Mentice AB (publ)

Hi, and welcome everyone. MENT has recently released their Q2 2024 report. And today I have the pleasure of introducing the company's CEO, Göran Malmberg, and CFO, Eureka Jotts-Voksepp, who will present the report before we go on to a Q&A session. Before we start, I want to remind everyone that you can ask questions in the form below the video player. And without further ado, Göran and Eureka, please take it away.

Thank you, Christian. So we'll jump right in. to the presentation. I'm going to start with some remarks and then Ulrika will go into the details. After my concluding remarks, we will have some questions from Christian. First, it's a pleasure to present the second quarter. A really strong top line. sales, net sales, 36% above last year. And as you know that are following us, we had a slower start in the year. So it's a good recovery for the first half year. And consequently, with the high Next season quarter, we also generated the highest EBDA amount in a single quarter with 0.4 million, 0.5 million. It's 129% increase from last year. And we should remind ourselves that last year's first half was a really strong one and unusually strong second quarter as well. All of this also down to positive operational cash flow and positive net income for the quarter of 17 million, which is also extraordinary. So really looking at this from a distance, I mean, we started off slow in January and February. But I would say that looking at the period from March to June, we're really operating in a consistent and normal way. So looking more from a business side, we have continued to enforce and enhance and strengthen our organization. mainly looking at sales and support, US, but also in Europe. Obviously, other functions as well. We added people. So we have added from 113 to about 130 people by the end of the quarter. We talk more about that in the details. We see largely very positive development within the street. Obviously, we are a focus and teams client, but we still have some variability. Some of the large clients are on par or above, while some of them are slightly behind. And it should be known that you need to look at this again from a longer perspective and variability in a quarter or even in a half year. It's just related to these clients planning. We started off really strong in APAC. quite significantly above first half year last year. And from an essay point of view, that's mainly related to one or a couple of, but really one large order in Q4 that we have delivered in the second quarter, partly in first quarter, but mainly in the second quarter. Looking at America, we are still slightly behind, but I would say that to the large effect, reflecting the unusual system structure we have for 2023. Really, really good feedback. We've been participating in a couple of the world's most significant congresses over the last couple of months here. both in the neurovascular, sexual health, and other management speciality, and really, really good feedback from the industry. So there's really no change, just continuing that enforcement in terms of our market leadership. So on a summary, from a quarterly point of view, again, we are A little bit behind in the quarter for orders. Again, second quarter last year was significantly, or it was unusually strong, I would say. And looking at the first half here, we're also slightly behind last year. Net sales significantly above for the quarter. But looking at the first half here, we are 5% above last year. The order book consequently has decreased a bit. Nothing strange about that. I mean, it's just a consequence of order intake lagging a bit from net sales. As I said, strong sales from net sales from APAC. EBITDA, fantastic number, 24 million. and really a strong improvement from last year, which also was a good year from a profitability point of view. Positive cash flow for both quarters, both for first and second quarter, which is important. And positive net com and positive earnings per share for the second quarter. So that's really... from a 30,000 feet or 10,000 meter perspective. And I'm handing over to Ulrika.

Thank you, Göran. And as Göran has mentioned, we need to remind ourselves that we have change in patterns of seasonality during years and in the years. So there is a variance and a variability between quarters on order intake. So, the somewhat slower order intake during the quarter is mostly related to the product area I meant this list. And it's, as Joran mentioned, associated to a few larger customers within the medical device industry in the US market. And you can clearly see that on the graph on the right-hand side. So, the order intake for the quarter of 71 million SEC That means a decrease compared to last year's quarter with 8%. And moving from order intake to net sales, we have the strongest quarter ever so far with 101 million Swedish kronor net sales. And it's a very strong performance, as Jørgen mentioned, in the APAC region and in the Americas. So an increase of 36% compared to last year, which was a very strong quarter. The Americas represents the largest region for Mentes this quarter and has done so previous quarters as well. And the increase in net sales is almost 20% in the second quarter, and most of it related to the medical device industry. And really good to see is the April region with a very strong quarter. Almost 26 million, that's an increase of 274% versus Q2 2023. And the majority of this is related to the MDI segment and the order that we announced end of last year. And looking at the sales from a product area perspective, I mean, Mendes Vist being our main supplier, product and system, this is where we see the increase both in the US and the APEC market. And also good to see the strong sales of physical SIM. So this has been a quarter of a high execution of orders, as Jørgen mentioned. So therefore, when we look at the order book, this is a consequence of the very high execution of orders and the somewhat lower order intake That means that the order book as of end of June is 9% lower than it was end of Q2 last year. It's 140 million Swedish crowns, where 47 is related to revenues that we anticipate to be recognized in 2024, whereof the majority is related to Mentes Vist. And just a very short comment on the annual economy revenue is more or less at the same level as the same quarter last year. So this really is the strongest performance in a quarter with the 101 million Swedish crowns in net sales. And we have a good level of gross margin in line with our expectations, almost 85%. And with the very strong EBTA result for the second quarter, 24.5 million Swedish crowns, we have managed for the full year to be on a positive EBTA level with 6.1 million. A brief comment about the cost levels. Other external costs have increased with 4 million compared to the second quarter last year. 1.5 million of these costs are related to cost specific for the quarter. And the majority of the remaining increase is related to consultants being in employee positions where we're making recruitments. And the personal costs amounted to 41.9 million Swedish crowns. And just to clarify, the cost for the consultants having positions for vacant recruitment is included in other external costs and not in personal costs. A comment on cash flow. We have a strong position at the end of the quarter with 57 million. The cash flow is positive. And despite the fact that we have grown and increased net sales during Q2 and therefore also increasing account receivables, we still have the positive cash flow from operations.