BICO Group AB (publ)

Hello and welcome to Beico Group's Q1 2026 earnings call. I'm Maria Fors, President and CEO and I will together with Beico's CFO Eva Lindsete present this interim report. Here is today's agenda. I will open today's session by summarizing Q1 2026 and also describe how Beico serves the world's leading pharma and biotech companies with solutions that transform how labs operate, innovate and solve our customers' challenges. Following that, Eva will present the group's financial performance. I will then comment on our R&D pipeline with our ongoing product development efforts. Additionally, I will highlight some recent and upcoming product launches. The session will conclude by highlighting our focus for 2026 before we open up for Q&A. A strong start to the year with 11% organic growth, navigating in a dynamic market still affected by geopolitical uncertainty and a weak academic funding in the US. Due to continued currency headwinds, our total reported growth was negative 1.4%. All numbers presented are in million Swedish kronors unless otherwise stated. EBITDA was negative 42 million with adjusted EBITDA of negative 11 million and the differences mainly relates to a restructuring cost of 52 million of which 30 million affected EBITDA. Cash flow from operating activities totaled 47 million Veiko successfully issued senior secured bonds of 40 million euro and the new capital puts us in a position to support further growth and capture market recovery while navigating ongoing macroeconomic uncertainty. A property in Olo, Finland carved out from the divestment of Dinalis was also divested for a total of 3.5 million euro. We settle our convertible bonds, originally issued in 2021, with a total outstanding amount of 1 billion and 8 million Swedish kronors in full on their scheduled maturity date. Before Eva provides more details on our financial performance, I will present how BiCo serves the world's leading pharma biotech companies, with solutions transforming how labs operate and innovate, which is what our vision is about. Our customers all share one ambition, reducing time to market and increasing the probability of success. With our leading software suite, Green Button Go, together with off-the-shelf automation products, as well as bioprinting, our portfolio is in the sweet spot of meeting that ambition and solving their core challenges with long and costly development cycles. Our solutions enable smarter, faster, and more efficient labs, and here lies an underlying strong demand. Pharma and biotech companies all face the same fundamental challenge, long costly development cycles for new therapies. The development of new therapy often takes more than 10 years and costs between 2 and 4 billion US dollars, with the probability of approval after phase one at just 10%. To overcome this, our pharma and biotech customers are investing heavily in automation and AI to increase efficiency, speed and quality, to bring innovations to market faster and at a lower cost. Our products and services enable our customers to connect data across systems and apply AI tools to plan, run, and optimize experiments in real time. We are enabling AI-driven drug discovery workflows through our Green Button Go platform, connecting workflows and data streams. The AI acceleration shifts the bottleneck to the wet lab, where our automation solutions are at the core. Now we'll explain how Green Button Go enables AI-powered automation in the wet lab to ease this bottleneck. AI accelerates discovery, and then the wet labs become the new bottleneck. Generative models and predictive biology dramatically speed up hypothesis generation, yet the wet lab validation remains the hard constraint. In fact, more AI driven candidates need more experiments, not fewer, intensifying pressure on lab throughput, system uptime, and data reproducibility. This means that wet labs become more critical rather than obsolete. AI breakthroughs have made wet labs even more central to R&D. The lab is now a biological compute cluster, validating AI predictions, so high throughput automation and trusted data become mission critical. So all in all, Baiko lab automation provides the trusted execution and validation layer that converts AI generated hypothesis into proven experimental evidence. We have already integrated assistive AI into our platforms, bringing natural language workflow creation and troubleshooting in Green Button Go, making automation accessible to every scientist. And we are also developing next generation systems like Crescendo to scale up experiments while keeping human in the loop oversight. So by emphasizing reliability, data integrity and compliance, we ensure the coming search of AI driven experiments can run at scale without compromising quality or uptime. This execution focused strategy cements our platform as indispensable infrastructure in an AI powered biotech landscape, making AI an opportunity for us rather than a threat. And this leads us to our vision, which have been updated this quarter. BICO's updated vision has been developed to position us as more visionary and with a clear portfolio cohesion and direction in line with the BICO 2.0 strategy and portfolio. From this quarter we are reporting BICO as one operating unit which reflects the integrated operating model, shared resources and joint strategic initiatives across the group. Our updated vision is to enable life science labs to accelerate the discoveries that change lives. With a mission where BiCo leverages a global portfolio of pioneering brands, fusing automation, intelligence and data to unlock scientific discovery at scale. Ultimately, we support customers to advance science so therapies can reach people faster. Customers using Beico lab automation solutions consistently report measurable gains in productivity and reliability, including reduced hands-on time, faster turnaround times, and higher instrument utilization. Let me show you one example that emphasizes the value Beico delivers to our customers. The data shown here are from one of the top pharma customers we are serving, and they kindly share their efficiency improvements by using