Medistim ASA First Quarter 2013

Kari E. Krogstad, President and CEO

Thomas Jakobsen, CFO

April 25th, 2013

Disclaimer

The information included in this Presentation contains certain forward-looking statements that address

activities, events or developments that Medistim ASA (“the Company”) expects, projects, believes or

anticipates will or may occur in the future. These statements are based on various assumptions made by

the Company, which are beyond its control and are subject to certain additional risks and uncertainties.

The Company is subject to a large number of risk factors including but not limited to economic and

market conditions in the geographic areas and markets where Medistim is or will be operating, IP risks,

clinical development risks, regulatory risks, fluctuations in currency exchange rates, and changes in

governmental regulations. For a further description of other relevant risk factors we refer to Medistim’s

Annual Report for 2012. As a result of these and other risk factors, actual events and our actual results

may differ materially from those indicated in or implied by such forward-looking statements. The

reservation is also made that inaccuracies or mistakes may occur in this information given above about

current status of the Company or its business. Any reliance on the information above is at the risk of the

reader, and Medistim disclaims any an all liability in this respect.

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25.04.2013 Medistim ASA Q1 2013

Table of contents

1. Highlights First Quarter

2. Financial Statements

3. Business Segments Update

4. Implementing the Strategy

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1. Highlights first quarter

Highlights first quarter 2013

• Sales revenues in line with all time high last year

o 14.0 % growth in the USA

o 3.9% decline in 3rd party products

o 5.7% volume growth of own products

• Strong growth in system sales in Europe

• Operating profit in line with last year

o Negatively affected by one-off relocation

cost of MNOK 0.4

• Development project for new system platform

started

• The board suggests a dividend of NOK 1.10 per

share (NOK 1.00)

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5

Revenue

MNOK 45.5 (45.1)

EBIT

MNOK 7.3 (7.6)

Currency effect

No of Products sold

Systems 30

Flow probes 1 488

Procedures (USA) 7 803

1.0%

-4.0 %

-1.5 %

30.4 %

1.2 %

-1.2 %

Q1 2013 Q o Q

2. Financial statements

Profit and loss Q1 2013

7

Sales per Quarter (TNOK)

EBIT per Quarter (TNOK)

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Profit & loss Q1 2013 Q1 2012

All numbers in NOK 1000

Sales 45 507 45 054

Cost of goods sold 12 191 12 646

Salary and sosial expenses 15 144 14 532

Other operating expenses 9 071 8 731

Total operating expenses 36 406 35 908

Op. res. before depr. and write-offs (EBITDA) 9 100 9 146

EBITDA% 20,0 % 20,3 %

Depreciation 1 814 1 554

Operating result (EBIT) 7 286 7 592

EBIT% 16,0 % 16,9 %

Financial income 312 2 092

Financial expenses (200) 1 598

Net finance 512 494

Pre tax profit 7 798 8 086

Tax 2 045 1 804

Result 5 753 6 282

30 000

35 000

40 000

45 000

50 000

55 000

Q1 10

Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Q4 11

Q1 12

Q2 12

Q3 12

Q4 12

Q1 13

0 %

5 %

10 %

15 %

20 % 25 % 30 % 35 %

40 %

-

5 000

10 000

15 000

20 000

Q1 10

Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Q4 11

Q1 12

Q2 12

Q3 12

Q4 12

Q1 13

Balance sheet - Assets

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Balance sheet 31.03.2013 31.12.2012

All numbers in NOK 1000

Assets

Intangible assets 42 262 42 288

Fixed assets 11 434 10 944

Total intangible and fixed assets 53 696 53 232

Inventory 35 862 36 174

Customers receivables 31 673 30 063

Other receivables 4 508 5 718

Cash 27 927 26 680

Total current assets 99 970 98 635

Total assets 153 666 151 867

-

20 000

40 000

60 000

80 000

100 000

120 000

140 000

160 000

180 000

Q1 12 Q2 12 Q3 12 Q4 12 Q1 13

Intangible assets Fixed assets Inventory

Accounts receivable Other assets Cash

Balance sheet - Equity and liability

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Balance sheet 31.03.2013 31.12.2012

