2013-08-20 07:04:02 -
Turnaround concept "Fit for Future" concluded, implementation already started
Cryo-Save Group N.V. (Euronext: CRYO, 'Cryo-Save', or 'the Group'), the
international stem cell storage company and the largest family stem cell bank in
Europe, has published its financial results for the six months ended 30 June
The economy in Cryo-Save's main markets remained depressed during the first half
of 2013. This has significantly stalled new client acquisitions. Cost savings as
announced in 2012 materialized but were not sufficient to offset the bottom line
impact of the slowdown of the revenues. In addition, gross profit margin was
under pressure and declined by increasing collection and transport cost.
Significantly lower revenues (-16%) and gross profit margin pressure resulted in
a gross profit of
€9.8m (1HY 2012: €12.5m). The impact of the 2012 cost savings
programs (€2.0m) was not sufficient to offset this decline in gross profit. In
addition, the operating expenses were impacted by severances (€0.4m) and by
additional legal and consulting expenses (€0.3m). As a result EBITDA ended at
-€0.1m (1 HY 2012: €0.2m, including €0.8m restructuring expenses). The total
number of employees, denominated in full time equivalents, decreased from 259 at
the end of December 2012 to 226 at 30 June 2013.
Ultimo 2012 Cryo-Save started a turnaround to regain profitable growth. During
the first half of 2013 a renowned strategy consultant company was engaged for an
identification of further measures to restore profitability as well as an in-
depth analysis of the Group's strategic objectives for the mid to longer term.
This analysis reconfirms that Cryo-Save is active in a market that holds a
strong future promise as the conditions treatable with stem cells as well as
clinical trial activities are increasing continuously. The organisational
structure will be further adjusted to the appropriate scale and the
effectiveness of the Sales & Marketing operations will be further optimised.
The group will swing back to profitability by year-end based on driving
awareness aimed at the consumer, improving the effectiveness of all sales
channels in combination with strict cost saving programs, improved working
capital management and disposal of loss-making foreign operations. The
turnaround program will lead to a sustainable profitable future and a healthy
upside from the next wave of growth of stem cell therapy. In the mid-term,
management will develop the company towards a multi-service provider in order to
maintain its leadership in this industry.
The Group reached agreement to sell its property in Lyon in August 2013. The
proceeds of the sale (€2.3m) will be added to the cash reserves, since the
property was debt free. The Group recorded an additional non-cash impairment
charge of €0.7m.
The Group had a solid cash position of €5.3 million as at 30 June 2013.
Evi Mattil, Chief Executive Officer a/i, commented:
"This has been a challenging period for Cryo-Save, with no clear signs of
economic recovery in our key markets.
"Our turnaround plan is already underway. We are focussing our strategy to
concentrate more on selling direct to the consumer, are scaling down our cost
base and optimizing our commercial operations to capture the growth
opportunities that we believe the market still holds.
"We expect the swift action we have taken to bring the Group back to
profitability by the end of the year".
Click here for full 1HY 2013 press release:
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Source: Cryo-Save Group N.V. via Thomson Reuters ONE