our lab automation solutions. Downstream process and assay development was reduced by 75% and the capacity with existing equipment they already had was revved up by 400% because parallel processing and variable driven robotic processes just allow for more uptime to be squeezed out of each piece of equipment in the lab. And ultimately, these productivity increases mean that their scientists are able to achieve 200% of their original productivity. And this is because the automation was coming alongside them, supporting them, taking over the manual steps and running concurrently in ways that a person just can't manage alone. And this is just one example of a lab leveraging the button go. We're taking technology and using it to augment the work of humans, using technology to get to innovation faster. So to summarize, we lead the way in solving the challenges in life science with speed, accuracy and efficiency. All in all, our customers can run their processes faster, improve their quality of data and ultimately make better decisions. I will now hand over to Eva to present the results for the first quarter.

Thank you, Maria. I will now give some more details to the numbers presented by Maria. After a strong start in January with a positive outlook, the market was again affected by geopolitical uncertainty with tariffs and war. The weak academic funding seen in 2025 has continued during Q1, where academic end markets remain soft, with cautious spending and delayed capital equipment purchases. Despite this general trend, we see some pockets of improvement sales also in the academia segment during the quarter. Total organic growth was 11%. As from this quarter, we are reporting Baiko as one single operating segment. Following the divestments of three bioprinting companies, a step towards a more consolidated business, the portfolio is now more focused on lab automation and software intelligence across our entire business. This reinforces the one Baiko approach. where strategic decisions and performance evaluations are made on a consolidated basis. This reporting, which is now focused on the group as a whole, reflects the integrated operating model, shared resources and joint strategic initiatives across the group. Navigating these dynamic market conditions, sales in Q1 amounted to 330 million SEK, an organic growth of 11%, mainly deriving from strong desktop instrument sales. The 12 percentage points difference between reported and organic growth can be explained by FX headwinds, mainly due to the weaker US dollars against the Swedish krona. To align with industry standards, we have revised our reported sales categories into instruments, consumables, and service and other. Lab automation projects have previously been grouped as a single category and are now split into instruments for the product part and into service and other for the software and installation parts. In Q1, we saw growth in the segments instruments and consumables. EBITDA amounted to a negative 42 million and adjusted EBITDA being negative 11 million. The difference mainly relates to one of restructuring costs of 52 million, of which 30 million affected the EBTA. These restructuring costs are connected to a program launch during the quarter. The aim is to improve cost efficiency, further simplify the operating model and improve the R&D pipeline execution in one of the business units. The program includes organizational streamlining as well as a planned closure of one site in Europe. We also have aligned some group functions to our current business needs. These programs will yield analyze savings of about 30 million. Even if we see a decline in the gross profit margin compared to the same quarter last year, mainly due to unfavorable product mix, the adjusted EBITDA improved as a result of increased sales as well as continued cost control activities. One example is legal costs, where we have invested in legal competencies in-house, which has led to reduced external legal costs. In a growing, yet still emerging and increasingly demanding market, we continued during the quarter to address execution challenges in parts of our lab automation business, primarily related to complex projects. These initiatives are receiving focused management attention, and we are actively implementing targeted measures to strengthen execution, enhance scalability, and reinforce our competitiveness going forward. Cash flow from operating activities amounted to 47 million, impacted positively by working capital changes of 79 million. During the quarter, we settled our convertible bond and also issued new senior secured bonds. We sold our finished property with a net proceeds of 32 million. The total cash flow during the first quarter amounted to minus 547 million due to the settlement of the convertible bonds of 1 billion 8 million SEK. Cash reserves by the end of the period were 744 million. As mentioned on the previous slide, the effect of changes in working capital amounted to a positive effect of 79 million compared to the previous quarter. Operating receivables decreased by 146 million. Inventories increased by 13 million. Operating liabilities decreased by 55 million. In percentage of the last 12 months sales, Net working capital in the quarter corresponded to 7%. The low working capital is a consequence of reduced accounts receivable, as our sales normally are lower in the first half of the year, but also fewer new large projects started. Over time, we expect working capital in relation to sales to be in line with industry standard of closer to 20% of sales. As earlier mentioned, we issued senior secure bonds in January with a total nominal value of 40 million euro. The bonds have a tenor of four years and a carrying floating interest rate of three months EUR plus a margin of 5.9%. As Maria has mentioned earlier, the new capital puts us in a position to support further growth and capture market recovery while navigating ongoing macroeconomic uncertainty. The transaction also serves as a clear testament to the capital markets continued confidence in Baico. I will now hand over to Maria to present the R&D portfolio and some recent product launches.

