Earnings call transcript: Medistim’s Q3 2025 results show strong growth

Medistim ASA, with a market capitalization of $20.87 million, reported robust financial performance for the third quarter of 2025, with significant revenue and profit growth. The company’s stock surged 4.76% following the earnings announcement, reflecting investor optimism. Medistim’s revenue for the quarter reached NOK 166.8 million, marking a 25.7% increase year-over-year, though it fell short of the forecasted NOK 169.5 million. The earnings per share (EPS) forecast of 1.6 was not directly compared due to the absence of EPS data in the earnings call. According to InvestingPro analysis, the company is currently trading at a high earnings multiple, suggesting investors are pricing in strong future growth expectations.

Key Takeaways

• Revenue increased by 25.7% year-over-year to NOK 166.8 million.
• EBIT grew by 27.1% year-over-year, reaching NOK 40.6 million.
• Stock price increased by 4.76% following the earnings release.
• Imaging systems now account for approximately 50% of total system sales.
• U.S. market supports 37% of coronary artery bypass graft (CABG) procedures.

Company Performance

Medistim demonstrated strong performance in Q3 2025, with both revenue and profit showing significant growth. The company’s focus on expanding its imaging systems and probes contributed to this success. Imaging probe sales surged by 73%, while flow probe sales grew by 22%. The U.S. market remains a key driver, supporting 37% of CABG procedures.

Financial Highlights

• Revenue: NOK 166.8 million (+25.7% YoY)
• EBIT: NOK 40.6 million (+27.1% YoY)
• Gross Margin: 81.5% (improved by 1.2%)
• Profit After Tax: NOK 34.7 million (+48% YoY)

Earnings vs. Forecast

Medistim’s actual revenue of NOK 166.8 million was slightly below the forecasted NOK 169.5 million. Despite this, the company showed strong year-over-year growth, which may have tempered any negative market reaction.

Market Reaction

Following the earnings announcement, Medistim’s stock rose by 4.76%, closing at 252 NOK. This increase positions the stock closer to its 52-week high of 276 NOK, indicating positive investor sentiment despite the revenue miss. The stock has shown impressive momentum, with InvestingPro data showing a 15.82% price return over the past six months.

Outlook & Guidance

Medistim continues to focus on the U.S. as a primary growth driver and is exploring direct sales in new markets such as France and Japan. The company is also investing in the vascular market and expanding its Medistim Academy to include customer certifications.

Executive Commentary

CEO Kari Krogstad emphasized the company’s strategic initiatives, stating, "One team, bold moves, excellence redefined." She highlighted the pivotal moment for the company and identified Asia-Pacific as a medium to long-term growth engine.

Risks and Challenges

• Slowed growth in the vascular market, now at 3.7%.
• Potential market saturation in established regions.
• Economic fluctuations affecting healthcare budgets.
• Competitive pressures in the imaging and probe markets.
• Regulatory challenges in expanding to new markets.

Q&A

Analysts inquired about market acceptance of price increases, quarterly performance variations, and potential geographic expansion. The flexible compensation structure was also discussed, highlighting Medistim’s strategic adjustments to enhance performance.

Full transcript - Medistim ASA (MEDI) Q3 2025:

Kari Krogstad, CEO, Medistim: Good morning, everyone, and welcome to the presentation of Medistim’s third quarter results. My name is Kari Krogstad, and I have my CFO, Thomas Jakobsen, with me, and we will take you through the results. Before entering into the highlights, I would like to remind ourselves of our track record and our commitment to deliver profitable growth consistently over time. As these graphs are describing, that is a promise we have delivered on. Let’s look into the highlights for the third quarter. After a record start of the year, with the first half providing records both for sales and revenues, I’m very happy to present our best third quarter ever for both sales and revenues, or operating profits. We can see that we are delivering NOK 166.8 million in revenues. That’s a 25.7% growth. EBIT also growing very nicely, ending at NOK 40.6 million, 27.1% growth.

