The Astrea acquisition further strenghtens Biotage

April – June

• Net sales amounted to SEK 409 (395) million, an increase of 3.4 percent and an organic* decrease of 14.0 percent.
• Operating profit amounted to SEK 53 (93) million and adjusted* to SEK 78 (98) million.
• The operating margin was 12.9 percent (23.4) and adjusted to 19.1 percent (24.7).
• EBITA* amounted to SEK 64 (100) million and adjusted to SEK 90 (105) million.
• The EBITA margin* amounted to 15.8 percent (25.2) and adjusted to 22.0 percent (26.5).
• Profit after tax amounted to SEK 34 (57) million.
• Earnings per share were SEK 0.49 (0.87) before and after dilution.
• Cash flow from operating activities decreased to SEK 51 (88) million.
• Net cash* as of June 30 was SEK 226 (224) million.
• On April 28, Maja Nilsson informed that she is leaving the position as CFO.
• On June 1, Biotage completes the acquisition of Astrea Group Holdings Company Ltd ("Astrea"). As part of the transaction 13,954,103 ordinary shares were issued in June.

January – June

• Net sales amounted to SEK 769 (781) million, a decrease of 1.5 percent and an organic* decrease of 13.4 percent.
• Operating profit amounted to SEK 106 (189) million and adjusted* to SEK 149 (199) million.
• The operating margin was 13.8 percent (24.2) and adjusted to 19.4 percent (25.5).
• EBITA* amounted to SEK 125 (203) million and adjusted to SEK 169 (213) million.
• The EBITA margin* amounted to 16.3 percent (26.0) and adjusted to 21.9 percent (27.3).
• Profit after tax amounted to SEK 77 (129) million.
• Earnings per share were SEK 1.13 (1.95) before and after dilution.
• Cash flow from operating activities decreased to SEK 62 (145) million.
• On March 9, it was announced that Lars Bäckman, Chief Legal Officer, will retire and leave Biotage in September 2023.
• On April 28, Maja Nilsson informed that she is leaving the position as CFO.
• On June 1, Biotage completes the acquisition of Astrea Group Holdings Company Ltd ("Astrea"), which was announced on 15 February 2023. As part of the transaction 13,954,103 ordinary shares were issued in June.

Message from the CEO
On June 1, Biotage completed the acquisition of Astrea Bioseparations. Astrea contributed to our record sales of SEK 409 million in the second quarter of the year. We are now very much looking forward to building this successful company further that, like Biotage, has the customer in focus.

The acquisition of Astrea further strengthens Biotage for the future. With our shared expertise and resources, we can create a world-leading chromatography platform that covers both small and large molecules. Astrea delivered convincingly strong double-digit growth in June, in line with our own high internal expectations. In addition, Astrea strengthens the group’s aftermarket business, which accounted for a total of 63% of sales in the second quarter, exceeding our target of 60%. Our service business is also developing strongly, with double-digit growth figures, thanks to the previously acquired ATDBio.

The underlying business in Scale Up continues to develop with strong growth, we still have some way to go before we see the same sales volumes as during the pandemic. We are also actively working to broaden our business in China and to run our aftermarket business with local partners. During the period, customers continued to decommission stocks and showed caution regarding capital purchases, resulting in reduced system sales. However, thanks to implemented price increases, we are seeing a positive quarterly development for our gross margin and adjusted EBITA (which were 62% and 22%, respectively, in the quarter). We have also seen how supply chain challenges have decreased during the quarter, lead times have been shortened, and freight prices have been reduced.

The fact that Biotage is now a company with a global presence and a diversified product portfolio helps make us less vulnerable. We are never passively facing challenges, but prioritizing resources where there are prerequisites for success. A new sales record was set again in the second quarter for our largest geographical market in terms of sales, Americas, which grew by 16%. Thanks to our investment in Biologics & Advanced Therapeutics through the Astrea acquisition, we also saw growth in EMEA.

Of our three customer focus areas, both Red Tech and Blue & Green Tech continued to grow during the quarter. Four of our six product areas grew during the quarter. Diagnostics, which includes our oligonucleotide business, showed double-digit organic growth and both Analytical Testing and Water & Environmental Testing continued to grow. Thanks to the Astrea acquisition, Biologics & Advanced Therapeutics also grew significantly.

We continue to develop new solutions with a strong focus on our customers. We have launched the Biotage® PeptiRen-96 well plates, which, together with our Biotage® Extrahera™ sample preparation system, can streamline the peptide purification workflow with a low solvent consumption. We are combining existing solutions in a new application that improves the process for our customers, while at the same time increasing Biotage’s current revenue in an attractive and growing niche with a positive future. A clear example of how customer focus builds value for ourselves, our customers and other stakeholders.

With the introduction of a new security pack for our Biotage® Selekt product family for flash purification, we have also taken further steps in our digitalization strategy and of our customer journey. It provides complete, built-in, industry-standard encryption for secure remote control and monitoring of Biotage® Selekt systems, protecting customers’ valuable information and scientific research from data breaches.

After an intensive first half of the year, we are now looking forward to continuing the good cooperation we have started with our new colleagues at Astrea. At the same time, our global organization continues to work with a high level of commitment to improve gross margins. Today we are a strong company, with the aim of putting Swedish life sciences on the world map. It gives us confidence for the rest of the year!