DiaSorin S.p.A.

Good afternoon, this is the Coruscall Conference Operator. Welcome and thank you for joining the Diasorin Half Year 2026 Results Conference Call. As a reminder, all participants are in listen-only mode, and after the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Carlo Rosa, CEO of the Sorin. Please go ahead, sir.

Thank you, operator. Good morning, good afternoon, and welcome to the second quarter conference call. As usual, I'm going to comment on the results at constant exchange rate, and then our CFO, Mr. Donati, is going to take you through the numbers. So, quarter two to 2026 recorded a growth of 4%, and if actually we exclude two outliers, China and molecular growth would have been 5%, molecular respiratory. And this is confirming the expected quarterly progression provided during the full year 25 results in March. If we look at the three Technologies of the Sorin S.p.A. segment immunodiagnostic grew 4% in Q2, 5% ex-China. Fundamentally, return to growth is supported by double-digit performance in the U.S. as we have discussed during the Q1 results. Quarter 1 was actually affected by this talking on quantiferon. plus weather conditions in the U.S. So the growth of 4% globally is driven by U.S. and it's also recording a normalization in Europe and the impact of VBP in China. And we're going to talk about it later. And clearly in Q2 there are no one-off effects that has happened in Q1. If you look at molecular diagnostic, plus 1% in quarter two. Ex-respiratory, that as we have discussed many times, has affected the results of a lot of companies in H1. So without respiratory would be 4%. And as we're going to comment later, we have strong growth in our strategic product lines. And then finally, LTG, plus 7% in quarter two. And we see initial signs of recovery, especially in life science. But as we have discussed, H1 was a tough call compared to last year because of the ordering pattern. So this result is expected and has been discussed already in the quarter one call. So now let's deep dive in the technologies and let's first cover the immunodiagnostics. As we said in Q2, plus 4%, which is actually normalizing H1 growth to plus 2%. If we look at the different geographies, and we start from the U.S., the U.S. performance is back to historical growth with a hospital strategy that continues to deliver new hospitals. And we confirm our expectation of reaching 600 hospitals by the end of 2026. As said before, weather impact and TB destocking that we experienced in Q1 is behind us. And so we have experienced a double-digit growth in TB as well in the U.S., By the same token, specialty tests continue to show strong momentum in the U.S., and it's noteworthy that hypertension, which, as we have discussed, is a key product line for the S.sorin, we are experiencing an acceleration of our hypertension portfolio following the recent guidelines changes that Ironman, everybody, recommended to screen patients All patients suspected of hypertension right away with aldosterone and renin, which are two products that we carry both in Europe and the U.S. As far as LTB, again, is concerned, we see double growth in the U.S. and we see double-digit growth in Europe as well. And so this talking is important. is behind us. And for those of you who are interested, we have clearly not seen any activity by Roche so far. They presented the assay, but we don't see them yet on the market in Europe, notwithstanding the fact that the product got approved in Q2. Ex-US and Europe. If we look at all the other direct business ex-China, which means Australia, India, Brazil and Mexico, strong performance in Q2, 12% growth versus last year. If we look at our export business, it actually declined 7%. where we have been seeing Middle East clearly impacted due to the current situation, especially in Iran, where we had a very nice business. And comparing to Q2 last year, where we had over a million and a half of revenues this year, we registered no revenue. So we have this delta that we expect to continue to see In China, the business continues to decline, roughly 25%. In line with previous quarters, we see no end to the effect of EBP and