We can see that we have very little currency effect this quarter. That means that the total sales is almost the same, 25.9%. Looking at the sales of our own products, we see that that is at almost 30%. A very, very nice contribution from our own products this quarter. Americas is continuing to take the lead here, up 35.7%. Of the NOK 34 million of growth this quarter, Americas is actually delivering 21.5%. 63% of the total nominal value here is coming from Americas, just highlighting the importance of this region for Medistim’s growth. Asia-Pacific is also delivering very nicely, 194% growth. The only disappointment here this quarter is that EMEA is a bit down. It is the European part that is showing a decline this quarter, while the Middle East/Africa section of it is actually growing.

We will get back to more details into what’s happening this quarter in EMEA. The third-party products have a normal growth, we would say. Looking back at historical levels, that has been around 5%. 4.4% is in line with that. We can remember that we had a fantastic first quarter due to some new hospitals establishing their practices here in Norway. This is really getting back to a more normal situation. This strong sales performance has led to some high commissions and accruals for year-end bonuses. We will see that the operating expenses have increased also quite a lot this quarter. Still, the operating profit is up by 27% and at a margin of 24.3%. Pretty decent. Looking then at the year-to-date situation, that means that we are still at the best level yet.

Record sales revenues and EBIT year to date: NOK 517.5 million, 25.8% growth on revenues, ending up at NOK 153.9 million in EBIT, a 46.2% increase. Again, very little currency effect here. Total sales up 26%. Our own products are very high, 28% growth. Americas, as indicated, really taking the lead here in the growth year to date at 36.2%. Asia-Pacific is also contributing very nicely, 73%. Year to date, EMEA is up at 1%. Third party, this is an effect of the tremendous first quarter we had. Year to date, this is growing at 16.2%. Operating profit up 46%, strong EBIT margin at almost 30%. This is related to strong sales of our own products. With those highlights, I will leave the floor to Thomas to go through the P&L and some of the other numbers, and I’ll return with some more details on the business segments.

Thomas Jakobsen, CFO, Medistim: Thank you for that, Kari, and good morning, everyone. I will take us through the P&L, our balance sheet, and cash flow for this quarter and year to date. Since Kari is going through sales figures in units, split of sales per product, and geography, I will not go into that detail in my presentation here. However, cost of goods sold and gross margin is increasing with 1.2%. That’s despite the fact that we have a strong increase in sales of our imaging portfolio. As we’ve said before, our imaging portfolio has a slightly lower margin than our flow products, but we have very high pricing on the imaging products, and it’s very profitable for Medistim. This is partly compensated with high sales through our direct organizations, especially in the U.S. Therefore, we have an improved gross margin of 1.2%, ending at 81.5%.

Salary and social expenses increase from NOK 46 million to NOK 60 million. Yes, we have increased our capacity in our commercial organization and elsewhere in the organization, but the main driver for this increase is actually related to incentives and commissions and bonuses. In the third quarter last year, we did realize that our internal goals would not be achieved. We had actually a reversal of the accrual that we made in the first half of last year in the third quarter. Practically zero commission and bonuses were recorded in the third quarter last year. This is obviously not the case in this quarter and so far this year, and this is the main explanation for why our salary and social expenses increase the way that we can see here. Other operating expenses are also increasing, and again, related to our commercial activities.

We have much more travel expenses and face time with customers through our sales force and marketing departments and so forth. Therefore, we have increased other operating expenses as well as a consequence. Our EBITDA increases NOK 8.7 million, ending at NOK 46.4 million. Depreciation increases. It consists of both lease obligations, but also depreciation on development products and other fixed assets. Our operating profit increases 27%, ends at NOK 40.6 million. Net finance is very positive this quarter, related to currency, but also hedging contracts and a net positive contribution of NOK 5.4 million. Profit before tax then is about NOK 15 million higher than last year, ends at NOK 45.9 million, and profit after tax ends at NOK 34.7 million, up 48% compared to last year. Strong growth in profit this quarter.

