ChemoMetec Aktie

Good day, and welcome to ChemoMetec's conference call.

[Operator Instructions] Please note that today's conference is being recorded.

I would now like to turn the conference over to ChemoMetec's CEO, Martin Helbo Behrens. Please go ahead, sir.

Hello, everyone, and welcome to Q1. With me today, I have, first, of course, a disclaimer. We have to show everyone, but we'll quickly move on to the next slide, where today, I have our CFO with me, who will actually start here at first giving a presentation on the numbers from Q1. And then as usual, I will go over the commercial aspect. So, over to you, Phillip.

Thank you, Martin. Let's jump into the financials. As always, all numbers I'll refer to will be in DKK. Revenue for the quarter increased by 28% to DKK 160 million, while EBITDA increased by 46% to DKK 100.3 million. This resulted in an EBITDA margin of 63% compared with 55% last year. The development was mainly driven by higher revenue, providing operating leverage, continued cost discipline and improved gross margins on our XM products.

Looking across our product portfolio, Instrument sales were the main growth driver this quarter. Revenue went up with 61% to DKK 65.6 million. The main driver for this area was the XM products, especially our NC-203 that accounted for DKK 20 million in revenue this quarter compared to 0 in the same quarter last year. Consumables increased with 8%, while services increased by 22%.

We saw growth across all of our geographical segments, regions. North America increased by 25% to DKK 88.6 million. Europe increased with 24% to DKK 53.3 million, while the rest of the world increased by 71%. The increase in the rest of the world is mainly driven by distributors that built up their inventories of instruments. That also means North America remains our largest market with just above 55% of group revenue, Europe with -- followed by Europe with 33% and the rest of the world with 11%. So overall, the geographical mix is quite stable quarter-over-quarter.

Our core LCB business increased by 31%, so strong performance here. Revenue ended at DKK 153.4 million, and it represents 96% of group revenue. And the smaller animal semen, beer and milk business area declined by 11% and represented 4% of group revenue.

Following the strong first quarter and the continued positive development into Q2, we upgraded our full year guidance this week. We now expect revenue to be between DKK 570 million and DKK 605 million, EBITDA between DKK 335 million and DKK 360 million. And investments, we still expect approximately DKK 120 million. The upgrade is mainly driven by the stronger-than-expected instrument demand, particularly for the NC-203 and then the continued lower cost base.

And with that, over to you, Martin.

Thank you. Not the worst quarter. So over here to the market conditions. And again, we do see some growth in the CAR-T area. We are very excited, of course, about the previous generation. But again, as you can also see here, there is some competition. And as you probably also have read, you have Yescarta from Kite with some competition from some of the other ones, Carvykti and Breyanzi. But overall, what we like to see and what we also hear in the field is our customers are expecting growth, which means, of course, that we're also expecting to sell more instruments and more consumables and more services to these customers. And overall, it is quite important to see that the revenue keeps growing in this segment.

If we move over to patients treated, it's also something we follow because as everyone knows, every time one patient is treated basically, they will use one cassette. Of course, we do not have all the approved cell therapies, but we usually say that we have 9 out of 10 using our products. And as you can see here, just as of Q2, it looks like an all-time record again for the approved cell therapies, and this is something which is, of course, very good for ChemoMetec.

On the funding side, we still only have the numbers from first half of the year. But it seems like there is some recovery in the field. And also when we're talking to customers, when we are basically in the field, we do also see some recovery. I do remember a couple of years ago when I went with our team around the world, we did see a lot of layoffs. We did see many customers saying, yes, well, we do not have the money right now to spend on instrumentation. We're not basically looking to scale right now, whereas of today, I will say it looks better, also the budgets are better. So definitely some recovery in the industry.

Also, what we're looking at because you can probably imagine using our instrumentation, you need staff. So if you lay off a lot of staff, it usually means you'll also cut some projects, which means less instruments, less usage and which is also, of course, affecting our revenue. So this is also in line with what we're seeing in the field. It looks better, and this is definitely something to follow.

