Difficult but satisfying year for medical device manufacturer
PRESS RELEASE
Famed Żywiec delivered twice as many hospital beds to its customers in 2020 (an increase of 97% year-on-year). The equipment went to dozens of countries, mainly to hospitals on the front line of the fight against the effects of the Covid-19 pandemic. Despite higher demand, higher production costs, and an increase in logistics costs, Famed did not decide to raise prices. At the same time, there was a sharp reduction in demand in the operating table segment, until now the most profitable equipment category. Despite the difficult situation, domestic and export revenues of the Żywiec-based company reached approximately PLN 75 million. This result is a quarter higher compared to 2019 and better than planned.
Famed expands into new markets in difficult times
Poza osiągniętymi kolejny raz dobrymi danymi dot. sprzedaży i poziomu przychodów, poprawie uległa także rentowność działalności. Zarówno na poziomie EBITDA jak i netto – przekraczając w znacznym stopniu założenia budżetowe Famedu na 2020 rok.
– We achieved a very satisfactory result, better than the plan, which to a limited extent took into account the impact of the pandemic situation on our business. In our case, the negative trend involved a significant slowdown in the operating table segment. On the other hand, the intense growth in demand for hospital beds is a sign of pandemic time for us, so to speak. However, we had to demonstrate great flexibility both in implementing projects with extremely short delivery times and in changing our production plans,» judges Marek Suczyk.
Another of the challenges faced by the company from Żywiec was the fluctuation of transport rates. There were cases when the price increased to a level where the cost of delivery exceeded the value of the equipment ordered. A factor affecting the assessment of the results achieved was a reduction in demand for operating tables, the most profitable products in Famed’s portfolio. It was only in the second half of the year that an increase in interest in this product segment was noted, which was a sign of a return to «normality», giving hope for better business results.
– The pandemic caused prices of medical products and health services to rise. Hospital beds were a very «hot» item around the world, but we chose not to raise prices. As a result, we significantly strengthened the capital of trust in our brand. This difficult time was a test for the health care system and the manufacturers that support it. I believe that we have risen to the challenge by fulfilling our mission, i.e. offering medical personnel products which increase the safety and effectiveness of therapy,» comments Marek Suczyk. – At the same time, although the possibility of expansion was severely limited due to barriers related to Covid, we managed to enter new markets on four continents. We have expanded our customer base to include hospitals in Botswana and Libya, Paraguay, Nepal and Luxembourg,» he adds.
Currently, Famed Żywiec supplies medical equipment manufactured in Poland to 105 countries.
Four strong foundations with an eye on the future: Poland, China, Saudi Arabia and Russia
The largest increase in revenue, by 71 percent, took place in Poland, where Famed completed, among others, the delivery of 500 beds for the Great Orchestra of Christmas Charity. The domestic market is a priority for Famed and by default generates about one third of its revenues. The company can be proud of good results in countries where it is consistently building its brand, namely China and Saudi Arabia, as well as in Russia, where Famed is gradually strengthening its position. In China, where the equipping of local hospitals for Covidu began in the first quarter, sales increased by more than 20 percent. A similar increase was achieved in Saudi Arabia. The largest increase in sales, at 93 percent, was recorded in Russia.
– Thanks to our extensive sales network in China, we have been able to successfully supply equipment in many different regions of the country, which has brought results. However, we are particularly pleased with the improvement we recorded in Russia, not an easy market, where new products are not quickly accepted – says Marek Suczyk. – The Famed brand has been there for several years. We are increasing our market share step by step, but gradually. We focus mainly on reliability, not the origin of the products, which is also influenced by the complicated political situation between Russia and the EU. Last year’s doubling of sales means that the many years of effort are paying off. It also bodes well for the future,» he adds.
The best-selling model in 2020 was Famed Nexo – the most popular Polish hospital bed. It accounted for almost 2/3 of the total sales volume in this product segment. The key factor in the continued interest in it remains its wide functionality. This model can be used in ICU wards as well as in less demanding hospital environments. At the same time, the company recorded more than doubled sales of Famed Nano and Famed LE-13, more expensive beds intended specifically for intensive care units.
Future scenarios – Famed approaches challenges with confidence
– It is still difficult to assume any scenarios as certain. However, with high probability we expect decrease in demand for hospital beds. First of all, because it is not the equipment that is the bottleneck but the lack of medical staff to operate it – says Marek Suczyk.
The company hopes to continue reversing the trend in operating room refitting. It also plans to focus on improving antibacterial technology for hospital beds, which it has pioneered.
– We expect a change in the approach to medical equipment disinfection towards greater automation. Anticipating this trend, we have been developing technologies in this area for some time now,» comments Marek Suczyk. – Times are still uncertain, but the fact that we have a wide product portfolio, we manufacture with our own resources and continuously developed technologies, and we are present in more than 100 countries makes risk management much easier. We can handle any situation and we look to the future with optimism,» he concludes.