Release Date: March 20, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Ion Beam Applications SA (IOBCF, Financial) reported a record revenue of EUR498 million for 2024, marking a 7% increase from 2023.
- The company returned to profitability in 2024 with a net result of EUR9.3 million, an improvement of EUR18 million compared to the previous year.
- Order intake for 2024 was strong at EUR321 million, driven by the sale of 33 Other Accelerators systems and 5 Proton Therapy systems.
- The backlog remains at a record high of EUR1.5 billion, providing significant visibility into future revenue.
- Ion Beam Applications SA (IOBCF) continues to invest in future growth, exemplified by the PanTera joint venture securing important funding for actinium-225 production.
Negative Points
- The application of IFRS15 for revenue recognition led to a decrease in gross margin and REBIT's margin percentage.
- Proton Therapy equipment revenues declined by 4% due to the cycle of backlog conversion.
- Dosimetry REBIT declined due to delayed acquisition synergies from RadCal and challenges in the Chinese market.
- The company experienced a loss of EUR12 million in Proton Therapy REBIT for 2024 under the new segment reporting.
- Working capital was temporarily impacted by the Spanish Ministry of Health contracts, affecting cash position.
Q & A Highlights
Q: Can you explain the significant losses in Proton Therapy for 2024 and the expected margin by 2028?
A: Olivier Legrain, CEO: The losses were anticipated due to executing orders taken in a competitive environment with lower margins. However, all orders have positive gross margins. We are investing in service productivity and competitive positioning. We expect Proton Therapy to return to profitability in 2025, with margins normalizing by 2028, similar to Other Accelerators.
Q: What is the sustainability of the high margins achieved in Other Accelerators?
A: Henri Romree, Deputy CEO: The 2024 margins are within the range of what can be expected long-term. We will continue to invest in R&D for next-generation machines and chemistry, but the REBIT margins observed in 2024 are sustainable.
Q: Why was the 2026 guidance dropped, and what should we expect for 2025?
A: Olivier Legrain, CEO: The guidance was updated to reflect increased R&D investments in Proton Therapy and nuclear medicine, driven by new clinical evidence and market opportunities. The 2025 guidance of at least EUR25 million REBIT is a conservative anchor point, with expectations to exceed it.
Q: How does the new reporting system impact the postponement of the 10% REBIT margin guidance?
A: Thomas Pevenage, Head of Investor Relations: The impact of the new reporting methodology on the updated guidance is minor. The main drivers for revisiting the guidance are strategic investments in R&D and market access.
Q: How confident are you in reaching a 10% REBIT margin by 2028?
A: Olivier Legrain, CEO: We are confident in reaching the 10% margin by 2028, supported by strategic investments in R&D and market access. If necessary, we can adjust costs to maintain the trajectory.
Q: What is the growth potential for IBA after the Ortega contract delivery?
A: Olivier Legrain, CEO: The 5% to 7% sales CAGR guidance includes the impact of the Ortega contract. We expect continued growth in Proton Therapy and Other Accelerators, supported by service revenue and new deals.
Q: How will clinical evidence impact the Proton Therapy market and reimbursement?
A: Olivier Legrain, CEO: Clinical evidence, such as the MD Anderson study, demonstrates the benefits of Proton Therapy, potentially influencing reimbursement policies and expanding the addressable market. More studies are expected to support this trend.
Q: What are the expectations for free cash flow, CapEx, and working capital in 2025?
A: Thomas Pevenage, Head of Investor Relations: CapEx will be in line with previous years. Working capital will be impacted by the Spanish contracts, with a reversal expected in 2026 as deliveries accelerate. We maintain strong cash discipline and have unused credit lines for short-term needs.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