competition by local suppliers. And honestly, at this stage, we don't expect H2 to show different results. It's been discussed many times. China for the Sorin is becoming a very small market, although, again, it continues to decline double digits. The only good news on China is that we expect to receive, by the end of the summer, approval of the TBSA. So starting from Q4, we will start to commercialize the liaison products in China as well. Now let's talk about molecular. I'm going to talk about the different technologies here. If you look at Q2 overall, the business has been slightly growing, 1% plus 1%, notwithstanding, again, the effect of a very soft flu season. If we go through the different franchises, and we start from the liaison MDX, which represents approximately €100 million of annualized revenues, we look at this business in actually three subsegments. We have targeted specialty, which is roughly €45 million of business annually. and this is growing very well for the Sorin in Q2 is up 25% versus last year and clearly this is fueled by the launch of all the specialty assays as we have discussed in the previous calls. We have still in this technology a smaller respiratory business which represents roughly 10 million of annualized revenues and this continues to decline. Minus 20% in Q2 and minus 35% in H1. Finally, roughly 40 million euro of ASR. ASR are those reagents that we use for, that customers use to develop LTDs in the US. And this business is very, it really depends on the ordering pattern in Q2 was relatively flat. We expected to be flat or low middle digit, single digit growth, sorry, single digit growth by rent. Again, all the impact here is really determining how this business is performing on a quarterly basis. Now let's move to multiplexing Q2 plus 7%. This clearly shows Multiplexing for us means the Virgin One Legacy product and the Liaison Plex. The growth of the business so far is heavily reliant on respiratory panel, as you can imagine, because we got approval of the blood panel recently, and we just launched them, and we really got approval of the GI panel in the last few weeks. So the plus 7% takes into account clearly a very negative impact on the flu season, although the rest of the proline is growing nicely and compensating the decline of flu. We have roughly 150 customers when it comes to Plex. The flex adoption continues to be very well received from the market with the vast majority of our clients choosing flex. So just to give an indication, only a third of our placements today are with the fixed, whereas the rest is primarily with flexed. My customer type, 90% hospitals and 10% commercial labs. So we have initiated to develop the business around the private labs and then we migrated very rapidly into the hospital systems in the U.S. that took longer to close, but we expect to represent the bulk of placements moving forward. So we're very happy about the way that this product line, the Plex, is received on the market, and we expect, by the way, to launch this product with now the full panel in Europe starting from Q1 of 2017. When it comes to the liaison net, we literally just started the commercialization of this product line through our distributors. I'm not going to provide numbers because those would not be of any significance. It is noteworthy that we have received also a fighting approval for our second assay, the group A strep. So now we have the full panel, and we are going to give better resolution in the Q3 and the Q4 calls, when also we are going to have a better understanding of the seasonal impact of flu in 2026. Last but not least, the LTG. The LTG, as we discussed many times in 2025, was... Haven is skewed toward H1, and then we had a light H2. And, again, this has to do with ordering pattern. Q2 was surprisingly very good, better than we expected. We grew 7%, and fundamentally we see a recovery in life science and biopharma business. And so we are confident that we're going to deliver by year-end, mid-possibly to high single-digit growth on this business. At this point, I'm going to leave the microphone to our CFO who's going to take you through the numbers. Thank you.