If we look at the year-to-date numbers, the explanations are the same very much as for the quarter, only bigger numbers. Still, with the increase that we see here on salary and social expenses, it is also actually with the same explanation as for the quarter, where we had very low accruals and commissions in 2024, where we did not reach our internal goals. This is not the case in 2025. We’ve also seen that the incentives that we’ve set for this year have actually given us great results in many of our regions, especially Americas, and also in the Asia-Pacific region as such. EBITDA increases around NOK 48 million, ends at NOK 171.7 million. Depreciation being at the same level, our operating profit ends at NOK 153.8 million. That’s up 46%.

If you look at the top line, we increase with more than 25%, and our expenses increase only 20%. This gives a very positive impact on our EBIT and profit as such. Net finance is also positive year to date, ends at NOK 5.1 million, currency-related. Profit after tax ends at NOK 159 million. Profit after tax, NOK 121.1 million, up 47% compared to last year. Strong year to date so far for Medistim. Our balance sheet, intangible assets increases. We have our two major development projects that we are investing in. Fixed assets decrease. That means we depreciate more than we have invested so far this year. Inventory ends at NOK 167 million. That’s up from the beginning of the year. However, it’s actually down from the end of Q2, which ended at NOK 174 million.

We have now seen a decline in inventory based upon what also was communicated with those orders that we have committed to that are now fulfilled from our end. Accounts receivable is increasing, ends at NOK 173 million. We have a strong cash position now recovering after our dividend payment of NOK 110 million in the second quarter. We are now well above last year’s position, NOK 127 million. This quarter, we’re at NOK 157.7 million. Strong and good cash position. Further on our balance sheet, we have a strong balance sheet with equity, almost 73%. No interest-bearing debt from bank or other credit institutions. Our long-term debt is related to lease obligations and extended warranty. The long-term liability related to this is NOK 28.6 million. Total obligation is NOK 37.9 million. Some key figures.

When we have strong profit, obviously our earnings per share are following, and we have already 1 krone per share more at the end of September compared to the whole fiscal year 2024. Good performance so far. Our cash flow, strong cash flow from operations year to date, but also a very strong cash flow from operations this quarter. Apart from good profit, we also have a reduction in the working capital, decreasing both inventory levels, but also accounts receivable, and gives us a solid cash from operations of NOK 69 million. Investments, NOK 6 million, mainly related to our development projects, as I mentioned earlier. Net cash from financing is basically our lease obligations. Net change in cash this period is NOK 61 million, which is drastically up from last year’s third quarter, which was only NOK 20.3 million in comparison.

We end the period with a good and solid cash position, ending at NOK 157.7 million. With that, I leave the word again to Kari. Thank you.

Kari Krogstad, CEO, Medistim: Yes, let’s take a look into the details here. Starting with the unit sales of flow and imaging systems in units, we see here that we have a net positive number of nine, nine more systems sold this quarter compared to the same quarter last year. It’s really Asia-Pacific that is driving this. We see that they are up by eight units. Americas is up by two units. EMEA is down by one, and we will see that EMEA is actually down on all of the different product categories this quarter as a number of units. I think it’s interesting to note that this quarter we are actually selling around 50% of the total number of systems sold from Medistim with the imaging inside. This is a very nice and positive development. I think historically we have been around 40% of systems being on the imaging component integrated.

This is definitely a development that we like to see. Also, very good this quarter, imaging probe sales in units is growing as high as 73%, and it is Americas that is driving these unit sales. 27 imaging probes sold this quarter, which is extraordinary. Asia-Pacific also doing well here. EMEA down by 10 units. Looking at the flow-only systems in units, we are up five units in total. Asia-Pacific up by nine, and both Americas and EMEA are slightly down in the number of units here. Flow probes also have a very strong performance this quarter, 22% growth in the number of units. Again, Americas is really driving this growth, 66% growth in the number of flow probes sold in Americas. Of course, Americas is US for the most part, although Canada and South America are also contributing. Asia-Pacific up 59%, EMEA down 10%.

