Earnings call transcript: Devyser Diagnostics Q2 2025 revenue beats forecast

Devyser Diagnostics AB reported a robust financial performance for the second quarter of 2025, with revenue surpassing expectations. The company achieved a revenue of SEK 67.4 million, marking a 27% year-over-year increase and exceeding the forecasted SEK 61.93 million. This positive outcome contributed to an 8.03% surge in the company’s stock price, reflecting optimistic investor sentiment. According to InvestingPro data, the company maintains a strong financial health score of 2.58, rated as "GOOD," with particularly impressive momentum metrics.

Key Takeaways

• Revenue exceeded expectations with a 27% YoY increase.
• Significant growth in the US market, with a 200% rise quarter-over-quarter.
• Stock price increased by 8.03% following the earnings announcement.
• Three new products launched, enhancing the company’s market offerings.

Company Performance

Devyser Diagnostics demonstrated strong growth in Q2 2025, driven by impressive revenue figures and expansion in key markets. The company’s performance in the US was particularly noteworthy, with a 200% increase quarter-over-quarter. This growth aligns with the company’s strategic focus on expanding its presence in North America.

Financial Highlights

• Revenue: SEK 67.4 million, a 27% increase YoY.
• Gross Margin: 84.2%.
• EBIT: SEK 5.5 million.
• Cash Position: SEK 100 million.

Earnings vs. Forecast

Devyser Diagnostics exceeded revenue forecasts, achieving SEK 67.4 million against the expected SEK 61.93 million. This represents a significant revenue beat, highlighting the company’s strong market position and effective strategies.

Market Reaction

The company’s stock price rose by 8.03%, reflecting positive investor sentiment. This increase positions the stock closer to its 52-week high, with InvestingPro data showing just a 0.91% gap from the peak. The stock has demonstrated strong momentum, delivering a 21.1% return over the past year. Based on InvestingPro’s Fair Value analysis, the stock appears to be trading near its fair value, suggesting balanced market pricing.

Outlook & Guidance

Looking ahead, Devyser Diagnostics targets a 30% annual organic growth and aims for an 80% gross margin. The company is focused on product development and is in the process of obtaining FDA approval for its transplantation products.

Executive Commentary

"We are turning the company around on a path to profitability," stated Fredrik Dahl, Acting CEO. This sentiment was echoed by Thijs Kipling, CCO, who highlighted, "We have increased since I joined, double digit on prices every year."

Risks and Challenges

• Softer sales in the Asia Pacific region could impact future growth.
• The ongoing FDA approval process may present regulatory challenges.
• Market expansion efforts might face competitive pressures.

Q&A

During the earnings call, analysts inquired about the MolDX reimbursement feedback and the commercialization strategy for the RHD test. The company also addressed questions on distributor sales dynamics and potential market expansion.

Full transcript - Devyser Diagnostics AB (DVYSR) Q2 2025:

Conference Operator: Welcome to the Devizer Diagnostics Q2 Report twenty twenty five Presentation. During the questions and answer session, participants are able to ask questions by dialing pound key 5 on their telephone keypad. Now I will hand the conference over to the speakers, CEO, Fredrik Dahl CFO, Sabina Berlin and CCO, Thijs Kipling. Please go ahead.

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Good day, and welcome to Devicer q two twenty twenty five earnings call. I’m Fredrik Doll. I’m the acting CEO of Devicer, and would like to thank you everyone for joining our call today. On the call today, we have, in addition to myself, our CFO, Sabina Berlin, and our chief commercial officer, Thijs Kipling. I will start with a short summary of our quarterly results and then recap our recent activities that have resulted in an improved efficiency overall for the organization.

I will then give an update on the recent product launches and present some additional highlights from the quarter before handing over to Sabina for a more detailed review of our financial results in q two twenty twenty five and then to Thijs for an update on our recent commercial activities. We are turning the company around on a path to profitability. We had another record quarter based on revenue with 67,000,000 SEK in sales, representing a growth of around 27% compared to q two last year. Gross margins came in at 84%. What we are most proud of is the EBIT that came in at record 5,500,000.0 SEK.

This includes a reclassification of nonoperational FX impact that Sabina will talk more about and a 1,800,000.0 SEK in one offs related to the reorganization. Our cash position was at a solid 100,400,000.0 SEK. Our reorganization plan that we initiated early this year has now been completed. Along with an improved company wide cost control process, we have managed to find a much healthier cost structure for the company going forward. Our strong EBIT result improved by SEK 20,000,000 from the previous quarter, and we remain confident that we will reach our financial targets that we previously communicated of 30% annual organic growth, 80% gross margin, and 20% in EBIT margin by 2026.

