FINANCIAL SUMMARY
- Net sales for the second quarter amounted to TSEK 672 (210) and for the half-year to TSEK 1,026 (479)
- The operating loss for the quarter amounted to TSEK -13,312 (-12,397) and for the half-year to TSEK -24,032 (-27,989)
- Loss after tax for the quarter amounted to TSEK -14,671 (-13,473) and for the half-year to TSEK -26,764 (-29,388)
- Earnings per share before and after dilution were SEK -0.41 (-0.48) for the quarter and SEK -0.74 (-1,04) for the half-year
- Cash and cash equivalents amounted to TSEK 35,995 (29,357) as per June 30, 2023
 
SIGNIFICANT EVENTS DURING THE SECOND QUARTER
- Nanologica’s product for preparative chromatography, NLAB Saga®, reaches the company’s quality requirements and is approved for delivery to customers
- Delivery of NLAB Saga® to a Latin American customer where it will be used in the production of insulin
- The business is focused on Chromatography resulting in reduction of the management team and the board of directors
 
SIGNIFICANT EVENTS AFTER THE END OF THE PERIOD
- No significant events after the end of the period

ONE MILESTONE PASSED – NOW WE LOOK FORWARD
During the quarter, we reached an important milestone when we were finally able to approve our product in chromatography – NLAB Saga® – and after that make the first delivery to a customer who will use it in their production of insulin.
The fine-tuning of the production that we implemented at the beginning of the year were successful, and on May 3 we were able to approve our product for preparative chromatography. For Nanologica, this is a game-changing achievement – we have a product that meets our highly set quality requirements and that we can proudly deliver to our customers. We still have a lot left to optimize in the process to gradually improve the production pace and production economy, and additional product types will be produced. But, it is a monumental difference between waiting for an initial approval after several years of scaling up and waiting for production of a specific product to match against orders. We also notice an increased trust in us as a volume supplier by increasingly positive customer dialogues. This is likely to be amplified the more we deliver.

In the beginning of June, we saw the result of a good customer dialogue when we delivered NLAB Saga® to a customer in Latin America. They are a pharmaceutical manufacturer that produce, among other things, insulin and insulin analogues. The delivery consists of silica for the production of insulin, and this is the first time NLAB Saga® will be included in actual production. The collaboration has comprised the purification of one of their diabetes drugs, where we at the end of last year developed their method which led to higher purity and improved yield and established confidence in us as a long-term partner. This has led to them now including us as a supplier of silica for the production of this drug.
 
These advances have also given us a boost in the continued launch and marketing of our product NLAB Saga®. In May we participated in TIDES USA and in June in CPhI in China, two major conferences in our field. In these key markets, we noted a strong focus on increasing volumes of drugs for the treatment of obesity, which strengthens our positive market outlook. In China, we are also experiencing a clear shift at our customers, where older experienced staff are being shifted towards a younger generation with limited experience in preparative purification with HPLC. Here we see great potential to differentiate ourselves from our competitors by offering expertise and experience in application and method development.
 
We see a very large potential within preparative chromatography and are now optimizing our resources to establish ourselves as a global actor on this market.
 
To create the best conditions for success within preparative chromatography, we decided to focus operations on Chromatography and therefore down-prioritize the business in Drug Development. The down-prioritization is expected to result in cost savings of approximately TSEK 7,500 on an annual basis, excluding external costs for materials, analysis, and surveys. In connection with this, the management team will be reduced by two persons.
 
By focusing on Chromatography, we create prerequisites for reaching positive cash flow faster. Cash flow from operating activities is expected to improve significantly already in the second half of 2023, as sales of products within preparative chromatography increase, and production costs already having been paid to the most extent.
 
During the quarter, we have taken great steps towards Nanologica becoming a profitable company. Further patience will be required before production reaches the pace we want, but I look forward to continuing to report progress!
 
 
Södertälje in July
/Andreas Bhagwani, CEO