Getinge (GETI) CMD 2007 presentation summary

2006 performance and investment

• FY net sales were 13,001 MSEK, up 9% YoY; EBITDA was 2,271 MSEK, up 7%, and operating profit was 1,936 MSEK, up 7%.

• FY operating margin was 14.9% versus 15.2% in 2005; profit before tax was 1,728 MSEK, up 8%.

• Organic order intake grew 8.0%, or 9.6% adjusted for Ontario MOH orders; Medical Systems grew 13.5%, Infection Control 6.1% and Extended Care 1.3%.

• 2006 investments included broader coverage in developing economies, stronger US sales operations, increased product development, production restructuring and La Calhène integration.

Strategic direction and targets

• Strategic cornerstones: pursue global No. 1 or No. 2 positions, combine product leadership and know-how for customer process improvements, and build direct customer relationships through owned distribution where justified.

• Group targets: average YoY pre-tax earnings growth of 15%, EBITA margin of 17% on the current structure, and cash flow supporting 10% external growth.

• Business-area targets: Infection Control organic growth 4–5% and EBITA margin 16%; Extended Care 7% and 19%; Medical Systems 5% and 17%.

• Huntleigh and Extended Care were planned to form a globally leading institutional bedside-management business, with critical mass, market leadership, cost efficiency and a growth platform.

• New Extended Care targets: average organic growth of 7%, EBITA margin of 19% by 2009 versus 14.4% pro forma in 2006, and 350 MSEK integration charges over 2007–09.

Group priorities

• 2007 priorities were supply-chain development, internationalization, Huntleigh integration and creation of a new Extended Care, and external growth.

• Supply-chain initiatives covered product generation planning, R&D and assembly value creation, plant consolidation and specialization, lower-cost-region production, and logistics and SOP development.

• Internationalization focused on reducing dependence on Western Europe, investing in owned sales infrastructure in developing economies, and expanding US market share.

• Acquisition plans emphasized bolt-ons for technologies and new geographies; targeted new product lines included consumables, interventional cardiology, cardiac surgery, endoscopy and critical care.