Getinge (GETI) CMD 2006 presentation summary

2005 financial performance

• Orders received rose 13% to MSEK 12,225; net sales increased 9% to MSEK 11,880.

• Operating profit reached MSEK 1,803, up 4%; operating margin was 15.2% versus 16.0%, and profit before tax rose 4% to MSEK 1,601.

• Operating cash flow was MSEK 1,868; net debt was MSEK 5,104, while the equity/assets ratio improved to 37.1% from 34.3%.

• Infection Control orders rose 9% to MSEK 3,896 and sales 6% to MSEK 3,745; EBITA margin fell to 13.8% from 15.1%.

• Extended Care orders rose 16% to MSEK 3,131 and sales 10% to MSEK 2,982; EBITA margin was 17.5% versus 19.0%. Medical Systems orders rose 14% and sales 11%; EBITA margin was 15.4% versus 15.1%.

Strategic direction and targets

• Growth ambition: 15% average per year, comprising organic growth of 5%+, bolt-on acquisitions of ~3%, and globally leading product-line acquisitions of ~7%.

• Strategic cornerstones: target global No. 1 or No. 2 positions, use scale to support cost leadership, deliver integrated solutions and process improvements, and build direct customer distribution where justified.

• EBITA margin targets versus 2005 actuals: Infection Control 16% vs 13.8%; Extended Care 19% vs 17.5%; Medical Systems 17% vs 15.4%.

• Targets assume January 1, 2006 exchange rates and current group structure; future price erosion is to be offset by supply-chain improvements.

Group initiatives

• StinG is a supply-chain transformation program focused on durable competitive advantage and value creation in design, assembly and quality assurance.

• StinG combines product management, performance measurement and sourcing; sourcing priorities include purchasing, consolidation, re-localization, integration and make-or-buy decisions.

• Broader initiatives include supply-chain development, logistics, internationalization and external growth.