Let’s take a closer look into the Americas. We are delivering NOK 83.2 million in sales in the third quarter, currency neutral, 35.7% growth. We see that the number of systems sold is really on the same level as last year, but we’re selling more imaging units. That is, of course, contributing to the higher revenues. Also mentioned strong probe sales for the quarter, both from the flow probes and the imaging probes. Canada also continuing to contribute, growing this quarter with 68%. Also, Latin America is growing, or a little bit lower actually, but it’s very small numbers. It doesn’t really have a big impact. Looking at the number of procedures that’s coming out of the U.S., I’ve already commented on the number of systems, so that’s the first table here.

Looking at the number of procedures, here we can see really the impact of the many flow probes that were sold this quarter. That translates into an extremely high number of procedures. Also, when we have this very high number of imaging probe sales, that of course also translates into a very high number of imaging procedures. This is not to say that this is a measure of the utilization of the systems for the same period. I have to be very clear about that. Certainly, it’s a nice development. If we look then at the number of flow-only procedures sold in the U.S. per year, and we’re looking at the year-to-date numbers here, we see that we are covering or supporting around 37% of the CABG procedures in the U.S. with our technology so far. Steadily improving.

When it comes to Asia-Pacific, ending up at $25.2 million in sales, 194% growth. The most important thing to note here is really that we are seeing a continued normalization in the sales to China. This was our promise at the beginning of this year that we expect to see quarterly variations, but a normalized year. In the third quarter, we saw that the sales were up 143% in China specifically. Also contributing to the great results in Asia-Pacific for the quarter is Japan contributing with $6.7 million, but we had zero sales from Japan in this quarter last year. Other distributors are also contributing. EMEA is, as we see, a bit down, $37.1 million, down by 11.8%, currency neutral. This quarter, it is actually our normally highly performing markets, the direct markets, Spain, Germany, also Scandinavia, which is showing a decline for the quarter, $26.8 million.

The distributor portion of the business is having a good quarter with 22.3% growth. We have to keep in mind that both Spain, Germany, and Scandinavia as well are markets where we have a very high penetration in the CABG part of the business. With the flow technology, it’s really almost fully penetrated. The growth needs to come from conversion to imaging, which is steadily ongoing, but still that will continue to take some time. For the future, we really rely on building and developing the market for vascular products. Of course, there will be some new target markets. We’re currently working our way into the Turkish market. That will also contribute to the future growth here. The third-party products, as mentioned, started on an extremely high note. Revenue up 4.4% for the quarter. With this first quarter strength, we are looking at a year-to-date growth of 16.2%.

All in all, a very, very strong performance from the third party. This leads to the regional performance as we see in this table. U.S. up 32%, Canada up 68%, South America up 251%. China, as we see, 143% up. The rest of Asia-Pacific up 84%. Europe, especially the European direct markets, this quarter down 17.9%. Middle East/Africa up 133%, of course, from a much lower number. This leads to the total sales growth of 25.7%. When we look into the split of vascular and cardiac, we see that we are having an unusually slow development for the vascular products this quarter. It’s growing only by 3.7%. I will ask everyone to keep in mind that both Q1 and Q2 actually delivered more than 40% growth. This is leading to the year-to-date situation where we’re growing at 29%.

Looking a little bit back into our history, the growth in vascular has probably been around 20%. We are still delivering very good developments in vascular, and some quarterly variations always have to be expected. I would like to point to the fact that the cardiac product portfolio is also developing extremely nicely, almost 37% growth for the quarter and 27% growth year to date. We are always interested in seeing the imaging development, and this year we are seeing terrific performance here. Almost 40% growth for the quarter and 52% growth year to date, meaning that the interest in our imaging products is as solid as ever. This business is really coming back after weaker 2023 and 2024. When it comes to the recurring revenues, this is when we are counting sales from capital probes, PPP smart cards, and lease revenues continue to be high.