Again, on the long run, it's very good to see that we're seeing an increase again in active trials. This is very important for the industry. Again, only 49 approvals in the world. We got 9 in this year so far. So again, we still see approvals coming out. And of course, quite -- we're looking quite forward to the future basically.

If we move over to product and partnerships, this is an important part for ChemoMetec, but we have basically launched our new instrumentation here, which is also a decent amount of the growth you see this last quarter. But if we're looking first at the XM40, we do have this instrument specifically target for the bioprocessing area. And also in the last quarter, we actually have started to penetrate bioprocessing. We have sold a decent amount of instrumentation to the bioprocessing area. So this is, of course, something we're very happy for.

Looking at the 40 and the 30, basically, those instruments can be used in bioprocessing, but mainly the 40 is targeting that area since a lot of instrumentation previously and competitors are based on the carousel we also have in the 40. The 30 is meant for automation, and we have seen a lot of customers reaching out saying they're looking into automation. But again, it takes time with automation. They might have running manufacturing today where they're not used to manufacturing. So actually transforming from manual to automated setups takes time. But we do see many larger companies having specific departments now trying to develop automation flows, and we have a lot of inbound leads on the 30, and we do really believe the future is automation.

The 203, which is an upgrade basically to the 200 and the 202, is based on the same platform technology-wise as the 40 and the 30. It's cassette based, which many customers like. And overall, when we go into the field now with the new platform, what our customers really love is basically that previously, you had to validate one instrument. And then if you wanted to change that method, you need to do a revalidation. Now we have actually made it possible to have a different way of handling your sample. You can have the carousel, you can have the automated way with the satellite, the 30 and then the cassette-based 203. And you only have to validate the platform once, then they actually align across, and that's something our customers really love. And that's also some of the USPs where we're actually competing against other instruments out there.

On the strategic partnership side, it's not a secret that penetrating bioprocessing could be difficult. It's a very established area, and you need good relationships with the customer to basically show your product. So what we have learned is you need to build combined solutions. And we're trying to do that with Tecan and Hamilton and Roche [ for. ] We have more coming up, some exciting partnerships. But basically, what customers want is they do not want to contact different vendors and then do the automation integration themselves. They want to buy off-the-shelf solutions. So it has been a very important part for us to basically team up with all these partners. And remember, you see the partners here today, but we have been working with them for a couple of years now to do the integration, the validation to basically be ready to sell these products. So more of that coming in the future for sure.

Then we have product development, which is always an exciting area. And as you know, not only in the future do we want to be a cell counting company. It's important for us to basically show our capabilities, which means we can actually build end-to-end automated sample management systems actually combined by hardware and software. And mainly what you see here is one of our ideas to customers. It's a modular end-to-end system where you can basically have a lot of high-throughput cell counts, including other instrumentation than our own products, but also analyzers and whatever you need. And mainly in the future, we hope that customers, which we already know, will implement these end-to-end systems so they can basically cut the cost, which is one of the biggest, you can say, the biggest issues today with manufacturing of CAR T cell therapy.

So we have big hopes for these systems. And it's not more than a couple of weeks ago, we showcased this product last time. It was our XM user days where we fly all our larger customers. This time it was in France, and we showcased our new technology. We got some feedback on this specific sample management system, and we hope to start testing next year with customers.

Next up, we have software and integration. And last time, I'm not sure if you know, but we only had software here, but now we added integration. And that's because what we have learned the last year and 2, is that many, many companies out there can do software. They can integrate and they can show some data. But what we have learned is what the customers actually want is the data generated on our hardware. So we have started to already sell API licenses in the field, which means if customer wants to get the data out of our computer, out of their computer of their system into another system, today, they actually pay an API license. And of course, in the future, we're going to add the XM Octopus on top of that. But today, we have already sold for a couple of million API licenses just for integration. And in the future, all XM30s will come out with API license. So that's a new revenue stream for us.

And then we are ready for some questions, which I guess there will be many of. Thank you.

[Operator Instructions] We will take our first question and the questions come from the line of Mads Brinkmann from Berenberg.

