Medartis Holding AG: Medartis achieves solid full-year 2020 result and nominates new Chairman of the Board of Directors for election (english)

    Medartis Holding AG: Medartis achieves solid full-year 2020 result and nominates new Chairman of
the Board of Directors for election

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EQS Group-Ad-hoc: Medartis Holding AG / Key word(s): Annual
Results/Personnel
Medartis Holding AG: Medartis achieves solid full-year 2020 result and
nominates new Chairman of the Board of Directors for election

10-March-2021 / 07:00 CET/CEST
Release of an ad hoc announcement pursuant to Art. 53 KR
The issuer is solely responsible for the content of this announcement.

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Medartis Holding AG
Hochbergerstrasse 60E
CH-4057 Basel

PRESS RELEASE

Medartis achieves solid full-year 2020 result and nominates new Chairman of
the Board of Directors for election

Basel, Switzerland, 10 March 2021 - Medartis Holding AG (SIX: MED) achieved
sales growth of 9% in local currencies in the second half of 2020, driven by
13% growth in direct markets. Taking into consideration pandemic-related
disruptions, Medartis has reached a solid full-year 2020 performance of 1%
growth in local currencies, outperforming the market. The adjusted EBITDA
margin increased to 16% compared to 15% year on year, thanks to cost
discipline while continuing to invest in growth initiatives. The Board of
Directors will propose Marco Gadola for election as the new Chairman of the
Board of Directors at the next Annual General Meeting on 23 April 2021. Dr.
h.c. Thomas Straumann will assume the role of Vice Chairman.

Medartis will today hold a telephone conference (in English) for the media,
analysts and investors at 10:00 CET.

  CHFm           2019        2019         2020        2020       Change
              (reported) (adjusted)(1- (reported) (adjusted)(- (adjusted)
                               )                       2)
  Sales         130.1        130.1       124.7       124.7        -4%
  Sales at                               131.2       131.2        +1%
  constant
  currencie-
  s*
  Gross         111.3        110.6       103.5       103.5        -6%
  profit
  Opex          103.9        103.6        99.7        97.5        -6%
  Operating      7.4          7.0         3.8         6.0         -9%
  profit
  (EBIT)
  EBIT            6%          5%           3%          5%         0pp
  margin
  EBITDA         20.3        20.0         19.7        20.2        +1%
  EBITDA at                               21.8        22.4        +12%
  constant
  currencie-
  s*
  EBITDA         16%          15%         16%         16%         +1pp
  margin
  EBITDA                                  17%         17%         +2pp
  margin at
  constant
  currencie-
  s*

  Headcount      609          609         636         636         +4%
(1) Excluding a provision for possible price and commission agreements in
Brazil of CHF 3.0 million and excluding positive effect from pension fund
plan amendment of CHF 3.4 million.

(2) Excluding extraordinary impairment on intangible assets of CHF 1.7
million and additional inventory provisions of CHF 0.6 million.

* Alternative Performance Measure: Due to the latest economic developments,
several currencies in which we also operate (mainly EUR, USD, AUD and BRL)
have lost value compared to our reporting currency (CHF). We therefore show
"at constant currencies" performance measures, calculated with a consistent
currency FX rate for 2019 and 2020 (2019 monthly FX rates applied to 2020
figures), whereby Cost of Goods Sold is primarily production costs incurred
in CHF. These alternative performance measures are only shown for the
full-year 2020 and not for the full-year 2019, as the sole reason for these
alternative performance measures is to show the operating performance in
2020 with no major FX influence, which only existed for the period under
review.

