Q3/2020: Capital reduction successfully implemented; sales in Q3/2020 almost stable despite continued negative impact of COVID-19; strong growth in US business (+68%) and recovery tendencies in Europe

DGAP-News: aap Implantate AG

/ Key word(s): Quarter Results/Preliminary Results

09.10.2020 / 11:18

The issuer is solely responsible for the content of this announcement.

The COVID-19 pandemic continued to impair business operations at aap Implantate AG (“aap” or the “Company”) in recent months, as reflected in the sales trend in the third quarter and the first nine months of 2020. Contrary to this trend, aap continued to record a clearly positive business development in the U.S. and showed dynamic growth on both a quarterly and nine-month basis. In addition, following the easing of COVID-19 measures in the third quarter, the German and European markets (excluding Germany) showed signs of recovery that were reflected in almost equal or even higher sales year-on-year. According to preliminary figures, sales in the third quarter of 2020 were thus almost at the level of the previous year at EUR 2.6 million (Q3/2019: EUR 2.7 million) and in the first nine months of the current financial year at EUR 6.9 million (9M/2019: EUR 8.7 million). Based on the sales development in Q3/2020 and the lower cost level as a result of the comprehensive restructuring and efficiency improvement program, the Management Board expects a significantly improved EBITDA and Recurring EBITDA for the third quarter of 2020.
 

Sales Q3/2020

In KEUR Q3/2020 Q3/2019[1] Change
Sales
Germany
USA[2]
USA Distributors
USA Global Partners

International (without USA)
Europe (without Germany)
BRICS countries
RoW (Rest of World)2
2,575
641
707
646
61

1,227
564
188
475
2,705
671
420
372
48

1,614
445
300
869
-5%
-5%
+68%
+74%
+27%

-24%
+27%
-37%
-45%
Sales 2,575 2,705 -5%
 
In KEUR Q3/2020 Q3/2019 Change
Sales (constant exchange rates) 2,575 2,683 -4%

 

Sales 9M/2020

In KEUR 9M/2020 9M/20191 Change
Sales
Germany
USA2
USA Distributors
USA Global Partners

International (without USA)
Europe (without Germany)
BRICS countries
RoW (Rest of World)2
6,929
1,766
2,050
1,777
273

3,113
1,347
676
1,090
8,679
2,180
1,435
1,365
70

5,064
1,510
1,312
2,242
-20%
-19%
+43%
+30%
>100%

-39%
-11%
-48%
-51%
Sales 6,929 8,679 -20%
 
In KEUR 9M/2020 9M/2019 Change
Sales (constant exchange rates) 6,929 8,681 -20%
 

With regard to the sales development in the individual regions, the picture is ambivalent in the third quarter: While sales in Germany and Europe (excluding Germany) showed signs of recovery from July onwards following the reduction of the lockdown measures, which were reflected in almost equal or even increased sales year-on-year, the remaining international business fell significantly short of the previous year. Developments in Germany benefited from an increased shift of summer vacations to Germany, while sales development in Europe (excluding Germany) was positively influenced in particular by the revival of business in Spain and Portugal, following the lifting of the extremely strict measures in the first half of the year. In the third quarter, foreign business in the BRICS and RoW regions, which is important for aap, was again strongly affected by the effects of the COVID-19 pandemic, since the top-selling international partners here are companies from South Africa, Brazil and Mexico. These countries continue to be the most affected by the COVID-19 pandemic worldwide.
 

The sales development in the first nine months was visibly influenced by the COVID-19 pandemic and the corresponding lockdown measures of the first half year, which is reflected in significantly lower sales compared to the previous year. It should also be noted that even if normality returns, there will be no catch-up effects, as in the consumer goods industry, for example, but at most a return to pre-crisis levels.
 