Congrats on a really strong quarter. Just starting with 2, please. If we look at the instrument sales, obviously, they were very strong. But if I'm just playing the devil's advocate here a little bit, obviously, very much driven by the 203. I'm just thinking how should we think about the XM sales? Because if I look at XM year-over-year, I mean, it's more or less flattish. So I'm just thinking about how should I think about the development of XM or XcytoMatic as a whole, excluding 203 for the remainder of the year?

And then the second one, please, if I just look at your guidance, I know you just upgraded it again. But if I look at sort of the implied growth based on a very strong growth in Q1, the implied growth for the remainder of the year is 6% to 5%. I'm just thinking what it would take for the guidance to reach the lower end. It seems quite cautious, especially given the sort of easy comp that you have in Q2. That was all for me to start with.

Yes. Thank you, Mads. I can take the commercial side, Phil, then you can do the guidance. But first of all, when we're selling our new platform, it's important to say that previously, we went into the market with the 200 or 202, and they basically implemented that for every single department. Now we do see it very differently. We do see that customers might be implementing the 40 in R&D, then in clean rooms, in process. They like the closed container system, which is the 203, where they just have no way of basically having any contamination with our instrument. And then in QC, you have a lot of testing where you then want to automate that testing with a 30 and a liquid handler system. And right now, in process is the big part of the manufacturing.

So from our point of view, when we go into the market, it's not important if the customer wants the 30, the 40 or the 203. The big USP is basically they can choose whatever they want. And what we have learned is they will actually want different instruments for different departments. And right now, the 203 is what they want, but also we have actually sold some 30s and some 40s. I will say the 30 is more long term because it's automation, and you don't automate something overnight.

So some of these sales you see right now is just for the validation. It's just for the first integration. At some point, they will buy in bigger bulks. And of course, we're looking very much forward to that. But that can take a year or 2 before they really start buying a lot of 30s for those flows. So overall, I think you should look at it as a platform. Of course, there is a different pricing between the products. But from our point of view, it's just a big USP to sell a platform. So we're just happy whatever they buy. So that will be the answer to the first question.

I think, Phillip, you can do the guidance then.

Yes, definitely. So thank you for the question, Mads. I just want to reiterate that Q1 was exceptionally strong, and we're not going to extrapolate the 61% growth on instrument sales mechanically for the full year because the growth was primarily driven by the NC-203. We also had some delayed and postponed instruments order that was executed during this quarter. It is difficult to predict the future. We're really doing our best here. But our current guidance reflects the current expectations for the year, including expected revenue and also the cost development.

I will add to that also that last year, we had a similar situation. And this year, of course, we want to be conservative. We want to make sure that we don't have to downgrade. So we have learned from the past. And I think it's only 6 months ago, we had a lot of, I won't say, angry investors, but we had some. And I think we have learned to basically be very transparent and say it's very difficult for us to predict the future here because our visibility is so low. So of course, we're hoping for the best, but it is crucial for us that we don't have to downgrade again. So we have learned from the past, and that, of course, is also some of what you're seeing here.

That's perfect. That makes sense. Just one follow-up, please, on the instrument side. Obviously, I think you mentioned it yourself as well, just the rest of the world, obviously very, very strong as well, but you also mentioned that some distributors are building up inventories. Maybe just if you could add a few comments on that. I mean how -- just are you adding any distributors? Is that part of it? Or is it essentially just distributors taking in more stock? And how should we think about that for the rest of the year? Or is it more sort of a very strong Q1 impact and maybe we should expect it to come down a little bit for the rest of the year?

Yes. So to be very transparent, we have also made a strategic change in the rest of the world. So we have changed pricing from January 1. So they align with Europe and U.S. from that point of view -- from that time, sorry. So of course, they have bought instruments now at the current pricing and to hope not to spend too much with the new pricing. So it is a timing thing, but it is crucial for us to say, in the future, we sell to bioprocessing, we sell to global customers. So the pricing will be the same globally, and that has something to do with the pattern you have seen in Q1.

Our next questions come from Jesper Ingildsen from DNB Carnegie.