Our updated strategy is being implemented across the organization and is further improving our focus and efficiency in way of working. Our updated strategy is also helping us focus our product development efforts to develop products that solves important clinical problems within our two main strategic customer segments, the clinical genetic labs and the transplantation labs. We have now generated a very exciting and strong product road map for the next three years that both better quantifies the opportunities and meets the needs communicated by our customers. As mentioned previously, we strongly believe there are significantly more unmet diagnostic needs that we can address together with our customers and scientific collaborators. We’re now starting to see the effects of our recent investments in our diagnostics machinery, and we are eager to start executing our newly developed product road map.

In addition to our reorganization, we have worked extensively with implementing tools and processes to improve efficiency across the organization. Overall, we now feel that we have an organization that is better cost balanced and is working on solving the relevant problems. And as demonstrated by this quarterly report, this has been done without compromising our growth. Would like to highlight our recent product launches in q two twenty five. As previously announced in late twenty four, we achieved IVDR class b approval from our external regulatory assessment of our device or RHD product.

We then finalized our internal quality processes and enabled us to launch and start shipping the product in early June. We have now demonstrated that we can deliver class d products end to end from development to batch release and that we are well positioned to support the development of any IVD product regardless of risk class going forward. Devicer remains at the scientific forefront in transplantation research. This has further been demonstrated by the development of our latest research product in our transplantation portfolio. The product called HLA loss addresses a very important and currently unmet area of investigation related to malignant disease after stem cell transplantation and provide researchers with a reliable method to study immune escape mechanisms and patterns that may be associated with treatment resistance.

The product represents a unique and premium tool in the segment and further demonstrates our pioneering capabilities in the transplantation research field. The product was launched in late June, and we are already getting positive feedback from our customers and early research collaborators. Another launch we had in late June was our genomic blood group typing product. This product represents a tool for typing blood donors in research settings and has the potential to advance the field of transfusion medicine. This next generation sequencing based solution enables comprehensive genetic blood typing covering red blood cells, human platelet antigen, and human neutrophil antigen systems in a single and streamlined test.

Devicer Genomic Blood Typing empowers research laboratories, transfusion centers, and transplant programs to move beyond the limitation of serology with capabilities for identifying real blood blood types and studying immune compatibility in research context. Finally, I would like to highlight a few additional activities from the quarter, starting with the MoDX submission that we just recently received feedback from. We received a very concrete and valuable feedback on our submission. It was mainly around a bigger sample size, which we already had prepared for in terms of sourcing these samples proactively. Overall, I would say we are pretty pleased with the feedback since we now have a very specific and achievable deliverable to com complement the application with to obtain a positive reimbursement decision later this year.

As a commercialization strategy, we are in parallel in discussions with partners with commercial capabilities in this field, and you will hear more on this from Thijs later in the presentation. As part of the transplantation strategy, we have an ongoing FDA project as previously communicated that we are in process of collecting samples from the required reproducibility and accuracy studies. And moreover, we recently had a pre submission meeting with the FDA that confirms that we are on the right track and thus moving forward with the sample collection. More details on the timeline will be communicated later this year. With that, I would like to hand over to Sabina to share more details on our financial results for the q two twenty twenty five.

Sabina Berlin, CFO, Devicer Diagnostics: Thank you, Fredrik. So here, let me give you a summary of the financials for the quarter. Revenue for the period April to June came in at SEK67.4 million compared to a SEK53.2 million in the quarter of last year. The growth is almost 27% in the quarter and back to historical levels. Thijs will soon go through more about the market dynamics during the quarter.

Also going forward, there will always be fluctuations in individual quarters. The trend with strong growth quarter over quarter continues and we are proud to again present the strongest quarter revenue wise in the company’s history, closing in on the next milestone of SEK70 million in a single quarter. Our EMEA region remains our biggest market, but The U. S. Continues to take market share with a quarter over quarter growth of over 200%.

Asia Pacific saw lower sales in the quarter this year compared to last year, but with such small numbers fluctuation between quarters can be expected. And it should be noted in these tables that Thermo Fisher sales is split between EMEA and US as we ship to both US and European warehouses. Distributor sales showed the strongest growth in the quarter with a major contribution from the transplantation agreement with Thermo. While direct sales showed a softer quarter overall, it is mostly impacted by phasing in the Italian market. We did see very strong growth in some of our direct markets such as The U.

S, UK and Spain. Tijs will cover more details on the markets and the dynamics for our channels shortly. Gross margins came in at 84.2% during the quarter, leveraging the new facility, sales growth and savings from the reorganization and efficiency programs that we initiated earlier this year. EBIT during the quarter was SEK 5,500,000.0. I’m also very happy that we can present a positive quarter that shows the effect of the changes we did at the beginning of the year.