Thank you Eva. One focus area for growth is continuous product innovation, and we have a solid R&D pipeline and roadmap in place at Baico. And this is based on the portfolio strategy, which is part of Baico 2.0. On this slide, you can see our comprehensive product development pipeline within BICO's prioritized focus area. The majority of the R&D investments are made in software development and the use of AI, while there are several upgrades of the instrument portfolio meeting customer needs. One example of a software upgrade is the AI-powered VCD and cell counting on the up-site. AI is more than large language models and chat prompts. In this case, AI is used for image-based pattern recognition to detect and segment cells quickly and precisely even under challenging conditions. And thanks to the new software update, in combination with other features, the UpSight offers a solution that is 10 times faster to results versus sequential viable cell count on the industry standard. And savings are estimated to 2,000 to 300,000 Swedish kronors per mid-sized cell line development lab. Multiple launches are planned for this year and these include both software, instruments and consumables. We have already launched a few products in quarter one and some more are around the corner and those were pre-launched at the major lab automation congress SLAS in February this year. The G-Station Generation 2 automates the next-generation sequencing library prep workflow, enabling the scalable, cost-efficient production of consistent, sequence-ready libraries for genomics and drug discovery applications. The DePure Generation 2 automates DNA purification, delivering rapid, reproducible, plastic-tip-free sample cleanup for seamless next-generation library prep workflows. And these are just two examples of technology and solutions delivering customer value, which are the results of our efforts within R&D. As presented earlier in this call, we have already integrated assistive AI into our platforms, bringing natural language work for creation and troubleshooting in Green Button Go, making automation accessible to every scientist. In our R&D roadmap for Green Button Go, we're also developing next generation systems like Crescendo to scale up experiments while keeping human in the loop oversight and data integrity end to end. So by emphasizing reliability, data integrity and compliance, we ensure the coming search of AI driven experiments can run at scale without compromising quality or uptime. Before the Q&A session, I will repeat our strategy, give some concluding remarks and highlight our focus for 2026. Here you can see our strategy BICO 2.0 on a page. Our five strategic focus areas to drive our top line and profitable growth are enabling end-to-end lab automation and scientific workflow solutions, coupled with further development of integrated data, AI and software solutions. To enable increased sales to pharma, we need to ensure regulatory compliance readiness. We also want to expand strategic partnerships such as the one with Sartorius and Becton Dickinson, as well as increasing the recurring revenue. In 2026, we have and we will continue to execute our strategy with focus on commercial excellence, an R&D pipeline that delivers clear customer value and financial discipline for profitable growth. With our strengthened cash position, we can accelerate commercial as well as R&D initiatives and also more seriously engage in dialogues for both acquisitions, strengthening our portfolio further. The new capital puts us in a position to support further growth and capture a market recovery. We have also increased our innovation efforts, including software solutions and the use of AI, as I just presented. And above all, we remain committed to supporting our customers' research. I strongly believe in Baikos updated vision, which is to enable life science labs to accelerate the discoveries that change lives. By providing innovative instruments, software, services, and consumables into one continuous operating system, we create labs where data flows seamlessly, every experiment advances to next, and breakthroughs move with efficacy from idea to impact. Together, we enable our customers to deliver what matters the most, the discoveries that advance human health. This was our final slide before the Q&A. I will now hand over to the earnings call host for further instructions.