Financial situation
1
2
28
I
LISI 2014FINANCIALREPORT
Commentsregardingbusinessactivity in2014andoutlook
■■
Sharp increase in activity at the end of the year and improved
profitability
■■
Record leveloftheorderbook
■■
Goodprospects for2015
Market
The globalmarket for orthopedics and implants had a rather dynamic
year 2014withanewphaseof restocking. The competitive landscape in
theUnitedStates,wheremedium-sizedcompaniesdominate, continues
to consolidate. In general, the underlying trends remain unchanged:
search for savings, particularly through innovation, introduction of
genericproducts, singleuseancillaries,etc.
LISIMEDICALconsiderstheorthopedic implantmarkettobestillgrowing
intherangeof3to4%peryear,butwith joltsdependingonthestocking-
destockingphases.
Theannual sales revenuestoodat€71.1M, an increaseof 10.8%due toa
sharp increase inactivity in the fourthquarteralone (+23.2% to€18.6M).
Productionamounted to€70.3M, allowing to lower inventories towards
theendoftheyear.
Commercially, order taking in the last two months has been quite
encouragingwitharecordbookto€20.1MatendDecember2014.
The operatingmargin has benefited from improved coverage of fixed
costs (methods, engineering, innovation) and stood at 5.0% (4.0% in
2013).All othermanagement indicatorsare improving.CAPEX remained
highwith€4.6M incommitmentsand€4.2Mrecorded (newequipment
andproductioncapacityextension).With inventoriesat80daysof sales
(94days in2013), theworkingcapitalhasdeclinedsharply.Consequently,
theFreeCashFlow improved, setting itselfat -€1.0M in2014 (-€1.3M in
2013).
To copewith the surge of activity, hiring, particularly of operators and
polishers, mainly on the Caen site, has been accelerated. Thus, FTEs
totaled597peopleatperiodend,versus536 in2013.
OUTLOOK
LISIMEDICAL started the yearwith the assurance that themain site of
Caenhad a robust order book. Thedevelopment of newproductswith
new customers remains the main objective with the perspective of
extendingtheplant.
ThesitesofNeyron (France)andEscondido (USA) remained ina reversal
situationandshouldreachcriticalmass inthecourseoftheyear.
Overall, the outlook is in line with 2014, with an improvement in the
volumeofbusinessandofallmanagement indicators.
Additionally, LISIMEDICALwill takeover thevolumeachievedbyManoir
Aerospace inorthopedics (between roughly €300 and€400Kon a full
yearbasis) to improvethe levelofserviceto itscustomers.
Activity
In€M
2014
%Group
2013
Changes
Sales revenue
71.1
6%
64.1
+10.8%
EBIT
3.5
3%
2.5
+38.5%
Operatingcash flow
3.5
2%
1.6
+123.9%
NetCAPEX
-4.6
5%
-3.1
+48.4%
Operatingcash flowsurplusFreeCash-Flow
1
-1.0
NA
-1.3
-23.4%
Registeredemployeesatperiodend
538
5%
474
+13.5%
Full timeequivalentheadcount
2
597
5%
536
+11.4%
1FreeCashFlow :operatingcash flowminusnet industrialCAPEXandchanges inworkingcapital requirements.
2 Includingtemporaryemployees
