BioTech

Medical equipment group Elekta beats profit expectations

Swedish radiation therapy equipment maker Elekta reported a bigger than expected first-quarter profit on Wednesday, citing improved profitability even as sales declined because of the COVID-19 pandemic.

Profitability improved

Restrictions hampered sales, orders

Adds detail, background

STOCKHOLM, Aug 26 (Reuters) - Swedish radiation therapy equipment maker Elekta EKTAb.ST reported a bigger than expected first-quarter profit on Wednesday, citing improved profitability even as sales declined because of the COVID-19 pandemic.

Operating profit jumped 42% from a year earlier to 335 million crowns ($38.2 million) despite a 5% sales drop to 2.98 billion crowns. Four analysts polled by Refinitiv had on average forecast a profit of 172 million crowns.

The operating profit before amortisation, which is closely watched by investors, widened to 18.5% from 13.9%.

Elekta, which is looking for a new chief executive after the CEO's unexpected resignation in June, said sales were still affected by restrictions leading to delayed installations and so far only China had returned to a normal level of installation.

Order intake, too, was hampered by the pandemic but grew 4%.

"A key driver was the GenesisCare partnership, which enabled us to show strong growth in the U.S. market," acting CEO Gustaf Salford said on the order intake.

"Most other regions experienced a large decline in order volumes, especially EMEA, where large parts of the healthcare systems were focusing on dealing with the pandemic."

The rival of U.S group Varian Medical Systems VAR.N said it booked several orders for its new radiation therapy system Unity in the quarter.

Unity received clearance in China this month.

($1 = 8.7668 Swedish crowns)

(Reporting by Anna Ringstrom Editing by David Goodman)

((anna.ringstrom@thomsonreuters.com; +46 8 502 423 74; Reuters Messaging: anna.ringstrom.thomsonreuters.com@reuters.net))

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