Thank you, Carlo. And good morning and good afternoon, everybody. And thank you again for joining us on H1 2026 Earning Calls. And thank you also for the continuous interest that you're constantly showing in our company. In the next few minutes, I'm going to walk you through the financial performance of the first half of the year, specifically with particular focus on the second quarter, and we'll then turn the line to the operator for the usual Q&A session. As we navigate through the results, you will see that H1 confirms the improvements we anticipated. Revenues came in flat at a constant exchange rate for the first half, while Q2 specifically delivered a return to growth at 4% at constant exchange rate, demonstrating the normalization, the progressive normalization of some of the extraordinary factors that impacted in Q1. As a result, we remain confident in achieving the full year guidance for 2026. Now, starting from revenues, H1 came in at €602 million, which was again flat at constant exchange rate compared to H1 2025, while at current exchange rates, revenue declined 3%, reflecting a total forex headwind of €20 million for the first six months of the year. The picture, however, is improving as the year progresses, because in Q2 2026, revenue grew 4% at constant exchange rate, and 3% at current exchange rates, with a much smaller Forex headwind of just 3 million in the quarter, which is a significant step up from Q1 when the Forex drag alone was around 17 million euros. This revenue improvement in Q2 reflects both the feeding of the extraordinary items that penalized Q1, Carlo mentioned them before, the exceptional weather events in North America, the stocking of certain large private customers in North America as well, and a more favorable base for currency translation. Moving to profitability, H1 adjusted gross profit came in at 390 million euro, which was minus 1% at constant exchange rates compared to H1 2025, and minus 4% at current exchange rates with a Forex headwind of 12 million. The adjusted gross margin remained S.p.A. is flowing directly to the gross margin line. The Q2 2026 adjusted gross profit was confirmed as 65% of revenues, and this is aligned with the same quarter of the previous year, notwithstanding the impact of the tariffs, which only marginally impacted Q2 2025, while at around 100 basis points impact in our Q2 2026 margin. Moving to the adjusted operating expenses for H1, they amounted to $241 million at cost and exchange rate, representing 40% of revenues. Now, if we exclude the commercial investment related to the next launch in North America, OPEX growth versus prior year is fundamentally entirely attributable to the inflationary impacts, including The annual salary increases, and this is again a reflection of the discipline cost management across the organization. H1 2026 adjusted EBIT came in at 149 million, 10% reduction at constant exchange rate, a 12% reduction at current exchange rate with a Forex headwind of around 4 million euro. The EBIT margin was 25% at current exchange rate and 24% at constant rates. The net financial expenses, again adjusted, were approximately $7 million in H-1 compared to $1 million in the prior year period. Now, this increase was mainly driven by lower interest income, which was a reflection of both lower market interest rate and lower average cash balances, as well as higher financing costs related to the credit facilities of the group. And this increase in borrowing and the reduction in the cash balances were primarily attributable to the ongoing share-buy-back program. Moving to the EBITDA, H1 2026, EBITDA closed at 194 million, down 7% at constant exchange rate and 10% at current exchange rate, reflecting a negative foreign impact of around 5 million euros. The EBITDA margin was 32% at both constant and current exchange rates, as confirmed by our guidance as well. And the year-on-year decline primarily reflects the impact of the VBP in China and the planned commercial investment to support the liaison nest launch in North America. Notably, the EBITDA margin improved from 31% in Q1 to 33% in Q2, benefiting from stronger revenue performance and so also demonstrating the operating leverage potential of the business. And as I was mentioning before, this trend is fully consistent with our expectations for the year and supports our confidence in achieving the full year EBITDA margin guidance of 32% to 33%. Turning to our balance sheet, and as well as the cash flow performance, we delivered a solid result despite the challenging revenue environment that affected us in Q1. Our net financial position showed the net debt of 844 million euro at the end of Q2 compared to 580 million in December 2025. These are 265 million movement that reflects on one side the good operating cash generation The free cash flow in H1 was 58 million compared to 83 million in H1-25, primarily due to the planned build-up of inventory to support the liaison-less launch. And this was more than offset on the other side by 233 million in share-by-back cash outflow under the program that the board, the shareholders' meeting approved back in January, and the payment of dividends for 65 million euros. Looking ahead, we expect for H2 cash generation to improve again in the second half of the year, supported by the stronger earning performance and a gradual normalization of inventory levels as the NAS rollout progresses. Now, going back for a second to the share buyback, as of today, the company has purchased around 3.6 million shares, representing approximately 6.5% of the share capital for a total of $236 million. And this is around 95% of the total program. Now, in light of the H1 results that I just mentioned and that came in line with our expectation, we are confirming our full-year guidance at constant exchange rates with a revenue growth 5% to 6% and an adjusted EBITDA margin 32% to 33%. I'll now hand over to the operator for the Q&A session.

