Eckert & Ziegler BEBIG, Mick Radio-Nuclear Instruments, WOLF-Medizintechnik (WOmed)


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IBt - International Brachytherapy s.a. : Results IBt , H1, 2008

Results IBt , H1, 2008

Regulated Information

EMBARGO till 29 August 2008

17:40 Brussels time
Major increase in operating results due to the integration of BEBIG GmbH
Sales + 61 %
EBITDA + 99%
First time half-year profit (before restructuring charges)
Seneffe restructuring completed
Outlook confirmed

Financial results in summary

Preliminary comment

The figures in the following tables present the group's financial results with reference to IFRS standards. They are consolidated but not audited. It should be pointed out that the comparability of the H1 2007 and H1 2008 figures is limited due to the fact that the group's scope of activity has changed considerably between these two periods:

(1) Following the September 2007 decision to terminate activities connected with the isotope Pd-103, the financial data relating to H1 2007 as stated in the tables below has been adjusted to reflect the data relating solely to continuing activities, i.e. the production and sale of iodine-125 implants;

(2) on the other hand, the scope has been widened by the consolidation of the activities of BEBIG GmbH since 29 February 2008, following the acquisition of the shares of that company at that time.

Consolidated income statement

In EUR thousands   1st Half 2008  1st Half 2007  Variation 
Turnover  6,881  4,264   + 61 % 
Cost of sales  -3,705  -2,131   + 74 % 
Gross margin  3,175  2,133   + 49 % 
Commercial and marketing expenses  -2,018  -1,569   + 29 % 
G&A expenses  -1,209  -758   + 59 % 
R&D expenses  -353  -241   + 46 % 
Other operating income and charges  1,401  735   + 73 % 
EBITDA  1,646  826   + 99 % 
EBIT  942  299   + 215 % 
Financial result   -145  62   NA 
Result before taxes  796  361   + 120 % 
Taxes  -326  -84   + 288 % 
Minority interests  -97  -147   - 34 % 
Net result - IBt share, before non-recurrent items  373  130   + 187 % 
Discontinued activities    -1,044  NA 
Impact of restructuring  -3,740    NA 
Net result   -3,366  -914   - 268 % 

Balance sheet

In EUR thousands   On 30 June 2008  On 31 December 2007 
Non-current assets  37,299   12,673  
Intangible assets  864   6  
Tangible assets  8,430   5,013  
Financial assets  3,035  
Deferred tax assets  7,653   7,653  
Goodwill  16,784  
Other non-current assets  534   1  
Current assets  11,410   5,000  
Inventories  2,035   798  
Trade receivables  3,919   1,127  
Other receivables  2,465   69  
Cash and cash equivalents  2,990   3,006  
Assets held for sale    137  
TOTAL ASSETS  48,708   17,810  
Equity  30,371   11,273  
Minority interests  320   222  
Provisions  4,652   62  
Amounts payable after one year  6,352   3,103  
Amounts payable within one year  7,014   2,831  
Liabilities held for sale    320  
TOTAL LIABILITIES  48,708   17,810  

Evolution of shareholders' equity

  Capital   Issue premium  Reserves  Translation differences  Equity 
Carrying value on 31/12/2007  6,692  30,946  -26,256  -110  11,272 
Result of the period      -3,366    -3,366 
Translation differences        -159  -159 
Capital increase  4,183  19,239      23,422 
Other variations    -798      -798 
Carrying value on 30/06/2008  10,875  49,387  -29,622  -269  30,371 

Management Report

I. Main events

Over this period of the first six months, two major events should be highlighted:

- a major development by external growth - by far the largest transaction in the young history of the group: acquisition of all the shares of BEBIG GmbH, the company's former principal European competitor, and

- the announcement and the implementation of a restructuring plan for the enlarged group's activities.

(1) External growth - acquisition of BEBIG GmbH shares

February 2008: Announcement of an agreement with the Berlin-based German company Eckert & Ziegler AG (EZAG) concerning the acquisition of all the shares in BEBIG GmbH, an EZAG subsidiary, by IBt S.A. BEBIG was the unit within the EZAG group responsible for activities in the area of brachytherapy-based cancer treatment using permanent implants.

As a reminder: as part of this deal, IBt acquired the stock of BEBIG GmbH (including that of its affiliated entities, i.e. its subsidiaries in Spain and Italy as well as its French and Indian branches) for a total sum of EUR 23.4 million. The value of this deal was based on two factors:

- an EBITDA multiple of 5.5 (based on BEBIG's 2007 consolidated results), and

- the estimated value of the company's net working capital.

To finance this transaction, IBt issued a total of 6,750,000 new shares at a price of EUR 3.47 a share. These were entirely subscribed by EZAG. As a result, EZAG now holds 29.9% of all voting rights in the Group. The results of the regrouped entities were subjected to consolidation as of 1 March 2008.

This strategic operation has led to the doubling of the IBt group's size and puts it into a leadership position in its field of activities in Europe.

(2) Restructuring and integration

June 2008: Announcement of a plan for restructuring and integrating the Group's operations. The Group has two operational sites, one at Seneffe, the other in Berlin, both basically conducted the same operations.

To optimize operations, the plan foresaw:

(a) concentrating all Sales and Marketing activities, all R&D relating to the intellectual property held by IBt, and all headquarters operations (Finance, HR, IR, Legal, etc) in Seneffe; and

(b) concentrating all production activities in Berlin and terminating all production of InterSource and InterStrand implants.

These decisions have had two principal impacts:

(1) On the operational side: the intention to close down the manufacturing department at Seneffe implied mass redundancy. The procedure foreseen in such circumstances by the "Renault Law" ("loi Renault") was immediately started, commencing with talks with employees' trade union representatives and followed by negotiations.

