Bonesupport Holding AB (publ)

Welcome to Bone Support Q1 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 Torbjörn Schold and CFO Håkon Johansson. Please go ahead.

Thank you, Operator. Welcome, everyone, to Bone Support's Q1 2026 results call. My name is Torbjörn Sjöld, CEO of Bone Support. With me here today is our CFO, Håkan Johansson, and together we will use the next 25 minutes to guide you through the Q1 presentation and then open the line for questions. Before starting the presentation, I would like to draw your attention to the disclaimers covering any forward-looking statements we will make today. So let's look at the financial and operational highlights of the quarter. Q1 was another strong quarter with solid execution across the business. Net sales came in at 224 million SEC, corresponding to a growth at constant exchange rates of 31% versus Q1 2025. Reported growth was 14%, showing that there was a continued strong currency impact on our figures for the quarter. Our adjusted operating result excluding incentive program effects was 85 million SEC corresponding to an adjusted operating margin of 26%. Reported operating result was 72 million SEC. We saw another quarter of solid cash generation with operating cash flows reaching 75 million SEC resulting in a cash position of 455 million SEC at quarter end. We continue to see strong traction for CermetG in the U.S., with sales reaching 222 million SEC for the quarter, compared with 178 million SEC in Q1 2025. The sequential CermetG growth, quarter over quarter of 2.6 million U.S. dollars, was the strongest ever. In Europe and rest of the world, we saw strong momentum across all markets with a growth of 16% at constant exchange rates compared to a very strong Q1 2025. Notable was also that our first Cermet sales in India were achieved during the quarter. During the quarter, the regulatory process for Cermet V progressed according to plan within the framework of the de novo process. As communicated in early December, the FDA submission for Ceramide V was transferred from a 510K pathway to the de novo process in close dialogue with the FDA. If granted market authorization, Ceramide V will constitute an entirely new product category, like Ceramide G did in 2022. Just as in the review of the de novo application for CERAMENT-G, both CDER, FDA's Center for Drug Evaluation and Research, and CDRH, Center for Devices and Radiological Health, are involved, and the lead review team, which sorts under CDRH, remains the same as during the 510K process. Bone Support has received questions within the scope of the de novo process and is working purposefully to address the requested details and clarifications. Responses are to be submitted no later than end of August. We are progressing with the early stage launch of Cerament BVF for spine in the U.S. in line with plan. The introduction in Spine is an important step as we continue expanding our portfolio of indications and applications. Now, let's move on to the sales development. Next slide, please. The chart shows total last 12 months reported sales in Swedish krona by quarter since 2019 in stacked bars per region and product category. As you can see, the launch momentum for CERAMIC-G in the US is exceptionally strong. Given that we keep bringing new strong clinical studies and opening up new market segments and new indications, a product like CERAMIC-G will remain in launch phase for many years to come. However, throughout 2025 and in the first quarter of 2026, we have seen strong influence from the US dollar to Swedish crown depreciation, which influences the optics of the graph, but not the in-market performance, as you will see in Horkam's slides later in the presentation. Last 12 months, growth in Q1 of 22% in the graph corresponds to an even stronger 35% at constant exchange rates. So the quarter-over-quarter slowdown in last 12 months' sales is mostly due to strong currency impact. U.S. Cermet BVF last 12 months sale was flat year over year at constant exchange rate. In total, antibiotic eluting Cermet grew with 48% last 12 months in the quarter at constant exchange rate. Next slide, please. In U.S., sales amounted to 267 million seconds. representing growth of 35% at constant exchange rates. We continue to experience strong growth of ceremony, driven by both increased access to new accounts and new surgeons, as well as wider adoption among existing users. We see growth from all three prioritized platforms, foot and ankle, trauma, and arthroplasty. At the American Academy of Orthopedic Surgeons Congress in March, Presentations and discussions confirm the strong clinical interest in the CERAMENT platform and the commercial momentum in the U.S. Dialogues with