Medartis generated total sales of CHF 124.7 million in 2020 with growth of
1% in local currencies, thus outperforming overall market growth. Following
the lifting of the first Covid-19-related lockdown measures in spring,
Medartis was well prepared to ramp up its business again, and its direct
markets with own subsidiaries returned to 13% growth in local currencies in
the second half of the year. Overall, sales increased by 9% in local
currencies in the second half of 2020, despite a slow-down in the fourth
quarter. Reflecting a focus of resources on markets less affected by the
pandemic, the sales increase in the second half of the year was in
particular driven by the US subsidiary with 18% growth, by the APAC region
with 23% growth and within the EMEA region by the German-speaking countries
Switzerland, Germany and Austria, with growth of 12%, each in local
currencies. Performance in the LATAM region and in global distributor
markets continued to be affected by the pandemic and the related restraint
with regard to investments in the second half of the year.

Operating expenses decreased by 4% to CHF 99.7 million in 2020. Adjusted for
extraordinary impairment on intangible assets of CHF 1.7 million and
additional inventory provisions of CHF 0.6 million, operating expenses
decreased by 6% compared to adjusted operating expenses in the prior year.
Year on year, headcount increased moderately by 27 positions to 636
employees, 15 of which were filled in the second half of the year. Although
Medartis pursued strict cost management in the context of the pandemic and
took early cost-saving measures, the company continued to invest in its
strategic growth initiatives. The organization was strengthened,
particularly in the US market, where further development and expansion
remain a top priority. As planned, the product portfolio was expanded in all
three business segments with the market launch of five innovative product
systems.

Profitability at EBITDA level amounted to CHF 19.7 million, compared to CHF
20.3 million in 2019; the EBITDA margin remained unchanged at 16% compared
to 2019. The adjusted EBITDA reached CHF 20.2 million versus CHF 20.0
million in 2019, and the adjusted EBITDA margin increased to 16% compared to
15% in the previous year.

The EBIT was CHF 3.8 million, compared to CHF 7.4 million in the previous
year. The adjusted EBIT was CHF 6.0 million versus CHF 7.0 million. Compared
to the net profit of CHF 2.1 million in 2019, the net loss for the period
under review was CHF 0.9 million. On an adjusted basis, net profit was CHF
0.9 million compared to CHF 1.8 million in 2019.

In addition to the pandemic, 2020 was also impacted by a significant
strengthening of the Swiss franc. On a CHF basis, Medartis reported a 4%
decline in sales compared to the prior year, in particular reflecting the
currency developments against the US dollar, the euro, the Australian dollar
and the Brazilian real. Net profit was impacted by total currency losses of
CHF 5.4 million (2019: CHF 2.4 million). Cash flow from operating activities
was CHF 12.6 million, compared to CHF 9.0 million in 2019.

Christoph Brönnimann, CEO of Medartis: "Given the unforeseen challenges last
year, we have reached a solid 2020 performance of 1% growth in local
currencies. Following the lifting of the initial pandemic-related lockdown
measures in spring, we were well prepared to recover our business and
achieved strong growth rates in the second half of the year, particularly in
the US, APAC and the DACH region. While mitigating the impact of the
pandemic, we have refined our strategic framework and made significant
progress in implementing our strategic priorities to better target regional
growth opportunities and advance our innovation pipeline. The strategic
investment in KeriMedical and the launch of our digital planning and 3D
printing platform CMX underscores our ambition to establish ourselves as a
leading full-range portfolio and solutions provider in the extremities and
head segments. We will consistently pursue this path. I would like to thank
our customers and our teams for their dedication and agility they have
demonstrated throughout the year."

Development by region

                         EMEA APAC LATAM North America Total
    Sales, CHFm
    2020                 68.2 25.4  9.7      21.3      124.7
    2019                 70.3 23.7 14.4      21.7      130.1
    Growth, %
    in CHF               -3%   7%  -33%       -2%        -4%
    in local currencies   0%  12%  -18%       4%         +1%
Medartis' largest region, EMEA, reported growth of 4% in local currencies in
the second half of the year and overall, closed the year at the same sales
level as in the previous year. The German-speaking direct markets achieved
12% sales growth in the second half of the year, while the other direct
markets were slightly hindered by the more restrictive coronavirus measures
that were introduced towards the end of the year. Due to the local pandemic
restrictions, the UK was the only subsidiary that did not recover in the
second half of the year. The distributor markets in the Netherlands,
Finland, Ireland, Norway and Slovenia developed encouragingly. In general,
however, sales development in the distributor markets remained significantly
behind the direct markets due to coronavirus-related restraint with regard
to investments. In Spain, Medartis has started with its own subsidiary
beginning of 2021; during the phase of transferring the distributor
business, sales temporarily declined in the second half of 2020.