This whole procedure was completed by 15 July.

It led to 35 people (out of a total workforce of 108) being made redundant or not having their employment contracts renewed. All the costs relating to this restructuring are stated in the results for these first six months (cf. details below).

(2) On the commercial side: during this period, the Group was, on the whole, successful in limiting or minimizing the impact of these decisions on the supply and organization of its hospital customers.

However, because of the specific situation in the Dutch market, the company has sold, in August, the shares it held in its distributor, CurieMed b.v. to the partner already holding a stake in the company. The sale of shares will not generate any significant financial impact on the Group's results.

The scope of consolidation will be modified, with the results of this subsidiary no longer being consolidated as of 1 July.

II. Comments on the consolidated key figures

Income statement

Turnover resulting from the sale of products after margin rebates to distribution partners reached EUR 6.9 million, up 61% against the first six months of 2007. This increase is mainly explained by the integration of BEBIG sales, which account for 49% of the first six months' turnover.

Other operating income relates mainly to capitalized production, and to a major write-off (non-recurrent by nature).

Operating expenses break down as follows (compared with last year's figures):

(1) Cost of sales: EUR 3.71 million EUR (+ 73.9%)

(2) Sales and marketing expenses: EUR 2.0 million (+ 28.6%),

(3) General and administrative expenses: EUR 1.2 million (+ 59.5%),

(4) Research and development expenses: EUR 0.4 million (+46.3%)

(5) Other charges: EUR 0.1 million (-25.6%)

The increase in expenses is mainly attributable to the integration of BEBIG GmbH expenses.

EBITDA and Result before restructuring costs both show marked improvement.

Net profit was burdened with an exceptional charge of EUR 3.74 million relating to restructuring activities at Seneffe.

The main components of this provision are:

(1) For an amount of EUR 1.1 million: accelerated depreciation on tangible and non-tangible assets - production equipment,

(2) Write-downs (EUR 0.7 million) relating to inventories of raw materials and finished products;

(3) Expenses for staff and other charges (EUR 1.9 million) consisting of severance indemnities, contractual indemnities and miscellaneous provisions relating to the production site.

Balance sheet


Intangible assets (amounting to EUR 0.86 million) consist on the one hand of the net value of the technological processes amortized over their protected life; and on the other hand of the net value of development costs, amortized linearly over a period of five years.

Tangible assets, net of accumulated depreciation, have risen to EUR 8.43 million. The main components are: EUR 2.09 million for the Seneffe site and buildings and EUR 1.11 million for equipment (production machines, etc). The accelerated depreciation for the equipment assets has - as stated above - been fully provided for in the restructuring costs.

Inventories have risen to EUR 2.04 million, of which EUR 0.7 million have been subjected to a write-down in value. Receivables within one year have risen to EUR 6.38 million. Cash and cash equivalents have risen to EUR 2.99 million.


Equity amounts to EUR 30.37 million and breaks down into capital of EUR 10.88 million, issue premium of EUR 49.38 million from which the loss for the financial year (after appropriation of the result) and the deferred loss totaling EUR 26.45 million are deducted.

The amount of the provisions recorded in the balance sheet is EUR 4.65 million The main component is the provision made for restructuring (EUR 3.74 million).

Total debts have risen to EUR 13.37 million. The EUR 6.35 million total for amounts payable after one year breaks down into four items:

(1) for EUR 2.8 million: a debt arising from a 3 year loan provided by Eckert & Ziegler as part of the deal involving the purchase of shares in BEBIG GmbH;

(2) for EUR 1.6 million: asset retirement obligation on Berlin site;

(3) for EUR 1.2 million: related to amounts payable received in connection with the financing of R&D projects by the Walloon Regional Government. It should be noted that the effective repayment of these amounts remains dependent on certain conditions being met;

(4) for EUR 0.3 million: debt corresponding to the financing of the acquisition of equipment by leasing.

The amounts payable within one year are made up of trade debts (EUR 2.80 million), tax and social security debts (EUR 0.72 million), debts maturing during the year (EUR 1.85 million) and other debts (EUR 1.63 million) mainly coming from the new German subsidiary BEBIG GmbH.

III. Outlook

The BEBIG GmbH acquisition at the end of February has had a profound impact on the Group's outlook.

In its enlarged form, the IBt Group has now become a major European player in its specific field, with a wider revenue base for financing its sales, development and marketing expenses. IBt is today engaged in nearly all major markets with its subsidiaries in France, Germany, the United Kingdom, Belgium, Italy and Spain, and via an extensive network of distributors. The main objective for the coming quarters will be for IBt to finalize its integration plan.

With regard to its strategic future development, IBt currently holds a call option on certain assets of the Eckert & Ziegler group. These assets relate essentially to the so-called "afterloader division" of the company (note: afterloaders are medical device equipments that allow to perform cancer treatment by brachytherapy with usage of temporary implants instead of permanent implants). The decision on whether or not to exercise this option will be taken in the coming months.

IBt confirms its outlook of posting in 2008 its first annual profits before restructuring charges.

Declarations - Art.13 of R.D. of 14.11.2007

Mr. Andreas Eckert, Chairman of the IBt Board, and Mr. François Blondel, CEO, Managing Director,

declare that to the best of their knowledge:

a. The intermediate report contains a faithful presentation of significant events occurring over the first six months of the 2008 financial year, and, as the case may be, major transactions between related parties, and of their impact on the summary financial information.

b. the summary financial information prepared in conformity with the applicable accounting standards though without being subjected to a review by the external auditor, gives a true and fair view of the capital, the financial situation and results of the issuer and the consolidated subsidiaries of the Group.

For any additional information:

Mrs. Laurence Goemaere

Investor Relations Manager

IBt s.a.

Tel: +32 64 520 811