Surgical Science (SUS) Q3 2024 earnings summary

Executive summary

• Q3 2024 net sales increased by 10% to SEK 231.8 million, with a 12% currency-adjusted rise; both Educational Products and Industry/OEM segments grew.

• Industry/OEM segment saw strong growth, with sales up 22% and simulator sales up 82% to SEK 26.1 million; license revenue rose 17% to SEK 65.0 million, driven by robotics market activity.

• Operating profit for Q3 was SEK 45.8 million, with a margin of 20%; adjusted EBIT margin was 22%.

• Cash and cash equivalents stood at SEK 666.3 million at quarter-end, with a strong equity/assets ratio of 92.6%.

• CEO transition completed, with a focus on operational scalability and customer growth as key opportunities and challenges.

Financial highlights

• Q3 2024 net sales: SEK 231.8 million (+10% y/y); gross margin stable at 69%.

• Q3 operating profit: SEK 45.8 million (20% margin); adjusted EBIT: SEK 51.8 million (22% margin); net profit: SEK 43.0 million.

• Cash flow from operating activities in Q3: SEK 22.1 million; cash at quarter-end: SEK 666.3 million.

• R&D costs increased year-over-year, reaching SEK 63 million or 22% of sales.

• License revenues accounted for 28% of total revenues, up from 26% last year.

Outlook and guidance

• Educational Products segment is not expected to show full-year growth in 2024, but strong growth is anticipated for 2025 and beyond.

• Industry/OEM segment is expected to drive future growth, especially in robotic surgery.

• Company remains confident in long-term growth, targeting SEK 1,500 million in sales and a 40% adjusted EBIT margin by 2026.

• Q4 is typically strong, but no specific short-term forecast was provided.

• Focus on organizational scalability and market presence for 2025.