The first half in review
Jan – Jun 2022
(Jan – Jun 2021)

• Net sales increased by 119% to 18.1 MSEK (8.3) with sales growth in all regions. The North American market grew fastest in the first half of the year, accounting for over 6 MSEK in total sales.
• Order intake increased by 90% to 22.2 MSEK (11.8).
• Operating loss increased by 6% to -23.5 MSEK (-22.1 excluding one-time revenues received as part of the Amicogen technology transfer agreement).
• Earnings per share in the first half of the year amounted to -0.66 SEK (0.29, -0.73 excluding one-time revenues).
• Cash flow from operating activities amounted to -27.2 MSEK (-21.7 MSEK excluding one-time revenues).
• Bank deposits amounted to 79.9 MSEK (43.2) at the end of the period.

Comments from the CEO

We are very happy with our continued growth. Sales grew in all regions, but the North American market led the way growing 226% in the first half of the year, making this a record first half of the year on the American market.
This is a direct result of our investments in an increased local presence via commercial staff employed in our US subsidiary, and we see potential to continue to invest in sales and marketing resources to secure strong returns in the coming year.
Order intake has also grown significantly by 90% in the first half of the year, and on June 30, Bio-Works had booked orders for 22.2 MSEK with 11.1 MSEK in the order backlog.
Overall, we see increasing customer demand and a stable inflow of orders.

Customer-oriented culture produces results
At Bio-Works, we are proud to be seen as a high-quality alternative and our differentiated performance as compared to traditional chromatography resins is one reason that customers discover and choose us as a vendor.
That said, an (at least) equally important factor is the customer experience that we offer our clients. Bio-Works strives to always meet our customers’ high expectations for quality, service, friendliness, and fast, reliable deliveries. We always strive to be a partner and consultant, and we consistently offer more than just a supplier of products. Our ambition is to be a company with whom it is easy to do business and in June 2022, we confirmed that we are achieving that goal.
In our yearly customer experience survey, Bio-Works was given a Net Promoter Score (NPS) of 70, widely considered to be the threshold above which companies are considered “best in class”. (NPS measures how likely it is for a customer to recommend Bio-Works to a colleague.)
We are thankful that our focus on strong customer relations is paying dividends. The value of personal recommendations which help to spread the word about Bio-Works cannot be underestimated—especially for a company working to become better known in the market.

New product launch sets the stage for accelerated growth
In June, Bio-Works launched a new product line of prepacked, turnkey products called “prepacked columns”. Prepacked columns have increased in popularity over many years due to the value that they create for the user by saving time in production and by securing a high level of consistent quality in purification processes. 
The launch of GoBio is well-timed as Bio-Works enters the second half of 2022. Customer interest is high, and long lead times and a limited number of suppliers creates very favorable conditions for a new market entrant. The possibility to offer prepacked columns gives Bio-Works access to a higher price segment and significantly expands the market for WorkBeads resins in bioproduction.
More importantly, the delivery of prepacked formats significantly increases the perceived value of Bio-Works products. We continue to follow our strategy to invest in high-value products—that is to say, products which generate increased revenue without driving the need for additional investments in production capacity.

Transitory costs put pressure on financial result
Despite a strong growth in revenue, operating loss has not decreased as planned in the first six months of the year. There have been three main causes for this.
Firstly, the product mix in the first half of the year has been heavily weighted towards new products produced at smaller scale. This result has been in line with our strategy to increase sales of products with a higher price point, but at the early stages of a product’s lifecycle, margins are relatively low. This is a transient effect which will be resolved with time—as the production scale increases, margins will improve, and volume discounts will drive down the unit cost of raw materials.
Secondly, inflationary factors have increased costs of some goods and services, for example freight.
Finally, one-time costs related to organization changes implemented in the first six months of the year negatively impacted our result. These charges are not expected to repeat in the second half of the year.
Despite the above, I am confident that our strategic priorities leave us well-positioned to benefit from strong and sustainable branch trends, and our plan to reach profitability remains unchanged.

Strong outlook for the second half
We enter the second half of 2022 with a strong backlog and great momentum. The launch of GoBio creates many opportunities for upside, and we see additional potential in our custom resins business. Both of these businesses benefit from strong trends in biotech where growth of new segments (for example gene therapy) drive an increased demand for advanced, niche purification products which command a higher market price.
Our new e-commerce platform (launched in May) simplifies the customer journey and allows customers to choose themselves when they want personal service. Our marketing plan for the late summer, fall and early winter is filled with activities designed to build strong relations with new and existing customers as well as strengthening our brand.
Continuous improvement is a theme that we have chosen to focus on during this year. We are proud of the first half of 2022, but there is opportunity to improve, and we are looking forward to an even better result in the second half.
We continue to build our order book while simultaneously positioning Bio-Works as the first choice for customers in biomolecule purification.
I want to thank all Bio-Workers for their great efforts during the past six months, and thank you for your continued confidence.

19 augusti 2022
Jonathan Royce
Chief Executive Officer