North America achieved sales growth of 18% in local currency in the second
half of the year and above 20% growth in the fourth quarter, following a
pandemic-related decline of 10% in the first half of 2020. This resulted in
overall growth of 4% in local currency for the full year. In addition to
strengthening regional management and the sales organization, a strong focus
was placed on expanding the largest segment, wrist, which recorded dynamic
growth in the second half of the year. In addition, growth was supported by
new collaborations with selected distributors. The encouraging acceleration
of growth in the second half of 2020 further emphasizes the significant
potential of the US market for Medartis.

The APAC region delivered growth of 23% in local currencies in the second
half of the year, following a first half that remained at the prior-year
level. The 12% annual growth in local currencies reflects that this market
region was the least affected by the coronavirus impact. The subsidiary in
Australia, Medartis' strongest market in the region in terms of sales,
reported excellent performance of 27% sales growth in local currency in the
second half of the year. The new lower extremity subsidiary in Japan
performed well, and the distributor markets in South Korea, Thailand and
Japan for upper extremities also developed positively. In China,
distribution activities were launched as planned in the fourth quarter of
2020.

LATAM recorded a decline in sales in the second half of the year (-9% in
local currencies) and reported a loss in sales of 18% in local currencies
for the full year. Overall, the subsidiaries in Brazil and Mexico remained
below the previous year's sales levels, although they recorded significant
growth in the fourth quarter compared to the prior-year period. In the Costa
Rican distribution market, Medartis won a major hospital tender. In the
distribution markets Argentina, Chile and Colombia, sales were strongly
affected by the difficult economic environment combined with the pandemic.

Development by business segments

                            Upper       Lower    CMF and Total
                         Extremities Extremities Others
    Sales, CHFm
    2020                    89.2        18.8      16.6   124.7
    2019                    92.6        18.3      19.2   130.1
    Growth, %
    in CHF                   -4%         +3%      -13%     -4%
    in local currencies      +1%         +8%       -8%     +1%
Unplanned operations in trauma remained unrestricted in 2020, case numbers
nonetheless declined due to mobility restrictions for large segments of the
population - for example, fewer sports-related accidents were recorded.
Although the postponement of elective procedures due to lockdown measures to
contain the coronavirus pandemic negatively impacted sales, particularly in
April and May, the negative effect was less pronounced than initially
expected over the whole year, despite renewed lockdowns towards the end of
the year.

The largest segment, Upper Extremities, which has the highest proportion of
trauma cases, achieved 8% growth in the second half of 2020, compared to a
5% decline in sales in the first half in local currencies (full year 2020:
+1% in local currencies). Growth momentum was achieved in the largest area,
wrist. In elbow, double-digit growth for the full year was reported despite
Covid-19, thanks to a training and sales initiative. As planned, Medartis
introduced the wrist spanning plates, initially developed for the US market,
in Europe and APAC in June. It launched a forearm fracture system, also in
June, and a clavicle system in September. Thanks also to good preparation
during the initial lockdown phase, the planned sales of these newly launched
products were significantly exceeded. With these additions, Medartis has
further complemented its plates and screws portfolio in the upper
extremities.

Lower Extremities, the newest business segment with the strongest growth
potential for Medartis and with a higher proportion of elective procedures,
recorded growth of 21% in the second half of the year after a decline in
growth of 4% in local currencies in the first half (full year 2020: +8% in
local currencies). The addition to the cannulated compression screw
portfolio, developed in a period of five months, was launched in June as
planned and reached expected sales in the second half of the year. However,
due to the lack of elective cases, it was decided to postpone the launch of
the two systems for midfoot and hindfoot corrections and fractures of the
lower tibia and fibula until the first half of 2021.