Thank you. This is the Coral School Conference operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star N1 on their touchtone telephone. To remove yourself from the question queue, please press star N2. Please pick up the receiver when asking questions. We kindly ask to limit yourself to two questions only in interest of time. It will be star one for questions. First question is from Aisha Noor, Morgan Stanley.

Hi, good afternoon, Carlo and Alberto. Thank you for taking my question. My first one is on your molecular guidance for the full year, which I can see you have reiterated at low double digit growth for the full year. This after the first half results of, you know, including a week flu season will still imply that you need to deliver something like 27% organic growth in the second half. And I imagine you are going to fully load that for the flu season and NES in the fourth quarter. So would love to know what you're seeing, you know, in the market today with respect to the adoption of NES and what gives you still the confidence to deliver this very strong number in the fourth quarter. And then my second question is maybe for Alberto on the tariff number for the quarter. Did you book any tariff refunds that could have helped the EBITDA in this quarter and fully done or is there more to come? Thank you.

I will take the first one. Yes, you're right. Mathematically, it's 27%. You need to take into consideration a couple of elements. The first one is that we are thinking about, we take into account a normalized flu season, right? We know the last year flu season was particularly weak, so there is an effect of normalization in volume. that will work on our current install base. But the second and more important element is that we are developing a base of liaison plex, which we didn't have last year and clearly are not contributing too much to the revenue right now because we are off-season, so the volumes are very low. And the same reason with Ness. Last year we had no Ness whatsoever. We started commercialization. We expect to place a certain number of systems. Don't ask me how many, but a number of systems that will generate revenues in Q3 and especially Q4, where we expect the season to start. that clearly we didn't have last year. So don't be fooled necessarily by the percentage. And I think it makes more sense to look at the dollar amount that is necessary, which is, I believe, due to the calculation, based on last year, very reasonable.

Okay. I'll take the one on tariffs. So as you correctly recalled, we did initiate a refund action through the CBP's established refund mechanism for the EAPA tariffs, and we did receive in Q2 part of the refunds that we submitted in the order of magnitude of around $2.5 million, and you can appreciate that in the decrease of other operating expenses net of no recurring items. So if you look at our income statement, this is answering to your question. Next question is from David Westenberg, Piper Sandler.

Hi, thank you for taking my question. So I want to stick with the Q2 guide and acceleration there. Q2 was obviously much better than Q1. Are you seeing strength in Q3 so far? And as we look at H2, how confident are you on the easier flu comps than the normal flu season? I guess you kind of just already got into that, but I'd love to get that in a little bit more. Product launch, how are you thinking about overall business momentum as you exited the second half? And then, you know, just to continue with that, you know, the guide also includes some operating leverage. Do you feel like if you got those revenue hit that you would get that operating leverage? And then I just have one more.

Okay. So let me try to answer. Clearly, I need to – I cannot provide you a specific answer, but – If you look at the three components of the business, right, and you look at Q2 and expectations for Q3 and Q4, I believe that we have discussed molecular already when it comes to the assumptions we make on respiratory testing volume, which is normalized versus last year, which was a weak season. So I'm not going to comment on that. The second element is immunodagnostic. Immunodagnostic, the problem we had was an unexpected Q1, which I believe surprised everybody, I have to say, including ourselves. And that was an outlier. In the U.S., our immuno business traditionally has been growing double-digit. The destocking on TB was very heavy. So the underlying business was still very strong, but we had that effect. Plus, I have to say a weather effect. Don't forget we have a significant business with some of the big commercial labs, and that is particularly subject to these events. Q2, we are going back to normal. The quantiferon volume continues to increase in the U.S., primarily driven by the fact that there is more adoption of TB, especially in association with certain drugs, and certainly some work that Kyogen is doing on converting to blood testing the skin testings. We expect that in Q3 and Q4 these elements will continue, so we expect that we continue to see growth of our overall franchise for Immuno as we have seen in Q2. There is clearly a question mark which affected for Immuno Q2, which has been the Middle East, where so far, as said, we have seen just in a quarter an effect of 1.5 million just with Iran. We did not project any revenues moving forward, but clearly normalization of the Middle East would add more S.p.A. as a combination not only of order patterns, but certain projects that some of the partners developed. Q2 was very strong. And we see recovery in life science, and we see to the content of last year more instruments now being moved down the channel, which was a good surprise. So when it comes to H2, the LTG is going to be... Good contributor to the growth of the company. We expect the LTG to grow in the mid-double digit. So this explains why clearly we are positive on the year-end guidance. You asked how does Q3 look like. In four weeks, you can not tell much. I remind you that Q3 started four weeks ago.

