Mauna Kea's ("MKEA") Q3/2020 sales exceeded management's expectations, growing 13% YoY to €2.0m (Q3/2019: €1.8m). Systems and services revenue grew 58% and 37% respectively compared to Q3/2019, largely reflecting a rebound in capital sales in all markets. The anticipated fall in consumable sales was also less than expected (16% vs. 23% - 27%);driven by better than expected performance from the US pay-per-use ("PPU") programme. We also note the narrowing YoY sales performance between H1/2020 (-47% YoY) and 9M/2020 (-28% YoY) highlighting a moderate H2 recovery in-line with growing procedure volumes. We remain cautiously optimistic regarding MKEA's near term outlook and expect the positive growth trend to continue into Q4/2020. We maintain and reiterate our OUTPERFORM recommendation and target price ("TP") of €3.10.