It’s for the quarter 72%, and for the last 12 months, we are at 69%. Also very solid. It’s typically a business as usual quarter for us. No big news to talk about. However, I would like to just reiterate how we started the year, and I know I’ve been talking about this every quarter, but in the beginning of the year, we knew that we were standing at, as we said, a pivotal moment for the company. We were just about to launch the Intuit software platform, and we were also starting the patent study. We felt it was a perfect time to strengthen our commercial efforts. I’ve talked about the organizational changes that we made and also some of the operations that we’ve changed in that part.

I also would like to say that something we have invested quite a lot of time and resources on this year is to establish or re-establish the Medistim Academy. We have actually revamped our training and education program for the sales force. This is part of the efforts of really strengthening our commercial operations at large and really supporting our sales reps and enabling them to do the best possible job out in the field. This is a new program with theoretical and practical exams. It will lead to a certification for the individual sales reps. The content is, of course, both on product, on clinical application knowledge, and also on the selling skills. We have developed our own sort of model for how we want sales to be performed, representing our products in the best possible way.

With this, I will leave you with the theme for the year, one team, bold moves, excellence redefined. We should open up for questions.

Yeah, as usual, we have quite a few questions. The first one is quite general. Congratulations on another strong quarter. Americas is driving the growth, while relative growth is even higher in Asia-Pacific. EMEA, on the other hand, seems softer. Going forward, where do you expect growth to come from?

Yes, so I mentioned that today Americas is actually contributing with 57% of the total sales of our own products. I think it’s with the investments that we’re making in the U.S. in terms of building out the sales force and really continuing to build on the momentum that we’re seeing there. There’s every reason to believe that the U.S. and Americas will be the growth driver also in the near term in the near years to come. This is driven both by increasing key opinion leaders’ support, more awareness, steadily increasing, strengthening the sales force, as I mentioned. We really have a lot of things going for us in the U.S., so that will be the most important growth driver also going forward. Asia-Pacific is really the medium to longer-term growth engine for us.

We should remember that we have the highest growth markets in the world in China and in India growing in the number of procedures, cabbage procedures, more than 10%. Of course, that’s the motivation for developing our own direct sales organization in China and also for our heavy involvement and collaboration with LivaNova for India. I think that will be the next one. When it comes to Europe and the Middle East, as I said, it is a much higher penetrated market for coronary bypass surgery, cabbage, but we still have growth opportunities in vascular. For us to grow in EMEA, it will be to increase our efforts on the vascular side, add some additional markets, of course, also go direct when the time is right.

The next one is on the U.S. You are presenting significant growth in procedures in the U.S., both for PTFM and imaging. Is this due to orders being placed prior to price increases, or is this down to other market factors? Is the price increase both for PTFM and imaging products?

Yes, we did a general price increase as of the third quarter. Of course, we’ve been very curious to see whether that would impact the volumes. What we can see is that the high volumes of probes sold in this quarter were at the new pricing. That’s at least an early reassurance that we are, yeah, that the new pricing is accepted. Of course, we will need to see that also a little bit further into Q4 and see what the achieved selling price really will be. So far, yes, it was not a stocking up before a price increase.

Thank you. Vascular shows lower growth this quarter, around 4%. What do you expect from this segment going forward?

Yeah, I think, you know, quarterly variations, we see it all the time. It can happen in regions. It happens to the different products. That will always be the case. All in all, we see very solid development from the vascular. The reason why we believe that vascular can be trusted to be a significant growth driver for the company going forward, that’s really the response that we’re seeing now that we are making more deliberate efforts in creating this interest awareness through the patent study and building all of these centers that are participating. Per now, we have about 55% enrolled in the study. We’re still getting the last study sort of up and ready for starting to enroll. This is a slow process, but it’s moving forward. We feel there is enthusiasm in this group of investigators, and they are already talking about the technology.

