Minimally Invasive Surgery with a Future

Transcription

1 Presentation Annual Financial Statement 2003 Minimally Invasive Surgery with a Future Peter P. Wiest (CEO) W.O.M. WORLD OF MEDICINE AG ISIN DE / Prime Standard WORLD OF MEDICINE March 2004

2 2003 Annual Report: It was better, but not yet good Sales Sales goal of 31.3 million achieved (2002: 30.9 million) EBIT Improved by T 468 to -T (2002: -T 1.911) through enhanced profitability in MIS Operative turnaround not accomplished, as performance of IB Laser below expectations Net Profit million (2002: million) Diminished due to risk provision at IB Laser AG ( 0.7 million) and extraordinary expenditures from the closure of the Gröbenzell production site ( 1.2 million) March 2004/page 2

3 Clear Recovery in Largest Medical Technology Market: USA US Sales in Medical Technology Market In the largest medical technology market, sales in US-dollars increased by 17% Flow&FluidWORLD Progress in Orders for Medical Devices in US Growth Market China Developments in the US contributed to improvements in EBIT to 1.9 million (2002: 1.0 million). Volume as of 12/31/2003 (in US-Dollar): + 60 % Orders placed in 2003 (in US-Dollar): + 28 % compared to 2002 Sales volume increase of 32 % Orders for MIS device technology, including U100 Laser and Gamma Finder March 2004/page 3

4 Presentation Annual Financial Statement 2003 Minimally Invasive Surgery with a Future Michael Ott (CFO) W.O.M. WORLD OF MEDICINE AG ISIN DE / Prime Standard WORLD OF MEDICINE March 2004

5 Higher EBIT in Flow&FluidWORLD Facts Sales steady at 22.8 million (2002: 22.6 million). EBIT increased to 1.9 million (2002: 1.0 million). Highlights Additional contracts with major customers for, among others, the new inflow-outflow pump for arthroscopy, and the new hysteroscopy pump. UROPOWER contract in Japan ( 1.8 million). Clinical trials of the new insufflator with Baby- Mode finished successfully (FDA approval granted in February 2004). Outlook for 2004 Market enhancement through new products March 2004/page 5

6 Developments and Prospects for LaserWORLD IB Laser Core competency in development and sales of diode-pumped laser beam sources Sales increased by 6 % to 3.6 million (2002: 3.4 million) : Strengthen sales Reduce costs Concentrate on current product line Operative loss (EBIT) of million (2002: million), because cost structures aimed at higher level of growth Risk management: Allocations on accounts receivable at Spektrum GmbH equal to 0.7 million. The Chairman Dr. P Wolff resigned; CFO M. Ott assumes leadership until sale or operative turnaround. March 2004/page 6

7 Development of Products at LaserWORLD Facts U100 Laser Sales volume increased by 21 % to 1.7 million (2002: 1.4 million); EBIT improved to million (2002: million) FREDDY technology for kidney, urinary, and bile duct stone destruction Additional deliveries to China; marketing delays in the US and Europe Gamma Finder Distribution contract for US and Canadian markets for applications in breast and skin cancer March 2004/page 7

8 Cost Reductions at VisionWORLD (in mil.) Facts Volume of Orders Closure of Gröbenzell production site ->Additional 1.1 million in savings Shipment delays due to relocation ->Sales declined by 9% to 3.2 million (2002: 3.5 million) Thanks to cost reductions, EBIT improved to million (2002: million) Higher volume of orders by year end: 1.3 million (2002: 1.0 million) Volume of orders placed in 2003 exceeded last year by 8% March 2004/page 8

9 Sales Development *Pro-forma US-GAAP Figures (in millions) * 1999* 2000* Division Five Consecutive Years of Sales Increases! March 2004/page 9

10 Sales Distribution by Region USA 43% EU 45% USA 41% EU 43% ROW 12% ROW 16% March 2004/page 10

11 Sales Distribution by Business Division Laser WORLD 17% Flow& Fluid WORLD 73% Laser WORLD 16% Flow& Fluid WORLD 73% Vision WORLD 10% Vision WORLD 11% March 2004/page 11

12 EBIT Progression of MIS / IB Laser *Pro-forma US-GAAP Figures in T MIS IB Laser Total March 2004/page 12

13 Breakdown of 2003 EBIT by Core Business MIS in T in 2003 Flow&FluidWORLD 1941 VisionWORLD -916 U100 Laser Gamma Finder -158 March 2004/page 13

