curasan presents strategic outlook for 2016

  • Revenue target of EUR 7.3 to 8.0 million
  • Monthly operating break-even point possible in 4th quarter
  • International business primary driver for growth

Kleinostheim, 25 June 2015 – curasan AG (ISIN DE0005494538), a leading specialist in medicinal products for bone and tissue regeneration, announced details of its planned corporate strategy up to the end of 2016 at its Annual General Meeting in Aschaffenburg today.

As part of his corporate presentation to the company’s shareholders, CEO Michael Schlenk explained how the company plans to achieve its previously published target, namely reaching its monthly operating break-even point during the fourth quarter of 2016: “We have carefully analysed what kind of conditions we can expect in our individual markets, how our company is positioned in these markets and what risks and opportunities there are for us.”

Based on a conservative plan for 2016, the company has therefore set itself a target range of EUR 7.3 to 8.0 million for sales revenues. To what extent the firm will exceed or fall below the envisaged target of EUR 7.6 million will also primarily depend on what happens during the rest of the 2015 financial year. “We will see the first effects of our new sales and marketing measures on revenue in the next two quarters, and this will enable us to develop our plans accordingly,” Michael Schlenk said.

Based on its current plan for Germany, however, curasan expects a below-average growth in revenue of 12 percent at both the regional and national levels up to the end of 2016. The reason for this is how the distribution process is currently structured, and curasan has worked with its distributors to make extensive changes to this. It will however take a while for these measures to have a positive impact on revenues.

The company is expecting an average increase in revenues of 20 to 22 percent by the end of 2016 in the remaining European markets. It hopes to benefit from positive momentum not only in its key markets of France, Italy, Spain and Poland but also and above all in the British market. “We realise that it takes time to redefine existing distribution partnerships and create the basis for new growth, even if all our feedback from our partners is positive. We did not previously have any distributors in the swiftly growing UK market, and this means that we can achieve rapid success via new partners and key account management.”

curasan’s current strategy will however continue to serve it well in the short term in some of its non-European markets. The firm’s management expects revenues to increase by 23 percent in the Asia Pacific region by the end of 2016. When it comes to the Chinese and Japanese markets, for example, curasan’s distributors are so effective that its own limited management capacities can be used to assist other regions. There is a similar situation in the USA, where the company’s subsidiary curasan Inc. also faces a bright future with an anticipated revenue growth of 25 percent by the end of 2016. Additional potential will be created from 2017 onwards with other, already initiated registrations in the area of orthopaedics.

“There will be less of a focus on regions such as Eastern Europe or Latin America,” Michael Schlenk added. “We will of course happily take advantage of any sales opportunities that come our way, but these markets are either too large or too far away, which would make it expensive to gain a foothold. So it wouldn’t be worth launching any major marketing campaigns before 2017/2018 at the earliest. The growth in revenue in these markets will be no more than six percent by the end of 2016.”

In contrast, curasan believes that the Middle East & North Africa region (MENA) offers a very good risk/reward ratio. The management has excellent links with decision-makers in the Middle East, in particular. “The political instability in many of these countries seems to have less of an impact on the healthcare system. We have a very good chance of substantially increasing our revenues in this region by 78 percent, to over half a million euros,” Michael Schlenk pointed out. To this end, the company plans to significantly strengthen both its network of distributors and its marketing measures in the region over the next two years. “As Europeans, we have a clear advantage over our US competitors in terms of how we are perceived. Any economic embargos do not apply to medicinal products, either. At the same time, the elites in these countries – financed predominantly by petrodollars – are only interested in the best possible medical care.”

In order to promote the planned growth measures, the company will restrict its investments in the coming months almost entirely to marketing measures and core personnel. The firm already appointed another export manager for Europe at the beginning of June. A further position for the MENA region will be created before the end of the third quarter. In addition, two new product managers will focus on international marketing campaigns as from the start of 2016, and a new project controller position will be responsible for generating internal business intelligence and providing commercial support for the campaigns.

“Even though the influx of funds as a result of the settlement payment from Stryker, which we received just today, has given us a very comfortable liquidity buffer, we will only be making very specific investments that are both targeted and reasonable. We want to earn our profitability, not buy it!” Michael Schlenk concluded.

A PDF file of the Powerpoint presentation at the 2015 Annual General Meeting will be available for download on the company’s website from 26 June.