Thank you. No, thank you. You answered probably four of my next questions, so I apologize. The next one's not going to be as good here. What are you seeing in terms of mix between, say, syndromic panels and single tests in the U.S. and trends for next year and the year out? What direction do you see that in? Are you seeing any changes in reimbursement difficulties on syndromic panels? I ask that because you obviously have that slack option that is beneficial. Thank you very much. That was great color on the last question. Thank you.

David, listen. For the sake of time, I really cannot take this question because we need to focus on Q2 and year-end, and this will take hours to discuss questions. What is going to happen next year? So you need to be a little bit more patient, and we're going to give color to this in our Q4. Thank you.

Next question is from Anca Verma, J.P. Morgan.

Hi, good afternoon. Thank you for taking my two questions. The first one is actually just a follow-up on Aisha's current question. Could you share how much of the tariff refunds will be left for H2 and how can we expect that to expect all of that to come to Q3 or will it be between Q3 and Q4? And also, could you share your FX guidance for the full year for 26? And then the second question is just around if we can get a bit more color around your next placements. I'm pretty sure you might not be able to give us the exact number, but just directionally how the placements have been going.

Michel, hi, this is Carlo.

Welcome back first. Let me start from the next question. I'm not going to give you numbers, it's too early. And I think that some of you have been, I saw that some of the analysts have been talking to our distributors and customers, and I believe there were some very good reports came about the system and the technology. S.p.A. S.p.A. Again, you need to be patient. Clearly, I'm fully biased about the technology. I believe this system is a beautiful system. As you can imagine, I believe that compared to what is out there, it is very handy when it comes to these physician office labs that are not at all ready to handle difficult technologies. But again, be a little bit more patient, and we'll talk about it in Q3 and Q4.

Thank you, Carlos. Take the other two. So regarding the tariff refund, let's start from what was the impact and what we paid in total, which was around $9 million in full. Now, regarding the refunds, 2.5, as mentioned, is what we received so far. But unfortunately, we do not have visibility of the timing of the remaining part of the refund. So we do not have an expectation in terms of when we're going to receive refunds. S.p.A. S.p.A. S.p.A. The exchange rate should remain at around 115, 116 with euro to US dollar. Our impact, full year impact should be in the range of around 25 million euro. As a reminder, we had around 20 million so far. Last year, second part of the year, the average was very similar. So should the exchange rate remain similar to the level of the last few weeks, we will have a minimal impact in the second half of the year.

Perfect. Thanks a lot, Carla and Alberto.

Next question is from Anna Ratcliffe, Bank of America.

Hi. Thank you so much for taking the questions. I wanted to follow up on quantifier on which was obviously really strong in Q2. Was any of that catch up from the slowdown in Q1 at all or it's all underlying momentum and could there be upside to the mid-single-digit guidance if that continues? And then I also wanted to quickly clarify on LTG. I see in the slide deck you guys have low single-digit growth as the guide for the full year, but all of the commentary seems to be pointing to the possibility of mid to high single-digit, so maybe just wanted to confirm what the LTG guidance is for this year. Thank you so much for taking the questions.