The CMF and Others segment, which comprises solutions for the
craniomaxillofacial region as well as instruments and containers, was most
affected by the impact of the coronavirus pandemic. Sales growth in the
second half of the year was 3%, following an 19% decline in local currencies
in the first half (full year: -8% in local currencies). The shift in
elective procedures had the most significant impact on sales in CMF because
of its high proportion thereof; for the full year, sales for elective
procedures were down by around a quarter compared to the previous year. In
April, the new MODUS 2 product generation was launched in DACH as planned.
In addition, the CMX digital planning and 3D printing platform for
mandibular correction and fixation was introduced, and the first cases with
patient-specific cutting guides and plates were performed in Germany and
Switzerland.

Substantial progress made in growth initiatives
In 2020, Medartis made substantial progress in implementing the program
initiated in early 2020 to accelerate growth with the priorities of sales
focus on regional needs, building the US business and advancing the
innovation pipeline.

In the US business, important cornerstones for the further acceleration of
growth were implemented in 2020. An experienced management team has been
established, led by Lisa Thompson, a member of Medartis' Executive
Management Board and President of North America since April 2020. Also in
the US market, the reallocation of regional sales territories to leverage
more sales potential has been completed, and a new growth-oriented incentive
system is being implemented.

Medartis demonstrated its innovative strength last year with the launch of
five different innovative product systems. This further complemented the
Medartis portfolio for plates and screws in the upper and lower extremities
as well as in CMF. In order to exploit further market potential in the
underserved market of small joint replacement in upper extremities, Medartis
has acquired a minority share position in KeriMedical, a specialist for
innovative implant solutions in the hand and wrist segment. KeriMedical has
developed new standards in patient treatment, particularly in the treatment
of osteoarthritis of the hand, which affects around 60 million people in
Europe and the US. With KeriMedical's complementary offering, Medartis
provides physicians with a comprehensive product portfolio in the hand and
wrist segment, improving competitiveness and growth potential, particularly
in the US.

Clear strategic direction
Medartis further refined its strategic direction in 2020 to support surgeons
as a provider of complete solutions in the areas of extremities and head and
to further accelerate growth. With this goal, Medartis is pursuing a growth
strategy based on three pillars:

  * Comprehensive product portfolio: The focus lies on the further
    completion of the plates and screws portfolio, aligned to regional
    needs, as well as the selective entry into new technologies such as
    small joint replacement and soft tissue management. The aim is to offer
    surgeons a comprehensive implant portfolio that covers all of their
    indication needs.

  * Solutions provider: With the launch of our CMX platform, Medartis has
    entered the market for digital surgical planning, and patient-specific
    implants and instruments. Complementing the implants portfolio, Medartis
    will drive the expansion of the CMX platform and other individualized
    solutions and services to improve patient outcomes, shorten surgery time
    and reduce inventory.

  * Geographical expansion: The top priority continues to be US market
    penetration and expansion. The focus also remains on consistently
    gaining market share in our key markets in Europe and APAC, and we will
    selectively expand our global footprint in distributors' markets. In the
    medium term, new direct markets such as Spain are also expected to
    contribute to growth.

Outlook
In the long term, Medartis sees no structural impact from the pandemic on
market potential. In the first two months in 2021, Medartis experienced a
positive sales momentum in line with expectations. For the full year 2021,
Medartis targets a sales growth of at least 15% in local currencies and
stable EBITDA margins - subject to any unforeseen events, specifically from
Covid-19.

Change of Chairman of the Board of Directors
Dr. h.c. Thomas Straumann, who founded Medartis in 1997, has decided to hand
over the leadership of the Board of Directors after having served as its
Chairman for 23 years. The Board of Directors of Medartis will therefore
propose Marco Gadola, Member of the Board of Directors since 2020, for
election as Chairman of the Board of Directors at the Annual General Meeting
on 23 April 2021. Dr. h.c. Thomas Straumann will remain committed to
Medartis and will stand for re-election as a member of the Board of
Directors, where he will assume the role of Vice Chairman.

