Senzime AB (publ)

Good morning. Pleasure to be here. I'm here to present Sanzime Q4 2025 results, as well as a brief summary of the year of 2025. So if we start by looking at overall 2025, it was a year of continued accelerated growth, and we took clear continued steps towards profitability. We grew about 90% in constant currencies. So we met the guidance of reaching above 110 million in constant currencies. Our underlying gross margin increased. Our OPEX remained stable and our adjusted EBITDA improved by about 60%. So the fundamentals are there. We're really reconfirming our goal to reach positive cash flow during 2026. And this is going to be fueled by continued growth and stringent cost control. So this was a summary. I'll dig down deeper into the numbers. If we look at Q4 alone, it was a strong ending to the year. We more than doubled the business. We reached 28.3 million SEIC in reported revenues and 31.2 if you're looking at the constant currencies. The growth was driven by more important hospital wins, very strong sensor growth. We had more guidelines coming in that I'll dig deeper into. And we had an exciting regulatory approval in Japan that started kicking off the next gen. And it was also a quarter of launching additional new products. We came out with the Mgen software suite that I will talk a little bit more about. So if you look at our installed base of tetragraphs and the shipments we're doing, it keeps on growing. Throughout the year, we shipped out 2,139 tetragraphs, predominantly the next-gen tetragraph, comparable to just under 900 the year before. So strong growth. If we look at Q4 standalone, it was 416 units. It's notable that some of these units, a few hundred, are hospitals that have upgraded from the older platform to our new next generation platform. Hence, the installed base is slightly lower than the 5100 mark you see here. What's encouraging is the growth and the continued growth in sensors. Remember, there's one sensor for every patient connects to the TetraGraph. So throughout the year, we shipped over 440,000 sensors. Strong ending again in Q4, we shipped just over 140,000 sensors. versus 67,000 sensors Q4 and 24. So more than double growth in sensor use. So we're seeing an increasing utilization of the systems out there in the market. If we look at geographies and product groups, we have strong growth throughout the global markets we are active in. US continues to be our biggest market with approximately 70% of the sales. We are noting more growth also in other regions, so we're becoming more and more a diversified global region company. Europe had a phenomenal year with nearly double growth, and Japan and Korea had exceptional growth with very strong uptake of our markets. So you can see that we're now transitioning from being a hardware company to truly a sensor company, with sensor being more than 70% of the business. And really an interesting deep dive into this. If we look at a little bit, start with U.S. and see what's going on there. We announced a number of strategic wins throughout the last 12 months. This is a mix of integrated delivery networks. It is university hospital systems. It is veterans affairs. One of the key wins last year was delivering to Department of Defense and the Walter Reed Presidential Hospital in Washington, D.C. So we're really winning ground in the U.S. and winning the key hospitals who are driving this shift to electromyography-based neuromuscular monitoring. It's also notable, like I said before, that some of these accounts upgraded throughout the year from our previous classic version to the new next-generation version. And if I compare utilization rates, the utilization is up significantly. in excess of 50% in the accounts that have upgraded to the new system. So the new Nexion tether graph is really driving up utilization and is very well accepted by clinicians. Okay, so what is driving this underlying growth? There are three perspectives on this. One is, of course, patient outcomes. It's truly proven that quantitative neuromuscular monitoring is driving patient safety. The second pillar is reducing costs. We're helping to significantly reduce the amount of anesthesia drugs by using monitoring to individualize the guidance and the therapy during anesthesia. And the third pillar is, of course, to be guideline compliant. So there are strong drivers of our business. If we then move to the European market, as I mentioned, we have strong growth throughout the European market. One notable hospital win was announced in December. This was a major, one of the leading NHS hospitals in the UK. It was the largest deal so far that we announced in Europe. It was over 70 monitors that are going to be used for standardized neuromuscular monitoring. And we believe this is an excellent reference and inroad to the NHS system. And remember, the UK was early with guidelines. It's just been a very slow transition in moving into the guidelines, so we believe this is going to open a lot more doors. The deal was secured by our local partner in the UK, Healthcare 21, doing a phenomenal job in working the market. Another snapshot, South Korea, just an interesting market, one of our major growth markets in Asia. The South Korean market is often known to be an early adopter, kind of driving new technologies, setting new standards in Asia. We have a few hundred TetraGraft Classic, TetraGraft installed in the market. And we've seen an incredible uptick in the usage of these systems over the last three