Interim Report Q1 – January – March, 2020 Redsense Medical AB (publ)

FINANCIAL SUMMARY

First quarter, 1 Januari – 31 Mars 2020

The Group

  • Net sales amounted to kSEK 4,996 (1,964), a 154 percent increase compared with the corresponding period in 2019.
  • Earnings before tax amounted to kSEK 241 (-706).
  • Total equity amounted to kSEK 14,947 at the end of the period.
  • Available liquid assets amounted to kSEK 9,778 at the end of the period.

The Parent Company

  • Net sales amounted to kSEK 3,795 (1,406).
  • Earnings before tax amounted to kSEK 26 (-349).
  • Total equity amounted to kSEK 56,787 at the end of the period.
  • Available liquid assets amounted to kSEK 4,298 at the end of the period.

Result and position

The Group’s result for the first quarter of 2020 amounted to kSEK 241 before taxes, or SEK 0.02 per share. The number of shares outstanding was 12,540,810 as of 31 March 2020. Cash and cash equivalents at the end of the period amounted to kSEK 9,778.

SIGNIFICANT EVENTS DURING THE FIRST QUARTER

Significant events 1 January – 31 March 2020

  • An influx of more than MSEK 1.5 in new orders in early January brought the total order book value up to approximately MSEK 2.
  • Redsense Medical AB presented the company and its operations at Life Science-dagen in Gothenburg.
  • In early March, a positive Final Notice was received from The Swedish Patent and Registration Office regarding the Company’s patent application for a second smart wound care related invention; patent approval will be obtained provided that minor corrections are submitted.
  • Announced that the COVID-19 outbreak is not expected to have a direct impact neither on Redsense’s operations nor on product demands, and that the Company’s US organization and supply chain remain intact and without disruptions.
  • Announced the postponement of the 2020 Annual General Meeting in an effort to contribute to social distancing and reduce the impact of the COVID-19 outbreak. The event will be held on Monday, 22 June 2020, instead of 4 May 2020 as previously disclosed.

Significant events after the period

  • No significant events have taken place since the end of the period.

COMMENTS FROM OUR CEO

First net-profit quarter achieved

The first quarter of 2020 has, to say the least, been truly challenging for the global community.

However, despite the unsettled situation in the wider world, I am happy to announce that we have now attained a significant and long-awaited mile-stone achievement: For the first time in the company history, Redsense is reporting a positive quarterly result!

Compared with the first quarter of 2019, sales increased by 154 percent, a strong number, especially bearing in mind that the first quarter historically has been the weakest period of the year.

The order intake stayed at an impressive level during the second half of 2019, and as we entered Q1 2020 with a carry-over of sales, the influx of new orders continued. Fortunately enough, we are now reaping the harvest of our previous measures to strengthen production capacity; we have managed to build a reliable and responsive supply chain, and that allowed us to meet the growing demand and make delivery on all orders this quarter.

Limited coronavirus impact

As we moved into March, the COVID-19 pandemic’s grip took a firmer hold on society. For Redsense Medical, operations continued unabatedly and the direct impact of the outbreak on our business has so far been limited, at least in the US, our largest market. The well established domestic organization in the US gives us a resilience against the imposed travel restrictions, and it is mainly the logistics and product supply that have an influence on sales; shipment times have increased by 5-6 weeks, and we have pre-ordered the estimated material requirement for the coming 4-6 months as a response.

As regards our end customers – hospitals and clinics – the pandemic is obviously putting a heavy strain on all healthcare operators. This may eventually impact their placing of orders, and it is possible that we will see more pronounced effects from delays in the second quarter. In addition, with the isolation rules in Europe, the distributors are prevented from performing demonstrations and evaluations in clinics.

An opportunity to aid the risk groups

Redsense improves essential care services and should thus perform relatively well in the current sentiment, without real demand risks; patients on dialysis will continue to require regular life-supporting treatment.

While many hospitals are at the verge of being overwhelmed, dialysis patients must maintain social distancing and avoid exposure – and the incentives to switch from inpatient to home dialysis have thus never been stronger. For Redsense, this is an opportunity to operate in accordance with our vision: to improve care and save lives; the COVID-19 crisis puts the spotlight on the advantages of home dialysis, and the awareness and the willingness to use it increases – which reinforces the very trend that has been our main driver of growth during the last year, particularly in the US.

Moving forward, we fully expect to continue to see sales numbers that surpass the preceding year’s!

Halmstad, May 4th, 2020

Patrik Byhmer
CEO Redsense Medical AB

 

 

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