UNILABS

Unilabs, one of the leading players in the €70bn a year European medical diagnostic market¹ announced today that for the quarter ending 31 March 2015, reported revenue was €167.6m, compared to €155.2m in Q1 2014. The results show a significant and positive organic sales growth of 5.5% (CER†) leading to EBITDA growth vs last year of 12.2%.

Unilabs is a leading supplier of clinical laboratory testing and medical diagnostic imaging services for public and private health services and other customer groups across 11 European markets. Its 125 laboratories provide one of the broadest catalogues of tests and complete 100 million diagnostic tests, over 1.5m medical imaging examinations and close to 5000 IVF procedures each year. The latest laboratory was opened on May 6^th in Oslo and will process 5 million tests each year. It was completed and brought online in less than 3 months following a successful tender process with Helse Sør-Øst.

Jos Lamers, Chief Executive Officer at Unilabs said, “These Q1 results demonstrate a continuation of the positive trend started in Q3 2014 which resulted in our most successful Q4 (2014) to date. With the European market for diagnostics worth €70bn, and the top 5 diagnostic groups sharing less than 5% of the market, there is huge opportunity for consolidation. Now that our three core strategic initiatives around getting the right people and right teams in place, organic growth and cost leadership have clearly started to deliver for the business we are actively assessing targets for acquisition that will enhance our offering in our existing markets or open up new opportunities that fit with our strategy.”

Unilabs Group
€millions		Q1 Reported						Q1 CER
		2014		2015		% change		2015 CER		% change
Revenues		155.2		167.6		8.0%		164.5		6.0%
Adjusted EBITDA		23.4		26.5		13.2%		26.4		12.8%
Adjusted EBITDA margin		15.1%		15.8%		78 bps		16.0%		97 bps

Commenting on the financial performance Chief Financial Officer Karl-Erik Clausen said, “Sales growth has been driven by new customer wins and increases in organic sales in both our Laboratory and Imaging sectors. Strong volume increases in Switzerland and the Nordic countries particularly contributed to the growth which resulted in a gain in market share not driven by price reductions.”

Organic Growth

Due to strategic measures taken in 2014 and further successes at the start of 2015, organic growth in net sales increased by 7.5% (5.5% CER) and EBITDA increased by 12.8% (12.2% CER) compared to Q1 in 2014.

Nine key organic growth initiatives targeted a 5% organic growth rate during 2014 and these have continued to deliver in Q1 2015 with new business being won in all regions. Key results from these initiatives include successfully retendering a contract in Sweden to secure sales of €10m and winning a key new contract in Spain with one of the world’s largest independent renal care providers. Further initiatives in radiology, pathology and specialty testing resulted in strong growth in these divisions.

Cost Savings

The company’s strategic ‘Cost Leadership’ initiative for 2014-16 is forecast to deliver more than €20 million savings by the end of 2015. It successfully achieved its target in 2014 and remains firmly on track after Q1 to deliver group-wide savings as planned. Through a carefully orchestrated program of lab network reduction, consolidation of volumes and productivity improvements, Unilabs has been able to both improve productivity as well as reduce costs more effectively than ever before. Dramatically consolidating IT systems, improving logistics across the group, consolidation of speciality tests in core labs and redesigning entire lab processes has allowed Unilabs to significantly increase speed and improve its service to customers.

Merger and Acquisition Activities

Already this year, Unilabs has acquired a pathology laboratory in France (€6m in annual sales; €1m in EBITDA on annual basis) and financial funds exist to support further M&A activity in 2015. The focus will be on medium sized deals in existing markets but opportunities to add in new markets will also be considered. Criteria have been established and some initial targets identified.

Outlook for Full-Year 2015

Commenting on the goals for 2015 Mr Lamers added, “During 2015 there is huge opportunity for our significantly renewed senior team to drive our unique offering of tailor-made, cost-efficient and reliable diagnostic services to our private and public customers across Europe. We will continue to set ambitious targets for the remainder of 2015 to maintain organic revenue growth at 5%, deliver total costs savings from 2014-15 of €20m and to build our business through targeted acquisitions.”

-ends-

Further investor relations information is available by registering at www.unilabs.com/investors

*EBITDA: Earnings Before Interest, Taxes, Depreciation and Amortization

†CER: Constant Exchange Rates

References

1. Healthcare Europa 2010, external sources, industry surveys and publications 2010 - 2012

Notes to Editors

About Unilabs

Unilabs is one of Europe’s leading providers of clinical laboratory testing and medical diagnostic imaging services to private and public healthcare providers, local governments, insurance companies, pharmaceutical companies and the general public. We operate laboratory and medical diagnostic imaging facilities in 12 countries: Denmark, Finland, France, Italy, Norway, Peru, Portugal, Russia, Spain, Sweden, Switzerland and the United Kingdom. Our network of facilities provides us with one of the broadest geographic footprints of any clinical laboratory and medical diagnostic services provider in Europe. For more information about Unilabs, please visit www.unilabs.com .

Forward Looking Statement

This press release contains various “forward-looking statements” that reflect management’s current view with respect to future events and anticipated financial and operational performance. Forward-looking statements as a general matter are all statements other than statements as to historical fact or present facts or circumstances. The words “aim,” “anticipate,” “assume,” “believe,” “continue,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “may,” “plan,” “potential,” “predict,” “projected,” “risk,” “should,” “will” and similar expressions or the negatives of these expressions are intended to identify forward-looking statements. Other forward-looking statements can be identified in the context in which the statements are made. These forward-looking statements may include, among other things, statements relating to: our future financial position; our strategy and outlook; our liquidity, capital resources and capital expenditure; our planned investments; acquisition opportunities in the markets in which we currently, or may in the future, operate; expectations as to future growth in demand for our products and services; demographic trends; general economic trends and other trends in our industry; the impact of regulations on us and our operations; the competitive environment in which we operate; the outcome of legal proceedings; extreme weather conditions in the markets where we operate; failure to comply with privacy laws; and failure to comply with environmental health and safety laws. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can provide no assurances that such expectations will prove to be correct and such statements are not guarantees of future performance because they are based on numerous assumptions. Forward-looking statements are based on information available at the time those statements are made and management's good faith belief as of that time with respect to future events and are subject to known and unknown risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. For a further discussion of such risks please see the risks discussed under the caption “Risk Factors” beginning on page 26 of the Offering Memorandum dated July 10, 2013 (the “OM”) in connection with our offering of senior secured notes and second lien PIK toggle notes (collectively, the “Notes”). You should not place undue reliance on any forward-looking statement. Any forward-looking statement speaks only as at the date on which it is made and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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Contact:

For further information or to arrange an interview with Unilabs CEO Jos Lamers and/or CFO Karl-Erik Clausen please contact:
Clark Health Communications
Sarah Newman
T: +44 (0)203 574 4768
M: +44 (0)7860 929 266
E: unilabs@clarkhealthcomms.com