Year End Report  01/01/2018 – 31/12/2018

Summary of Q1-Q4 2018

The following summary refers to the period 1/1/2018 – 31/12/2018,
compared to 1/1/2017 – 31/12/2017

  • Net sales for this period totaled to SEK 1,237,988 (SEK 191,345)
  • Operating result for the period of SEK -6,840,659 (SEK -8,958,852)
  • Cash and bank balance SEK 6,819,997 (SEK 15,660,371)
  • Capitalized development costs of SEK 1,370,801 (SEK 1,428,220)
  • Average number of registered shares 9,877,264 (8,788,203 shares)
  • Result per share* SEK –0.69 (SEK -1.02)
  • Equity Ratio 82.7% (93.8%)

*Result per share is calculated on the average number of registered shares during the period.

Summary of quarter Q4 2018

The following summary refers to the period 1/10/2018 – 31/12/2018,
compared to 1/10/2017 – 31/12/2017

  • Net sales for this period totaled to SEK 311,886 (SEK 191,345)
  • Operating result for the period of SEK -1,640,324 (SEK -1,864,393)
  • Capitalized development costs of SEK 151,804 (SEK 373,084)
  • Average number of registered shares 9,877,264 (9,406,025 shares)
  • Number of registered shares 9,877,264 (9,877,264 shares)
  • Result per share* SEK –0.17 (SEK -0.20)

*Result per share is calculated on the average number of registered shares during the period.

CEO comments

A year of solid progress

During 2018 OptiFreeze has taken firm steps towards commercialization of our technology and products. This has been done by increasing the focus on sales, marketing on the two application areas “OptiFlower” and “OptiDry”. In both segments, we have performed industrial scale trials at customer sites that were partially financed by the customers. This is a very positive development for us and also brought revenues to OptiFreeze. As a result of the intensified work within the OptiFlower segment, we made our first sale of the OptiCept line to a multinational leading flower company.

In 2018, the focus has been on getting the first sales and successful meetings and trials with customers. As a result of the new focus we have re-focused the organization towards a more sales-oriented team. Our R&D team worked on process and concept development during the customer trials as well as method development. By the end of the year, a mechanical engineer joined us for designing our products and supporting our team in mainly technical aspects. During the year a lot of focus has been to increase the awareness of Optifreeze and its technology. Through our increased sales efforts we are today well-known in the flower industry and amongst selected food companies.

Focus Areas – OptiFlower and OptiDry

OptiFreeze defined OptiFlower and OptiDry as the focus areas during 2018. We were positively surprised about the strong customer reactions in the OptiFlower segment. It is clear to us that we are solving an important problem in the industry and that they have been searching for a solution for many years. Especially the short life time of the plants have been a major headache.

In OptiDry, there is huge benefits to gain when applying our technology to dried vegetables, herbs and fruits. It is possible to reduce drying time, to save energy and more effectively retain the fresh-like sensory attributes in dried products.

The OptiFlower segment had an exciting development last year and the results we obtained during 2018 were very promising. The more trials we have done, the better results we have obtained. Additional customer benefits have been identified, such as better growing performance, better appearance and rooting attributes, and structure at the moment of sales. Together with one of our customers, who is also a market leader, we have close cooperation that is becoming increasingly profound. The cooperation so far is based on a LOI with the intention to sign a formal agreement early 2019.

The OptiDry segment’s breakthrough has so far been taking a bit longer time than expected. The main reason is that customers have seasonal products and they would like to do several tests on the same products. Another challenge in this segment is the capacity. For drying industries, the volumes are quite big since the products are meant to be dried (around 90% of the products are evaporated during drying). In order to catch up with our potential customer’s capacity, we need to upscale our system. We have performed customer trials with two different companies. One of these companies was introduced to OptiFreeze through their distributor and therefore OptiFreeze has signed a LOI with one of the largest distributors of herbs and spices in Europe.

OptiFreeze is still working on our other two application areas OptiFreeze and OptiFresh. However, the efforts were minimized in these segments. We have been in contact with European authorities to understand how to classify products that are treated with our technology and made progress on this subject during 2018. Our discussions and efforts will continue, and we expect to have a result in this matter during 2019.

OptiFreeze has a strong connection with researchers at Lund University. This important collaboration brought us deeper knowledge about our technology during 2018. As a result of this strong connection, OptiFreeze has received interest from researchers and master students from Lund University.

First Sales - Production of OptiCeptTM Line

An important event during 2018 was when OptiFreeze received the first product order from a multinational leading flower company. OptiFreeze is working with several different sub-contractors to produce the OptiCeptTMline. The OptiCeptTMline consists of two separate systems: Vacuum Infusion (VI) system and Pulsed Electric Field (PEF) system. VI system (on the left side) and PEF system (on the right side) are shown in the pictures below.

The OptiCept line is now ready to deliver to our customer’s farm in Kenya.

Looking ahead

During 2018, OptiFreeze has taken solid and successful steps in commercialization, sales and production. In 2019, we are excited to make our first installation in Kenya, start new trial programs and move forward with commercialization of our technology. The plan is to start introducing the treated cuttings by the end of 2019. We will also intensify the work with current customers and implement more OptiFlower trials with new ones.

OptiFreeze will continue ongoing projects with current customers in the OptiDry segment during 2019. Potential customers have expressed willingness to do more trials in 2019 and the aim is to fully understand their needs and finalize these projects with sales.

We will increase our efforts to make the OptiFresh segment successful during 2019. We are more confident now since we have made our first sales and will have reference customers which is an important advantage in negotiations with potential new ones. We have also gathered a lot of experience during the last year that gives us confidence to move forward in the OptiFresh segment. The focus will be to create more customer awareness, to increase the number of prospects and to have more projects with growth potential in this segment.

OptiFreeze’s main focus in 2019 is to increase the sales of lines and to receive as much installations as possible. The potential for our technology is huge and rapidly increasing. The market size for the flower cuttings is estimated at around 250 million euros and more and more companies within the flower industry are demanding a technology that can help them to prolong the life of cuttings in step with need of a better logistic chain in the industry. Having said that, we are going to focus fully on the OptiFlower project, but many interesting projects will come in the future.

This is a challenging to-do list, but with intensified work, clear goals and our skilled employees, I am confident that we can take OptiFreeze to the next level in 2019. Looking forward to continuing to work with you with great commitment!

Lund, February 14, 2019

Eda Demir Westman, CEO


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