surgeons and distributors show that CERAMENT-G is perceived as a clinically relevant and practically useful solution in a broad range of procedures where there is a need for combined bone healing and effective infection control. During the quarter, clinical evidence was further strengthened through the publication of positive data for Sermon G. In February, the first U.S. clinical pilot study in trauma was published, describing surgical technique and treatment results with Sermon G. The study, conducted at a U.S. Level 1 trauma center and published in OTA International, provides practical and real-world insights into how Ceramid-G is used in clinical practice in the U.S. Additional support was added in March through the first U.S. clinical case series focused on infection prevention in open fractures. By demonstrating how local antibiotic release can be combined with existing surgical techniques, the study highlights the clinical relevance Ceramid-G has within a segment with a high risk of infection. Despite the limited scope of the studies, they are of great practical importance as they provide concrete support regarding application techniques and expected outcomes for surgeons introducing CERMENT-G into their daily clinical practice. As part of our ambition to modernize an outdated standard of care in the U.S., we have successfully opened one market segment after another, starting with foot and ankle, followed by trauma, and now moving into arthroplasty. Interest continues to grow for CERMAT-G in revision arthroplasty and periclostatic joint infections, two areas where the clinical needs remain substantial and where the evidence supporting our antibiotic eluting technology has resonated strongly with surgeons. We have built a solid foundation for our spine strategy over the past quarters by establishing distributed coverage and preparing the market. In Q1, we continued the early stage launch of CERMAT-BVF in spinal procedures. with distributors now actively engaging spine surgeons across both existing and new partnerships. The surgeon access and early stages of adoption in spine follow plan and indicate the strength and potential of this segment. As this is a new clinical segment for us, more clinical data is needed to support broader market penetration. Importantly, the performance of Cermet BVF in spine will help confirm the value proposition for the Cermet platform, which will pave the way for the future antibiotic-eluting Cermet launch. We've made strong progress in evaluating and preparing the regulatory pathway, and we'll share more on the path forward at our Capital Markets Day this spring. After Q1, USCMS, Center for Medicare and Medicaid Services, announced a proposed ruling, full year 27 IPPS, inpatient prospective payment system, including changes that improve payments for the use of Ceramid-G in the treatment of complex orthopedic infections, such as periprocentric joint infection, fracture-related infections, and diabetes-related boning. In parallel, CMS proposes the introduction of more specific procedure and identification codes for Cerament-G and Cerament-V consistent with the company's submission. CMS also proposes new technology add-on payment, MTAP, reimbursement for Cerament-V effective October 1st, 2026, provided that FDA grants the company's de novo application by April 30th, 2026. If FDA approval is obtained at a later point in time, we plan to submit a new NSTAP application with a potential for additional payment from October 1st, 2027. Although this is a proposed ruling, this is very positive for bone support, as it validates the uniqueness and value Cerament brings and reduces the potential financial barriers for using Cerament in daily clinical practice. The company intends to submit additional classifications to the CMS during the ongoing 60-day public comment period. A final decision from CMS is expected in late summer 2026. Now, let's turn to Euro. Next slide, please. Sales in Euro came in at 57 million SEC, representing 16% growth at constant exchange rates. This is compared to Q1 2025, where we saw strong growth in euro, thus a very strong comparative quarter. We saw strong development across our three market structures, direct, hybrid, and distributor markets. In our direct markets, the UK continued the recovery we saw during the fourth quarter of 2025. Our investments in hybrid markets developed well, underlining clear continued potential ahead. In our distributor markets, Cerament was launched as planned in India with a focus on the private market. We note some uncertainty in the Middle East where geopolitical unrest is affecting market presence and logistics in the short term. Now, I'll leave a deep dive into the numbers to Håkan.

