,256
Development costs 5,667 5,218
Customer relationships 1,608 1,829
Technology 738 840
Other intangible assets 485 519
Total intangible assets 12,753 12,662
Tangible assets 359 406
Right-of-use assets 1,165 1,075
Deferred tax assets 11 8
Total non-current assets 14,289 14,151
Current assets
Inventories 2,539 2,468
Trade and other receivables 3,637 4,125
Cash and cash equivalents 10,608 18,866
Total current assets 16,784 25,459
Total assets 31,073 39,611
In thousands of euro Dec 31, 2020 Dec 31, 2019
EQUITY
Share capital 80 80
Share premium 504 504
Reserve for invested non-restricted equity 37,470 37,341
Translation differences 166 89
Retained earnings -14,970 -12,500
Profit (loss) for the financial year -3,177 -2,875
Total equity 20,073 22,637
LIABILITIES
Non-current liabilities
Borrowings from financial institutions 3,520 5,104
Government loans 2,670 2,998
Lease liabilities 782 699
Deferred tax liabilities 540 616
Total Non-current liabilities 7,512 9,416
Current liabilities
Borrowings from financial institutions 0 1,766
Government loans 328 60
Lease liabilities 425 414
Trade and other payables 2,736 5,318
Total current liabilities 3,489 7,557
Total liabilities 11,001 16,973
Total equity and liabilities 31,073 39,611
Consolidated statement of changes in shareholders’ equity
Equity
attributable
to
owners of the
parent
company
In thousands Share Share Reserve Translation Retained Total
of euro capital premium for differences earnings
invested
non
-restricted
equity
Balance at 80 504 37,341 89 -15,376 22,637
January 1,
2020
Comprehensive
income
Loss for the -3,177 -3,177
period
Other
comprehensive
income
Translation 77 77
differences
Total 77 -3,177 -3,100
comprehensive
income for
the period
Share issue
Share options 129 406 535
Total 129 406 535
transactions
with owners
of the
company
Balance at 80 504 37,470 166 -18,147 20,073
December
31, 2020
Equity
attributable
to
owners of the
parent
company
In thousands Share Share Reserve Translation Retained Total
of euro capital premium for differences earnings
invested
non
-restricted
equity
Balance at 19 565 18,549 75 -13,656 5,552
January 1,
2019
Comprehensive
income
Loss for the -2,875 -2,875
financial
year
Other
comprehensive
income
Translation 14 14
differences
Total 14 -2,875 -2,862
comprehensive
income
for the
financial
year
Share issue 61 -61 18,792 694 19,486
Share options - 461 461
Total 61 -61 18,792 1,155 19,947
transactions
with owners
of the
company
Balance at 80 504 37,341 89 -15,376 22,637
December 31,
2019
Consolidated cash flow statement
In thousands of euro Q4/2020 Q4/2019 2020 2019
Cash flows from operating activities
Loss for the financial year -652 -58 -3,177 -2,875
Adjustments:
Depreciation, amortisation and 533 583 2,173 2,261
impairment losses
Finance income and finance expenses 69 61 343 356
Other adjustments 92 166 284 466
Cash flows before change in net 42 752 -377 207
working capital
Change in net working capital:
Change in trade and other receivables -80 -468 496 -783
(increase (-) / decrease
(+))
Change in inventories 259 -135 -2 -1,346
(increase (-) / decrease
(+))
Change in trade and other payables 350 1,905 -2,483 2,396
(increase (+) / decrease (
-))
Cash flows before finance items 571 2,054 -2,367 475
Interest paid -17 -55 -75 -202
Other finance expenses paid -249 -17 -725 -136
Interest received 78 17 366 24
Net cash from operating activities (A) 383 2,000 -2,801 161
Cash flows from investing activities
Acquisition of intangible assets -546 -338 -1,553 -1,175
Acquisition of tangible assets -105 -69 -268 -260
Acquisition of subsidiary, net of cash 0 0 0 0
acquired
Net cash used in investing activities -651 -407 -1,820 -1,434
(B)
Cash flows from financing activities
Proceeds from share subscriptions 57 20,000 92 23,000
Share issue transaction costs 0 -4,208 0 -4,208
Proceeds from loans and borrowings 4 41 -167 176
Repayment of loans and borrowings 0 -186 -3,233 -460
Repayment of lease liabilities -95 -98 -390 -385
Net cash from financing activities (C) -34 15,548 -3,698 18,123
Net cash from (used in) operating, -302 17,139 -8,319 16,849
investing and financing activities
(A+B+C)
Net increase (decrease) in -302 17,139 -8,319 16,849
cash and cash equivalents
Cash and cash equivalents 10,899 1,721 18,866 2,000
at beginning of period
Effect of movements in 11 6 61 17
exchange rate on cash held
Cash and cash equivalents 10,608 18,866 10,608 18,866
at end of period
Selected notes
Corporate information and basis of
accounting
Corporate information
Optomed is a Finnish medical technology group (hereafter ‘Optomed’ or ‘Group’)
that specialises in handheld fundus cameras and solutions for screening of
blinding eye diseases, established in 2004.