14 Sales Development by Business Division ,000 26,000 *Pro-forma US-GAAP Figures 21,000 16,000 11,000 in T 6,000 1,000-4, * 1999* 2000* Flow&FluidWORLD 11,776 14,655 17,491 22,864 22,636 22,754 VisionWORLD 3,287 3,144 4,333 4,251 3,464 3,243 LaserWORLD 0 0 1,812 3,237 4,773 5,289 Total 15,063 17,799 23,636 30,352 30,873 31,286 March 2004/page 14

15 EBIT Development by Business Division ,800 *Pro-forma US-GAAP Figures 3,800 2,800 1,800 in T ,200-2, * 1999* 2000* Flow&FluidWORLD 1,548 1,484 2,459 3, ,941 VisionWORLD , LaserWORLD ,169-1,501-2,468 Total 1,290 1,042 1, ,911-1,443 March 2004/page 15

16 Inventory 14,000 12,000 in T 10,000 8,000 6,000 4,000 2, Raw materials and consumables 4,927 4,028 Work in process 3,069 3,201 Finished goods 4,276 4,122 Advance payments TOTAL 12,413 11,433 Inventories will be reduced by writedowns of VisionWORLD inventory of 0.8 million. March 2004/page 16

17 Reduced Size of Management Team Management Vorstand / Board / Board of of Directors Michael Ott CFO Peter P. Wiest President & CEO Dr. Clemens Scholz COO Finance Finanzmanagement Management Marketing R F & DE Materials Materialwirtschaft Management Vertrieb Sales New New Business Development Personnel Personal / Organisation Organization Legal Recht / Regulatory / Affairs Produktion/Qualitätsmanagement Production/Quality Management Management Team reduced to three persons. March 2004/page 17

18 Financing Equity Ratio Cash Flow Cash & Cash Equivalents Continues at a comfortable 70% (2002: 72%) Positive operative cash flow in 2003: T 302 (2002: million) End of December 2003: 2.2 million (2002: 4.0 million) *Adjusted for the payoff of a money market loan which was classed to Cash & Cash Equivalents. March 2004/page 18

19 Personnel Developments Average Number of Employees March 2004/page 19

20 Status of Cost Reductions Personnel Decrease in the average number of employees to 247 (2002: 282) Total number employees on 12/31/03 : 233 (2002: 272) Reduced personnel costs by approx. 2 million to 10.7 million (2002: 12.6 million) (in mil.) Personnel Costs -15 % March 2004/page 20

21 Status of Cost Reductions Investments Cost Rates Even in 2003, only minimal investments of 2.2 mil. (2002: 3.7 mil.); net investments of 1.2 million Production costs increased due to lack of sales at IB Laser Target structure Production Cost Rate 55.4 % 53.2 % % Sales Cost Rate 22.2 % 23.5 % % Administration Cost Rate 13.1 % 14.2 % % R & D Cost Rate 14.6 % 16.5 % 9-11 % March 2004/page 21

22 Presentation Annual Financial Statement 2003 Minimally Invasive Surgery with a Future Peter P. Wiest (CEO) W.O.M. WORLD OF MEDICINE AG ISIN DE / Prime Standard WORLD OF MEDICINE March 2004

23 Strategy 2004 Focus 2004 Goals Strengthening of OEM business by placement of additional products at major customers (e.g. Gamma Finder ) Pull out of areas with weak margins Profit over sales Slight sales increase in the single digits range, and operative turnaround Risks Sustainability of the economic recovery Currency exchange developments March 2004/page 23

24 Continuation of Cost Reductions in 2004 KIS POEV SYNCHRO Cost optimization in administrative areas with external partners Internal process optimization and earnings improvement program: Project start in June 2003 Synchronized production system Goals: Returns on capital, improved cash flow Eliminate wasteful processes Rapid and flexible response to customer demands Step-by-step reduction of inventory and work in process March 2004/page 24

25 Higher Volume of Orders Backed by Increased Demand Volume of Orders at W.O.M. Group 2002 to 2004 (current month) Volume of Orders in TI Months Volume of Orders 2002 Volume of Orders 2003 Volume of Orders 2004 March 2004/page 25

26 Clear Increase in Production in Q1/ Units Q1/2003 Q1/2004 Flow&FluidWORLD VisionWORLD In Flow&FluidWORLD, 36% more devices will be manufactured compared to last year; in VisionWORLD the increase equales 5 %. March 2004/page 26

27 Progress of WORLD OF MEDICINE Stock in 2003 Outperformance seen with comparable indices March 2004/page 27

28 Progress of WORLD OF MEDICINE Stock in 2004 Despite declining indices, stock price holds steady after announcement of preliminary figures. March 2004/page 28

