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2016-05-09

C-RAD AB – Interim report January-March 2016

port January-March 2016

Press release 2016-05-09

Key events in the period January-March 2016

-- Net sales: Jan-Mar 17.3 (15.2) MSEK, +13%
-- Rolling 12m 68.2 (57.3) MSEK +19%
-- Order intake: Jan-Mar 13.0 (22.1) MSEK, -41%
-- Rolling 12m 79.0 (75.8) MSEK +4%
-- Operating loss: Jan-Mar -8.2 (-2.4) MSEK
-- Net results per share: Jan-Mar -0.39 (-0.15)

· Catalyst System has been approved by Chinese FDA
· C-RAD receives first U.S. order for a proton therapy center
· The Board of C-RAD proposes a rights issue and secures the financing
of operations until 2017, when cash flow is expected to be positive

Comments from Tim Thurn, CEO:

During the first quarter we build on what we achieved in 2015. Revenues for the
entire group amounted to 17.3 MSEK in Q1 2016. This is an improvement of 13%
compared to Q1 2015, and is in line with our budgeted targets. Order intake
totaled 13 MSEK during Q1 2016, down by 41% from Q1 2015. However we continue
to see significant growth in the sales regions US, Asia and France which is
reflected in order intake. Decreases were noted in the Nordics and the
German-speaking cluster. These regions should be seen in the light of the first
quarter being exceptionally strong last year. First quarters in our industry
are not usually strong, especially in Europe and Asia, where most of our
clinical customers are government-funded; there the strong demand usually comes
in Q4. Despite this dip, this does not change our overall expectation for the
year. Only one deal has been lost, while other have been delayed.

A significant step has been taken during the first quarter. The approval for
marketing and selling the Catalyst system has been issued by the China FDA.
Adding to its earlier approval of our Cyrpa laser systems. Based on our market
preparations thus far and our presentations to clinical groups, we see a
considerable high interest among our potential customers. A clinical symposium
for our Chinese customers with international speakers presenting their
experiences and research results will be held in May in Shanghai. The first
tenders, where C-RAD products are part of the procurement scope, are ongoing.
C-RAD’s new version of the Catalyst System for use in proton and particle
therapy is tailored to perform the high-end radiation therapy treatment
techniques that are increasingly becoming widespread. We entered the proton
therapy arena with our first order in Sweden last year, and extremely positive
is that we now have secured our first order in the US as well. We will continue
to put additional focus on the proton and particle therapy market, which is
expected to grow by 14-17 percent annually through 2030.

In order to further improve our gross profit margin, we have launched a series
of initiatives to develop and optimize our supply chain. C-RAD’s target is to
increase the gross profit margin from 52% in 2015 to 60% by 2017.

An update on the lawsuit brought by Beamocular AB: The parties have filed
briefs in the District Court and have filed their statements of evidence. The
court has set the hearing for the end of September. Our assessment is that
C-RAD has very good chances to win the case, and that the particular patent in
question does not have a great significance, as it is not used in our business
operations.

C-RAD’s exhibition at the recent European Society for Radiotherapy & Oncology
(ESTRO) meeting in Turin, Italy, which took place in the beginning of May, was
well visited. In particular, visitors expressed great interest in stereotactic
(SRS) treatments as well as breast cancer treatments.

The cooperation with CERN with respect to the development of the GEMini
detector helped us to progress towards more robust detector and improved image
quality. We have increased tests with the detector to capture clinical images,
and have also initiated commercial activities with our GEMini detector system,
to target specific customers.

Since the end of the quarter, the Annual General Meeting on April 14 approved a
capital increase and a new share issue totaling 45 MSEK, with preferential
right for the Company’s existing shareholders. The CEO and the CFO, the Board
and the three largest shareholders – Per Hamberg, Olle Stenfors and Lars Kling
– have all undertaken to subscribe for their pro rata shares. Hamberg and Kling
have moreover guaranteed an additional 23 MSEK, which, taken with additional
guarantees from others, mean that the rights issue is fully guaranteed.

Looking ahead, we continue to see strong indicators of financial growth on our
main markets, as well as for our strongly developing service business,
supporting our confidence that we will reach our strategic targets.

About C-RAD

C-RAD develops innovative solutions for use in advanced radiation therapy. The
C-RAD group offers products and solutions for patient positioning, tumor
localization and radiation treatment systems. End users are radiation therapy
clinics worldwide. All product development is conducted in three fully owned
subsidiaries: C-RAD Positioning AB, C-RAD Imaging AB and C-RAD Innovation AB,
all of which are located in Uppsala, Sweden. Employees currently number 43.
C-RAD’s business originates from research and development at Karolinska
Institutet in Solna, Sweden. Sales of the company’s first product, the C-RAD
SentinelTM, started in 2007. Cooperation agreements have been signed with
Elekta (Sweden), Varian (USA) and IBA (Belgium). C-RAD is represented by
distributors specialized in radiation therapy on major markets. C-RAD has
established three companies for direct sales: C-RAD Inc. in the US, C-RAD GmbH
in Germany and C-RAD WOFE in China. Cyrpa International SPRL, a Franco-Belgian
laser company, is a wholly owned subsidiary whose operations are being
integrated. C-RAD AB is listed on NASDAQ Stockholm.

For more information on C-RAD, please visit www.c-rad.com

For further information:

Tim Thurn, CEO C-RAD AB, Phone +46-18-666930, Email investors@c-rad.com

The above information is price-sensitive and must therefore be disclosed under
the Securities Market Act (2007:528).

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