All numbers in NOK 1000

Share capital 4 585 4 585

Premium fund 41 852 41 852

Other equity 74 445 68 732

Total equity 120 882 115 170

Deferred income 3 296 3 470

Total long term debt 3 296 3 470

Total short term debt 29 488 33 227

Total equity and liability 153 666 151 867

-

20 000

40 000

60 000

80 000

100 000

120 000

140 000

160 000

180 000

Q1 12 Q2 12 Q3 12 Q4 12 Q1 13

Share capital Premium fund Other equity

Long term debt Short term debt

3. Business segments update

Flow probes and VeriQ sales in units

• Flow probe sales is established at a higher level • Increased system sale in Europe despite challenged

economy

• Sale of two VeriQ in the USA contributes to the solid

growth in the US for Q1

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11

Flow probes in units VeriQ systems in units

900

1 000

1 100

1 200

1 300

1 400

1 500

1 600

Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13

0

5

10

15

20

25

30

35

Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13

Asia Europe ROW US

Imaging probes and VeriQ C sales in units

12

Imaging probes in units VeriQ C systems in units

0

2

4

6

8

10

12

14

16

18

20

Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13

Imaging probes US imaging probes

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0

1

2

3

4

5

6

7

8

9

Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13

VeriQC ex US VeriQC US

• Imaging probe sales is establishing at a higher level as

installed base increases

• In Q1 2013, Japan continues to lead with 3 VeriQ C

units, while 2 capital sales contributes to the strong

growth in the US

Q1 revenue performance by region

• In Europe, own products show 7.1% growth due to strong systems sales compared to last year. The flow probe sales to

the installed base continues to be solid. 3rd party sales dropped with 3.9% compared to 2012.

• In the US, the double digit growth continues, this quarter driven by capital sales of both VeriQ and VeriQ C.

• Both Asia/Japan and ROW are so far smaller sales territories for Medistim, and quarterly performance varies significantly.

VeriQ C continues the positive development in Japan and the middle East.

Negative currency effects for the quarter with 0.7 MNOK.

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Mill NOK Q1 '13 Q1 '12 Q/Q 2012

Europe

(incl. 3rd party) 26,7 26,5 0,8 % 107,0

USA 12,8 11,2 14,3 % 48,5

Asia

(incl. Japan) 3,6 4,8 -25,0 % 18,4

ROW

(MEA, CAN, SA) 2,4 2,5 -4,0 % 9,8

Total 45,5 45,0 1,1 % 183,7

Q1 revenue performance by product

• Procedure sale in the USA: The total number of procedures are marginally down, imaging procedures are doubling

• Flow probes revenue: Same high level as last year, when the quarter showed 42 % growth

• VeriQ flow systems: Strong growth in system sales driven by both Europe and the USA

• VeriQ C imaging systems : Still strong momentum in Japan and a significant contribution from the USA

• Imaging probes: Same volume as last year, but revenues impacted by probe bundling with system sales

• 3rd party products: Lost agency and delayed product installations within ophthalmic

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Mill NOK Q1 '13 Q1 '12 Q/Q 2012

Procedures (USA) 10,6 10,8 -1,9 % 42,8

Flow probes 12,6 12,5 0,8 % 47,3

Flow systems (VeriQ) 4,0 2,8 42,9 % 17,9

Imaging systems (VeriQ C) 3,2 2,5 28,0 % 9,0

Imaging probes 0,3 0,7 -57,1 % 1,8

3rd party 14,7 15,3 -3,9 % 63,2

Other 0,1 0,5 -80,0 % 1,8

Total revenues 45,5 45,1 0,9 % 183,8

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Trend shift in the US market

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Trend shift in procedure growth

CQGR=−0.3%

CQGR = Compound Quarterly Growth Rate

# of Procedures

per Consecutive Quarter

CQGR = 1.95%

0

2

4

6

8

10

12

14

2009 2010 2011 2012

% Year over Year procedure growth

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5 500

6 000

6 500

7 000

7 500

8 000

8 500

9 000

Q2 09

Q3 09

Q4 09

Q1 10

Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Q4 11

Q1 12

Q2 12

Q3 12

Q4 12

Q1 13

4. Implementing the strategy

20 % 5 % 2 %

Medistim

Transonic

Other

No Quality Assurance

No Quality Assurance: > 73 %

Medistim owns a high share of an underdeveloped CABG market

74%

19%

7%

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PENETRATION SHARE OF PENETRATED MARKET

2 BNOK

STRATEGIC IMPERATIVES

In CABG

POST MARKET CLINICAL DATA

GUIDELINE

ENDORSEMENT

GAIN ACCEPTANCE FOR

CLINICAL VALUE

HEALTH-ECONOMIC MODELS AND DATA

PROVIDE RETURN

ON INVESTMENT

PALPATION VS

PRECISION

IMAGINATION VS

IMAGING

CHALLENGE CURRENT PRACTICE

30 DAYS MORTALITY VS

MACCE, RE-INTERVENTIONS AND

QUALITY OF LIFE

RE-DEFINE A SUCCESSFUL

OUTCOME

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”Standard of Care”

