Medical technology company benefits from currency effects / Earnings impacted by special effects

Carl Zeiss Meditec AG looks back on another positive fiscal year: boosted by positive currency effects, the medical technology company's revenue passed the billion mark in fiscal year 2014/15, with a 14 percent increase to € 1,040 million. Adjusted for currency effects, this equates to growth of around 8 percent over the prior year. Earnings before interest and taxes (EBIT) increased by 8 percent, to € 130.6 million (prior year: € 120.7 million). The EBIT margin of 12.6 percent (prior year: 13.3 percent) was impacted by additional strategic investments in research and development. Adjusted for these additional investments, the EBIT margin would have been at at 13.8 percent and thus at the same level as in the prior year - also thanks to the positive currency effect on operating result (prior year: 13.7 percent). The Company's growth was attributable – to varying degrees – to all three business units and global regions.

"A strong fourth quarter and tailwind from the exchange rates of major currencies supported the good operating result. In contrast to the positive currency effects on operating result, we had to accept charges from currency hedging and write-downs in the financial result," says Dr. Ludwin Monz, President and CEO of Carl Zeiss Meditec AG.

Key figures by business unit at a glance

Once again, the strategic business unit (SBU) Surgical Ophthalmology achieved the strongest growth in the fiscal year. Revenue increased by 22.5 percent (adjusted for currency effects 19.0 percent), to € 355.3 million (prior year: € 290.0 million). Business was driven both by good demand for intraocular lenses and consumables for cataract surgery and for surgical workstations for ophthalmology. 

Revenue of the Ophthalmic Systems SBU increased by 12.2 percent (adjusted for currency effects, 3.9 percent), to € 392.0 million (prior year: € 349.3 million). As in the previous quarters, the area of diagnostics suffered from price and competitive pressure, while the refractive laser business for the correction of vision defects, including per-procedure business in this segment, performed very well. 

The Microsurgery SBU benefited significantly from currency effects in the reporting period, with revenue growth of 8.5 percent, to € 292.8 million (prior year: € 270.0 million). After adjustment, this growth would equate to 2.7 percent. Business in Japan, in particular, which is especially important for this business unit, declined compared with a strong figure in the prior year. 

Revenue by region

The Company's revenue was boosted by growth in all three of its global regions; however, after adjustment for currency effects, the highest growth rate was once again recorded in the Asia/Pacific region. 

The development of the individual markets in the region Europe, Middle East and Africa (EMEA) region was heterogeneous. Germany and the UK were the main growth drivers, with a revenue increase of 9.4 percent, to € 358.8 million. Bolstered by the strong dollar, revenue in the Americas region increased by 21.9 percent, to € 361.9 million Adjusted for currency effects, this region grew by 6.0 percent. At € 319.4 million, revenue in the Asia/Pacific (APAC) region was up by 12.3 percent year-on-year (adjusted for currency effects: 10.1 percent). High growth rates in China and India more than compensated in this region for a downturn in the Japanese market.

The Company's financial result was curbed by non-operating effects: due to the current strength of the dollar against the euro, currency hedging costs impacted earnings per share just as much as charges from strategic investments. Earnings per share (EPS) decreased accordingly by around 17 percent compared with the prior year.

"We are satisfied with the results for the fiscal year. In spite of a difficult market environment, we once again succeeded in winning market shares in a number of markets," says Ludwin Monz. According to Dr. Monz, the Company can be expected to grow at least as fast as the underlying markets in the coming fiscal year – with an EBIT margin that should be within the range of 13-15 percent in 2015/16 and in the medium term. 

Revenue by strategic business unit

Revenue by region