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aap Implantate AG: 20% trauma sales growth in 2017; for 2018 further dynamic sales growth and start of human clinical study for silver coating technology aimed

03:40 EST 15 Feb 2018 | EQS Group

DGAP-News: aap Implantate AG / Key word(s): Preliminary Results/Forecast

15.02.2018 / 08:40
The issuer is solely responsible for the content of this announcement.


- Successful first year as pure player in trauma with 20% trauma sales growth

- Sales with around EUR 11 million in line with guidance of EUR 10.0 million to EUR 13.0 million

- Further dynamic sales growth and earnings improvement planned for FY/2018: Forecast for sales between EUR 13.0 million and EUR 15.0 million and EBITDA between EUR -5.0 million and EUR -3.4 million

- Start of human clinical study for planned CE and FDA approval of innovative antibacterial silver coating technology aimed for FY/2018



Sales development in 2017

aap Implantate AG ("aap") looks back on a successful first year as a pure player in trauma. This is reflected by the pleasing development of trauma sales. In the fourth quarter of 2017, according to preliminary figures, the company achieved a trauma sales growth of 42% on the same period in the previous year to EUR 2.9 million (Q4/2016: EUR 2.0 million). In the full financial year aap increased trauma sales by 20% to EUR 10.6 million (FY/2016: EUR 8.9 million). The main growth drivers were the distribution business in North America with a sales increase of 70% and the expansion of the existing business as well as the acquisition of new customers in international markets.
 

Q4/2017 Sales

In KEUR Q4/2017 Q4/2016 Change on year
Trauma
Germany
North America
North America Distributors
North America Global Partners
International
2,863
578
621
613
7

1,665
2,016
559
477
445
32

980
+42%
+3%
+30%
+38%
-78%

+70%
Other (mainly discontinued activities) 5 389 -99%
Sales 2,869 2,405 +19%
 

FY/2017 Sales

In KEUR FY/2017 FY/2016 Change on year
Trauma
Germany
North America
North America Distributors
North America Global Partners
International
10,648
2,427
3,071
2,491
580
5,149
8,877
2,352
2,436
1,464
972
4,089
+20%
+3%
+26%
+70%
-40%
+26%
Other (mainly discontinued activities) 254 1,609 -84%
Sales 10,902 10,486 +4%



The decline in other sales revenues in the quarter and in the financial year results from the divestments (aap Joints and aap Biomaterials) in 2016.
 

Overall, aap achieved in the fourth quarter of 2017 significant year-on-year sales growth of 19% to EUR 2.9 million (Q4/2016: EUR 2.4 million) according to preliminary figures. Despite the divestments made in 2016 and the consequent loss of sales revenues realized with these companies sales in financial year 2017 increased by 4% to EUR 10.9 million (FY/2016: EUR 10.5 million) and were thereby within the guidance of EUR 10.0 million to EUR 13.0 million.
 

Outlook for 2018

For financial year 2018 the Management Board anticipates the continuation of the dynamic sales growth and expects sales of EUR 13.0 million to EUR 15.0 million. The company thus aims for growth between about 20% and about 40%, which is significantly higher than the average growth rate of the global trauma market of 4 - 5%[1]. Regarding EBITDA the company plans an improvement in the current financial year as well and anticipates a value of EUR -5.0 million to EUR -3.4 million.
 

All markets shall contribute to the planned sales growth and earnings improvement, with both distribution business and partnerships with global orthopaedic companies (distribution networks, licensing deals as well as product development and approval projects) especially in North America as their main drivers.
 

With respect to the cost development the Management Board anticipates increased sales costs in financial year 2018 as part of the planned sales growth. Besides, the company expects increasing personnel and other costs against the background of significantly higher regulatory requirements and the extensive work in view of the planned approval of the silver coating technology. The expected cost increases in connection with the human clinical study will also lead to an increase in capitalised own work in 2018. Furthermore, aap was affected by various one-time effects on the cost level in the last year that shall reduce in the current financial year.
 

Overall, the Management Board expects a more moderate development over the first six months and a more dynamic growth in particular in the second half of the year.
 

For the first quarter of 2018 the Management Board anticipates sales of EUR 1.8 million to EUR 3.0 million and EBITDA to be in a range of EUR -1.9 million to EUR -1.4 million.
 

Management Agenda 2018

The Management Board has specified its targets for the current financial year as a Management Agenda in four strategic and operational action areas.
 

Accelerating Value-Based Innovations
Silver coating technology - Application on LOQTEQ(R): Start of the human clinical study aimed
Silver coating technology - Development projects with global companies: Initiation of joint product development and approval projects
LOQTEQ(R): Completion of LOQTEQ(R) portfolio with a focus on polyaxial fixation technology, plate systems for the foot and ankle areas as well as implants in sterile packaging
 
Enhancing Market Access
Established countries: Focus on North America, Germany and Western Europe as key markets; North America as the main growth driver
Emerging countries: Further stabilisation of sales development in the BRICS and SMIT countries
Global partnerships: Distribution networks and licensing deals with global orthopaedic companies
 
Optimizing Operational Efficiency
Quality first: Consequent continuation of the company-wide quality improvement program
Production efficiency: Reduction of manufacturing costs and increase of ability to provide timely deliveries
Working capital: Optimisation of working capital management with a higher inventory turnover and further reduction of the figure DSO (days sales outstanding); strict consignment management
 
Realization of Financial Targets
Sales: Sales of EUR 13.0 million and EUR 15.0 million
EBITDA: EBITDA of EUR -5.0 million to EUR -3.4 million
 


The sales figures contained in this press release are preliminary as of 31 December 2017 which are subject to change until final publication. aap plans to publish the final, audited figures for the financial year 2017 on 29 March 2018 in its consolidated annual financial statements for 2017.


[1] Source: "The Orthopaedic Industry Annual Report 2017" from Orthoworld Inc.
 

_______________________________________________________________________________________
aap Implantate AG (ISIN DE0005066609) - Prime Standard/Regulated Market - All German stock markets -

About aap Implantate AG
aap Implantate AG is a globally operating medical device company headquartered in Berlin, Germany. The company develops, manufactures and markets trauma products for orthopaedics. The IP protected portfolio includes besides the innovative anatomical plating system LOQTEQ(R) and trauma complementary biomaterials a wide range of cannulated screws as well as standard plates and screws. Furthermore, aap Implantate AG has an innovation pipeline with promising development projects as the antibacterial silver coating technology and magnesium based implants. These technologies address critical problems in surgery that haven't yet been resolved adequately. In German-speaking Europe aap Implantate AG directly sells its products to hospitals, buying syndicates and hospital groups while it uses a broad network of distributors in more than 25 countries at the international level. aap Implantate AG's stock is listed in the Prime Standard segment of Frankfurt Stock Exchange (XETRA: AAQ.DE). For more information, please visit www.aap.de, or download the Company's investor relations app from the Apple's App Store or Google Play.

Forward-looking statement
This release may contain forward-looking statements based on current experience, estimates and projections of the management board and currently available information. They are not guarantees of future performance. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. Many factors could cause the actual results, performance or achievements of aap to be materially different from those that may be expressed or implied by such statements. These factors include those discussed in aap's public reports. Forward-looking statements therefore speak only as of the date they are made. aap does not assume any obligation to update the forward-looking statements contained in this release or to conform them to future events or developments.

For inquiries please contact:

aap Implantate AG; Fabian Franke; Investor Relations; Lorenzweg 5; D-12099 Berlin Tel.: +49/30/750 19 - 134; Fax.: +49/30/750 19 - 290; f.franke@aap.de



15.02.2018 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases.
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