years. And the curve and the bar graph to the bottom left is showing how this installed base of TetraGraph Classic monitors in a number of key hospitals in South Korea has really taken off from low levels to being in excess of 250 patients roughly now on average, and it's anticipated to grow additionally. So I think the success factor here is a very strong local partner. There is some type of reimbursement available in the South Korean market. And finally, the healthcare strike there has helped to open up the doors again. And we believe there's going to be more uptick in the South Korean market. The last pillar of our journey was in December, we announced that our next generation TetraGraph received regulatory approval in Japan. We had an initial order that we shipped to Fukuda Damshi, our local partner, and have strong beliefs in the 2026 numbers as we roll out the next one. Okay, just a glimpse back on the guidelines. I mentioned this before, but since over the last 15 years, there's been a number of national and international guidelines that have been published in favor of our technology and the mission we are on. During 2025, there were a number of important guidelines that came out. We had the The Japanese society who updated their guidelines to say that every patient should be monitored using an objective type of monitoring technique. We had the pediatric guidelines. We had the German society who kind of sharpen them, and we have difficult airway society. And if we just look into these quickly, what was pre-announced during the fall was that the ESPA, which is the Pediatric Society for Anesthesia, came out and said specifically recommending EMG-based quantitative monitoring on children due to its higher accuracy and better reliability. So, we noted a strong uptake since these were presented. In early Q4, we had a number of clinics reach out to us, and we started to deliver tetragrafts to pediatric hospitals across Europe. The other interesting part here is about the airway itself. Now remember, paralytic drugs are used to facilitate safe surgery. And remember, they're used to make sure that the patient lies absolutely still. And once you get these drugs, it takes about between one to two minutes, you're paralyzed, you cannot breathe anymore, and you need to be intubated and mechanically ventilated to breathe. And the timing of such intubation is very important because you want to intubate when the vocal cords are relaxed and open so you safely can intubate the patient and put them on the ventilator. And remember, there's about 100 million patients and more that are intubated every year. And if you look at research, between 5% to 20% of patients are damaged or receive some type of complication because they are intubated at the wrong timing. So new guidelines have now come out saying that quantitative neuromuscular monitoring shall be used to confirm adequate neuromuscular block before tracheal intubation. So what this means is that you should use a monitor that we have to assess the right timing. When is it safe to intubate the patient? So this really drives the tetragraph from not just being a monitoring system, but also to a decision support system. So timely on this matter, there was a study performed late last year at Mayo Clinic in the U.S. What they did was that they randomized a group of patients to either kind of subjective timing-based intubation, typically waiting for two minutes and then just intubate. And then the other group, they used the tetragraph to define, okay, by science and monitoring, I want to define the perfect timing for intubation. And what this study came out in November and showed that by using the tetragraph to define the right timing to intubation and make sure safety is you had a significantly higher proportion. It was superior in detecting the ideal conditions for intubation. So as a result of this, we introduced in December what we call the Tetragraph Intubation Readiness Indicator. It gives clinicians the scientifically validated number to understand, okay, when is it safe to intubate? When are the vocal cords in perfect shape so you can intubate the patient? So this was a strong new innovation that we've driven, and it's patent pending, and I think it's going to be a very important driver of safe intubation. So we continue to do groundbreaking innovation and really to personalize anesthesia. We launched in Q4 what we call the Mgen software platform. It's our operating system that runs the Tetragraph. So the uniqueness of the TetraGraph is that we are collecting billions of data points from our users. We're using that clinical data to continuously update, innovate and perfect the system. So we continue to develop new things and just as with your phone, with your computer or your car, you are expecting to be continuously updated with the latest features and the improvements. And this is exactly what the TetraGraph is about. By being a user, you can be assured that you will get continuous improvements, the latest innovations and groundbreaking research brought into your operating room. So, we will continue to bring out new features as we go along to our existing user base. Okay, let's look a little bit at some numbers. Gross margin. As I said, the underlying gross margin has improved, and it has done so because of product mix, but also because we're seeing lower production costs. If we compare the whole year, the underlying gross margin was 66.7 versus 64.4 the year before. If we look at specifically