OssDsign AB (publ)

Good morning. This is Mark Waugh, and I'm the CEO of Ost Design. If you are new to our quarterly calls, I'm going to mention that I joined the company in January. Also with me today is Ost Design's Chief Financial Officer, Anders Svensson, and today we're going to discuss our third quarter 2026 results. As always when we do these presentations, the normal disclaimers. For today's call, I'm briefly going to cover some highlights, then Anders will walk you through some financial results for the quarter in a bit more detail. And finally, I'll share some additional information about the transformation Ost Design has undertaken, as well as some good news we issued via a release this morning. For the quarter, Ost Design sales were SEC $35.7 million, or approximately U.S. dollars $3.7 million. Those were less than our Q2 sales performance, but in line with our expectations. Some of you might recall that we communicated an expected seasonal holidays impact for the quarter during our Q2 release. We're not quite large enough to be unaffected sales performance-wise when a number of customers simultaneously take time off from performing elective surgeries. On a year-over-year comparables basis, Q3 translated to a 19.8% year-over-year decline in constant currency terms. Gross margin and EBIT both improved for the quarter versus Q2, and I'll let Anders cover those details after these highlights. Catalysts and our supporting evidence for its use remain strong. We recently communicated that our Propel registry achieved a major milestone of over 400 patients enrolled. During the quarter, we utilized Propel's high-quality observational data to prepare and submit a significant labeling change. We also finalized our Level 1 study protocol and made progress vetting a number of potential interested sites. Our team continued to promote and share Catalyst's performance with customers during seven Surgeon Society meetings within Q3 and, just after the close of the quarter, we exhibited at the North American Spine Society meeting in San Antonio. We not only sponsored an excellent talk from the podium by two key opinion surgeon leaders, but also made strides in generating awareness of Catalyst and its performance. I'll share some additional details on that later. As you might recall, on June 25th, we announced Adam McCollister as Ost Design's new VP of Sales. Also regarding teams, I believe I may have mentioned this during our Q2 release call, but our new Area Sales Director for our East Territories started on August 10th. I know I've said before that building the right culture is just as important as having sufficient boots on the ground, and I'm happy with the changes I've witnessed and the direction we're headed in team-wise. And finally, before we move to financial details, I think it's important to clarify that I still believe we can achieve the sales growth within Ost Design's previously communicated scale-to-profit strategy. We're making good progress on both our next product release, MIS Catalyst, and the subsequent launch of our Catalyst Strip. Now Anders is going to share some more details on our financial results from the quarter.

Thank you, Mark. Yes, as Mark mentioned, in Q3 we saw a decrease in sales compared to the third quarter of 2025. So in SEC, 35.7 million compared to last year's 44 million. Translates to an 18.8% decrease in SEC. As you can see in the growth charts to the right, the US dollar rate effect has now turned around and it's actually currently providing some minor tailwinds, 1%. And we commented on this year's summer vacation effect during our Q2 release and highlighted that it would likely be more pronounced than in previous years, which, as you can see from the numbers, that's exactly how it played out. On a positive note, though, we saw an improved sales trajectory throughout the quarter. Sales quarter over quarter, as mentioned, some evocation effect, we've already commented on that. What we implied was basically that the Q3 sales were expected to come in soft compared to previous quarters. As Q3 is also, as I'm sure you all know, a seasonally smaller quarter in general, Adam McCollister, Tom Buckland, Adam McCollister, Tom Buckland, Anders Svensson, Melanie Marshall We're currently 5% down from the 12-month period leading up to end September in the previous year. And needless to say, this is not a development we are happy or satisfied with. But as stated earlier, our sales reorganization, which is still ongoing, by the way, has been quite extensive, even more extensive than we had first imagined it would be. However, we still expect those efforts to start delivering improved commercial momentum Albeit later than first envisioned, given the sheer size and scale of the reorganization. Over the gross margin then, 93.2% for the quarter. That was an improvement over 92.1% in the second quarter. And it's now back above our guided level of 93%. Adam McCollister, Tom Buckland, Melanie Marshall And that was actually the main driver of the margin increase. And with that, I'll hand you back to Mark.

