BioGaia AB (publ)

Welcome to BioGaia Q3 Report for 2026. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. Now I will hand the conference over to CEO Teresa Agnew and CFO Alexander Katsinas. Please go ahead.

Hello, this is Teresa Agnew, CEO of BioGaia, and we are here to present our Q3 results. So from a financial highlights standpoint, our growth excluding currency effects is 23% for the quarter. Our net sales, 400 million sec, and our EBIT margin is at 33%. Overall, our net sales, as we said, has grown 23% excluding currency effects. And if you look at the regions, our EMEA, Europe, Middle East, Africa region, increased by 38% excluding currency effects. Americas, which includes Latin America as well as North America, increased by 23% excluding currency effects. And sales in Asia Pacific increased by 8% excluding currency effects. Our overall operating profit for the quarter was around 132 million SEC, which is an increase of 54%. And our EBIT margin was 33% compared to 26% last year in the same quarter. Our overall net sales year to date reached 1.214 million SEC. with growth excluding currency effects of 16% and an overall year-to-date adjusted EBIT margin of 31%. So to talk about our strategy, we have three main strategic pillars. Our first is what we call Grow the Core, which is focused on our core health areas of gut health, oral health and immune health. Our second area is expansion through direct markets, where over the last five years, we have been taking certain markets direct as subsidiaries and driving growth through those markets. And then finally, breakthrough innovation, where this is probiotics that we're working on that will be category creating opportunities where probiotics are not typically used today. And our foundations are people and culture, investing for profitable growth, digital as an enabler, both in the way we go to market with our omnichannel approach, as well as digitizing our business internally to drive more productivity and efficiency, driven by science, which has been a foundation of the company and a very important one for the last 35 years, and sustainable solutions with a strong focus on driving sustainability in our products as well as how we go to market. In terms of delivering on our strategy for the quarter, in our Grow the Core area, As you saw, we have had strong growth across pediatrics and adult health segments. This is supported by protectus drops, protectus tablets, and predentis. We continue investment in consumer and medical marketing to drive growth in our key markets, specifically some of our direct markets, where the combination of medical marketing and consumer marketing is driving our growth upwards of the overall category. We are strengthening our position in oral health, particularly focusing on predentists, and especially in the US and Canada for the quarter, we've seen strong growth in predentists in those markets. In terms of expansion through direct markets, we continue our development in our direct markets, where this has contributed, our direct markets have contributed to 38% growth in EMEA. We are expanding distribution in France. So we started our direct market in 2025. And over the course of the last year, we have been driving distribution dramatically in France, as well as across some key retailers in the UK, where we are now in Holland and Barrett, which is a major retailer in the UK with our protectus drops in over 600 stores. We continue our focus on strengthening our BioGaia brand. We're expanding our global reach. And as I said previously, we have an omnichannel approach where we make our products available in the channels where the consumer wants to buy. And we surround the consumer with digital marketing through social media, video, and so forth. In terms of breakthrough innovation, we had an exciting launch this quarter with BioGaia Colis. So it adds to our science-based portfolio in adult gut health. Two years ago, we added a product called Gastrous Pure Action into adult gut health. And now this year, adding BioGaia Colis. This is a unique proprietary strain, BGR59, and it's supported by two independent randomized control clinical trials. Our initial launch has been in the UK, and this will be followed by rollouts across selected markets globally. In terms of our launches, you can see here the launches that happened in the quarter. One of particular interest is we've launched a new flavor of our Protectus kids tablets with vitamin D. It's a strawberry flavor, and this has been well received in the markets where we're launching this. We continue our rollout of our skincare products, our wash as well as body lotion into the UK. And we've also launched our Biogaia Aldermis, which is our probiotic ointment in Czech and Poland. In addition, we had some key events in the quarter. We announced on August 31st that we are continuing our exclusive distribution agreement with Ricardati in Spain and Portugal. As I said, we also announced the launch of our Biogaia Colis product, which is targeted for people to support colon health. And we have some clinical studies, as I said, also in the areas of acute uncomplicated diverticulitis. And then on September 16th, we announced that we will be hosting a Capital Markets Day in London on December 8th, and we will be holding both an in-person event in London, as well as our presentation will be broadcast live. In terms of our different segments, as you can see here, pediatrics has grown 21% for the quarter, excluding currency effects, and adult health has grown 29% for the quarter. And as you can see over the past quarters, we've had a strong growth each quarter in pediatrics as well as adult, especially adult with strong double-digit growth. Getting a little bit further into the segments, as I said, pediatrics grew 21% and adult health 29% in the quarter. If you look at this year to date, pediatrics is growing 14% excluding currency effects, and adult health is growing 23%. Specifically in pediatrics, our sales increased mainly in US, China, and France, and our protectus drops performed very well in the Americas and EMEA. In adult health, our protectus tablets increased significantly and sales increased overall in AsiaPac and EMEA, mainly in Hong Kong and Italy. And if we now go into more detail in the regions, EMEA grew 38% for the quarter, excluding currency effects. Overall year-to-date, that puts us at 26% growth for Europe, Middle East, Africa. Asia Pacific in the quarter grew 8%, and overall that puts us at 2% growth, excluding currency effects year-to-date. and Americas in the quarter grew 23%, overall year-to-date at 17%. For EMEA, some of the highlights for the quarter are sales increase mainly in France, Poland and Germany, We did communicate that we had some quarterly variations for individual orders where customers decided to move some of their orders from Q4 into Q3 for EMEA. In Asia Pacific, as I said, the adult health segment grew. The pediatric segment did decrease. Sales for the quarter were mainly in China, South Korea, and Japan. And in the Americas, some of the highlights are both the pediatrics and the adult health segment grew, and sales increased mainly in U.S., Canada, and Brazil. Overall, this puts us overall at 74% for pediatrics year-to-date, and you can see the breakup of our sales of year-to-date, 43% for the Americas, 35% for EMEA, and Asia-Pacific, 22%. I will now turn it over to Alexander Kotsinas to go through the financials in more detail.