Okay, I'll take the question. Yes. We believe that LTG can give us a positive surprise. Again, we were not expecting Q2 to be so strong, and actually it was. Again, as said, we see that the funnel of instrument placement is going back to where it was prior to the last year defunding and all the consequences that that had, especially in the U.S., So, yes, I believe that it could really help us out in the second half, better than expectation. But let's see. Keep in mind it's a B2B business, so we reflect what our distributors, distributors being the very large life science companies, are going to tell us in Q3 and Q4. So I honestly recommend that you listen to what they say in order to understand the performance of this business. When it comes to quantiferon, no, it was not a catch-up. As I said, very specifically, the event we incurred in Q1 was destocking by a couple of very large private labs, which are the ones that typically provide quantiferon testing for visa. And since they saw that demand increased, for QuantiFeron testing was a declining study from Q4. They destocked, so they didn't buy for one quarter, and that affected our revenues just for a quarter. Now they start again with a regular pattern. And again, QuantiFeron, keep in mind, if you're trying to read our number, our revenues, and try to correlate to the Calgene revenues, I'm warning you, it's not possible. because we only deal with CLIA. So the chemiluminescence, which does represent a portion of the total revenues of QIAGEN because they have a lot of ELISA revenues, which are not in the U.S. and not in Europe, that follow a completely different dynamic. Again, so don't take our commentary on quantifier to try to read the The next question is from Charles Pittman King, Barclays.

Hi. Thank you very much for taking my question, Charles Pittman King from Barclays. Two, if I may. Firstly, I was wondering if you could just provide us S.p.A. S.p.A. And then just secondly, in terms of the results in 1H, you delivered quite a good beat on sales and marketing expenses versus consensus. I'm just wondering, is there any phasing within that related to market expectations around the NES costs that are actually going to be delivered in the second half, or if there are any one-offs that we need to take into account? Thank you very much.

I'm going to cover the first question. Look, It's unreasonable to ask us about our pricing policy because that's competitive information, and so I'm not going to comment on that. I have to tell you one thing, that today the reimbursement in the U.S. when it comes to the targeted, which means four essays, and I'm not actually commenting on the multiplexing, but on the four S.p.A. S.p.A. S.p.A. S.p.A. S.p.A. So far for the NESS in the second. On the second question, Alberto.

Absolutely. And just allow me to make sure that I get your question correctly. You're looking at each one results. Your question is related to the fact that they were better than your expectation and you want to know if there is any one-off or facing effect and what's the expectation in the second half. Did I understand correctly? Versus consensus, yes.

Sales and marketing expenses came in lower than expected. Just wondering if there's anyone else we need to take into account or if this is phasing or you guys are just performing better on the sales cost.

So I think that there are three elements. So I'll refer to the EBITDA margin in Q2 closing at 33% as a function of three effects. One is the good operating leverage that we have compared to Q1. The second one is also a favorable mix. As Carlo was mentioning before, the LTG had a growth of 7%, which is supporting our gross margin and eventually also the EBITDA. And as a third element, also the tariffs offset because in one side, our gross margin suffered one point because of over 3 million of tariffs impact in the quarter. On the other side, we had around 2 million of refund that supported us to partially offset that impact. In terms of facing for the second half, we already explained during the guidance that there are several elements, the operating leverage, the mix of, for example, the FTG growing double-digit, as well as the normalization of all the costs that will be absorbed after the launch of the products. So this is absolutely aligned with the comments that we made in the previous call related to the guidance for the full year. Thank you.

Next question is from Odysseus Manizotis, BNP Paribas.

Hi, thank you for taking my questions. Firstly, could you remind us of your liaison Plex sales portion of U.S. outpatient versus inpatient S.p.A. S.p.A. S.p.A. S.p.A. And a very quick third one. I understand Q2 is the least popular quarter for syndromic testing, but can I confirm that you had no or low placements for liaison plex, given the number is the same as Q1? Thank you.

Let me start from the last. We didn't comment on placement for Q2. So I don't know how you came up with the fact that there were no placements.

Just a customer number, which is the same. Apologies.

