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LISI 2011 —
28
— financial report
Financial situation
In 2012, this industrial strategy will create additional islets including
in particular the creation of a dedicated unit for implantable plastics to
meet the spine market's requirements.
LISI MEDICAL settles in a new building in Tangier (Morocco)
On the 5,000m² of this new site in the Tangier Free Zone, LISI MEDICAL
acquires the necessary infrastructure to support its growth and offer
its customers a competitive offering for emerging markets.
This building will also host a manufacturing workshop for LISI
AEROSPACE which uses the same technology.
This unique project in the LISI Group opens the way for new synergies
between divisions.
Optimization and diversification of LISI MEDICAL Fasteners US
The year 2011 marks the recovery of the North American site whose
market share increased sharply with the major players in the industry.
Meanwhile the product portfolio has been diversified to limit
exposure to fluctuations in the dental market.
Different Kaizen sites (5S SMED) continued and significant efforts were
undertaken to improve the flexibility of the production means, the
versatility and multiple skills of the teams.
Comments on earnings
In € million
2011
2010**
Change
Sales revenue
74.0
42.7
+73.3%
EBIT
5.5
2.1
+157.7%
Operating cash flow
5.5
5.0
+10.0%
Net CAPEX
-4.2
-2.6
+61.9%
Registered employees at period end
508
483
+5.2%
Full time equivalent head count*
596
338
+76.3%
* Including temporary employees
** LISI MEDICAL Orthopaedics consolidated over four months.
LISI MEDICAL published for the first time in 2011 its results as a division
of the LISI Group in its own right. The year 2010 is not comparable as
it only included four months of LISI MEDICAL Orthopaedics business
activity.
The 16.8% decline of sales revenue on a like-for-like and constant
exchange rate basis is due to the cyclical adjustment that continued
throughout fiscal 2011. At €74.0m, the sales revenue incorporating
12 months of LISI MEDICAL Orthopaedics activities, ranks the division
among the world's leading medical implant outsourcers.
The division's contribution is in line with the Group's average operating
profit. However, it is affected by the underperformance of LISI
MEDICAL Fasteners (Neyron) and an accounting adjustment related to
inventory valuation for €1.8m.
Industrial CAPEX were significant at €4.2 million and mainly focused
on LISI MEDICAL Orthopaedics: they concerned in particular the launch
of new products and the integration of processes that were previously
outsourced. Cash flow and good management of working capital
enable to achieve a positive gross operating surplus ("Free Cash Flow")
(€4.1m).
OUTLOOK
Themarket potential and attractiveness of LISI MEDICAL are significant
in the demandingmarket of implant subcontracting. LISI MEDICAL also
intends to seize the opportunities created by regulatory changes to
impose its strategic differentiation to its customers.
The integration strategy of LISI MEDICAL Orthopaedics should help
it win new business and expand its customer base. The division's
improved performance is a goal shared by the teams across all sites.