ContextVision AB (publ)

Welcome to Context Vision and welcome to the presentation of our second quarter results. Today with Richard, our CFO, myself, Gerald, we have an agenda with three agenda items, a business update, a deep dive into the financial development and a brief summary and outlook. Without further ado, let's look into the business update and the second quarter 2025. We continue to expand our partnership network to advance into quantitative ultrasound and in the second quarter we have signed up University of Waterloo, InFace Solutions and Amra Medical. We have attended a conference CMEF in Shanghai in April. We have signed up a new customer and a new platform also in Asia and that was within specialty ultrasound. And I'm very excited that we have released in the second quarter a major revamped upgrade as well as a completion of an entirely new software platform with a new architecture that will be the foundation for an entire new series of products that are going to be clinically focused. Now looking at the financials, we saw a decline in revenues to 28.6 million SIC and that's a 10% decline compared to previous year. EBITDA amounted to 5.1 million SIC and that is adjusted for investments into data quality and corresponds to a 7.8% EBITDA margin. Operating cash flow was 1.5 million SEK. So in total for the first half year, we can report revenue amounting to 54.9 million SEK and an EBITDA of 7.2 million SEK. So again, most impact due to external factors while factors in our control like when a loss of new platforms remain stable. But Richard is going to dive deeper into the circumstances around the financials in a minute. But let's spend two more slides on the development of the business. And in the long run, we see that we're trending sideways looking at the 12-month rolling revenue. So compounded average growth rate is 8.4% between 2020 and 2024. EBITDA is slightly tilting down last year and that is not a surprise as we have started already in 2023 investing substantially into our data quality and POCUS venture which is reflected in those margins. So a bit more in detail now for the second quarter of 2025. We continue at a high pace, both in data quality as well as in image quality. So in image quality, looking at our sales and opportunities, we've attended CMF, the largest conference in Asia, and it happened in Shanghai in April in the second quarter. We've signed new contracts not only in ultrasound but also in x-ray and in particular a new customer and platform in Asia within specialty ultrasound. Now also important to mention that we see a transition and the trend on the technical side in the entire industry where we're seeing changes in the signal processing chain. Now those discussions we're having with leading OEMs reveal that those are actually good business opportunities for us moving into the imaging chain. So in that respect, also looking into the product development and the portfolio, I'm really happy that we were able to release a major upgrade for Revent and that is going to improve performance of the software as well as allows us to support new service offerings. I also mentioned in the summary that we've completed the development of an entirely new platform and that is particularly important as we're moving more towards offering clinically focused solutions. Now the launch of the first product in relation to that new platform and architecture is scheduled for the fall of this year. Regarding now a bit more the progress in our data quality segment, we're showing steady progress working off the milestones and in particular we had to expand our partnership network and strengthen both the clinical as well as the technical contributions to developing our AI-based solutions for organ-specific data analysis solutions, and that's primarily with the University of Waterloo, and there it's the Laboratory on Innovative Technology in Medical Ultrasound, LITMUS, that is joining with their experts from Canada, as well as technical experts from Insphase Solutions, who are based in Norway. Now, these partnerships will provide technical expertise in ultrasound and technical expertise in quantitative imaging or quantitative ultrasound, both to help us building AI-powered technologies within medical imaging. Later on, we also signed a partnership agreement with Amra Medical in Sweden, and they're an MRI-based analysis company that will allow us to measure liver fat, PDFF, MR-based liver fat measurements as well as abdominal fat volumes and detailed muscle assessments. So together with AMRA's contribution, we will enrich what we call the multimodal data set and enable correlations between MRI and ultrasound imaging biomarkers. So that is really strengthening the development of disease staging that we're spearheading with our POCUS venture. Now, looking at the headwinds and challenges, I also want to spend some time going a bit deeper there. As in many industries, also the market trends in the medical imaging sector show a general hesitation from customers caused by uncertainty from tariffs, higher costs and tighter budgets throughout the supply chain. So I think it's fair to say that purchases are being withheld and earlier build-ups inventories are being sold off. So besides that I think we should also mention that we see a trend in particular in medical ultrasound where we see a shift of higher segments more to mid and low range product range with lower costs. And again, that might be related to the market entry barriers that we've recently seen changing in the US, in Europe and in Asia. So I think the strategic caution in the market and our outlook into the market developments may persist in the near term. But we need to keep in mind that the entire medical imaging market is still a growing market with growing demand for imaging and the market is adapting to the new settings. So beside those more general trends, I think I also want to mention that we have, in the second quarter, lost a particular platform in X-Ray to a low price competitor in Asia. And at the same time, we're facing a phase out of an ultrasound platform that we're having under contract. Now, this is pretty normal that we see platforms being phased out and new platforms being phased in that we've already contracted under 2024 and early 2025. But there are time shifts in ramping up. So along with the general market conditions, we're negatively affected currently. But still, we're committed to keep our high pace, both in image quality as well as in data quality. We're progressing well and we see that we're at the end really addressing one of the most prevalent and fastest growing chronic conditions with our solution and that is fatty liver disease as we mentioned earlier. Now, I think that's about a brief deep dive into the business. I'll hand over Richard to you for a deep dive into the financials. Okay.