Thank you, Theresa. So to summarize, as we heard Theresa mention previously, our sales grew 23% from 327 million to 400 million. Our gross profit grew 20% and our operating profit grew 54%. If we look at the sales bridge, we had a growth of 23%, both including and excluding currency effects. So basically in the quarter, no major currency effects. In terms of the gross margin, we had a gross margin of 73% in the quarter versus 74 in the same quarter last year. This is mainly due to two percentage points lower gross margin in the pediatric segment. And year to date, however, the pediatrics margin is flat at 75%, and we have a somewhat lower margin in the adult health segment, and thereby year to date, the 72% margin versus 73. It's worth to mention also that in the quarter we did receive some U.S. tariff refunds from the IEEPA Act, and those were 3.2 million SEK, which positively then affected the gross margin in the quarter. In terms of the operating expenses, the total operating expenses were 159 million SEK versus 157 in the same quarter last year, a growth of 2%. And on an adjusted basis, it was the same since we did not have any adjustments in the quarter. Sales and marketing expenses increased due to higher expenses in our subsidiaries mainly. And also worth mentioning is that we have a positive effect in the other OPECs of 14 million SEK due to exchange gains on receivables. If we move on to the profit and loss then, as we already mentioned, we have a sales of 400 million, a gross profit of 292 and an OPEX 159, leading to an EBIT of 133 million, which was then 54% higher than in the same period last year. If we look at the EPS, EPS now stands at 1.09 SEC per share versus 0.65, a growth of 67%. And year-to-date, our profits grew on an adjusted basis 29%, and our EPS grew 25%. Coming to the cash flow, we have a cash flow from operating activities of about 80 million SEK. And the decrease in cash flow from operating activities compared to the same period last year is mainly due to a negative change in working capital. which in turn then is due to higher receivables, a slightly higher inventory and lower payables. These are normal variations and in the coming quarter, we expect this to normalize. So we always see these swings between the quarters. Cash flow from investing activities also is worth mentioning. It was 12 million SEK versus 1 million in the same quarter last year. And this is due to that we are ramping up, as we have explained previously, our investments in Buya production with a new warehouse that is now ongoing. And for year-to-date, we have investments of about 26 million versus 3 million in the same period last year. So with that, I hand over to Theresa for some concluding remarks.