Corporate News: MeVis Medical Solutions with record revenues in the first quarter of 2008

MeVis Medical Solutions with record revenues in the first quarter of 2008: Growth strategy successfully continued

  • 34.6 percent increase in revenues to EUR 2.4 million
  • As expected, EBIT down slightly due to growth related operational expenses
  • 86.7 percent increase in consolidated net profit to EUR 0.4 million
  • Growth forecast for 2008 confirmed by the Management Board

Bremen, May 27, 2008 - MeVis Medical Solutions AG [ISIN: DE000A0LBFE4] successfully continued its growth strategy in the first three months of this year. At EUR 2.4 million, the specialist in software for medical-imaging technology reported a 34.6 percent increase in revenues over the same period one year earlier (EUR 1.8 million), thus achieving a new record in this quarter. 'We got off to a good start in 2008. The trend in sales volume shows the strength of our existing product portfolio in the market.' says Dr. Carl J.G. Evertsz, President and CEO of MeVis Medical Solutions. 'Roughly 89 percent of our revenues were generated in the US market, where we hold a strong market position thanks to the partnerships that we have forged with leading medical technology OEMs. Therefore, we are able to partake strongly in current market growth. Our aim is to both extend this close collaboration and simultaneously gain further OEM partners for new products.' With revenues of EUR 1.8 million, the Digital Mammography segment performed particularly well. The number of licenses sold, which is independent of exchange rate fluctuations, increased by 58 percent year on year. In the segment Other Diagnostics, the number of licenses sold rose by 25 percent over 2007, contributing EUR 0.6 million to total revenues.

EBIT in the first quarter of 2008 came to EUR 0.3 million (previous year: EUR 0.6 million). 'The reason for the decline over the previous year is the systematic implementation of our growth strategy and the related capital spending efforts and ensuing expenses,' explained Dr. Olaf Sieker, CFO of MeVis Medical Solutions. In particular, this included additional recruiting expenses. In contrast to the previous year, due to the stock market flotation additional expenses were incurred and basic financing was paid to the non-profit research institute MeVis Research GmbH.

The Company’s headcount has almost doubled over the year-ago period to 139. Even so, personnel expenses rose by only around one quarter due to the initial capitalization of development expenses in accordance with the requirements under IAS 38. The capitalized personnel expenses relate to the development of numerous new products, which are to be launched on the market between 2008 and 2010. Explains Sieker: 'In the near future capital spending on our richly filled product pipeline is going to have a positive impact on sales and earnings.'

Due to the proceeds from the stock market flotation, net financial results increased to EUR 0.4 million in the first quarter of 2008. As a result, consolidated net profit for the period surged by 86.7 percent year on year to EUR 0.4 million (previous year EUR 0.2 million), equivalent to EUR 0.37 per share. As of March 31 of this year, total liquidity amounted to EUR 25.5 million, equaling liquidity per share of approximately EUR 14.

A further milestone in MeVis Medical Solutions’ growth strategy is the acquisition of the lung CT software suite 'R2 Image Checker CT' from Hologic Inc. in April of this year. The Company has announced plans to increase its scope of activities in the future and to supplement its software for breast cancer diagnosis and early detection, and the planning of liver surgery with software solutions for other disease areas such as prostate and lung cancer as well as for the planning of brain surgery. The newly acquired lung CT software is approved by the US Food and Drug Administration (FDA) and should start contributing to the Company’s top line as of the third quarter of 2008. The technology acquired will be further developed and marketed by the Company’s US subsidiary MeVis Medical Solutions, Inc. It will form a key part of the ex-tensive 'MeVis-Visia-Lung CT' software suite for diagnosing diseases of the lung and for pre-operative planning of lung surgery. Says Evertsz: 'In this way, we will be able to additionally reinforce our strong market position as an independent vendor of disease-oriented software products for image-based medicine.'

The Management Board confirms that the Company is still on track to meeting its full-year targets of revenues of at least EUR 9.0 million and EBIT of at least EUR 2.5 million.