#Sweden #Cybersecurity #Sectra #Medical Imaging #Linköping

Sectra Reports Record Order Bookings

International medical imaging IT and cybersecurity company Sectra (STO: SECT B) has recently announced its six-month interim report for 2024/2025, revealing exceptionally high order bookings for the second quarter, exceeding SEK 4 billion. This significant achievement marks a 739.6% increase from the previous year's figures. While the overall results were affected by currency fluctuations and an evolving business model, the transition towards service-based offerings and cloud solutions is being realized swiftly, promising benefits for both Sectra and its clientele in the long run.

Second Quarter Performance Highlights

For the period spanning August to October, the company's contracted order bookings surged to SEK 4,223.1 million, with guaranteed bookings accounting for SEK 4,017.0 million. Of these guaranteed orders, 3% were recognized during this quarter, with an anticipated 1-11% to be recorded as revenue within the next year. However, net sales experienced a slight decline of 4.3%, totaling SEK 753.5 million. Notably, the recurring revenue exhibited a promising increase, rising 12.8% to SEK 484.7 million.

In terms of operational metrics, the operating profit saw a decline to SEK 109.6 million, leading to an operating margin of 14.5%. Despite these challenges, the cash flow from operations showed notable improvement, totaling SEK 176.1 million, significantly up from SEK 57.7 million in the prior period.

Six-Month Performance Overview

When reviewing the six-month period from May to October 2024, contracted order bookings increased by 39.3%, reaching SEK 4,838.1 million. Net sales for this timeframe rose by 7.7%, up to SEK 1,477.3 million, highlighting a resilient growth strategy even amid market challenges. Recurring revenue was a standout performer, climbing 17.0% to SEK 967.0 million.

Strategic Insights from Leadership

Torbjörn Kronander, President and CEO of Sectra, emphasized the importance of these milestones, noting, “The first half of the year can be summarized as follows: record-breaking order bookings, a continued positive trend for secure communications, and significant progress in our transition to offering medical diagnostic imaging as a service.” Kronander recognized that while larger contracts have led to variability in order bookings and earnings between quarters, these changes are pivotal for achieving sustainable growth in the future.

One notable development this quarter was the acquisition of a SEK 3 billion contract for Sectra One Cloud, aimed at public healthcare in Québec, Canada. This contract exemplifies the ongoing trend of larger contracts aimed at comprehensive solutions and long-term partnerships in healthcare.

Furthermore, the demand for Secure Communications has risen as customers increasingly invest in bolstering information security against cyber threats. Kronander cited a settlement with a US company regarding patented secure communications technology as a significant positive development for Sectra, poised to enhance future profitability.

Looking Ahead

In conclusion, Sectra is strategically positioned in the growth sectors of healthcare and data security, which are expected to remain resilient against economic fluctuations. With a loyal customer base and a robust brand in emerging markets, Sectra's future appears optimistic. The full interim report, including additional insights from Sectra’s leadership, is available for review for those seeking a deeper understanding of the company’s ongoing evolution in the medical imaging and cybersecurity landscape.