INFLUENCE PAYORS AND

PATIENTS

LOBBYING

NEW MEDIA

Dr. Schoettle’s

White Paper

New, Disruptive Marketing Campaigns

EU & NICE, Ground-

breaking new studies in planning

Health economy

model developed

Lobbying, PR,

Digital marketing

Building Organizational

Excellence

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EXPANDING OUR STRATEGY

Strategic directions and priorities

Emerging, high-growth markets (BRICs)

Under-developed markets (USA, UK, Fra)

Mature markets (Jp, Nordic, Germany) >50% share

CABG surgery (2 BNOK)

Vascular surgery (>1 BNOK)

Other open heart surgery (1 BNOK)

1. Within mature markets for CABG;

convert our large installed base of flowmeters to

our latest innovation the VeriQ C™

2. Through marketing and product development,

offer differentiated products and solutions to win

new, high- growth geographies for CABG

3. Through product and applications innovation,

target new segments in

vascular surgery and open heart surgery

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1 3

2

Doubling market potential

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PRODUCT DEVELOPMENT NEEDS

How to win in new application areas?

CAROTID SURGERY

• Evaluate flow pattern after end-

arterectomy and detect technical

imperfections with imaging

• Unfulfilled needs:

o Improved probes for a

minimal invasive surgery

o Adapted system user interface

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LIVER TRANSPLANT SURGERY

• “Insufficient perfusion may harm the transplanted liver and

even result in a rejection of the organ – evaluation of every

graft with TTFM, reduce risk. “ (Case Report 2004, Ghent)

• Unfulfilled needs:

o Ability to detect and visualize

deep laying vessels

o Adapted system user interface

MICROVASCULAR SURGERY – FLAP TRANSFER

• “Operative decisions were modified on the basis of TTFM

in 19 out of 52 cases (36.5%) in reconstructive surgery”,

Dr. Selber, MD Anderson, 2012.

• Unfulfilled needs:

o Smaller probes

SHUNT SURGERY

• Evaluate quality of anastomosis and

monitor flow during creation of AV

fistula for dialysis

• German guidelines: “…flow has to be measured intraop…”

• Unfulfilled needs:

o The ability to measure flow on shunts

o Adapted system user interface

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NEW PRODUCT DEVELOPMENT

Trends and demands

• The customers demand application specific

probes for both flow and imaging

• Demand for effective hospital routines require

focus on usability and handling of probes

• Increased competition from the general ultrasound

market creates enhanced customer

expectations

• The new information society drive demand for

system interconnectivity due to higher demand

for patient data-integrity, -security and -exchange

• New OR designs expects vendors to support

tighter systems integration to help unifying the

surgeons information flow in the OR

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21

1994

1997

2002

2009

2014→ NEW PRODUCT DEVELOPMENT

System platform evolution

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25.04.2013 Medistim ASA Q1 2013

CARDIOMED™

BUTTERFLY™

VERIQ™

VERIQ C™

NEW PRODUCT DEVELOPMENT

The next generation system platform

• On March 1st, 2013, Medistim initiated a

new product development project in order

to develop the next generation system

platform

• A flexible platform addressing new clinical

applications, markets and enabling future

generations

• Maintaining leadership in existing

applications

• The first products are expected to launch in

2014 / 2015

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Current CAGB

VeriQ

VeriQC

System platform Products Applications

n

1

2

3

4

Other open

heart surgery

Vascular

Transplant

Re-

constructive

CABG

Neuro

1

2

n

System platform Products Applications

...

...

CURRENT PLATFORM & PRODUCTS: 2BNOK OPPORTUNITY

FUTURE PLATFORM & PRODUCTS: 4BNOK OPPORTUNITY

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Seeing is believing

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Geographic split of sales in units

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Number of units Q1 2013 Q1 2012 2012

USA

Procedures flow measurement 7 461 7 896 30 333

Procedures imaging 242 112 1 550

Flow systems (VeriQ) 2 1 10

Ultrasound imaging system (VeriQ C) 2 - 2

Asia

VeriQ flowmeasurement instrument 3 4 38

VeriQC and imaging flowmeasurement instrument 3 4 13

Imaging probes 7 6 20

Flowmeasurement probes 348 375 1 289

Europe

VeriQ flowmeasurement instrument 14 4 30

VeriQC and imaging flowmeasurement instrument 1 2 4

Imaging probes 1 3 11

Flowmeasurement probes 939 932 3 712

Rest of the world

VeriQ flowmeasurement instrument 4 6 17

VeriQC and imaging flowmeasurement instrument 1 2 6

Imaging probes 2 1 10

Flowmeasurement probes 201 164 667

Total number of units outside the USA

VeriQ flowmeasurement instrument 21 14 85

VeriQC and imaging flowmeasurement instrument 5 8 23

Imaging probes 10 10 41

Flowmeasurement probes 1 488 1 471 5 668

25.04.2013 Medistim ASA Q1 2013