As we know, it’s an extremely influential group. With that investment and everything that we do also on the sales side, I should mention that on the training and education program that I just talked about, we have focused on peripheral bypass as the number one application area where we really wanted to lift the sales force and support them in how to engage with vascular surgeons. You know, we are determined to support and invest in the area. We’re seeing that we are getting a response from the market. That will be very positive, I think, going forward.

Thank you. There’s a question on cost. Your cost base is growing. Can you elaborate on the increase, and how flexible are you if you experience lower sales for some time?

Thomas Jakobsen, CFO, Medistim: I was touching up on the topic in my presentation. When we look at our increase in salary and social expenses, it can look like we have hired a lot of new employees. Yes, we have hired some, but the main driver for the growth is actually related to incentives and internal goals that we’ve been setting. Obviously, when these costs are then increasing, this is related to the fact that our internal goals have actually been reached. For instance, the main driver for this is the U.S., and what we have done for this year is actually to lower the fixed part of compensation and increase the variable one. If they reach their targets, then they will receive a good commission or they reach their incentive. We’ve seen that throughout this year. Also, as a consequence, we’ve seen a good growth on our top line.

If they would not reach their targets, the consequence, for instance, for the third quarter would be a reduction in expenses of around $10 million, and for the first nine months, more than $20 million. That means that we, in that sense, have actually a quite flexible model when it comes to goal setting and reaching our targets. When targets are reached, yes, then the expense will increase, but if it’s not reached, then there will also be a reduction in expenses.

Thank you. There is a question on Turkey. You mentioned Turkey as a new market. Will you start this market with a distributor, or will you go direct from the start?

Kari Krogstad, CEO, Medistim: Yes. No, we will follow our traditional method of always starting with a distributor in order to understand the market, map the market, and also see whether it’s resonating with the users in that market. We also want to have a certain level of business before we’re even starting to consider to go direct. We have started with a distributor. Our job now will be to really support that distributor and follow up closely and ensure that we have selected the right one and that we’re seeing the development and results that we need to see. That’s for the future to evaluate a direct operation there.

Thank you. It’s a question on, yeah, a wide one. Can you comment on France, Brazil, Japan, and India? Are there any plans of going direct in these countries?

France is a pretty, well, it’s a challenging country for us. I believe our penetration today is probably around, I don’t know, 30%, a little bit more maybe, but still not in the highest end in Europe, definitely. It’s one of the countries that it’s reasonable to look at for direct operations. You could say that’s on the list. Japan, Japan, yeah, it’s been, we have had a great development with our distributors for, I would say, 20 years or more. They have done a tremendous job for us in developing the cardiac market for flow. They’ve also done a good job in developing the conversion to imaging in the market. As we’ve seen over the past several quarters, there have been some reasons for concern, and the total business has been challenged, and we haven’t seen the steady development that we used to.

Of course, this is a profitable business. It is also one of the countries that we should think about for going direct. You mentioned Brazil. Brazil, South America in total hasn’t been really the highest priority part of the market for us. Brazil is the most interesting country in South America, and we do have some business there. We do have some installed base there, and we know that there is interest from Brazilian surgeons definitely for the products. It’s a part, it’s a geography where we are considering to increase our efforts, absolutely not going direct in the near future.

Did you mention India?

India, India, we are in a starting phase. I would say we have 2-3% coverage of the procedures performed. As I said, it’s growing more than 10%. It will soon actually be larger than the U.S. and then take the lead as the biggest market in the world in isolation. Definitely a place to be, a place to focus on, a place to ensure that we are present and supporting the local distributor. We’re very happy with LivaNova, but we need to work it a little bit further before it becomes even a question to go direct.

Thank you. There’s another one from the web. Can you comment on the performance of the direct Europe markets? Why was it down so much after being so strong in the past?

