ORGANOCLICK AB (PUBL) PUBLISH INTERIM REPORT FOR Q2 2024
"During the second quarter, our operating profit/loss continued to improve to MSEK -0.1 (-0.4) despite the fact that sales decreased by -6 percent to MSEK 38.7 (41.0). The earnings improvement was driven partly by the continued strong sales development of our consumer brands and partly from lower raw material prices within the Functional wood business unit. Overall, this has led to an improved gross margin of 29.1 (26.9) percent. For the first time ever, the Group thus showed a positive operating result in the first six months of the year. Cash flow from operating activities also strengthened during the quarter to MSEK 11.0 (8.0)."
Translation from CEO Mårten Hellbergs comments to the Interim Report.
Q2, 1 April - 30 June 2024
The Group compared with 2023
» Net revenue amounted to SEK 38.75 (41.03) million
» The gross margin amounted to 29.1 (26.9) %
» EBIT amounted to SEK -0.13 (-0.38) million
» Cash-flow from operating activities amounted to SEK 10.97 (8.04) million
1 January – 30 June 2024
The Group compared with 2023
» Net revenue amounted to SEK 76.92 (84.51) million
» The gross margin amounted to 29.2 (26.4) %
» EBIT amounted to SEK 0.02 (-0.29) million
» Cash-flow from operating activities amounted to SEK 0.55 (-7.18) million
A word from the CEO
During the second quarter, our operating profit/loss continued to improve to MSEK -0.1 (-0.4) despite the fact that sales decreased by -6 percent to MSEK 38.7 (41.0). The earnings improvement was driven partly by the continued strong sales development of our consumer brands and partly from lower raw material prices within the Functional wood business unit. Overall, this has led to an improved gross margin of 29.1 (26.9) percent. For the first time ever, the Group thus showed a positive operating result in the first six months of the year. Cash flow from operating activities also strengthened during the quarter to MSEK 11.0 (8.0).
The biggest decrease in sales came in the Nonwoven & fiber technologies business unit, where sales decreased by -19 (336) percent to MSEK 8.1 (10.0). The restaurant and hotel industry, to which the business unit is heavily exposed, has weakened significantly compared to last year’s post-pandemic record year. The weak consumer market has also meant that sales development for our new customers has been slower than expected. In the long term, however, our expectations have not changed. We and our customers believe that biobased and biodegradable nonwoven materials will eventually become the standard. This is also demonstrated by our second place in the World of Wipes Innovation Award presented at the world’s largest wipes conference in Minneapolis. During the quarter, we were also awarded an EU R&D grant of MSEK 7 to develop our binders and water-repellent products further.
For the Green coatings & maintenance products business unit, the positive development continued with a sales increase of 24 (23) percent to MSEK 14.6 (11.8), where all our product segments grew. Our BIOkleen brand had a very strong sales development with the sales to Bauhaus going strong. OrganoTex also grew in line with our expectations and gained, among others, the leading Italian outdoor retailer SPORTLER as a new reseller.
The Functional wood business unit continued to have a weak sales development but with a slightly smaller decrease than in the previous quarter. Sales decreased by -16 (-28) percent to MSEK 16.1 (19.2). However, gross margins improved thanks to lower raw material prices, which helped to maintain the business unit’s profitability. The Swedish market accounts for the biggest decrease, while sales in both Germany and Finland are growing. As expected, we received excellent test results during the quarter from our long-term field studies in Malaysia and Denmark of our new product, OrganoWood Nowa. These results are very important for our sales, especially to new manufacturing partners.
During the quarter, our CFO of 11 years, Jessica Sundborg, chose to move on in her career. With dedication and hard work, she has contributed immensely to the Group’s development. Many thanks, Jessica, and all the best in the future! I would also like to welcome our new Chief Financial Officer, Carin Eklund.
At the beginning of the third quarter, our consumer products have continued to perform strongly. Among other things, we have started an expansion on the Swiss market for OrganoTex, where we have signed an agreement with a leading distributor. In Nonwoven & fiber technologies, our work continues with customer projects where we plan for new product launches during the year. For Functional wood, our focus is mainly to grow on the German market, but we are also seeking to expand into other European markets. We continue to focus on sales growth and to improve our gross margins to achieve profitable growth as quickly as possible. So that we can build both an economically and sustainability leading company and continue replacing plastics and harmful chemicals with our biobased solutions!Sincerely
Mårten Hellberg, CEO OrganoClick AB
The complete version of the Interim Report is attached in this press release and is available on the companys´ homepage at https://organoclick.com/investor-relations/reports/. The informationen in this Interim Report is according to the rules of Nasdaq First North Growth Market.
This disclosure contains information that OrganoClick AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 19-07-2024 08:30 CET.
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For more information, please contact:
Mårten Hellberg, CEO
0707 - 16 48 90, marten.hellberg@organoclick.com
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About OrganoClick
OrganoClick is a Swedish green chemical company, founded in 2006. The business idea is to replace hidden plastic and harmful chemicals in fiber-based materials with green chemical solutions based on fossil-free raw materials. Based on the company's patented "OrganoClick" technologies, which are inspired by nature's chemistry, OrganoClick develops, produces and markets a range of products with the aim of enabling a green transition. For example, the bio-based binder OC-BioBinder for the nonwoven and paper industry, the biodegradable textile impregnation OrganoTex® for consumers and the textile industry, the biocidal wood protection technology OrganoWood® for wood treatment companies and the construction industry, as well as eco-labelled maintenance products for home owners under the BIOkleen brand. OrganoClick was founded as a spin-off from Stockholm University and the Swedish Agricultural University and has received several awards for its green innovations, including being named a "Climate Solver" by the World Wide Fund for Nature - WWF. The company is listed on the Nasdaq First North Growth Market and has its headquarters, production and R&D in Täby, north of Stockholm. OrganoClick's Certified Adviser on the Nasdaq First North Growth Market is Mangold Fondkommission AB, tel: +46 (0)8 503 01 551, email: ca@mangold.se.
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