Elekta (EKTA) Q2 24/25 earnings summary

Executive summary

• Net sales declined by 4% in constant currencies and 8% reported, mainly due to weaker performance in Europe and Latin America, while the U.S. showed growth and China saw improved order growth.

• Adjusted EBIT margin dropped to 9.8% from 11.5% year-over-year, reflecting lower gross margin and higher amortization from recent product launches.

• Cost-reduction initiatives achieved SEK 150 million in annual run-rate savings, targeting SEK 250 million by year-end.

• Product launches, including Elekta Evo and Elekta ONE Planning, are expected to drive improved profitability in the second half, with Elekta Evo receiving CE mark and FDA submission completed.

• Achieved the target of providing radiation therapy access to 300 million people in underserved markets, six months ahead of schedule.

Financial highlights

• Net sales for Q2 were SEK 4,341 million (4,732 prior year), with service business up 4% and solution sales down 10%.

• Adjusted gross margin was 35.7% (36.0 prior year), impacted by market mix, increased costs, and FX effects.

• Adjusted EBIT was SEK 423 million (542 prior year), with margin at 9.8% (11.5).

• Net income for the quarter was SEK 215 million (344 prior year), with EPS at SEK 0.55 (0.90 prior year); adjusted EPS at SEK 0.63 (0.94 prior year).

• Cash flow after capital investments was -SEK 31 million, down from SEK 211 million last year, due to lower earnings and higher investments.

Outlook and guidance

• Sales and profitability are expected to improve in H2, driven by new product launches and productivity measures.

• Full-year net sales are expected to grow by mid-single digits, with improved EBIT margin.

• Long-term EBIT margin expansion to 14% or higher is targeted beyond 2024-2025.