With the right sized cost base, we believe that we can fully leverage DeVisor’s strength and market potential towards a sustainable profitability within the communicated time frame of our financial goals. While the majority of the cost for the reorganization was taken in q one, the p and l the p and l for April to June includes 1,800,000.0 SEK in one offs from those initiatives, as Fredrik mentioned. We can expect to see the new run rate from our savings from Q3 and onwards. I’ll also take the opportunity to briefly explain a change in reporting that we initiated in this quarter. In the Q2 report, we have reclassified the currency impact from the internal loan from Devicer AB to Devicer Inc.

From operational, where it had been reported previously, to reporting it as the financial item that it is. Therefore, all historical quarters have been updated in the report for comparisons reasons and the report includes a bridge table where we state the impact on historical quarters for transparency. We closed the quarter with SEK100 million in cash. The cash flow for the quarter of minus SEK14.8 million has not yet caught up to the strong EBIT development, but we expect it to do so within a reasonable time period. We will continue to carefully balance investments in our product development activities with thoughtful cash management to ensure a healthy cash position.

I continue to feel comfortable with our cash flow, and it will turn over the foreseeable period as our focus on profitability continues. And with that, I hand over to Thijs.

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: Thank you, Sabine, and good morning from Italy. I’m pleased to share several promising highlights from q two and why we’re confidently excited about what the future holds. Q two, as you heard, was another all time high revenue quarter with 60,000,000 SEK in revenues, which clearly distances itself from the previous all time high of q four of last year. As Fredrik mentioned, we launched three new products during the quarter, which all are gaining traction with interest, scheduled demonstrations, and even orders already at this point. The past year’s investments in infrastructure is already paying off.

And since the introduction of our new CRM last year, we have gained new and unprecedented transparency across our commercial funnel, which further enhances our visibility to where our investments in creating leads pays off the most. As of June, we had doubled our leads and even further developed our customer conversion rates, which in turn has increased the number of new customers significantly. In addition to this, we are increasing the number of products sold to each customer while consistently increasing our average selling prices, which contributes to the average revenue per customer increase that we have seen across our segments. This, in combination with our launch momentum, is indeed very promising for the future. The past quarter was strong on the thermal side, but also in North America where we are gaining momentum.

All of this while our European business remains on track, which I will go through in more detail during the coming slides. Moving on to an update on the partnership with Thermo Fisher. Q two was good, both revenue wise and customer wise. We attended several large trade shows during the quarter together with Thermo Fisher, which bit by bit establishes our products as the golden standard within the community. Both we and Thermo Fisher remains confident in the continued test adoption and revenue growth, and both are expecting that the revenues will be considerably stronger in the second half of the year versus the first half of the year.

The FDA presubmission feedback has been received, as you heard from Fredrik, and we are still on track with the program. More details around this will be given later in the year. North America had a strong quarter and almost triple revenues over the same period last year, driven by Sighted and the early momentum in Canada and The US, particularly driven by RT testing. Later in q three, we expect one of the largest service providers to commercialize our RHD test across The US, which is naturally a big thing. Partnering for channel coverage remains a preferred strategy and also something we are actively engaging in with our transportation services related to our ClearLab.

As Fredrik mentioned, we received concrete, actionable, and not least doable feedback from our multi x submission, which already is being addressed. We remain optimistic about resubmitting and receiving a positive confirmation, which in turn will enable to sign up one or several commercialization partners within The US. Sided is following plan, and volumes are increasing by the month, something that is expected to continue throughout the year, which is also positive for the revenue momentum in general. During the quarter, we had a very well attended webinar focused on our test for cystic fibrosis together with the prestigious CAP today, which generated a lot of interest and leads. We still today have one of the only available tests that lives up to the updated guidelines from the American College of Medical Genetics and Genomics, the ACMG, recommending screening of a 100 variants instead of the previous guide guideline stating 23 variants.

Moving on to Europe. I’m pleased to share that despite the very strong q one we had in many markets, we still did well in q two. As Sabina said, what is holding back our overall growth in direct markets is a softer than expected performance in our largest market, Italy, which grows around 3% on year to date basis. They are, however, up against quite a tough compare as they grew more than 20% same period last year, so h January. The funnel, however, for the second half of the year looks very healthy, and we continue to win tenders as you also have seen from the report, and we have no concerns about the healthy and continued growth in our largest market of Italy.

We’re seeing a solid onboarding of new customers within our genetic labs customer segment, which we expect will accelerate on the back of the new products that we launched just recently. On a year to date basis, we have increased the number of buying customers by 16% in Europe while also increasing our average selling prices. Our position in Europe is gradually building, and I’m confident that our new one stop shop strategy will further strengthen this position. We stand on such a solid platform based on our regulatory strength with IVDR and recently cleared our RSD product within the highest classification class d. We are increasingly seeing requirements by customers and tenders to have IVDR products available already now today, which will increase further during the years ahead, making us confident that we are in a very strong position to win across various segments and markets in Europe.

And with that, I give it back to you, Fredrik.