No, I'm sorry. I'm sorry if I guided you guys to our own number. We had placements, clearly, in Q2, and not only with placements, but also with activation of blood into existing respiratory accounts. If I move to the quantifier for China, the problem of China is that there is a ton of local competition. And that has, yeah, there are 26 local ELISA suppliers, and I believe one came in luminescent competition S.A. which is similar to what we have at least on paper so that has really been driving the price to very low level so China today is fundamentally becoming a very cheap market so yes we are going to have revenues in China but don't expect China to really move the needle significantly Sorin S.p.A. So that is the next wave of expansion that we see of QuantiFERON.

Remind me the first question. Plex outpatients, inpatients.

Okay, here is a very interesting discussion here because I think as we said a few times, our initial placements were in private labs, right? And by definition in private labs is all outpatients. In the hospital market where we operate right now, I would like to say that it really varies quite a lot depending on whether these hospitals actually also have a business where they serve physicians and request so they're coming from the outside. In general, we've seen more prevalence of inpatient. So I would say 60, 70% inpatient versus the outpatient. But it's very difficult because today hospital systems, few hospital systems are also developing a business model where they start to offer services competing locally Thank you for the detail, Carlo. Just to clarify the second part of the first question, I also wanted to get a feeling of whether the expansion of MOL-DX

is going to be an issue for your outpatient sales for liaison flex, given that was a bit of a burden six, seven years back.

What is, sorry, what is exactly MOL-DX? What are you referring to?

In my understanding, it's stricter reimbursement requirements for outpatients for using multiplex molecular testing on the outpatient front, but it has not yet been expanded yet. But I understand if that's not a topic yet.

No, but look, don't forget that our overall strategy is mini panels. So we really believe that highly complex multiplexing panels are not going to be reimbursed any longer, unless for some very specific reasons. for some very specific patients. Today, I believe that every customer we talk to, they say that when it comes to reimbursement, they count on $142, which is what is paid with a very minimum denial rate for these small panels. And this is why we believe that the concept of mini panels not only makes sense clinically, but is also following the fact that the reimbursement system is starting to become way more careful with the abuse of the highly complex multiplexing panels. This has been, if you remember, our theory since the beginning. And I think that now it's proven right to the point that competition now is moving to fix mini panels. Roche is doing that. And you saw also Beaumarieu is using the spot fire with smaller panels. What's unique about the Sorin is that we don't impose mini panels. We give them the ability to design any mini panel they want to. And as you have seen in our presentation of the LTP for the AGI is a wonderful example where you can have eight mini panels. that really covers all the different applications, whereas if you take SafeAid, for example, it's just offering one panel of 11 targets.

Thank you for the extra call, Carlo. I really appreciate it.

Next question is from Jeanne Koch, Deutsche Bank.

Hi, Carlo. Hi, Alberto. Thanks for taking my two questions. My first one is on LTG. In the press release, you mentioned that growth was driven by a different timing of orders and the partial recovery in the life science segment. Could you try to separate these two effects and quantify them? And then secondly, on PLEX, how's the launch of the GI panel progressing? And have you already benefited from the current outbreak in the US? And one clarification, if I may. On the 150 Plex customers you mentioned during the call again, you provided the same number on the Q4 call actually. Are you going to provide an updated number going forward?

So I covered the first two and then Alberto is going to cover the last. I cannot give you any split. simply because I'm providing information of all my partners when it comes to the LTG. The only comment I can make, as I said, is that what we did not expect is to see a fast recovery on the instruments. But again, to read this business, I strongly recommend you to listen to what our partners are saying because eventually it's an asset B2B. But it's actually recovering, in my opinion, faster, certainly, than what we expected. Again, keep in mind that last year our H2 was very weak because of ordering patterns. So on top of the recovery, we believe that there is a favorable comparison H2 to H2 last year. When it comes to GI, just launched, again, I believe GI is the wonderful product application for mini panels, eight different mini panels. I am aware of, if I look at the funnel of opportunities, really expanded by a significant number, the funnel that we have access to. But in terms of customers, I believe that so far we validated two accounts. So in the numbers that you see in Q2, there is no effect. I'll try to explain a little bit.