Thank you, Torbjörn. Net sales improved from 284 to 324 million. equaling a growth of 14% in reported sales growth or 31% in constant exchange rates. Turbine has already spoken about the solid performance in especially the U.S. and the major drivers behind the sales growth, but after large movement in U.S. dollars compared with the first quarter last year, somewhat hides a continuous strong trajectory in the U.S. I would like to share the U.S. sales performance in U.S. dollars. Sermon G is the growth driver in the U.S., and this slide shows the quarterly Sermon G sales in the U.S. in U.S. dollars. And what we can note is an all-time high sequential growth resulted in accelerated growth in sales per workday. The contribution from the U.S. segment improved by 25.5 million versus Q1 2025, and the amounted to 122.7 million. the improved contributor relates to increased sales after the effect of increased costs. Selling and marketing expenses during the quarter amounted to 128.4 million compared with 1.1.6 million previous year, of which sales commissions to distributors and fees amounted to 85.1 million compared with 78.8 million the same quarter last year. From the graph at the bottom of the screen, Showing net sales as bars and gross margin as the orange marker, it can be noted that the gross margin remains stable and strong at 94.5%, with a minor decline in the period following a gradual impact from tariffs. In Europe and the rest of the world, a contribution of 12.7 million was reported, to be compared with 15.4 million previous year. Selling and marketing expenses increased by 6 million, mainly related to the previously communicated commercial investments in the so-called Eurobooster program. From the lower graph and the orange marker, a minor improvement in gross margin can be noted, mainly impacted by market mix. Selling expenses excluding sales commission fees increased by 11.6 million, following commercial investments in both the US and Euro, but also related to high intensity in terms of marketing activities. Research and development remained at a stable level and focused on the execution of strategic initiatives, such as the application studies and spine procedures and the marketable persuasion submissions for Sermon V in the US. And finally, administrative expenses, excluding the effect from the long-term incentive programs, remaining stable with an increase of 1.4 million in the period. The adjusted operating result amounted to 84.9 million with only minor currency effects impacting. I will come back to this on a later slide. The newly introduced tariffs in the United States have gradual impact on costs in the quarter. The full effect of a 15% tariff will equal an impact of 0.8 percentage points on U.S. gross margins, and this will come gradually with full effect later in 2026. The difference between adjusted and reported operating results are costs regarding our long-term incentive programs. amounting to an expense of 12.8 million in the quarter, compared with an expense of 10 million previous year, as you can see on the previous slides. The increase in expense includes 1.6 million related to the long-term incentive program approved by the AGM in May 2025, which was included in the accounts for the first time this quarter. Operating cash flow was strong in the period, partially supported by inflow of customer payments deferred from December to after the holiday season. During the period, the Swedish krona has experienced volatility against the US dollar, with a minor weakening towards the end of the period, and with only minor exchange gains and losses reported as other operating income and expenses. The graph on this slide shows The gray bars how the relationship between the US dollar closing rate and the Swedish krona has varied over time. This is read out on the right eye axis. The blue dotted line read out on the left eye axis shows adjusted operating result. The adjusted operating result excluding translation exchange effects is the orange line and gives a more comparable view on the underlying trend in operating results. In the table below the graph, you can see that the FX adjusted operating margin of 25.5% in the period, compared with 22.6% in the same quarter last year. In the shorter term, the operating margin is impacted by the commercial investments made in both Euro and in the US. The gradual return to improvement in operating margin is expected as these investments are assumed to have positive impact on future sales growth potential. The relation between the US dollar and the Swedish krona has been stabilizing over the last four quarters, which becomes visible when comparing the adjusted operating results, including and excluding translation exchange effects on a rolling last 12-month basis. By the reported figures in Q1 this year, it is noticeable that the difference between including and excluding translation exchange effects is becoming narrower, following a more stable relation to the US dollar. The strengthening of the Swedish Krono over time impacts both net sales and operating results as visible in the graph. A solid cash conversion has been reported continuously since third quarter 2024, with an average cash conversion of 81%, visible as a dotted line in this graph. Q1 this year reported ahead of the average, mainly due to the previously mentioned timing effects from customer payments. And with this, I hand back to you, Torbjörn.