The Group’s parent company, Optomed Plc. (hereafter the ‘company’) is a Finnish
public limited liability company established under the laws of Finland, and its
business ID is 1936446-1. It is domiciled in Oulu, Finland and the Company’s
registered address is Yrttipellontie 1, 90230 Oulu, Finland.
Basis of
accounting
Optomed’s consolidated financial statements has been prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by the European
Union. The preparation of this interim report also takes into account the
amendments to IFRS standards that have become effective by January 1, 2020.
All presented figures have been rounded. Financial ratios have been calculated
using exact figures.
These interim financial statements have been prepared in accordance with IAS 34
Interim Financial Reporting, and should be read in conjunction with Group`s last
annual consolidated financial statements as at and for the year ended 31
December 2019. This Interim financial statements do not include all of the
information required for a complete set of IFRS financial statements: selected
explanatory notes are included to explain events and transactions that are
significant to an understanding of the changes in the Group`s financial position
and performance since the last annual financial statements.
Critical management judgments and related estimates and assumptions
The preparation of financial statements under IFRS requires management to make
judgments, estimates and assumptions that affect the reported amounts of assets
and liabilities, and disclosure of contingent assets and liabilities at the end
of the reporting period as well as the reported amounts of income and expenses
during the reporting period. These estimates and assumptions are based on
historical experience and other justified assumptions, such as future
expectations, that Optomed management believes are reasonable under the
circumstances at the end of the reporting period and the time when they were
made.
Although these estimates are based on management’s best knowledge of current
events and actions, actual results may ultimately differ from those estimates.
The estimates and underlying assumptions are reviewed on an on-going basis and
when preparing financial statements. Changes in accounting estimates may be
necessary if there are changes in the circumstances on which the estimate was
based, or as a result of new information or more experience. Such changes are
recognized in the period in which the estimate or the assumption is revised.
Use of judgment and estimates
Judgements that management has made in the process of applying accounting
policies and that have the most significant effect on the amounts recognised in
the financial statements, relate to the following areas:
— capitalisation of development costs: determination of development expenditure
eligible for capitalisation
— impairment testing of development expenditures
Reportable segments
Q4/2020
In thousands of euro Devices Software Group admin Total
External revenue 1,738 2,303 4,041
Net operating expenses -748 -484 0 -1,232
Margin 990 1,819 - 2,809
Depreciation and amortisation -384 -148 0 -533
Other expenses -989 -1,184 -697 -2,869
Operating result -384 487 -697 -593
Finance items 0 0 -69 -69
Loss before tax expense -384 487 -767 -664
Q4/2019
In thousands of euro Devices Software Group admin Total
External revenue 2,158 2,171 4,329
Net operating expenses -1,045 -539 -1,584
Margin 1,113 1,631 - 2,745
Depreciation and amortisation -370 -213 0 -583
Other expenses -1,282 -1,155 242 -2,195
Operating result -539 264 242 -33
Finance items 0 0 -67 -67
Loss before tax expense -539 264 175 -101
2020
In thousands of euro Devices Software Group Admin Total
External revenue 5,097 7,913 13,011
Net operating expenses -2,235 -1,820 -4,055
Margin 2,862 6,093 - 8,955
Depreciation and amortisation -1,569 -603 -2,173
Other expenses -3,113 -4,167 -2,408 -9,687
Operating result -1,820 1,323 -2,408 -2,904
Finance items 0 0 -341 -341
Loss before tax expense -1,820 1,323 -2,749 -3,247
In thousands of euro Devices Software Group Admin Group
External revenue 7,309 7,668 14,977
Net operating expenses -3,109 -1,924 -5,033
Margin 4,200 5,744 - 9,944
Depreciation and amortization -1,504 -757 -2,261
Other expenses -4,609 -4,077 -1,593 -10,279
Operating result -1,913 909 -1,593 -2,596
Finance items 0 0 -356 -356
Loss before tax expense -1,913 909 -1,949 -2,952
2019
Revenue
In thousands of euro Q4/2020 Q4/2019 2020 2019
Finland 2,263 1,945 7,777 59.8 % 7,308 48,8 %
China 1,031 295 2,443 18.8 % 1,795 12,0 %
Other 747 2,087 2,791 21.4 % 5,874 39,2 %
Total 4,041 4,327 13,011 100,0 % 14,977 100,0 %
Tangible assets
Machinery and equipment Machinery and equipment
In thousands of euro 2020 2019
Cost
Balance at January 1 1,992 1,729
Business combinations
Additions 265 262
Disposals - -
Effect of movements in -
exchange rates
Balance at End of 2,257 1,992
Period
Accumulated
depreciation and
impairment losses
Balance at January 1 -1,585 -990
Depreciation -313 -595
Impairment losses -
Effect of movements in
exchange rates
Balance at end of -1,898 -1,585
period
Carrying amount at 406 739
January 1
Carrying amount at June 359 406
30/ December 31
Leases
Leased tangible assets
In thousands of euro 2020 2019
Additions to right-of-use assets 90 378
Carrying amount at the end of the reporting period 1,165 1,075
Leased tangible assets comprise business premises and are
presented as a separate line item Right-of-use assets in the
consolidated balance sheet.