Thanks, Anders. Just my usual summary for those of you new to our calls, that while Ost Design Catalyst has been participating in this market for about four years, we have built a great body of evidence around the product. This includes 19 preclinical and clinical publications and white papers, as well as our Propel registry I mentioned previously. We continue to show both high fusion rates and fast bone formation. The well-established Bowden model showed 100% fusion for catalyst. Our top fusion study also showed 100% fusion in two years. Our registry showed catalyst with an 88.4% fusion in a highly complex real-world patient population. In fact, nearly half of the patients in the Propel Registry's first published cohort had three or more comorbidities that are widely associated with a higher risk of non-unions. There are a number of comorbidities known to hinder successful fusion in spine surgery. Because Propel is an observational registry, we don't instruct surgeons to exclude those challenging patient factors. You will continue to hear us say, real-world results, real-world data, real-world results, because we're seeing strong performance in an unfiltered patient cohort. Before we wrap things up and take questions, I'm going to quickly reiterate our scale-to-profit strategy, which we shared in Q3 of 2025. Then, as promised, I'm going to share a bit more detail on our transformation plus our additional news release today. There are four key pillars in our strategy. First, accelerating access and coverage within the U.S. market. The good news is we've achieved our goal of having the ability for coverage in 35 states. We are, however, still working to double our sales force versus when this strategy was communicated in 2025. I'm going to show you some more details on that in just a bit. I mentioned this last quarter, but we continue to see new business in the foot and ankle segment of the market as well. Second, expanding our product portfolio and indications. I mentioned the MIS upcoming launch and the STRIP project earlier, as well as that we've recently submitted for a labeling change. Third, we will continue to invest in clinical evidence. I covered our Propel registry and commented on our Level 1 status in my opening remarks. Our goal here is really to differentiate Catalyst via ongoing, compelling clinical evidence. And finally, our fourth pillar is to scale and add a U.S. production footprint. I mentioned last quarter that we identified a way to do this in a very cost-efficient manner, and I'm proud of the progress the teams are making on this. I use the term levers in our Q3 release comments, and given the types of questions I receive from our shareholders, I want to take a moment to explain some of those levers so that you might better understand the changes that our dedicated team members and I are enacting. First, there were some foundational issues that needed shoring up. We've moved from inconsistent selling and communications as far as our messaging to a stronger, more consistent approach. We've also taken steps to move certain investments forward, which are key to our long-term growth. And another part of shoring up the company's foundation was the dual source supply chain that I mentioned during the prior slide. We've also taken deliberate steps to increase awareness of Catalyst and its performance. This includes more comparative marketing, ensuring we're responsive to competitor attacks, and continuing to produce and leverage real world data. Adam McCollister, Tom Buckland, Anders Svensson, Melanie Marshall This is just a bit more on what I mean by awareness and our recent participation at the North American Spine Society meeting. I still don't believe we've saturated the market with targeted marketing and messaging enough to where the majority of our potential customers recognize Ost Design Catalyst and more importantly understand its world-class performance. We don't usually go into this level of tactical detail and results calls, but I want to share that we revamped things quite a bit this year from a branding perspective and we've also taken deliberate steps to increase that level of awareness. The left is more how we visually represent the product while the two tiles on the right are examples of a very large message we had throughout the recent meeting in San Antonio. I'm confident that nearly all of the attendees saw those given we had them at registration, entrances to the exhibit hall, and in multiple locations throughout the hall. We also leaned into promotional efforts leading up to that meeting, both to highlight our own talks from the key opinion leaders I mentioned on usDesign Catalyst and to continue driving the important awareness. We partnered with Orthopedics this week on that promo campaign, and the good news is we achieved nearly 60,000 impressions alongside a solid response or click-through rate for the various Catalyst content across website ads, direct email to 13,000 subscribers, social channels, and placement of newsletters. The bottom line here is we've stepped up these efforts to better position our sellers for success and, of course, to generate leads. Finally, I promised to provide you some additional details on the team transformation we've undertaken. First, I want to be clear that these changes are not a personal indictment of anybody who has left AusDesign, either by their own choosing or because we needed to make a change. You will note at the start of this year, we had 16 people in our sales organization. Of those 16, we've replaced 10 with new people throughout this year. Thank you for watching. When I consider the strength of Catalyst, the opportunities we have for conversations with new customers, the dedicated and hardworking people we have remaining on our sales team, and those that truly seek to support our sales managers and distributors every day, I refuse to accept that there are not avenues of growth for Ost Design in every territory. Adam McCollister, Tom Buckland, Anders Svensson, Melanie Marshall Adam McCollister, Tom Buckland, Anders Svensson, Melanie Marshall Speaking of opportunities for conversations, I also want to mention that today we communicated the first nanosynthetic fusion warranty in spine orthobiologics. In the U.S., as bundled payments and episode-based care models expand, proven performance in real-world, high-risk patients matter. For those of you listening who are unfamiliar with what's happening in the U.S. market, a trend is occurring in spine that is already a bit more established in other orthopedic procedures, such as hip and knee replacements. Adam McCollister, Tom Buckland, Anders Svensson, Melanie Marshall If complications, extended hospital stays, or emergency readmissions drive total costs above that target price, the providers or hospital may have to absorb the financial loss. This is often referred to as downside risk. I'm sure you can understand that within this framework, it's more important than ever to have an option-like catalyst that has been shown to produce strong fusion results in complex patients. In fact, our confidence in offering this warranty stems from real-world data we've published from our Propel registry alongside other published results. And I mentioned this before, but I'm going to say it again. Nearly half of the patients in our first published cohort had three or more comorbidities that are widely associated with a higher risk of non-unions. We communicated this today, and the rollout from our team starts this week. I'll close the day by reiterating what I said during my first call with you regarding transparency. I hope that we've shared some details today that allow you to better evaluate what we're addressing to reignite us design's growth trajectory. I appreciate your time to join our call today. And now I'm going to hand it back to Anders who will handle any questions on the line. Thank you.