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Thank you, Tyson, Sabina. The theme for 2025 is to leverage our recent investments, focus the organization on turning the company around towards profitability and our financial targets. With all the exciting product launches, internal initiatives, and commercial focus, I’m confident that we’re are now turning the company around and on a good track to achieve these goals as we have set up for 2026. With a more focused and efficient organization, we are positioning Devicer to better serve our customers and patients as well as our employees and shareholders. August 3 will be my last day as an interim CEO.

I will then hand over to our new CEO, Jan Walstrom. I will say the future for DeVisor looks very promising, and I’m looking forward to continue my work in my capacity as a board member. With that, I would like to open up for questions.

Conference Operator: If you wish to ask a question, please dial 5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial 6 Next question comes from Ludwig Lundgren from Nordea. Please go ahead. Next question comes from Ludwig Lundgren from Nordea. Please go ahead.

Ludwig Lundgren, Analyst, Nordea: Okay. Maybe now it works. Hi, Congratulations on the strong numbers here in the quarter. So first, I just wanted to clarify from the prepared remarks on the MolDX feedback. So was this feedback basically a denial of the reimbursement of the TransMedTrace as it stands today?

Or is this just a part of the usual reimbursement workflow?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Well, it’s a application that has very many parameters, and there is a you know, you we we could look at the application from sort of there there’s a lot of risks and unknowns in what what MoldDx would like to see in the end. What so, I mean, one outcome could be that, yeah, we were fine with this today. That will be sort of the perfect outcome. Right? But I will say the second to the best outcome was that you need to complement with with more with more samples.

That that’s a very concrete and focused task for us to do, and that’s something that is quite straightforward as a complement to the application.

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: And maybe I can add that usually only one third of these tech assessments gets a positive reply in the first round. So it’s it it was, you know, expected.

Ludwig Lundgren, Analyst, Nordea: Okay. Understood. And, like like, what so more specifically, what is needed then for your like before you can reapply for approval? Is it one more clinical trial in The U. S.

Or anything else?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: No. We just need to supplement with additional samples to the study that has already been done.

Ludwig Lundgren, Analyst, Nordea: Okay. Great. And then I also wanted to continue a bit on the prepared remarks on the RHD test in The U. S. To be commercialized through one of the largest service companies, I think you said.

So can you elaborate a bit more on how this test will be offered under this partnership? Will the test be offered as a send out to your lab in The U. S? Or is will it be your kits be internally validated at these labs?

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: Right. So, Thijs, you you can take this. Yeah. For this specific opportunity, the it’s the test will be validated by the partner and offered by the partner in partnership with the but not in as part of our ClearLab. But it’s a it it it’s a great it’s a great achievement by the team.

And once we can we can officially launch and declare who the partner is, I will be very proud to do so. But we are a little bit a few months early on that.

Ludwig Lundgren, Analyst, Nordea: Okay. Understood. And like for this to generate significant revenue, do you also need some reimbursement decision and so on for for that, or how how would that process look?

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: No. And that would rely with the with the partner. But if you look at what, for example, let Terra successfully have been doing is to complement some of their offerings, right, with the RHD and truly have taken up quite a market position within a very short couple of within this year, essentially. And and you’re we’re seeing quite interest from all the other large service providers in The States to complement their offerings to be on par with what is currently the change in the market. And keep in mind that this market up until less than a year ago was all dominated by prophylactic injections.

Right? There were no testing happening. So we’ve been talking about how devices take part of this change, and here we are. And we will be one of those very instrumental testing providers within The States.

Ludwig Lundgren, Analyst, Nordea: Okay. Great. Sounds exciting. I’ll jump back into the queue.

Conference Operator: Next question comes from Ulrich Trotter from DNB Carnegie.

Ulrich Trotter, Analyst, DNB Carnegie: Congratulations on the results. And some additional questions here on the sort of reimbursement and development in Americas. And just as well sort of how the Thermo Fisher agreement on the transplantation portfolio and especially the solid organs, how will that sort of proceed following reimbursement? Will these also be validated into Thermo Fisher’s own labs? Or will they also be sent to the CLIA lab?

How does sort of this strategy now with a service partner in addition, Or how does that resonate with your proceeding with the FDA approval? Will that be able

Ludwig Lundgren, Analyst, Nordea: to be

Ulrich Trotter, Analyst, DNB Carnegie: expanded post FDA approval of these products? Would be my first question.

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Yeah. Maybe I can can sort of try to answer it in sort of broader terms and then, Thais, you can ship in as well. So I I would say there’s three ways for us to commercialize our transplantation products in The US. The first one is through the research use only kits through Thermo. And what happens is that Thermo reach out to customers and saying that they they they can sell the kits, but the customers needs to make their own validations of the kits.

