Vitrolife AB (publ)

Hello and welcome to the Virtual Life Group In-Frame Report Q2 2024. My name is Laura and I will be your coordinator for today's event. Please note this call is being recorded and for the duration of the call your lines will be on listen-only mode. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star 1 on your telephone keypad to register your question If you require assistance at any point, please press star zero and you will be connected to an operator. I will now hand you over to your host, Patrick Tolf, to begin today's conference. Thank you.

Thank you. Good morning and welcome to the conference call for the interim report for the second quarter 2024 for the Vitrolife Group. My name is Patrick Tolf, CFO for the Vitrolife Group, and today is the 17th of July and the time is now 10 o'clock. We will, as always, do a presentation, and thereafter open up for Q&A. You will find the presentation at our website, vitralifegroup.com, and I will now leave over the word to our CEO, Bronwyn Brophy.

Thank you, Patrick. Good morning, everyone, and thank you for dialing in. I will now move you to the second page of the presentation and take you through the Q2 highlights for the Vitralife Group. So starting with our growth margin, you can see that we've increased growth margin to 59.9%. This is mainly as a result of product mix, but we also did have some operational efficiencies within our business area genetics. EBITDA also proving as a consequence, coming in at 34.7. In terms of growth, we'd like to highlight technologies, which had a very strong quarter, 40% growth. This was driven by very high growth in North America, but the EMEA region also performing strongly. And then finally, to highlight the acquisition of eFertility, which we completed in May. This acquisition is a core element of our strategy in terms of building out an automated and integrated platform for IVF clinics globally. Okay, so moving on then to the next page and we will look at some of the key financials. So sales coming in at 941 million sec for the quarter, an organic growth of 4% in local currency, better growth certainly despite the headwinds that we face in our genomic kits business. Growth margin, as I've already mentioned, coming in at 59.9 as a consequence of product mix, but also those operational efficiencies that I mentioned. EBITDA, 327 million SEC for the quarter and 34.7% margin. Cash flow also increasing to 236 million SEC and net income up to 143 million SEC. So you can see earnings per share also increasing there to 1.06%. Okay, I will move you on now, and we'll take a look at the sales and the growth per geographical segment. So, Americas, bear in mind that this includes both North and South America. America had sales of $316 million for the quarter, growing at 5%, with North America, it has to be said, being the main driver, delivering growth across all of the business areas, with the exception of genomic kits. The EMEA region, sales of 355 million sex for the quarter, growth of 11% in our largest region. The growth really coming from, well, across the board, but Southwest Europe, Middle East performing particularly well. And you'll see in the later slides, strong performance, very strong performance in technologies in EMEA. And then APAC region, sales of 270 million sec in the quarter, a decline of 5%. This region is significantly impacted by the genomic kits and also a very strong quarter in 2023 as one of our key competitors exited the market. So you can see that we do this shift, have a quarter in our share of total sales. with EMEA leading now at 38%, Americas on 33% and APAC at 29%. Okay, moving on then to the business areas and we will start with the consumable business area. So sales here are 356 million sec. I think you can see if you look at the bar chart here that Q2 last year was exceptionally strong. due to that competitor exiting the market and we really benefited from that mainly in APAC. So despite this we did deliver double digit growth in media in the US and solid media growth in EMEA. APAC most definitely challenged with the comps in consumables and we did have a softer quarter in disposable devices in both EMEA and APAC. This is primarily due to the phasing of distributor orders and actually Again, I would say there that APAC is the region most impacted. But strong performance in media, which is good to see, and very strong performance in consumables across the board with 14% growth. Okay, moving on then to the technologies business area. A great quarter for this business area, sales of 197 million SECs. a growth of 40%. Terrific performance in Americas, but also a very strong quarter in EMEA. So, you know, you can see Americas 174% growth off a lower base, but EMEA 50%. And we do have relatively high penetration of time lapse already across most of Europe in particular. APAC 2%, a very strong quarter again last year. in this region, but I would like to point out that China still managed to deliver high double-digit growth again in the quarter. So strong growth across the board, and we are certainly seeing accelerated adoption in America. Okay, moving on then to our genetics business area. So sales of 388 million set in the quarter. a decline of 7% in local currencies. Bear in mind that this genetics business area is a combination of genetic services and genomic kits. And in fact, genetic services returned to mid single digit growth this quarter. However, genomic kits significantly impacted the top line growth. We're also starting to see some nice sales growth in tests like carrier screening and And from a regional perspective, our growth in genetic services is accelerating outside of the U.S., with EMEA growing high single digit. And we had multiple markets actually across the globe growing at double digits. So good to see that genetic services is back growing. Okay. I'm now going to hand you over to Patrick, who will take you through the geographical segment.