Q4, we had an uptick to 69.3. But then we had 2025 was a year of various events. We had the U.S. tariffs come in. So the U.S. tariffs hit us with about 1.3% negative on the gross margin, which was in line with previous statements I've done. And then we had the weakened U.S. dollar that hit the gross margin with another 2.6% negative throughout the year. And then as we now are focusing so diligently on the next-gen tetragraph, we made a one-time non-cash driving write-off or write-down of raw material and components for our older tetragraph system. So we made a write-off of 10.7 million SEK, which was a one-time thing that hit the Q4 numbers. And again, we're doing it because we're seeing the growth for the next gen, and that's where we want to focus our efforts going forward. We are continuing to raise pricing. We're continuing to introduce new innovative business models. So in 26, we anticipate quite an uptick in our gross margins. If we look at our expense level, I also guided about a year ago saying that the operating expense level of Senzyme is to increase maximum of about single digit percentage. And we increased our direct expenses with 1.9% over the full year versus the year before. And this is despite major commercial investments in the U.S. We grew the sales team. We invested in a new medical affairs department. We continue to grow out our marketing team. So if you look at Q4, the operating expense level was pretty flat compared to the year before. And the strategy for Sunshine continues to be rapid growth while maintaining a very stable operating expense level. So we are moving towards profitability. EBDA continues to improve. We had a 16% improvement. I'm reporting here adjusted, meaning took out the one-time inventory right down. By the end of the year, we had 74 million in cash, and we had a little bit of money still pending from a non-closed shares issue last summer. We are growing rapidly and growing rapidly means working capital needs and optimizing the inventory for fast deliveries. What we constructed here is a credit facility. We have secured 50 million Swedish kronor and this is a credit facility to secure working capital needs as we grow. The credit facility is a combination of a loan provided by DBT Capital, which is part of NOBA Bank Group, but also in large, it is a credit facility provided by our major shareholders and using, as I said, for working capital purposes. This is a credit facility without any type of warrants, other dilutive instruments or special conversion rights. It's done at fair market terms. And I think it signals a strong vote of confidence from our major shareholders and confirming that we have the long term financing need to take this to pure profitability. So our investor base continues to be very strong. I think that the major changes that we noted in 2025 was Handelsbanken left us as well as Carnegie Funds. We had an uptake from other investors come in. We grew the amount of shareholders with about 30% over the year. So we're seeing a strong interest in the share itself. Looking a little bit forward-looking. I mean, the mission, I think you guys know it by now. This is about safeguarding every patient's journey from anesthesia to recovery. It's about developing user-friendly systems that are used in the operating room to drive a new standard of care. We're targeting a big market, in excess of 100 million patients. We're running towards 160,000 operating rooms, and we're targeting over 15,000 hospitals. And it's about winning by science, commercial excellence, and working with the best partners in the market. So if you look at our outlook for this year, given that the uncertainties in the currency rates and the difficulty in predictability then, what we've done is we've made a clear new statement. 2026 is about maintaining strong sales growth in line with our previous years and to generate positive cash flow within the fourth quarter. And we're going to make this happen by strong growth, fixed expenses, and a strong uptick in our gross margin. Our longer term goals remain very intact. This is about building a strong global market leader. And we believe that the next milestone of this is reaching a billion SEAC in sales. Okay, so to wrap up some key takeaways. One, Sensime, we are a hyper growth company. We've had phenomenal growth over the quarter by quarter. We had a little bit of uptake Q4 in 2024, where we launched the new next gen and everybody waited to get deliveries. Operating expenses remain stable. We're improving our EBITDAI and we're on path for profitability. Number two, we're winning a technology shift. There is a very strong demand for the next-gen tetragraph. There's a strong demand for our technology. Electromyography is changing in every operating room out there, and we're winning the key hospitals who are driving the change. And number three is the guidelines and the building blocks. We have the guidelines. We're backed by long-term science. The clinical need is apparent, and we have the long-term funding, and the shareholders basically succeed. So that's the wrap up. And I want to join everybody to really, we're on a mission. We're there again, as I said, we're there to safeguard every patient's journey. We have the technology, we have the team, and we have the platform to make sure that everybody wakes up safe from anesthesia. Thank you. Want to stay updated on the company? Click here to visit the company page and add it to your watch list. Add all your holdings to stay informed.