And that that’s ongoing. The other way is to go through FDA, and then we do the validation. And we do it once, and then we can reach out to customers, say that the product is already validated. Now it’s more of a matter of getting the customer up and running in terms of training and and maybe a small subset of samples just to to make sure it works. So it’s very much a a a much faster implementation from a customer perspective to get up and running on the products.

The third one is is to go through our our our CLIA lab. And although we say in in our strategy in in terms of the transplantation that we’re trying to get the customers to run the samples on their own instead of sending out samples. And and that said, there’s gonna be a portion still on of the total market that that still prefers to send out samples, and then we should have the capabilities to help out through our CLIA lab. So that’s the three path, that that we we see we can pursue in The US. So, Thijs, maybe you you can extrapolate if you like.

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: Yeah. No. I think you you you covered it, and then we’ll like if if it answers. But maybe just a few few additional comments. Keep in mind that currently, the only the research use only product is under contract with Thermo Fisher.

We have retained exclusive rights for any anything that relates to to the product as a service within The States, which is not to be underestimated. And lastly, with regards to the FDA engagement, although we are we are collaborating with Thermo Fisher on bringing the product through FDA, That final FDA cleared product still resides exclusively with Devicer as we have not made any decision on who should be the commercialization partner at that given point in time.

Ulrich Trotter, Analyst, DNB Carnegie: Great. And a follow-up question on Thermo Fisher and the agreement. You received a large order in Q4. Obviously, it had some destocking effect for Q1, but now it seems like they’re ramping up their order intake again. Can we sort of interpret this sort of ramping up of orders that the Q4 order is not part of inventory anymore?

It’s been sent out to customers and been used on on customers. So is that a fair interpretation?

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: It would be speculation because we honestly don’t know either, but we have seen, obviously, a recurring ordering pattern from thermal during the quarter. But whether whether we can confirm that, that means that the supply from q four has been depleted would be speculation. But the pattern increases for sure.

Ulrich Trotter, Analyst, DNB Carnegie: Okay. Great. And on the Americas development, and you touched upon this slide with sites and already awarded RHD contracting in Canada. But can you give us some type of granularity in terms of revenue contribution here in the second quarter? And I noted that you mentioned that ScytheD is expected to sequentially ramp up in sort of later part of the year.

And in addition to SITED, because these are tests, not device or developed tests from SITED, how much capacity do you have in your CLIA lab at the moment to ramp up, especially given comments about the possibility for you sending out and selling transplantation products for your CLIA lab. And I guess, given the fact that you were seeking reimbursement for, like, several products, these would also be included into the CLIA lab reimbursement. So so I guess just how how should we view this?

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: In broader strokes, then there will be an increased contribution in in in in general from across North America in second half of the year versus first half. And that obviously comes from not only Cytis, but also our RHD commercialization both in Canada where we’re expecting Canadian blood services to start clinical utilization. And then, obviously, in The States, we will start commercializing with the partner as mentioned. Cytis will increase. Notably also during the second half of of the year.

And interestingly enough, we are we’re taking in quite some dialogue with similar kind of companies like Sided who wants to more or less replicate what we have done with together with Sided. So there are plenty of opportunities. And when it comes to the capacity, we we have no constraints on capacity within the lab. And once we get reimbursement and we sign up the commercialization partners, that will also contribute quite significantly to revenue contribution within you know, from the onset of that approval. But there’s no, at this point in time, any consideration or constraints when it comes to ClearLab capacity.

Ulrich Trotter, Analyst, DNB Carnegie: Okay. Great. And last question on my end before getting back into the queue. EMEA development, you talked about 16% customer increase year over year and increased average selling price. Did you dare to comment on price increases or it’s a product mix function where like, the genetic portfolio obviously carries or the NGS portfolio obviously carries a higher selling price, or or is there sort of general price increase on on your end?

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: We have increased since I joined, double digit on on on prices every year. Right? And that’s something we are we are continuously doing. So that’s that can also be expected that there will be a price increase for 2026 coming in, and, obviously, that that has has an impact when I when we look at the average selling prices. But and that’s not you know, not anybody can can successfully deliver on that, right, and and continue to grow customer base.

And that’s what I’m particularly proud of about the devising team and what they have been doing is as part of the new strategy, obviously, we wanna we know that door into the genetic lab is already open. It’s not too difficult for us to to go in and sell additional new products. That’s a key thing we are working on. And, obviously, that contributes to the ever selling the average revenue by customer also, right, in addition to the to the price contributions that we’re actively utilizing.

Ulrich Trotter, Analyst, DNB Carnegie: Okay. Yeah. Just a follow-up on on that. Double digit price increases, 16% customer growth as well as increased volume per customer itself. Would that not sort of imply that your financial targets look a little bit too conservative and even sort of your most mature market should be able to grow well above your financial targets?

