Sorin presents to the financial community its 2005-2009 strategic plan
Sorin presents to the financial community its 2005-2009 strategic plan
Drago Cerchiari, Sorin's Chief Executive Officer, presented today to the financial community the guidelines of the Group's 2005-2009 Strategic Plan.
The Plan's objective is to maximize shareholder value over the next five years by:
Posting double-digit revenue growth: +12% annual average to about €1.3 billion;
Doubling profitability: EBITDA to 20%;
Continuing to strengthen the Group's leadership position in Cardiac Surgery;
Expanding quickly in the fastest growing segments of the cardiovascular market: Cardiac Rhythm Management and Vascular Therapy;
Expanding in Europe, strengthening significantly the U.S. and Japanese operations;
Cutting costs and improving efficiency: industrial restructuring and operational reorganization programs already under way;
Continuing to focus on innovation and research.
The 2005 budget calls for revenue to grow by more than 8% and EBITDA to increase by over 30% (compared with 2004 on a comparable foreign translation exchange basis).
Milan, March 1, 2005 – Drago Cerchiari, Sorin's Chief Executive Officer, and his management team presented today to the financial community the guidelines of the Group's 2005-2009 Strategic Plan.
The five-year plan, which is focused on maximizing shareholder value, calls for a significant increase in worldwide revenues from cardiovascular medical technologies and a sharp rise in profitability.
The Plan's objectives are based on the following assumptions:
Average annual revenue growth of 12%, with revenues rising from the current €723 million to about €1.3 billion by 2009;
Doubling of profitability, with EBITDA growing to more than €260 million by 2009 (from 9.4% of revenues in 2004 to about 20% of revenues in 2009) and EBIT increasing to about 15% of revenues within five years;
Further strengthening of the Group's leadership position in all of the segments of the Cardiac Surgery market in which it operates;
Rapid revenue increases, particularly in the Cardiac Rhythm Management (implantable devices to treat arrhythmias) and Vascular Therapy (drug-eluting and bare-metal coronary stents, endovascular stents and catheters for angioplasty), which are expected to account for 40% and 12% of Group revenues, respectively, by 2009;
Continuing geographic expansion in Europe, the United States and Japan, with these markets expected to account for 40% of Group revenues by 2009;
Implementation of industrial restructuring and operational reorganization programs, which are expected to provide significant benefits as early as 2006.
Major revenue growth and an increase in profitability will be achieved through a program designed to transform Sorin from a key player in the cardiac surgery segment into a world leader of the broader cardiovascular market.
The key aspects of the growth strategy that is being presented by management are:
Cardiac Surgery: Reinforce the Group's leadership position by consolidating its already strong presence in all major market segments (cardiac valves, cardiopulmonary and autologous transfusion systems) and continue to develop nnovative products for the fastest growing segments of the market, such as cardiac alves that can be implanted percutaneously with minimally invasive procedures.
The Plan also calls for the implementation of programs to help the Group to become cost leader in its industry and thus achieve continuous and further improvements in the profitability of its businesses through a streamlined manufacturing oganization.
Cardiac Rhythm Management: Grow from a Group with a solid market position in Europe, particularly in the bradycardial segment (pacemakers), into the acknowledged leader of the cardiac stimulation market. The Plan calls for doubledigit growth and market shares increases, both in Europe and the United States, achieved by leveraging the Group's major strength in the pacemaker segment, by introducing quickly innovative defibrillators and resynchronizers for the treatment of heart failure (CRT-D) and, in general, by launching highly innovative therapies such as AAIsafeR, a sophisticated algorithm that can be used to preserve the heart's spontaneous atrioventricular conductivity.
Vascular Therapy: Rapid penetration of the drug-eluting stent market, with the goal of achieving a leadership position in the vascular therapy field by developing and marketing systems on the cutting edge of technology. The Plan calls for strong growth made possible by exploiting the full potential of Janus, a next-generation drug-eluting stent, and by developing new stent platforms and delivery systems.
The objectives of the 2005 budget include revenue growth of more than 8% (on a comparable foreign exchange translation basis) and EBITDA growth of more than 30% compared with 2004.
The data of the Janus extended clinical trial (Jupiter II) will be published before the end of the third quarter of 2005. In addition, the launch of the first adult oxygenator developed by integrating the best technologies available through Cobe CV (USA) and Dideco (Italy) is scheduled for second quarter of 2005. With this product, the Group will introduce a best-inclass oxygenator, while at the same time beginning the process of streamlining its manufacturing organization.
In the CRM segment, the FDA approval needed to begin marketing the Symphony (AAIsafeR) pacemaker in the United States is expected in the second quarter of 2005. The launch of this new product, coupled with the introduction of a new line, Ovatio, of defibrillators and CRT-Ds will provide significant growth momentum.
The strategic plan defined by the management team of the Sorin Group is strongly oriented toward delivering sustained revenue growth and a rapid improvement in profitability in all lines of business, achieved also by balancing more effectively the Group's geographic presence in the United States and Japan.
"The Sorin Group stands for excellence in innovation in the European market for cardiovascular therapies. The high-tech projects that are already under way will enable us to maintain and strengthen our leadership position over the length of our Strategic Plan, not only in the field of Cardiac Surgery, but also in such high growth segments as Cardiac Rhythm Management and Vascular Therapy," said Drago Cerchiari, Sorin's Chief Executive Officer.
The Sorin Group (Reuters code: SORN.MI), a world leader in the development of medical technologies for cardiac surgery, offers innovative therapies for cardiac rhythm dysfunctions, interventional cardiology and the treatment of chronic kidney diseases. The companies of the Sorin Group are: Dideco, CarboMedics, COBE Cardiovascular, Stöckert, Mitroflow, ELA Medical, Sorin, Sorin Biomedica, Bellco, Soludia and SorinLifeWatch. The Sorin Group has about 4,800 employees working at facilities in more than 80 countries throughout the world to serve over 5,000 public and private treatment centers.
For additional information, please visit our website: www.sorin.com
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