Alk-Abello As B Shs New

Hello everyone and welcome to this presentation of ALK's Q1 results and full year outlook for 2025. Thank you all for joining us. Let's turn to slide number two with an introduction to the agenda and the speakers. My name is Per Plotnikoff, I am Head of Investor Relations and with me today are CEO Peter Halling and CFO Klaus Steensens earlier. We will first be sharing a few highlights from the quarter, followed by a closer look at the markets, product trends and financials. And we will then provide an update on recent progress on our paediatric agenda and on the NEFI partnership before we move to the full year outlook. As usual, We will end the presentation with a Q&A session. And to get started, I'll hand over to Peter and slide number three for the highlights. Please go ahead, Peter.

Thank you, Per, and thank you all for joining today's call. As expected, Q1 results were solid. Revenue grew by 12% to 1.5 billion Danish kroner. Moreover, all sales regions had double-digit growth, and we were pleased to see sales in North America bounce back with 14% growth, as we started to see results from initiatives to get this region back on track. Across regions, tablets stood out as the main contributor to growth. Global tablet sales increased by 22%, and growth was predominantly driven by higher volumes and shipments to our partner, Torii, in Japan. We only had a minor effect from pricing adjustments compared to last year, where improved pricing and rebate adjustments delivered half the growth in our main region, Europe. Within the tablet range, the Hausdorfs MyTablet AcarisX performed very well across markets in Europe and North America. The tablet's new pediatric indication contributed to growth and the initial market response to the launch has been very encouraging. We are determined to achieve the good results with our treat tablet for young children and older lessons as well. Earnings improved by 50% in local currencies to 469 million DKK, yielding an EBIT margin of 31%. The strong progress was also made feasible by last year's execution of optimization and prioritization initiatives, which are generating savings of plus 300 million DKK in 2025. Savings that allow us to pursue strategic priorities more rigorously without jeopardizing earnings improvement. Klaus will elaborate on these results later. So, ALK was off to a solid start in this year and we remain optimistic about the year ahead, despite the current turmoil in the markets from trade and tariffs wars, which we believe will only have a modest impact on ALK. Accordingly, we maintain the full year outlook. We will detail this further during the presentation, but first, I'll hand it over to you, Claus, and the market trends on slide 4. Thanks, Peter.

Let's dive into the performance in our three sales regions. Our main region, Europe, reported 10% growth, driven by double-digit growth in several key markets, including the two largest European markets, Germany and France. Tablets remain the number one source of growth. Tablet sales increased by 17% on high single or double-digit growth in all markets, except in those where we downsized the sales organizations last year. Volume growth was roughly in line with last year, while there was a reduced impact from price and rebate adjustments. The intake of new tablet patients during the 2024 and 2025 initiation season exceeded last year's numbers by more than 10%. We continue to mobilize patients digitally and strengthen advocacy for the evidence-based tablet portfolio. The number of consumer touchpoints and the number of confirmed doctor visits in Q1 was ahead of targets driven by increased investments in digital activities aiming at driving suitable patients to see a doctor. Combined sales of skid and slit drops grew by 3%. Slit drops sales increased, while skid sales decreased slightly, partly due to fewer than expected new patients, partly due to a reduced impact from price and rebate adjustments. Sales of other products was up 1%. Revenue in North America increased by 14%. The tablet-focused business in Canada continued to deliver solid growth, while the US business recovered from last year's stagnancy and reported double-digit growth. All product lines progressed in the USA after we launched a number of initiatives to strengthen sales growth. Tablet sales in the region increased by 22%, skid bulk sales grew by 3%, while sales of other products increased by 20%. Revenue in international market was up 24%, despite no skid product shipments to China. Tablet revenue grew by 41%, driven by phasing of shipments to Japan. Our partner Tori is on track with a doubling of the API manufacturing capacity, which is expected to come on stream during the second half of the year, allowing Tori to incrementally increase market supply of ZetaCure in the fall. Higher tablet revenue was also reported in Southeast Asia, the Middle East and India, where our partner Dr. Redis launched Akaisax in April. Conversely, skip revenue in international market decreased by 85% as no products were shipped to China. After the recent renewal of ALK's import license, we plan to resume shipment to China from Q2 and onwards. In-market sales in China grew by double-digit in Q1 based on existing wholesaler inventories. Let's now turn to the product lines on slide 5. Tablet revenue was up 22% driven by double-digit growth in all sales regions. Revenue from skid and slid drops was unchanged, reflecting the slight decline in European skid sales and the absence of skid shipments to China. These factors were offset by growing slid drop sales in Europe and increasing skid bulk sales in North America. Global revenue from other products increased by 11%. Sales of lifestyle products such as vials and multi-test devices recovered from last year's phase-out of a major low-margin account in the USA as we upgraded the sales organization and focused on winning new accounts. The prepend product also did well in the US. Oppositely jigsed sales in Europe were temporarily affected by lower replacement rates for adrenaline pens in the UK and other markets. With these updates, let's move to slide 6 and the financial results. Revenue was up 12% in local currencies and exceeded 1.5 billion Danish kroner. Topline growth mainly reflected the progress in tablet sales. The gross profit of 1 billion Danish kroner yielded a gross margin of 67%, an improvement of one percentage point. The increase mirrored volume growth, changes to the sales mix and various production efficiencies, including reduced scrapping. Capacity costs decreased by 5% to 547 million Danish kroner. The decrease was enabled by last year's optimizations and prioritization activities or initiatives when we downsized operations in certain markets with limited immediate growth prospects. R&D expenses were flat, while sales and marketing as well as administration costs declined, so that the overall capacity cost-to-revenue ratio declined by 6% to 36%. The operating profit EBIT was up 50% to 469 million, fueled by higher sales, gross margin improvements, and lower capacity costs following last year's optimization activities. The EBIT margin increased from 23% to 31%, but looking at this level, please bear in mind that Q1 historically is our most profitable quarter. Free cash flow almost tripled to 330 million Danish kroner as higher earnings offset planned changes in working capital and additional investments to build up tablet production and upgrade legacy production. The net debt to EBITDA ratio is low and the effect of the one billion Danish kroner NEFI upfront payment to AIS Pharma back in November 24 is already being washed out of our numbers, indicating that our balance sheet is getting increasingly stronger. So all in all, yet another strong set of results. And with this, now back to Peter and a strategy update on slide seven.