29 W.O.M. WORLD OF MEDICINE AG: Investment Case... Global leader in medical device technology for Minimally Invasive Surgery Internationally Well-Positioned Many Years of Experience In MIS Growth Market Strong Technology and Product Portfolio for MIS Operative Turnaround Export share over 50%, presence in USA, well-positioned in Asia. 50% global market share in core business. Long-standing business relationships with over 200 partners; 37 FDA approvals and 37 patents. Modern, certified production facilities. Unique combination of knowledge and expertise in insufflation and pump technology, video technology, and laser technology By focusing on sales to major customers and retreating from weak margin products; return to the profit zone March 2004/page 29

30 Minimally Invasive Surgery with a Future Addenda March 2004/page 30

31 W.O.M. WORLD OF MEDICINE AG: Our Devices for Minimally Invasive Surgery (MIS ) Products/ Applications Abdominal Areas (Laparoscopy) Joints (Arthroscopy) Uterine Organs (Hysteroscopy) Urinary Tract (Urology) G.I. Tract (Gastroenterology) Ear, Nose, Throat (ENT) Flow&FluidWORLD Insufflators Pump Systems Tubular Systems VisionWORLD Monitors, Cameras, Light Sources, Documentation Systems LaserWORLD U100 Laser Laser Fibers Gamma Finder March 2004/page 31

32 WORLD OF MEDICINE Today: a Globally Active Group of Companies W.O.M. WORLD OF MEDICINE AG Main Office: Ludwigsstadt, Upper Franconia, Germany Branch Office: Berlin, Germany 100 % 94,25 % 100 % 100 % 100 % W.O.M. WORLD OF MEDICINE USA, Inc. WORLD OF MEDICINE LEMKE GMBH IBL Industrial- Broad Spectrum Laser AG Industrial Broad Spectrum Laser Inc. Clyxon Laser GmbH Main Office: Orlando, FL (USA) Main Office: Berlin, Germany Main Office: Berlin, Germany Main Office:: Orlando, FL (USA) Main Office: Berlin, Germany 20,1 % 55 % Spektrum Laser- Entwicklungsund Vertriebs-GmbH Main Office: Berlin Thor Systems Inc. Main Office: Orlando/FL, USA March 2004/page 32

33 Milestones in the Company s History 1974 Develops the first hysteroscopy insufflator 1982 Enters the field of arthroscopy 1985 Enters the field of laparoscopy with the world s first electronic laparoflator 1990 Opens production facility in Ludwigsstadt 1998 Founds W.O.M. WORLD OF MEDICINE USA, Inc. subsidiary in Orlando, Florida 1999 Founds IBL Innovative Berlin Laser AG subsidiary in Berlin 2000 Assumes majority holding of WORLD OF MEDICINE LEMKE GmbH, Gröbenzell/Munich 2000 Introduces U100 laser (FREDDY technology) into market 2001 Reorganizes into a P.L.C. and enters the new market in Frankfurt 2001 Establishes a sales office in New Delhi/India 2001 Assumes majority holding of Wiest International Deutschland Amerika GmbH 2002 Merges Wiest International with W.O.M. WORLD OF MEDICINE AG 2003 Listed on the Prime Standard of the Frankfurt Stock Exchange March 2004/page 33

34 Shareholder Structure Free Float 34.42% Peter P. Wiest (CEO) 65.58% March 2004/page 34

35 Corporate Governance Company s Own CG Principles 2 nd Declaration of Conformity Since May 2002 Published in December 2003 Both documents are available for download March 2004/page 35

36 Corporate Governance-Declaration of Conformance 2003 WORLD OF MEDICINE shall conform to the German Corporate Governance Code, with the following exceptions: Committees Management Compensation Because the Supervisory Board consists of only three individuals, no committees were formed. Compensation amounts to the Management Board will not be individually itemized. March 2004/page 36

37 IR Calendar for Month Report 4th Berlin MedTech Day May 13, 2004, Berlin May 18, 2004, Berlin Shareholders Meeting June 4, 2004, Ludwigsstadt Half-Year Report 9-Month Report August 11, 2004, Berlin November 11, 2004, Berlin March 2004/page 37

38 Analyst Coverage HSBC Lars Korinth First Berlin Stephen Love Nord LB Marc Schwammbach IR Contact WORLD OF MEDICINE Stefanie Gehrke Fon: +49 (0) March 2004/page 38