Sectra shares jump on strong earnings

Investing.com -- Shares of Sectra AB (ST:SECTb ) jumped on Friday following its first-quarter earnings report. The company reported a 44% surge in operating profit, to SEK 99.8 million, from SEK 69.3 million in the same period last year. 

At 6:27 am (1027 GMT), Sectra AB was trading 7.7% higher at SEK 261.80.

This growth reflected an improved operating margin of 13.8%, up from 11.9% in the previous year. 

The profit for the period also saw an increase, amounting to SEK 80.4 million, up from SEK 61.6 million.

Sectra's net sales for the first quarter rose by 24%, to SEK 723.8 million compared to SEK 583.7 million in the previous year. 

This increase in net sales was supported by a 21.4% rise in recurring revenue, which amounted to SEK 482.3 million, and a 42.1% jump in cloud recurring revenue, reaching SEK 122.8 million.

However, the company reported a 79.3% decrease in contracted order bookings to SEK 615.0 million, of which SEK 543.1 million were guaranteed bookings. 

The reduction in contracted order bookings is balanced by an improved distribution of revenue and growing recurring revenue streams, which have contributed to the company's overall financial health.

““The first quarter was dominated by deliveries of previously ordered customer projects. Additional hospitals have gone live with our cloud-based services for medical imaging and we have delivered several products for secure communication to defense forces and authorities,” said Sectra’s chief executive, Torbjörn Kronander.

Cash flow from operations, however, showed a negative SEK 56.7 million, though this figure represents an improvement from the previous year's SEK -98.3 million.

Source: Investing.com