Elos Medtech: Robotic surgery is doing wonders - ABG

Solid margin drove 18% EBIT beat
Elos Medtech reported yet another impressive quarter, with particularly strong EBIT margin of 14.6% (ABGSCe 12%), driving an EBIT beat of 18% vs. our expectations. Dental and Orthopedics was 51% and 58% better on EBIT vs. ABGSCe, respectively. Dental grew 174% y-o-y and reported 10% higher volumes, and 4.9% higher EBIT margin than we expected, as the dental market has returned to normal. While Orthopedics delivered 10% lower volumes than expected, its EBIT margin was a sizeable 8.3% higher than we expected, coming in at 18.9% (10.4% in Q1’21). It was largely a result of a beneficial sales mix with a large share of robotic surgery products combined with staffing efficiencies. Life Science performed worse than expected, with sales and EBIT 9% and 8% below what we expected, respectively, as a result of lower demand from hearing implant customers. Group sales were SEK 181m, up 53% y-o-y (63% organically) and up 6% sequentially.