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Since its birth in 1996, Revenio has established itself as the world reference in terms of tonometers, devices used to measure intraocular pressure, a key indicator of glaucoma. This Finnish company markets iCare, a range of rebound tonometers (known as “RBT”) born from its R & D, which allows eye pressure to be measured accurately, quickly and painlessly. The system has given Revenio a considerable technological lead in its sector, reinforced by a skilful distribution strategy for professionals. The equipment manufacturer also benefits from a light structure: it develops and designs, but production is outsourced.
Formerly more extensive, probably too extensive, the product catalog has been gradually refocused on tonometers. But to avoid feeling too cramped there, the Finn has decided to diversify into other areas of ophthalmology. To do this, it first acquired the Italian manufacturer of fundus imaging equipment CenterVue in 2019, then the Australian specialist in ophthalmology software Oculo in 2021. The scope of Revenio has therefore widened, which enables it to respond to larger calls for tenders, in particular when it is necessary to equip practitioners or care centers with new equipment. Ultimately, the management aspires to make the group an essential leader in the field of state-of-the-art ophthalmological equipment, as well as in the software part that accompanies it.
Outstanding profitability
The recent growth dynamic is a good illustration of the company’s strengths: its turnover has jumped by an average of 27% per year over the last five years, whereas the growth of its reference market has traditionally been between 5 and 6%. This rise has not come at the expense of profitability, which is extremely high. It even establishes itself at the best sectoral standards, despite Revenio’s small size. The operating margin reaches around 30% and the net margin fluctuates between 25 and 30%. There is no debt and cash generation is strong. The valuation is a bit high, as for any growth company, but it has returned to decent levels after the post-Covid surge. Turnover should increase from 97 million euros in 2022 to more than 140 million in 2025. If margins remain within current limits, which is a reasonable assumption, the increase in results will automatically improve financial ratios and help support the course of action.
This rather flattering picture should not hide the challenges facing the company. We identify two. First, the intellectual property advantage of RBT technology is expected to diminish this year. A lesser evil, because Revenio can rely on its reputation, expertise and other patents to keep its rivals at bay. Especially since the Finn also relies on its new software brick to continue to stand out. The other issue relates to its ability to resolve the operational difficulties that its change in size brings about. By leaving its niche positioning, Revenio must take a step forward and face more powerful competitors.
Despite these two downsides, the intrinsic quality of the company, flourishing and well managed, is to be underlined. It also has some loyal supporters, such as the Danish fund William Demant Invest, the largest shareholder with 16% of the capital, which has supported it since 2018. Several well-known European funds are also positioned. Revenio wraps itself, finally, in a light speculative perfume. Valued at 1 billion euros on the stock market, this nugget has something to interest a well-established player in medical equipment who would seek to expand or diversify its range.