HTL-Strefa

EBITDA: EUR 29 million in 2015
Number of Employees: 1,179
Sales: EUR 68 million in 2015

HTL-Strefa is the globally unrivalled, leading developer and provider of blood micro-sampling medical devices with a 46% global market share in safety lancets, with a strong and growing global position in personal lancets and pen needles.

The blood sampling lancets are used for single-use capillary blood testing, while pen needles are used for hypodermic injections, mainly addressing the growing global diabetes patient population, point-of-care testing, and increasing safety compliance of professional care.

HTL-Strefa sell its products in over 80 countries and provide products to two target groups of end users: professional care customers such as hospitals and nursing homes, as well as home care customers, which include diabetes patients. The Company manufactures and sells more than two billion high quality lancets and pen needles per year.

About a quarter of HTL-Strefa's sales are sold under HTL-Strefa's own brands through distributors and hospitals, with the remaining sales being based on long-term contracts with leading diabetes companies and distributors. HTL-Strefa is known for high quality and the products are protected by patents and governed by tight regulatory requirements (such as FDA requirements for medical devices). HTL-Strefa has two modern and automated production facilities in central Poland, which benefit from integrated in-sourced needle grinding and plastic molding as well as a focused packaging and storage facility in the US. HTL-Strefa has industry-leading technological and production process knowledge which ensures best-in-class quality, efficiency, innovation and profitability.

The origins of HTL-Strefa go back to 1995 when production of lancets was started. The company was listed on the Warsaw stock exchange in 2006 and was acquired by EQT in 2009 in a take-private transaction.

To HTL-Strefa

Market trends and drivers

The key underlying market driver for safety lancets is the growing need for safe blood glucose test in hospitals and the growth of insulin users. In addition, the market is powered by increasing regulation and safety standards in mature and new markets in parallel with a growing usage of point-of-care testing from single blood drop, also reaching outside the diabetes market.

The personal lancet and pen needle markets are similarly driven by continued growth of diabetes prevalence, diabetes diagnosis and insulin usage as well as reduced reuse of devices on the back of increased compliance to treatment. Pen needle demand is moreover enhanced as insulin pens are substituting syringes as insulin delivery mechanism.

Investment potential

When EQT acquired HTL-Strefa the key factors were an attractive underlying market with low cyclicality and strong growth, which is driven by demographic trends, health and safety regulations, new applications and growth in emerging markets. The entire value chain of lancets has high profitability and HTL-Strefa has industry-leading margins.

The business plan is focused on revenue growth by strengthening HTL-Strefa’s leading market position in safety lancets, driving sales of own brands, winning new customers as innovative market challenger in pen needles (e.g. with safety pen needles), launching new products and focusing on innovation. Margins can be improved with economies of scale and operational excellence.

HTL-Strefa expects strong sales growth to continue and to be driven by strong market growth and market share gains. Productivity improvements and fixed cost leverage are expected to drive margin expansion.