STOCKHOLM (Reuters) -Radiation therapy equipment maker Elekta said on Wednesday it was preparing for more high supply chain and related costs after profits tumbled in the three months to July.
Shares in the company fell 6% in early trade.
The Swedish group said its fiscal operating profit in May-July fell 40% to 201 million Swedish crowns ($23 million) from a year earlier due to higher supply chain, logistics and service expenses caused by the pandemic.
"We expect the situation of higher supply chain and logistics costs to continue during the second quarter," Chief Executive Gustaf Salford said in a statement.
"We expect the current supply chain challenges and the impact on margins to gradually improve," he added.
The company said it had no major issues with actual supply in the short term.
"The continuity of Elektas supply chain has benefited from a dual source strategy and the fact that Elekta and its suppliers being labelled essential business by relevant government authorities," it said.
Elekta forecast the overall market would continue to recover and the firm's ability to install systems at customer sites would keep improving in the second quarter, after sales grew 1% in the first quarter.
But it said the risk for new waves of the pandemic, especially in emerging markets, increased uncertainty in order volumes and installation plans.
Elekta, whose rival Varian Medical Systems (NYSE:VAR) is being bought by Germany's Siemens Healthineers, said in May it expected to increase sales by more than 7% a year until 2024/25, with an improved operating margin.
It said in June it would increase investments in innovation as part of the company’s new mid-term strategy.
($1=8.7109 Swedish crowns)