Lease liabilities
In thousands of euro 2020 2019
Current 425 414
Non-current 782 669
Total 1,207 1,113
The above liabilities are presented on the line item Lease
liabilities (non-current / current) in the consolidated balance
sheet, based on their maturity.
Intangible assets and goodwill
At December Goodwill Development Customer Technology Other
Total
31 2020 costs relationships intangible
assets
In thousands
of euro
Cost
Balance at 4,256 8,246 2,222 1,023 859
16,606
January 1
Business -
combinations
Additions 1,463 - - 86
1,549
Balance at 4,256 9,709 2,222 1,023 945
18,156
December 31
-
Accumulated -
amortisation
and
impairment
losses
Balance at - -3,029 -392 -184 -340
-3,945
January 1
Amortization -854 -222 -102 -121
-1,298
Impairment -160 - - - -160
losses
Balance at -4,043 -614 -286 -461
-5,403
December 31
-
Carrying 4,256 5,218 1,829 840 519
12,662
amount at
January 1
Carrying 4,256 5,667 1,608 738 485
12,753
amount at
December 31
At December Goodwill Develop Customer Technology Other
Total
31 2019 -ment relationships intangible
costs assets
In thousands
of euro
Cost
Balance at 4,256 7,353 2,222 1,023 543
15,397
January 1
Business -
combinations
Additions 894 - - 316
1,210
Balance at 4,256 8,246 2,222 1,023 859
16,606
December 31
-
Accumulated -
amortisation
and -
impairment
losses
Balance at - -2,181 -170 -82 -168
-2,601
January 1
Amortisation -848 -222 -102 -172
-1,344
Balance at -3,029 -392 -184 -340
-3,945
December 31
-
Carrying 4,256 5,172 2,051 942 376
12,796
amount at
January 1
Carrying 4,256 5,218 1,829 840 519
12,662
amount at
December 31
Financial liabilities
In thousands of euro 31.12.2020 31.12.2019
Non-current financial liabilities
Borrowings from financial institutions 3,192 5,104
Government loans 2,998 2,998
Lease liabilities 782 699
Total 6,972 8,800
Current financial liabilities
Borrowings from financial institutions 0 1,766
Government loans 328 60
Lease liabilities 425 414
Trade payables 595 1,667
Total 1,348 3,907
Total financial liabilities 8,320 12,707
The financial loans have been restructured during the 2020. Financial loans were
paid prematurely 3,173 thousand euros. Within next 12 months there will be no
amortization for borrowings from financial institutions.
Fair values - financial liabilities measured at amortised cost
Optomed considers that the carrying amounts of the financial liabilities
measured at amortised cost substantially equal to their fair values. This
estimate corresponds to the fair value hierarchy Level 3, as the measurement of
the said liabilities is based on Optomed management view.
Financial covenant
Optomed's borrowings from financial institutions contain a financial covenant
(equity ratio) and Optomed also has to meet certain key operative targets. The
borrowings will be repaid in accordance with the new repayment schedule.
Optomed has to comply with the financial covenant terms specified in the loan
agreement terms at the financial year-end. Equity ratio is calculated in FAS
figures using the agreed formula. The table below summarises the Group's
financial covenant term and compliance during 2018 and the reporting period.
Equity ratio
Covenant term Actual ratio Applicable level
At December 31, 2019 25 % 57,53 % Optomed Group
At December 31, 2020 25 % 69,03 % Optomed Group
Related party transactions
In thousands of euro Revenues Trade receivables Other expenses
Jan 1 - Dec 31 2020 2,685 1,389 -103
Jan 1 - Dec 31 2019 2,200 1,172 -143
Revenue and trade receivables and some of the other expenses relate to the major
shareholders of Optomed Ltd considered to be related parties to the parent
company.
Other expenses consist of consulting fees and travel expenses paid to the
Chairman of the Board of Directors.