Weak results in the U.S. and in emerging markets contributed to a below-expectations performance for radiation oncology firm Elekta in its 2014/2015 fiscal year.
For the period, Elekta had net sales of 10.84 billion Swedish kronor (1.15 billion euros), up 1% on a nominal basis and down 8% on a currency-equivalent basis from the 10.69 billion Swedish kronor (1.14 billion euros) reported in the 2013/2014 fiscal year. The company posted net income of 558 million Swedish kronor (59.3 million euros), down from 1.2 billion Swedish kronor (122.4 million euros) a year ago.
In response to the financial performance, Elekta said it has launched a comprehensive action aimed at returning to growth, improving profitability, reducing costs, and continuing to focus on cash flow. For example, actions have been initiated in the U.S. market to address both growth and profitability, according to the vendor. Elekta also noted that results were also below expectations in some emerging markets due to weak market conditions, political developments, war, and civil unrest. However, the company said it believes that although market growth has been lower the last couple of years, the overall demand and underlying medical need for radiation therapy remain healthy.
Earlier in May, Elekta announced that former president and CEO Tomas Puusepp would replace Niklas Savander as CEO. As part of its action program, Elekta said it has also made a number of other changes to its organization. Chief Commercial Officer Ian Alexander will now manage all global sales, marketing, service, and customer support activities. This new commercial organization will focus on improving customer service and support, as well as strengthening Elekta's global reach and brand, the company said.
In addition, COO Johan Sedihn will be managing all products and solutions, Elekta said. He will be responsible for the competiveness of the company's products and solutions, research and development, manufacturing and supply chain management, as well as improving operational effectiveness and cost-efficiency.
Elekta also said Executive Vice President for Asia Pacific Gilbert Wai and Executive Vice President of North America Jay Hoey have resigned as members of the executive management team. Hoey will take on a new position as head of external relations, Elekta said.