Sectra had net sales of 224.9 million Swedish kronor ($26.9 million U.S.), up 5.9% from the 212.4 million Swedish kronor ($25.3 million U.S.) reported in the same period a year ago. However, net sales would have increased 14.7% if a nonrecurring item of 16.3 million Swedish kronor ($1.9 million U.S.) for a patent sale in the first quarter last year was excluded.
The company reported operating profit of 31.4 million Swedish kronor ($3.7 million U.S.), down from 40.5 million Swedish kronor ($4.8 million U.S.) last year. Operating profit would have risen 29.8% without the nonrecurring item from the previous quarter.
Sectra President and CEO Torbjörn Kronander, PhD, said in a statement that the quarterly improvement was partly attributable to the large number of long-term contracts the company has signed in recent years. These contracts are helping to counterbalance seasonal variations in net sales. He also said that new and additional sales are contributing to increased order bookings in the company's Imaging IT Solutions business in several markets, including the U.S. where it is intensifying its growth initiatives.
While order bookings remained favorable and well above the firm's net sales, they did decline compared with the first quarter of last year, according to Kronander. As anticipated, order bookings in the U.K. -- where the firm's order bookings had increased the most in the last fiscal year -- were not as high.
Kronander also noted that long-term managed-services agreements, while somewhat reducing net sales variability between quarters, can increase variability in order bookings. Sectra recognizes the entire order amount when a five-year managed-services contract is signed, for example, but distributes the sales results over the duration of the agreement as the systems are implemented.
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