Dr. h.c. Thomas Straumann, Chairman of the Board of Directors of Medartis:
"I have always considered it a great privilege to lead Medartis on its
growth path as Founder and Chairman, and I would like to thank you for the
trust you have placed in me. Today - 23 years after its foundation and three
years after our IPO in 2018 - Medartis has a very solid foundation that it
can build on to realize further market opportunities. This is the right time
for me to hand over the chairmanship. Marco Gadola has proven expertise in
the international medical devices market, strong business acumen and
strategic foresight, which he also demonstrated in his previous position as
CEO and, since 2020, as a member of the Board of Directors of the Straumann
Group. He is therefore the ideal candidate to lead Medartis to further
growth. I wish Marco all the best and much success in his future role at our
company. I will remain committed to Medartis in the long term as a
significant shareholder and a member of the Board of Directors, where I will
in future act as Vice Chairman - a set-up which has also proven very
valuable at the Straumann Group."

Documents 2020 full-year results
The following documents pertaining to the 2020 full-year results are
available online:

Press release full-year 2020 results

Presentation full-year 2020 results

Full-year report 2020

Telephone conference for the media, analysts and investors (in English)
Date: Wednesday, 10 March 2021
Time: 10:00 CET
Speakers: Christoph Brönnimann, CEO; Dominique Leutwyler, CFO
Participant's Link:
Telephone conference full-year 2020 results

Participants may call the following numbers, 10-15 minutes before the
conference start:
Switzerland/Europe [phone], UK [phone], US +1 (1)
631 570 56 13
For other international numbers please see media.choruscall.ch

Financial calendar
23 April 2021 Annual General Meeting
17 August 2021 Publication of 2021 half-year results
08 March 2022 Publication of 2021 full-year results

Contact
Patrick Christ
Head Corporate Services
Medartis Holding AG
Phone: [phone]
[e-mail]

About Medartis
Founded in 1997 and headquartered in Basel, Switzerland, Medartis is one of
the world's leading manufacturers and providers of medical devices for
surgical fixation of bone fractures for upper and lower extremities as well
as for the craniomaxillofacial region. Medartis employs over 640 individuals
across its 14 locations, with products offered in over 50 countries
globally. Medartis is committed to providing surgeons and operating theatre
personnel with the most innovative titanium implants and instruments as well
as best in class service. For more information, please visit
www.medartis.com.

Disclaimer
This communication does not constitute an offer or invitation to subscribe
for or purchase any securities of Medartis Holding AG. This publication may
contain certain forward-looking statements and assessments or intentions
concerning the company and its business. Such statements involve certain
risks, uncertainties and other factors which could cause the actual results,
financial condition, performance or achievements of the company to be
materially different from those expressed or implied by such statements.
Readers should therefore not place reliance on these statements,
particularly not in connection with any contract or investment decision. The
company disclaims any obligation to update these forward-looking statements,
assessments or intentions. Further, neither the company nor any of its
directors, officers, employees, agents, counsel or advisers nor any other
person makes any representation or warranty, express or implied, as to, and
accordingly no reliance should be placed on, the accuracy or completeness of
the information contained herein or of the views given or implied.


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End of ad hoc announcement

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   Language:       English
   Company:        Medartis Holding AG
                   Hochbergerstrasse 60E
                   4057 Basel
                   Switzerland
   Phone:          [phone]
   Fax:            [phone]
   E-mail:         [e-mail]
   Internet:       www.medartis.com
   ISIN:           CH0386200239
   Valor:          38620023
   Listed:         SIX Swiss Exchange
   EQS News ID:    1174220



   End of Announcement    EQS Group News Service
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1174220 10-March-2021 CET/CEST

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