Thank you, Gerald. Now, looking at our revenue development, we saw a decline of approximately 10% in revenue compared to Q2 last year, now reaching 28.6 million SEK. During the quarter, we've seen continued FX headwinds, with US dollar and euro weakening against the SEC, affecting our revenue negatively with 3.5%, or 1.1 million SEK. We've also seen a decrease of licensed sales in Asia, as our customers are facing uncertain market conditions. And besides that, we've seen a shift to lower segment level in some cases, thus affecting us. In the six-month period, we reached 54.9 million in revenue with a negative FX effect of 2.6% or 1.7 million SEK. In general, we see that manufacturers in the sector are affected by both political and economical turbulence where global trade and supply chain delay purchasing decisions. We expect these uncertain market conditions to continue in the short term, but we're confident in our long-term strategy focusing on both image quality and data quality to support long-term growth. Now looking at our profitability, our EBITDA adjusted for investment into data quality came in at 5.1 million SEK with an adjusted EBITDA margin of 17.8%. The main reason for this is the decrease in revenue and to the factors mentioned previously, as well as transactional effects affecting our EBITDA negatively with almost 1.1 million in the quarter. In general, we've also kept investing in R&D and in data quality as we're moving closer to the clinical study start. There will be continued investments in data quality going forward, especially when we start the clinical study, but our expectation is that it's going to be well worth it. Now looking at our cash flow and financial position. Our cash flow came in at the negative 0.2 million SEK with cash flow from operating activities reaching one and a half million in the quarter. In the first six months our cash flow was negative 0.4 million SEK with operating cash flow of 1.8 million. The reason for the negative cash flow is a mix of lower revenues, increased spend in R&D and investments in ultrasound and IT equipment. As you can see in the left bar, we've had the share buyback of almost 8 million SEIC in 2024, which took place in December. To sum up, our cash position is still strong at 70 million SEIC, giving us plenty of headroom for both further investments in image quality and data quality, M&A exploration, and shareholder value increasing activities, such as share buyback programs. We are in a good cash position to continue our investments to reach our long-term strategy for growth. And with that, Cheryl, I'll hand it over to you for summary and outlook.

I could just chime in, as you said, with a brief summary and outlook. So we have met in the second quarter critical milestones within data quality, in particular signing up new partners to the team, University of Oslo, Inphase and Amra Medical. In image quality we continue to see high interest from existing and new customers both when we are on conferences as well as when we're talking about new opportunities and product improvements that we have done for instance with our Revent upgrade release and the new platform that is going to be the base for a series of new clinically focused products. So moving forward, we'll add in data quality further partners to our network. We're approaching our clinical study and we see a good launch plan for our new products in the fall of this year. Now, we remain very optimistic for our future. However, we need to face the fact of difficult, I would say almost unpredictable market conditions in the short run, given global trade and supply chain affecting purchase decisions. Now, with that summary, I'll thank for your attention and hope to see you soon.