Just a few weeks ago, during the last call, Carlo did mention that we had approximately 150 customers. We are now over 150, and what we are now – Carlo was also referring to the several installations and activations of the customers – Thank you. Thank you.

Next question is from Natalia Webster, RBC.

Hi there. Thanks for taking my questions. My first two are on Plex. Just to follow up there with the blood and GI contribution going forward, what sort of mix between respiratory versus non-respiratory do you see as reasonable going forward? And then my second question also on Plex is around the implementation timelines. You previously talked to longer timelines of six to 12 months. Is that still the case or are there things you can do to help accelerate these? And then just finally, if I could follow up on margins, you previously talked to 2026 guidance excluding additional inflationary pressures. Are you able to comment at all on what you're baking in there, particularly with that sort of 8 to 10 million you were guiding towards at the CMD? Thank you.

Thank you, Natalia. So I'll try to answer to the questions, starting from Plex versus respiratory versus non-respiratory and the related needs. Please keep in mind that while the respiratory is not only the first panel that we launched, but it's also the most prevalent in the overall syndromic market in the U.S. Naturally, the respiratory panels will be prevalent and the most relevant in our revenues going forward, at least for 2026. GI was just recently launched. We saw very positive pickup of quotes. a very active funnel, but as of today, we're not providing the exact split of our forecast between respiratory and non-respiratory. As I said, just please keep in mind that respiratory still is over 70% of the overall syndromic market in the U.S., so although we have a very strong GI strategy with the mini-panels, we still believe that respiratory constitutes more than half and majority of our Revenues at least for 2026. Going into the second question related to deactivations, I can confirm that the time to activate customers has not changed dramatically compared to when Carlo first discussed it. This is a function of several factors. One is the fact that customers need to do validation as it happens not only in molecular diagnostics but also in immunodagnostics and any other platform. but the difficulty here is the fact that we are offering a product with the flex and our mini panels that is in a way very unique and that requires longer time for the IT departments of our hospitals to to adapt and to integrate our mini-panel into their system. So on one side, the number of customers that are activating and picking up the flex is increasing. On the other side, there are still complexities in the validation and activation that are behind the 6-12 months activation timeline that Carlo mentioned and we can confirm. Last but not least, you asked about the inflationary effect, if I recall correctly, related to the conflict in the Middle East. Am I understanding? Am I recalling correctly, Natalia?

Yes, that's right. I believe you previously mentioned an 8 to 10 million impact. Just curious to what you're seeing at the moment and what you're expecting within the guidance.

So we took out the disclaimer from the guidance simply because as of this year and we are already at the end of July, we believe that we have had so far minimal impact, inflationary impact that we've been able to absorb. We expect for the second half also that we can be able to absorb the impact. The 8 to 10 million is an annualized overall impact coming from both not only the cost of the fuel, the jet fuel, for example, so the link to distribution, but also the cost of raw materials linked to plastics. This is confirmed as an overall assessment, but since we have not had material impact to date, we have not reiterated that as an impact for 2026. We will see how the conflict progresses and what the impact could be for 2027. Thank you.

Next question is from Kavya Dashpande, UBS.

Good afternoon, Carla and Alberto. Thanks for taking my questions. I've actually just got two on the new high-throughput version of the quantiferon test. What does the gross margin look like on that product compared to your regular throughput liaison quantiferon test? And also, what proportion of your customer base can eventually be converted to the high-throughput version in your view? Thank you.

Hey, Kavya. The conversion is going to be 100%. We actually started already, and I believe we converted anything between 30% to 35% of the base. So the idea is that by year end, we are going to have it pretty much done across all technologies. The margin structure is exactly the same as the previous one.

Got it. Thank you very much.

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