First quarter in brief
Comparative figures in Q1 are the Parent Company's since the Group was formed 1[st] of July 2019.
Significant events during the first quarter
SyntheticMR has received orders directly from hospitals in all priority markets. Well-reputed institutions such as the Mayo Clinic and the M.D Anderson Cancer Center in the United States will from now on use SyMRI in clinical use.
Fredrik Jeppsson has completed his position as CFO.
Significant events after the first quarter
Covid-19 has so far had limited impact on our business.
CEO comments
Our own sales resources produce immediate results
We were pleased to see the positive effects of the strategies we are now actively implementing in the first quarter of the year. The 10,000 annual hours of in-house sales resources that we have invested in have contributed greatly to the sales of SyMRI, increasing significantly compared to the same period last year. Orders have come directly from hospitals in all of our priority markets, several of which are globally reputable institutions. For example, we are very proud that Mayo Clinic and MD Anderson Cancer Center in the US will now use SyMRI in theirclinical operations.
Sales in the first quarter amounted to SEK 12.5 million (10.3), which is an increase of 22 percent compared to the correspondingperiod last year. The increase is primarily attributable to an increased number of SyMRI licenses.
Operating profit amounted to SEK 0.8 million (2.9) in the first quarter, which corresponds to a margin of 6 percent (28). The lower margin is due to the increased investment in our own sales resources, which is made to secure the next phase of our growth journey. The costs are scalable, which means that if we need to slow down in some area then we can make it directly.
Successful implementation of our strategies
The progress of our strategic initiatives has so far exceeded expectations in all our priority markets. The processes that resulted in orders from SyMRI from the hospitals have all proceeded efficiently and the licenses that thecustomers have invested in are time-limitedfrom one to several years, a model that overtime will build a customer base for recurring sales. In the key markets, the number of business opportunities is also continuously increasing, and our salespeople are constantly driving the sales processes at a high rate. An increased local presence is also in place to strengthen cooperation with our partners and be closer to the end customer.
Overall, the work to deepen our existing partnerships continues. Among other things, significant steps are now being taken in the right direction to have SyMRI included in Philips Healthcare's product catalog. In addition, we successfully implement our plan related to the fact that SyMRI is available in Siemens Healthiner's syngo.via Open Apps platform. With GE Healthcare, we continue to develop the collaboration on existing MAGiC products. We are also intensifying the development work of new customer offerings to existing and new customer segments. In line with our ambition to increase our market potential and thus contribute to long-term sales growth, we also continue the recently initiated projects with potential partners.
In parallel to us selling our existing products, work is ongoing on developing our product portfolio. Focus is on several innovative solutions, all of which are in different development phases. For example, work is ongoing with the next-generation SyMRI, which with 3D technology further increases the detail of the images and the quantitative basis from the MRI study.
The new generation of SyMRI will, among other things, provide a basis for supporting the healthcare system in the management of more disease states and increased number of parts of the body.
The current situation and the way forward
The Covid-19 pandemic obviously has an impact on our business, but we can see that it has been limited so far. However, it is realistic to assume that changing priorities at the end customer will affect demand in the current circumstances. We continuously address the situation according to given and expected conditions and make the decisions that are deemed relevant to continue to implement our plans effectively. SyntheticMR is a growth company with high ambitions. We have unique product offerings that many, several world-leading, hospitals are now implementing in their clinical workflows. In addition, we are an organization with all the conditions for continued development. I am convinced that our strategies, such as increasing proximity to the end customer with our own sales resources, are the right ones for us to show increased sales growth over time.
Ulrik Harrysson,
VD SyntheticMR AB