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: I think that speculation would perhaps to defer back to Fredrik or Sabina if they wanna comment on on specifically the the targets. But what I can answer to is, obviously, assuming that we issue a price increase of 10, it’s it’s not usually what goes straight to the to the actual selling prices because quite a bit of our business is tied into long term contracts that has certain boundaries for how much you can increase prices. So that’s would only impact list prices and how we would negotiate with new customers. So but that’s the strategic way of working with increasing your value base over over years. That’s that’s one thing and why you can’t, you know, make that correlation of of double digit price increases to growth.

But, generally, the business is growing really, really well, and all markets are incrementally growing. Right? The only thing holding back our growth in direct markets in this quarter is is Italy. Right? But they also had a fantastic first half of twenty twenty four, which in a mature market where you’re the market leader in many of the segments, it’s it’s difficult, right, if to continue to grow more than 20%.

So that’s why we see these these phasings that are happening. I hope that answered.

Ulrich Trotter, Analyst, DNB Carnegie: Okay. Yeah. Yeah. Absolutely. Thank you very much, guys, and and thank you for your time, Sabine, as well.

Ludwig Lundgren, Analyst, Nordea: And I’ll get back into the queue.

Conference Operator: Next question comes from Philipp Weiberg from Pareto Securities.

Philipp Weiberg, Analyst, Pareto Securities: Hi, good morning. I’ve got a few questions here, but I’ll take them one by one. So firstly, I would just like to follow-up on distributor sales here. And I know you’re quite hesitant normally in giving some guidance on that. But excluding FX, it’s in line with the Q4 last year, which was really strong.

And so I’m just curious of the one off effect and how temporary Is it possible for you to give any sort of guidance or any indication of how strong it was and what to expect now going forward for the remainder of the year?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Thijs, do want to comment?

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: Yes, I can comment. Well, the good thing is that it’s it’s within distributors, it’s not only thermal fixture. We have all we have a very healthy distributor business that is being run exactly as it should be. And if you look at, for example, the European part of Bit Polar than maybe than than that one, we had 40% growth in in that specific region during the quarter. So it’s so it’s a it’s a mix.

And then as you saw, ace APAC was a little bit softer, which is only distributor channel also. Right? So it’s it’s it it is a mix. I can’t go closer. As you know, we don’t disclose partner sales.

Philipp Weiberg, Analyst, Pareto Securities: All right. Okay. It’s worth a try, I guess. But all right. I’ll move on to the next one.

But around the newly launched test here, you said that you received some positive feedback. So is it possible to just share some more details around the traction that you’ve had now then also around what the feedback has been?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Sure. So I I think if we look at the HLA loss that we consider a very much a premium product, and from from various perspective, there is there is not many other alternatives. And the ones there there is, we can see that we’re basically has a superior performance. And, moreover, we were looking at the customer segment that is, I would say, not the traditional sort of, old school genetic labs. These are labs that, I would say, working in the transplantation field, with a little bit more sort of, research forefront and has, I would say, another sort of they’re not as sensitive on price.

This is a product that has a huge impact on on the people lives, and we can, of course, take advantage of that from from a from a sort of pricing perspective. And this is a, I would say, a product that we’re really proud over and highlights the sort of our scientific forefront from the Pfizer in in the in the transplantation research field. Yeah. So so that that has been a has been very well received overall since the launch, I would say.

Philipp Weiberg, Analyst, Pareto Securities: Okay. And and in terms of your product portfolio, how would you rank these tests, like, according to the, the potential that they have?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Well, it’s it’s don’t communicate that, I would say. But, I mean, look. So so I think that you should you should look at this as from a capability perspective that, if we are, now focusing our product portfolio efforts, on the two customer segments, the the clinical genetic labs and the transplantation labs. And we are getting a a sort of a focused effort across the organization, all the way from from our research and development groups all the way to our commercialization where we have sort of boots on the ground, and a ongoing discussion with, these customers. So so as Thijs mentioned, we’re gonna continue developing product in these fields, and continue to feed the customers that we have already up and running with more exciting products like this one.

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: And maybe, Philip, just give you a bit a bit more guidance because here, obviously, when you look at the patient population, if you’re trying to model a little bit, this is usually as a as a reflex test to the chimer region most often. So it it it will be it won’t be top selling product, but it will be a very significant contributor, and it will be an additional product into the mix that we can offer transportation laboratories, which is not to be under underestimated. For the if we move to the genomic blood typing product, you know, that’s also truly unique. That can that we’re that’s about changing a market also with a lot more now we can offer a lot more granularity and detail on on the specific patient plot typing. And and that could certainly be quite transformative within those fields.

And here, have seen interest from Stockholm, interest from from both Canadian Blood Services and Hemo Quebec. So all these blood centers are picking up interest on in in this product, which is very, very interesting to follow.

