Elekta (EKTA) Q3 24/25 earnings summary

Executive summary

• Net sales increased by 2% in constant currencies to SEK 4,695M, driven by strong performance in Europe and APAC, while the US and China declined.

• Order growth accelerated in Q3, with a book-to-bill ratio of 1.15, supported by new product launches (Elekta Evo and Elekta ONE) and commercial wins in Mexico, the US, and Europe.

• Adjusted gross margin improved to 37.1% due to price increases and favorable product mix, especially from services.

• Adjusted EBIT margin rose to 11.7% year-over-year, supported by gross margin gains and higher amortization from new product launches.

• Record high cash flow after investments reached SEK 730M in Q3, supported by improved EBITDA and working capital reduction.

Financial highlights

• Net income reached SEK 336M; EPS was SEK 0.89, up from SEK 0.80 last year, and adjusted EPS reached SEK 0.94.

• Service business grew 10% year-over-year, while solution sales declined by 4% due to lower US and China volumes.

• Rolling 12-month cash flow from operating activities was SEK 2.38B, with cash conversion at 79%.

• Cost reduction initiatives delivered SEK 264M in annual run rate savings, ahead of plan.

• Cash and equivalents rose to SEK 3,583M, mainly due to a SEK 1,500M bond issue for future refinancing.

Outlook and guidance

• Full-year 2024-25 net sales expected to be broadly stable; EBIT margin to be lower than 2023-24 due to continued weakness in the US and China.

• Targeting EBIT margin of 14% or higher beyond 2024-25, driven by product portfolio and demand.

• Near-term caution due to lower volumes in the US and China; positive long-term outlook based on innovation and backlog.