Arcam: Year-end Report 2012
(For complete interim report see attached file)
Strategic orders, sharply increased turnover and strong order book for 2013
Net sales rose 29% to 139.1 (107.7) million
Profit after financial items increased to SEK 15.0 (5.5) million
Earnings per share amounted to SEK 4.04 (1.49)
The profit margin increased to 10.8% (5.1)
Cash and cash equivalents at end of period 26.9 (38.2) million (in cash and cash equivalents include advanced the research grant of approximately 5.0 (10.6) million)
Order intake amounted to 24 (12) systems
15 (14) EBM systems were delivered during the period
The order book at the period end was 10 (1) systems
Reverse share split 40:1
Listing on NASDAQ OMX Small Cap June 18
Including the fourth quarter:
Sales amounted to SEK 62.5 (46.0) million
Profit after financial items 13.7 (10.8) million
Order intake amounted to 12 (4) systems
8 (6) EBM system was delivered in the fourth quarter
Significant events after the balance sheet:
Orders from MTC in Japan in January
Basic Information about the Arcam is on page 9 of this report.
Strategic orders, sharply increased turnover and strong order book for 2013
After a strong fourth quarter, we achieved full-year sales of over 139 million and a net profit of 15 million. The success comes after purposeful and long-term business development, combined with successful development of higher performance and increased usability. We are delighted with the growing demand for our EBM technology in an otherwise generally weak market for industrial products. More and more customers realize the potential and benefits of our EBM technology and are therefore prepared to take decisive and long-term decisions about investments in our systems.
Strategic business
The new business gained during years of great strategic importance for the company. In 2012 an agreement was reached with several strategic customers in the aerospace industry, including the supply agreement with a leading player in the aviation industry that was signed in June, which is the company's largest single transaction. The long-term cooperation with Avio, which began in 2007 has great potential in the serial production of aircraft engine parts, and in the year ordered an additional 6 Avio system for pilot production of turbine blades. Partnerships such as these create a stable platform for continued marketing and sales in the aerospace industry, Arcam potentially largest future market.
Growing orthopedics market
While Arcam advancing their positions in the aviation industry continues efforts to develop implants market. Implants made by Arcam EBM technology is approved for clinical use in the U.S. and Europe. Estimates show an annual production volume of over 20,000 implants made by Arcam EBM technology. As an increasing occupancy, we see that our existing customers are expanding their production while the interest from new customers increases. During the year three new machine orders for expansion of capacity of existing customers in the orthopedic industry.
Production and long-term product
Arcam's success in the highly demanding markets aviation and implant industry is a result of long-term business and development. 2011 we had three major research grants awarded, one from Vinnova of 2.4 million, and two from the EU's Seventh Framework Programme (FP7), each worth approximately SEK 10 million. Grant from Vinnova related to the development of EBM technology for large scale production of orthopedic implants, a project carried out in collaboration with a leading implant manufacturers and completed in 2012. Grants from FP7 is further developing essential functionality Arcam EBM technology. The projects will be completed in 2013. The development is expected to lead to significant improvements that can broaden the use of our products and therefore our competitiveness. The funding from FP7 income not from Arcam and projects thus does not affect Arcam accounts.
During the year the patent work strengthened and we have searched seven new patents and received three new patent families approved.
To meet the increased demand during the year we expanded our production facilities. Larger rooms that allows a doubled production compared to 2012 was inaugurated in January 2013
Arcam on the Stock Exchange
In early 2012, the Board decided to implement a reverse stock split, moving the company from NGM and to apply for listing on the NASDAQ OMX. On June 18 introduced shares on NASDAQ OMX, and the closing price on the first trading day was 46.50. In 2012, the share rose to rate on December 28 was 169.50.
A stable order book and a positive business climate creates opportunities for continued strong growth in 2013.
Mölndal, February 1, 2013
Magnus René, MD