Philipp Weiberg, Analyst, Pareto Securities: Okay. Thank you very much. And then just last question here, perhaps to Saddinna around the cash flow. So EBIT is turning positive now, but you’re also capitalizing a lot. So the cash flow is still negative, and now we have a cash position at 100,000,000.

So I’m just trying to get some more sense in when you’re expecting this to turn and if it just contingent on continued growth.

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Sabine, do you want to take this one?

Sabina Berlin, CFO, Devicer Diagnostics: Yes. And in a growing company, I would say cash flow is one of the priorities for the CFO and so for me as well. We’re not guiding specifically on when we expect our cash flow to turn. Apart from that, we do expect it to. And we will continue to invest into our product portfolio, and we have a very strong road map.

But all the forecasts and the internal strategies and plans we have is a balance between the growth that we expect to see in the company and investments that we will and can make. So there are many handbrake opportunities and several opportunities to push the gas develop depending on how our growth on the sales side continue and how we decide to utilize that money as well as our run rate on the cost side. Did that answer your question?

Philipp Weiberg, Analyst, Pareto Securities: Yes. Well, I think it was somewhat helpful, Elyse. Thanks.

Sabina Berlin, CFO, Devicer Diagnostics: Thank you.

Philipp Weiberg, Analyst, Pareto Securities: Yes. That’s all from me.

Conference Operator: Next question comes from Oskar Bergmann from Redeye. Congrats

Oskar Bergmann, Analyst, Redeye: on a very strong report. Nice to see. I got a few questions. The first one, I think maybe this one was already discussed in the Q and A session. But could you elaborate on what you see ahead in Italy for the second half of this year?

Because direct sales is so dependent on how things are progressing on that market.

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Yeah. Thais, we take that one.

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: Yeah. Well, we we historically, Italy has always been growing, you know, modest very high high high single or modest double, And we’re not seeing anything should change in that respect. And we just announced as we also disclosed in the report another very sizable tender that in itself has 10% organic growth. So we do expect Italy to rebound in second half of the year.

Oskar Bergmann, Analyst, Redeye: And then I know that in the previous years, you have talked a lot about the conversion of distributor markets to direct markets, but this seems to have been given a less focus in the past maybe two years. Is this something that you agree with? And should we assume that this is not a key focus area for you?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: I mean, look. I I think it’s part of the how we communicate what device is all about. It’s not a company that likes to highlight when we convert how we convert customers. It’s more of a sort a of what we deliver as a scientific and diagnostic company and how we can help people. But I wouldn’t say that the the strategy on the conversion has has changed maybe us the communication around it.

Oskar Bergmann, Analyst, Redeye: Can you then just elaborate on how how this has progressed in the last twelve months or so?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Thijs, do you want to comment on the specifics? Yeah.

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: I can do that. I mean, as you said, we we we we converted some year three years ago quite a number of of markets. Right? And going direct is also an investment. Right?

So we wanna make sure that we are we keep the focus on where we are currently playing ball and in our direct business. And so so those markets remains to be the the large European markets and North America. And until the day where we have truly delivered on on those, we can afford investing elsewhere, we will do so. But APAC, naturally, there are some of the the Eastern European markets that are very attractive markets to be open and convert into direct sales, but it’s not something that we are diluting our efforts with at this point in time. And I wouldn’t expect that to change then probably this year, next year.

But that’s that that’s a bit of an internal consideration.

Oskar Bergmann, Analyst, Redeye: Okay. Okay. And then I have a question for you, Sabine, also. Was wondering if you can elaborate on the investments in intangibles and how we should expect this to develop in the coming quarters.

Sabina Berlin, CFO, Devicer Diagnostics: As previously, we are careful in guiding on investment strategy. And as I as I answered to the other question, it’s very much dependent on preserving our cash flow as well. But, yes, we have quite strong investments in intangible assets during this first six months of the year. But we will continue to invest in the road map. We have been quite successful in improving our project management, meaning that more of funds spent are capitalized compared to in 2024.

And I would expect to see a similar trajectory during the rest of the year.

Oskar Bergmann, Analyst, Redeye: Okay. And are there are there any specific milestones I have that could render a decrease in investments?

Sabina Berlin, CFO, Devicer Diagnostics: Not anything that we are specifically planning. We continue to be a growth company, and we will continue to expand our product portfolio. We have some very interesting products ahead of us, including the FDA that we will run-in parallel with the development projects. So I think you will need to make some assumptions on your own regarding the size of the investments, but that’s about how much we’re guiding right now.

Oskar Bergmann, Analyst, Redeye: Okay. And then just a final question. I mean, following a presumed FDA approval for ACCEPT, do you know what might be required for you to broaden the approval to other sorted organs?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Yeah. Thijs, do you want to ship in on that? I I think that, you know, we we will be a bit careful on on on sort of guiding beyond the the current application, but we we have, of course, a a good good sense on on on the requirements. Thijs, maybe you want to share some details on that. That.