In the U.S., by contrast, aap continues on a dynamic growth course and was able to increase sales significantly year-on-year in both the third quarter (+68%) and the nine-month period (+43%). This is even more remarkable given that the U.S. is the country with the highest number of COVID-19 infections worldwide. Here, the sales momentum of the first half of the year was maintained and the number of weekly surgeries was sustainably stabilized at a level of up to 50 procedures. In addition, focused efforts to conclude contracts with nationally active companies that give aap access to a U.S. network of clinics and surgical operation centers continue to bear fruit. Overall, aap is aiming for a year-on-year sales increase of at least 30% in the U.S. in the financial year 2020 despite COVID-19.
 

As part of the comprehensive restructuring and refinancing process, the Management Board proposed an ordinary capital reduction in the ratio of 10:1 to aap‘s shareholders at the Annual General Meeting on August 7, 2020, which was approved by a large majority. The capital reduction was entered into the commercial register on October 5, 2020. Together with the complete placement of the convertible bond, two key elements of the financial restructuring and refinancing were thus successfully implemented. At present, the technical execution of the capital reduction is being carried out from the German stock exchange, so that the adjustment of the share price to the effects of the capital reduction should be carried out soon. On this basis, the Management Board of the Company is currently evaluating further capital measures (e.g. capital increase or further convertible bonds) to secure the financing of the Company in the long term.
 

The figures contained in this press release are preliminary figures as of September 30, 2020, which may still change before its final publication. aap plans to announce the final results for the third quarter and first nine months of 2020 in a press release in the first half of November.

[1] The disclosure of the other sales revenues still reported in the previous year no longer applies and are now allocated to the individual regions.
[2] In the previous year, sales to Puerto Rico were reported as part of North America (distributors); from Q3/2019 as part of RoW.
 

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aap
Implantate AG (ISIN DE0005066609) – General Standard/Regulated Market – All German stock exchanges –

About aap Implantate AG
aap Implantate AG is a globally active medical technology company based in Berlin, Germany. The Company develops, manufactures and markets products for trauma. The IP-protected portfolio includes besides the innovative anatomical plating system LOQTEQ(R) a wide range of cannulated screws. In addition, aap Implantate AG has an innovation pipeline with promising development projects such as the antibacterial silver coating technology and magnesium-based implants. These technologies address critical and unmet needs in trauma. In Germany, aap Implantate AG sells its products directly to hospitals, purchasing groups, and hospital groups, while at international level it primarily uses a broad network of distributors in around 25 countries. In the US the Company pursues a hybrid distribution strategy with its subsidiary aap Implants Inc. Distribution is carried out both through distribution agents and partnerships with global orthopedic companies. aap Implantate AG’s stock is listed in the General Standard segment of Frankfurt Stock Exchange (XETRA: AAQ.DE). For more information, please visit our website at www.aap.de.

Forward-looking statements
This release may contain forward-looking statements based on current experience, estimates and projections of the management board and currently available information. They are not guarantees of future performance. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of the company and the estimates given here. Many factors could cause the actual results, performance or achievements of aap to be materially different from those that may be expressed or implied by such statements. These factors include those discussed in aap‘s public reports. Forward-looking statements therefore speak only as of the date they are made. aap does not assume any obligation to update the forward-looking statements contained in this release or to conform them to future events or developments.

For inquiries please contact:

aap Implantate AG; Fabian Franke; Manager Investor Relations; Lorenzweg 5; 12099 Berlin, Germany; Phone: +49/30/750 19 – 134; Fax: +49/30/750 19 – 290; f.franke@aap.de
 


09.10.2020 Dissemination of a Corporate News, transmitted by DGAP – a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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Language: English
Company: aap Implantate AG
Lorenzweg 5
12099 Berlin
Germany
Phone: +49 (0) 30 75 01 90
Fax: +49 (0) 30 75 01 91 11
E-mail: info@aap.de
Internet: www.aap.de
ISIN: DE0005066609
WKN: 506660
Listed: Regulated Market in Frankfurt (General Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart, Tradegate Exchange
EQS News ID: 1139931

 
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