SOURCE: BB MEDTECH AG

April 28, 2009 01:41 ET

BB MEDTECH AG: A solid first quarter; ways of minimizing the discount are being reviewed

SCHAFFHAUSEN, SWITZERLAND--(Marketwire - April 28, 2009) -


The past quarter was highlighted by recessionary worries in the first two months and corporate results that, at least in some cases, fell short of analyst expectations, two factors that led to a massive wave of selling on stock markets. A slight recovery set in during the month of March. The Swiss Market Index (SMI) retreated 11% in the first quarter of 2009 while in Germany the DAX index lost an even greater 15%. The Net Asset Value of BB MEDTECH was unable to completely avoid the negative market trend but it nevertheless clearly outperformed the benchmark indices.

The dividend adjusted Net Asset Value declined 4%, which represents an outperformance of 7% versus the SMI and 10% versus the DAX. In the wake of the continuing financial market crisis, and the ensuing widespread selling pressure on stock markets, or rather the absence of buyers, BB MEDTECH shares were also marked down 11% notwithstanding the solid development in its portfolio value. Trading volumes were low and a second reason for the decline was, in our opinion, the convertible bond maturing on March 6, 2009, which had a mandatory conversion ratio of 50% and prompted some investors to engage in arbitrage trading. The divergent trends between Net Asset Value and share price caused the discount to widen to 18% as at March 31, 2009. At the Annual General Meeting of shareholders on March 30, 2009, the Board of Directors of BB MEDTECH AG made clear that it regards itself as obligated to review all potential means of reducing the discount. It has therefore passed a resolution to have the corresponding legal, tax and financial requirements and conditions of the various alternatives clarified by specialized firms.

Shareholders' equity (excl. treasury shares) amounted to CHF 488 mn as at March 31, 2009 (-6% since December 31, 2008). Shareholders at the Annual General Meeting on March 30, 2009, approved all proposals submitted by the Board of Directors, including the dividend payout of CHF 0.90 per registered share and the re-election of the sitting Board members Heino von Prondzynski and Dr. Wolfgang Reim as well as the election of Laura Rossi as a new Board member. Dr. Ernst Thomke did not stand for re-election. We thank Dr. Thomke for his great dedication and support during his nine years of service as Chairman of the Board of Directors and as a Board member. Upon her election to the Board of Directors, Laura Rossi resigned from the BB MEDTECH management team after nine successful years. The management team is now headed by Stefan Blum.

As part of its efforts to promote the continual development of BB MEDTECH, the Board of Directors confirmed the cornerstones of the company's investment strategy. Detailed fundamental market and company analysis and regular close contact with the management of our portfolio holdings remain the focal point of our activities as in the past. The expertise of the Board of Directors and the management team in the medtech market and our extensive industry network will likewise remain the key elements of our investment process. Our objective is to have a portfolio of 10 to 15 participations in mid-sized, well managed companies positioned in highly attractive segments of the medical technology market such as molecular diagnostics. The geographic focuses are on Europe and North America but may be widened to include individual participations in Asia. In addition, we also have the possibility of becoming an active investor in a company.

Our investment focus on defensive sectors within the medtech industry paid off during the first quarter. Only minor changes were made to our portfolio during the past quarter. We slightly reduced our positions in Qiagen and Masimo. The position in Axis-Shield was increased somewhat. The management and supervisory boards of Epigenomics decided to conduct a capital increase without subscription rights. We were able to more than double our participation in Epigenomics through this capital increase.

As of March 31, 2009, 77% of BB MEDTECH's assets were invested. As in the preceding months, the high cash allocation is a reflection of the portfolio realignment process as well as the volatile market environment. Last year revealed that not every subsector of the global medtech market is immune to macroeconomic cycles. Nevertheless, we are confident that the current weakness on stock markets also offers opportunities to profit from historically low valuation levels and selectively add positions in attractive, fundamentally sound medtech companies to our portfolio in the coming months.

We remain convinced that the medical technology market offers investors above-average returns over the long term driven by demographic developments and innovation. BB MEDTECH's share price gained 82% (incl. dividends) between early 2000 and March 31, 2009, and we are optimistic that we will sustain this trend for our shareholders in the remaining quarters of 2009.




The composition of BB MEDTECH's portfolio as at March 31, 2009 is the following (in % of equity, rounded values):


Qiagen                                               20.5%
Fresenius preferred shares                           11.5%
Fresenius common shares                               2.4%
Tecan                                                 8.9%
Illumina                                              7.2%
Masimo                                                7.2%
Mindray                                               5.3%
Galenica                                              3.7%
Celera                                                3.7%
Carl Zeiss Meditec                                    2.9%
Epigenomics                                           2.5%
Axis-Shield                                           1.2%
Optos                                                 0.4%
Vascular Innovation preferred shares1)              < 0.1%

SWAP agreement on treasury shares                   < 0.1%

Total securities                       CHF 377.8 mn  77.5%

Liquid funds (net)                     CHF 105.8 mn  21.7%
Other assets                            CHF 10.1 mn   2.1%
Other payables                         CHF (6.0) mn (1.2)%

Total shareholders' equity             CHF 487.7 mn 100.0%
Own shares (in % of company)                         12.8%

1) unlisted company



The Quarterly Report as at March 31, 2009 is available on www.bbmedtech.com





For further information please contact:
Bellevue Asset Management AG, Seestrasse 16, CH-8700 Kusnacht/Zurich
Thomas Egger or Anja Stubenrauch, phone +41 44 267 67 00





Company profile

BB MEDTECH acquires shares in companies in the growth market of medical technology. BB MEDTECH is listed on the Swiss Stock Exchange and in Germany. The focus of the shareholdings is on listed companies in Europe and North America that are taking on a market leadership role in their area of activities and demonstrate sustained turnover and income potential. For its selection of holdings, BB MEDTECH relies on fundamental analysis by industry experts. The Board of Directors has many years of industrial and scientific experience behind it.

pdf Engl.: http://hugin.info/130286/R/1308816/301953.pdf


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