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: Yeah. Just briefly. I mean, obviously, it’s it’s serious business. Right? That so the FDA would want to see quite a a rigorous clinical evidence package, right, just like the one we’re building for the kidney.

So you can expect that we would have to build and go through similar efforts as we’re currently working on, but focus on kidney.

Oskar Bergmann, Analyst, Redeye: Okay. And a follow-up question on that. Do you expect that Typhoon Fisher would be astringent on having that documentations and claims before potentially venturing into heart, liver, lung?

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: I think we we I can make it we have as you’ve seen from publications, there are several engagements already outside kidney, right, but on a research basis that is driven by Thermo Fisher. So evidence is obviously already being built, right, but on a in a in a research setting.

Oskar Bergmann, Analyst, Redeye: Okay. And just a final question, and I suspect you you don’t have the details regarding this. But do you know sort of the mix of of sort of organs that TARO fish is using except for today, if it’s solely kidney, for example?

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: I don’t have a concrete answer to that aside saying, obviously, it’s it’s focused very much on kidney, which is the lead focus. But but there is quite a scientific engagement program going on that looks beyond kidney and into heart, liver, and lung also.

Conference Operator: Next question comes from Ludwig Lundgren from Nordea.

Ludwig Lundgren, Analyst, Nordea: Yes. I just had a few follow ups on costs here. So there’s been significant changes in OpEx in the last few years, partly from the move to new premises. And now with this restructuring program making year over year comparables maybe less relevant. So I just wonder, looking a bit out in the mid to long term, what OpEx growth rates are reasonable to expect for the business from this newly lower established cost base here in Q2?

Like what would you say is the reasonable organic OpEx growth into ’26, for example?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Yeah. Sabina can ship in, but I would say that in general, we’re feeling very comfortable with the sort of setup we have right now with our new facilities, the new leadership in our operation active groups. We have a a sort of a a way of working that that looks like we’re gonna be able to in more efficient and and more streamlined way, delivering more products with the same with the same or or as as you can see here, even lower headcount. So so, mean, we we have already improved a lot in in in the way of working, but, of course, there’s a a lot of efforts ongoing to further improve our efficiency and and and also our our our COGS. So that that we’re looking forward to communicate on on later.

But, Sabina, maybe you want to to comment as well.

Sabina Berlin, CFO, Devicer Diagnostics: I think you covered that well.

Ludwig Lundgren, Analyst, Nordea: Okay. Yeah. Great. Very helpful. And and do you have do you like to expect any restructuring costs in h two as it looks today?

Fredrik Dahl, Acting CEO, Devicer Diagnostics: No. Not really. We we as it as we when we started the the year, early this year, we we we had a plan, and and we feel that we executed that. So at the moment, we’re we we are finding a a company that is a a much more balanced, and we’re looking forward to to just continue to work on our diagnostic machinery to to get more products out more efficiently.

Ludwig Lundgren, Analyst, Nordea: Okay. Great. And then I just had a final one on on because I saw that MolDX published a new proposal proposal for the LCD covering post transplant testing last week, restricting the number of post transplant tests to four for kidney in the first year, I think. So I just wanted to hear your view on this change and also whether this new LCD could affect the reimbursement timeline in any way for you.

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Yeah. I mean, it’s a little bit early days to comment, but but sure. I mean, we we looked at it. I think that you can you can look at it from different perspective. I would say that for us right now, it it has a minimal impact when we look at sort of the overall opportunity in terms of the market size.

I think when we communicated this on our sort of broader capital market day, I think we had calculated the test of to be six the first year instead of four. That said, if we if we read what what CareDx, one of our the competitors, they they claim that they are not even at four with the current ongoing business. So I wouldn’t say that this is you know, it it it it’s has has marginal effects, I would say, for us. Maybe would could say that it it it adds a bit of, I would say, it it it unpredictable in in in the business that that things like this happens. But but for now, I I think the the clarity is it it’s it’s not a bad thing.

And and, you know, again, minimal impact for from our perspective at the moment.

Thijs Kipling, Chief Commercial Officer, Devicer Diagnostics: Yeah. Maybe I just Okay. Great. As you’ve as you saw from the TV, there’s clear confirmation of of the necessity and the relevance of of CFDNA within this field. Right?

So I think regardless of the number of monitoring, keep in mind, this is still a draft. Right? But the the science scientific relevance is being established, right, which is only gonna benefit us and the field of within the industry.

Ludwig Lundgren, Analyst, Nordea: Great. Thank you very much.

Conference Operator: There are no more questions at this time. So I hand the conference back to the speakers for any closing comments.

Fredrik Dahl, Acting CEO, Devicer Diagnostics: Yeah. So, again, thank you everyone for for joining our call today. We certainly feel a very good momentum and energy in the company today with many exciting opportunities ahead of us. So, thank you everyone for for calling in.

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