REPORT FROM ELEKTA’S ANNUAL MEETING 2008
Stockholm, Sweden, September 18, 2008
At the Annual General Meeting of Elekta AB (publ), 228 shareholders entitled to vote participated, representing 51.6 percent of the votes in the company.
• Dividend to shareholders of SEK 1.75 (1.00) per share.
• Akbar Seddigh, Carl G. Palmstierna, Tommy H. Karlsson, Laurent Leksell, Hans Barella and Birgitta Stymne Göransson were reelected to the Board.
• Luciano Cattani and Vera Kallmeyer were newly elected to the Board.
President and CEO Tomas Puusepp opened his speech by describing different cancer diseases and giving examples of Elekta’s contribution to cancer care.
“Elekta’s systems cover the whole spectrum of cancer care and have been developed as solutions to real needs. We provide our customers with systems in three business areas with strong brands and our product portfolio is very competitive. The range of our product portfolio opens new possibilities and during the present year we will therefore invest in increased market presence in Latin America and other chosen growth markets.
At the same time, we continue to invest substantially in research and development. Last fiscal year about 8 percent of net sales were invested in R&D and I estimate that it will continue to be on this level the coming years.”
Tomas Puusepp further established that Elekta during a couple of years has distributed substantial capital to its shareholders. Together with the repurchase of own shares that was conducted during 2007/08, the dividend to shareholders for the year total SEK 361 M.”
Thereafter, he summarized the fiscal year 2007/08.
“That was a year when Elekta’s technology for image guided radiotherapy had great success and we continued to gain market shares in all major markets. Elekta also continued to develop and launch new and resource efficient technology for better care of cancer and brain disorders. Operating profit for the fiscal year increased by 28 percent, despite a substantial negative currency effect. Order intake increased by 21 percent in local currency and net sales increased by 18 percent in local currency.”
Tomas Puusepp also presented the result for the first quarter 2008/09.
“Order intake during the first quarter increased by 9 percent compared with the same period last year and at unchanged exchange rates. Net sales increased by 13 percent compared to last year and at unchanged exchange rates. Operating profit amounted to SEK 13 M.
We remain firm on our previously communicated outlook for the full year 2008/09 of an increase of net sales by over 15 percent in local currency and an increase of net profit by over 15 percent. Net sales and operating profit will be significantly higher in the second half of the fiscal year, compared to the first.”
To conclude, Elekta’s long-term growth factors and strategy were presented.
“Cancer is unfortunately a growing disease, mainly due to on an aging population and better diagnostics. In almost all countries there is a lack of treatment capacity for radiation surgery and radiation therapy. The systems are becoming more advanced and therefore the average selling price gradually increases. There is also great demand for IT solutions which streamlines the workflow in cancer care.
Elekta has taken the step from being a technology supplier to being a comprehensive partner across the whole spectrum of care in oncology and neurosurgery. Going forward, Elekta’s strategy is to focus on the patients’ diseases and to continue to develop new solutions and systems that enhance the standard of care and to thereby play an increased role in the customers’ value chain.”
Disposition of the company’s earnings
Elekta’s dividend policy is to distribute 20 percent or more of net profit in the form of dividends, share buy-backs or comparable measures.
The Meeting resolved in accordance with the Board’s proposal, that from the company’s disposable earnings of SEK 671,342,778 a dividend be paid to the shareholders in an amount corresponding to SEK 1.75 per share and that the balance be carried forward. The record date for the dividend was set at September 23, 2007.
Election of the Board
Following the proposal from the Nomination Committee, the Annual General Meeting reelected Akbar Seddigh, Carl G. Palmstierna, Tommy H Karlsson, Laurent Leksell, Hans Barella and Birgitta Stymne Göransson as Board members, and elected Luciano Cattani and Vera Kallmeyer as new members of the Board. The Meeting resolved to reelect Akbar Seddigh as Chairman of the Board.
Luciano Cattani has 25 years experience from the international health care industry. He has recently scaled back from his full time responsibilities as Group President, Corporate Office at Stryker Corporation, and currently dedicates his time towards advance Stryker’s capabilities in the government and public affairs arena.
Vera Kallmeyer is Founder and Managing Partner of Equity4Health LLC, a financial advisory firm and of Veritas Venture Partners, which pooled interests with Earlybird in 1999. She is also a Consulting Professor in the Department of Neurosurgery of Stanford Medical School, where she teaches courses on innovation and entrepreneurship.
The Meeting decided that the total remuneration to the Board shall be SEK 2,385,000 of which 570,000 to the Chairman, SEK 285,000 each to the external Board members, SEK 70,000 to the Chairman of the Executive Compensation Committee and SEK 35,000 to other members of the Executive Compensation Committee. No remuneration is paid to Board members employed by the company.
Election of auditors
Following the proposal from the Nomination Committee, the Annual General Meeting resolved to elect Deloitte AB as auditors for a term of four years, ending at the shareholders’ meeting to be held in 2012. Deloitte AB has informed the company that Jan Berndtsson will be responsible for the audit.
Remuneration to the auditor was resolved to be paid according to an approved account.
Principles for executive compensation
Board Chairman Akbar Seddigh reported on Elekta’s strategy for compensation to managers, in which the aim is to strengthen management by objectives, profit development in the short and long term as well as create long-term value growth and align management with the shareholder perspective. The Chairman also reported on the work of Elekta’s Executive Compensation Committee.
The Meeting approved the principles for remuneration as proposed by the Board and presented in the Annual Report for 2007/08. The principles will be valid for employment agreements entered into after the Meeting and for any changes made to existing employment agreements thereafter.
Reduction of share capital
In accordance with the authorization given at the previous Annual General Meeting, Elekta during the last fiscal year repurchased 951,300 of its own B shares. The Board has previously announced that the intention is to cancel the acquired B shares.
The Meeting decided to reduce the company’s share capital by SEK 1,902,600 through retirement of these 951,300 B shares without any repayment. The reduction amount shall be allocated to the company’s disposition fund to be used in accordance with resolutions passed by the shareholders’ meeting.
Authorization of the Board to purchase and transfer own shares
The Meeting authorized the Board of Directors during the period until the next Annual General Meeting, on one or more occasions, to decide on acquisition of a maximum number of own shares to the extent that after purchase, the company holds not more than 10 percent of the total number of shares in the company.
The Meeting decided in accordance with the proposal on the issue of employee stock options in accordance with the Elekta AB 2007 Share Unit Plan and to approve to issue warrants and the approval of the transfer of warrants.
The Meeting resolved to issue a maximum of 1,856,000 warrants, each entitling to subscription of one class B share in the company. As a result thereof, the company’s share capital could increase by a maximum of SEK 3,712,000 corresponding at full subscription to 1.47 percent of the total number of shares in the company. Taking into account also outstanding warrants reserved for earlier employee option programs in the company, the share capital increase, at full subscription, could correspond to 4.75 percent of the total number of shares and 3.75 percent of the total number of shares.
Composition of Election Committee
The Meeting decided that an Election Committee should be appointed through a procedure whereby the chairman of the Board, before the end of the second quarter of the financial year, contacts three to five representatives for the, at that time, largest holders of A and B shares. Those representatives shall together with the Chairman of the Board constitute the Election Committee and fulfill its obligations in accordance with the Swedish Code of Corporate Governance. The names of the members of the Election Committee shall be published as soon as they have been appointed, however, not later than six months before the next Annual General Meeting. The Election Committee is appointed until a new Election Committee has been appointed. No remuneration shall be paid for the performance of the work in the Election Committee.