Yeah, so again, quarter by quarter, we do see a lot of variation, and there can be customer projects that are being closed or not being closed, entering into the next quarter, and so on and so forth. That’s something that we’ve seen historically and will continue to see. If you’re not winning the customer or closing the opportunities in the quarter, that will affect everything. Like we saw, it was down on both system sales and probe sales. This is, of course, parts of the same issue. I think that our ambition is to continue to grow, and especially in the direct markets. We have different challenges. Germany, as one market, is very, very highly penetrated, rather price sensitive, not easy to just compensate by increasing price.

In Spain, we’ve seen some resistance to buying capital, and we’ve then introduced more consumables-based deals, which will then result in less revenue at the time of sales, but really then securing the future growth from the Spanish market. Spain is in really good condition, and Germany for that matter. When it comes to the UK, it’s the occasional close of sale. Still haven’t really cracked the nut in the UK, as we talked about many times.

Yeah, it’s a question on Medistim Academy. Could you comment on the Medistim Academy? Is this for internal sales reps only or also for distributor partners?

Yes. Yeah.

Should I do that? It’s a three-part question. Why did you see the need of reestablishing this? Any particular event? How would you like your sales force to sell the product? What does an ideal sales process look like?

Great question, big question. First of all, of course, we have trained the sales force in the past as well. It’s just that now we have revamped the content that we are, you know, the training materials and the approach. We are using a combination of classroom situations and digital solutions as well in order to do the training. It’s really to elevate the quality of the training and talking about how we want to sell.

We have defined, and for a long time, defined the Medistim sales process, and we have a very clear understanding of what we need to do prior to the sales and also during the sales process and when we have closed the sales and how important it is for us to really be present and ensure that our technology is being used, is being used correctly, it creates enthusiasm, and that we are upselling within the customer that we have just sort of won. It’s too long to go into detail about the sales process here, but for sure, we’re rolling this out also to the distributors. Even more, we have a goal to establish a similar certification system for customers.

Some of our customers are actually asked for, you know, is there a way that we could certify our team in the hospital in order to make sure that we have some certified nurses and technicians that can really provide the internal training at the hospitals, which we think is a great idea. That’s on our sort of next to-do list to build out the Medistim Academy.

Thank you. We have one more. Yeah, one more from the web here. Americas recurring revenue was strong in the quarter, around 44-43% year over year, but not quite as strong as I might have thought given the price increases and very strong unit growth of probes. Could you please explain why?

I don’t know what the expectation really was, but we feel that the number of units sold was extremely high. As we say, we managed to sell this high volume of units at the higher price. Yeah, I think that’s, I don’t know whether you’re reflecting differently.

Thomas Jakobsen, CFO, Medistim: Maybe add something to that because, yes, the probes sales in units and the pricing we achieve there is obviously within the new pricing. However, we do also have a lot of lease and PPP contracts, which are lasting over a period of time. The price increase that we implemented from July 1 would not affect those accounts. Therefore, a good portion of the number of procedures that we have been sold in the third quarter is based upon the old pricing when it comes to the PPP customers and the hybrid customers. That probably explains why the increase in revenue is slightly lower than one could have expected. I’m not sure what the expectation was here, but this is a partly explanation.

Thank you. Another one coming in here on incentive structure. Could you elaborate on the new incentive structure and the flexibility that Thomas hinted at? Are goals always set in a way that it incentivizes for year-over-year growth? What would happen to bonuses if growth year-over-year was not to happen?

As I said, we were setting new targets every year. Of course, if those targets are not reached, then the incentives will not kick in. Again, going into the detail of the incentive plans for the U.S. would take too long time. Again, the main principle has been to lower the fixed compensation and then to give the carrot to sort of make sure that you perform. Because when you perform and performance is either both increase the existing recurring revenue on one side and on the other side actually drive capital sales. Those two are the main factors that will drive the incentive for the sales force.

Thank you. We are through.

Thank you.

Kari Krogstad, CEO, Medistim: Thank you for being with us for this presentation and look forward to meeting again for the fourth quarter presentation. Thank you.

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