Polygiene (POLYG) Q2 2024 earnings summary

Executive summary

• Net sales for Q2 2024 reached SEK 36.4 million, up 43% year-over-year, with strong growth in both Polygiene and Addmaster segments and positive cash flow of SEK 5.6 million.

• Gross margin declined to 65.2% from 74.2% due to product/customer mix and currency effects, but EBITDA improved to SEK 2.6 million from -SEK 4 million.

• APAC region, especially China and Vietnam, drove growth with over 100% increase; Sports & Outdoor is now over 50% of Polygiene's revenue.

• Strategic initiatives, including team reduction, business area separation, and cost-saving measures, have resulted in a debt-free balance sheet and strong liquidity.

• Positive cash flow and a lower cost base contributed to improved financial health.

Financial highlights

• Net sales increased 43% year-over-year to SEK 36.4 million from SEK 25.4 million.

• Gross margin was 65.2%, down from 74.2% last year, mainly due to currency and product/customer mix.

• EBITDA improved to SEK 2.6 million from -SEK 4 million; EBIT rose to SEK 1.2 million from -SEK 5.3 million.

• Cash flow was SEK 5.6 million versus -SEK 2.8 million last year; cash in bank increased to SEK 54.3 million.

• Equity ratio at period end was 92.5%; equity totaled SEK 306.1 million.

Outlook and guidance

• No signs of slowdown in July; Q3 started positively with significant orders from distributors and key customers.

• Focus remains on commercializing new technologies, including ShedGuard™ and StayFreshBIO™, with commercialization expected in 2025.

• EU extended biocidal product review deadline to 2030, supporting continued use of silver-based products.

• Sustainability reporting to be presented starting 2025, with CSRD work ongoing.

• No new long-term external forecast will be provided at this time.