First quarter 2025

• Net sales for the quarter totalled MSEK 57.5 (48.8), equivalent to an increase of 18% compared to the corresponding quarter 2024. At constant exchange rates, sales increased by 18%. Net sales excluding contract manufacturing was 55.8 (48.8) equivalent to an increase of 14% compared to the corresponding quarter 2024. At constant exchange rates, sales increased by 15%.
• Gross profit amounted to MSEK 40.7 (34.8) equivalent to a gross margin of 71% (71%).
• Earnings before interest, taxes, depreciation and amortisation (EBITDA) totalled MSEK -0.6 (-3.6), equivalent to an EBITDA margin of -1% (-7%). The quarter's result was impacted by negative currency effects of MSEK -1.0 (-0.4). Adjusted for this, EBITDA amounted to MSEK 0.4 (-3.2).
• EBITDA ex-US was MSEK 3.8 (-1.1) for the quarter, corresponding to a margin of 7% (-2%). Adjusted for the above-mentioned currency effects, EBITDA ex-US amounted to MSEK 4.8 (-0.7).
• Operating income (EBIT) totalled MSEK -5.9 (-9.2), equivalent to an EBIT margin of -10% (-19%).
• Net income for the quarter was MSEK -23.4 (20.7) and earnings per share before and after dilution was SEK -0.24 (0.21). The decrease is due to unrealized currency effects on cash placed in USD, but also of interest on cash and cash equivalents.
• Cash and cash equivalents at the end of the quarter totalled MSEK 165 compared to MSEK 194 at the beginning of the quarter, including negative currency effects of MSEK 16 related to cash placed in USD.
• Cash flow from operating activities totalled MSEK 6.0 (8.4). The positive cash flow from operating activities is due to positive ex-US operating cash flow, a reduction in inventory, and increased short-term liabilities.
• Cash flow from investments in intangible assets amounted to MSEK -16.7 (-52.1) and mainly refers to our clinical studies and registration preparation work in the USA. Including last year's repaid deposits, cash flow from investing activities amounted to MSEK -17.5 (103.2).
• Total cash flow for the quarter amounted to MSEK -12.5 (110.3). Adjusted for last year's repayment of deposits, total cash flow for the quarter amounted to MSEK -12.5 (-45.0).

CEO comments

We are off to a strong start into 2025, with a new record quarter in sales, a profitable ex-US business, and FDA granting us Early Access in the US.

Early Access Program granted in the US

Earlier in the year, we reached a fantastic milestone on the journey towards approval in our highest-potential market: both of our pivotal clinical trials in the U.S. met their primary endpoint and showed that the therapy was well tolerated by patients – crucial results for the FDA’s assessment.

Now, we have recently shared the next exciting news from the US: the FDA has approved our Early Access Program, also known as Expanded Access Program (EAP). Under this program, participating hospitals will be able to treat “difficult-to-sedate” patients, i.e. those who are unable to achieve and maintain target sedation levels with intravenous (IV) sedatives, ahead of a marketing authorization. Clinical indicators may include repeated episodes of agitation or self-harm, escalating sedative or opioid requirements, or physician concerns over continued IV sedation use.

We are very happy that we will be able to provide our products to critically ill patients who do not have a good option today. But also from a company perspective, this FDA authorization marks a significant milestone from multiple angles. Importantly, the FDA grants this type of access only when it determines that no comparable or satisfactory alternatives exist and that the potential benefits outweigh the risks. While the program is open to all hospitals in the US, we are seeing particularly strong interest in using our products from several of our clinical trial sites. Having hospitals already trained and familiar with our products by the time of approval could lead to a faster market uptake. Additionally, the program offers a valuable opportunity to test critical processes, such as our U.S. supply chain, and to gain more insights into hospital workflows ahead of a commercial launch.

We are all looking forward to have the first patients treated through the EAP in the second half of this year.

Best quarterly sales to date

On the commercial side, we set a new quarterly sales record, reaching 57.5 MSEK. This is the first time we have surpassed the 50 MSEK mark, representing an 18% increase compared to the same period last year.

Once again, our direct markets outside Germany delivered very strong performance, with sales growing 50% in the quarter, excluding FX effects. While Spain continues to lead in growth momentum, I am encouraged to see positive contributions from all our direct markets. Our efforts outside of Germany remain centered on three strategic markets - Spain, the UK, and France - where we are doubling down on commercial execution, focusing on high-potential accounts and expanding the use of our sedation therapy across a broader range of patient indications. In Q1, our other direct markets accounted for 37% of our core business (excluding contract manufacturing), a significant shift from just 17% three years ago - highlighting the success of our international growth strategy outside Germany.

In our main market Germany, our priority was to stabilize the team following some turnover in the second half of last year and to implement our sales acceleration plan. The team is now fully staffed and executing our plan with high motivation. I’m very pleased with the early results: we started the year with 8% growth compared to a strong Q1 last year, with nearly all sales districts showing year-over-year gains.

Meanwhile, the smallest part of our core business, the distributor business, declined by 38%. While quarterly fluctuations are normal and expected due to more irregular purchasing patterns, the majority of the decline is explained by the fact that we received the only order from our main South American partner in February last year, worth 1.4 MSEK. Looking ahead, based on current in-market demand and inventory levels in Mexico, Colombia, and Brazil, we anticipate solid growth from the region in 2025, though we expect the orders to materialize in the latter part of the year.

The results of the SESAR trial were published in March. As we previously commented in a press release, SESAR was an investigator-led study, which used sevoflurane instead of Sedana Medical’s proprietary Sedaconda (isoflurane). Since then, we have been thoroughly tracking daily orders and reactions on an account level in all markets and we see no sign of a change to our sales growth trajectory in March and April.

Profitability in the ex-US business

We have set a clear target to reach positive EBITDA in our ex-US business for the full year, through a combination of continued sales growth and discipline on the cost side. I see the company well on track towards this goal: our Q1 EBITDA in our ex-US business was 7%. Without the negative FX effect during the quarter, the EBITDA margin in our ex-US business would have been 8% and also slightly positive on a Group level, which includes the US.

Importantly, we also saw a positive operating cash flow at the Group level. The dynamic behind this is that we are generating positive cash flow from our European business, which we are partly re-investing in US market preparations - an important enabler of our future US launch.

As an additional building block towards sustainable profitability, the integration of our newly acquired manufacturing plant in Malaysia is progressing well and we look forward to the positive gross margin effect during the 2nd half of the year, once the inventories produced ahead of the acquisition are depleted.

2025 – an exciting year for Sedana Medical

With the promising milestones in the US and our good operational performance, I see the company well on track for an exciting and important year. I would like to thank you for your continued support and look forward to updating you on our continued progress.

Johannes Doll, President and CEO

Please find the full report at: Interim Reports | Sedana Medical

This document has been prepared in both a Swedish and English version. In the event of any deviations, the Swedish version shall prevail.

Sedana Medical will hold a telephone conference at 13:30 pm (CET) Tuesday May 6, 2025.

More info and link to the audiocast: https://www.finwire.tv/webcast/sedana-medical/q1-2025/

If you wish to participate via teleconference: +46 8 5050 0829. Meeting ID: 881 6242 7529 followed by #.