A couple of questions from me as well. So on the NC sales that you recorded in the quarter, could you just elaborate a bit if that sales is benefiting from sort of like last buys ahead of the end of life of the NC-200 platform coming up here in April? And yes, just more generally sort of like play out ahead of that cutoff in terms of April?

And then on the XM sales, including NC-203 and 30, 40, could you maybe also just elaborate a bit on how much of this is related to some of the larger orders that led you to downgrade your guidance last year and if that's something that's finally coming through?

And then maybe just a last one. You do also comment that you have had a strong start to Q2. And as alluded to before by Mads as well, I mean, you also have easy comps coming into November due to the U.S. government shutdown last year. Could you just elaborate a bit about this initial strong start and to some extent, if you are seeing some larger budget flushes this year coming into the latter part of the calendar year?

Yes. So on the order side, so mainly, yes, 1 or 2 of the delayed order from last year has been realized this quarter. But again, they have only bought some of the instruments, some of these customers are major customers. So of course, we're still expecting more. And to be honest, this is only the beginning and nothing has changed from what we have said over the last, I would say, since I started as a CEO. This takes time. We have some validations. We have learned that they are a little bit slower than we expected. Everything got basically postponed by 1 quarter. So that's the basics here.

On the last time buy subject, so mainly, what's going to happen now and here is we'll start selling a few NC-203s to many, many different customers. They'll start their validations. And while they do that, they will have to buy NC-200s for the time until they do the transformation to the 203. So every single NC-200 we sell right now will be replaced by 203 in a year or 203 (sic) [ 202 ]. So mainly, we have a lot of customers starting the validation now. We haven't replaced any manufacturing sites with NC-200s yet. This is only the beginning. And they will have to buy the amounts they need of NC-200s until they can do the transformation. So we will see some bulk orders on the NC-200 in Q3.

How many? It's almost impossible for us to say. We don't basically have the numbers. But of course, we have to expect some since this is their growth in the next couple of years, they'll have to buy for. And then later on, they'll have to replace those ones with the 203. So that will be the answer to that.

On the last one, Phillip, I think you can take that.

On the -- sorry, I was not -- could you please take that?

Yes, sure. So I think everyone is basically looking at strong first 4 months. And again, I can only repeat what I said to Mads. It's very difficult for us to predict. We want to be on the safe side. And I know if you just multiply Q1 with 4, then you have a very different number. But basically, for us, very low visibility. We don't want to disappoint anyone. Do we hope for more? Of course, but that's the case right now.

Okay. Just quickly coming back to the last buys at the end of life here in April. Do you include anything from that in your guidance at this point in time? And it sounds like you're expecting mostly to benefit from this in Q3 of your financial year, if I understand it correct.

Yes. No, we have not included it in our guidance. Of course, we have the usual running business. But if you see a bulk coming in from many companies, no, we haven't included that because we simply don't have the orders. And we have learned from the past, don't expect too much and then be disappointed. So it will be hopefully a positive surprise.

We will now move on from the conference call questions to those submitted via the webcast.

I would now like to hand over to Frederikke Hvidberg, who will read out the webcast questions. Thank you.

Okay. So the first question we have is from [indiscernible] who is asking, can you elaborate on the XM30, 40 sales figures in Q4 last fiscal year compared to Q1 this year?

Phillip?

Yes. So we saw a slight increase in the XM30 and the XM40 compared to the last quarter that we ended in the last fiscal year. So again, the main growth driver here is the NC-203. So it's kind of flat from last consecutive quarter to this quarter.

And the next question is from [ Knut Hansen, ] who is asking, what is the percentage of your revenue used for future R&D?

So again, we expect DKK 120 million in investments during the year. Half of that, I would say, approximately is for product development. So around 10%, I would say, is from the revenue is spent on R&D projects.

The next question is from Ludvig Lundgren, who is asking, consumable sales recovered after a slower period. Is it fair to extrapolate this growth considering the rather easy comparisons in the segment ahead?

Yes. I think it definitely depends on the amount of treated patients. But again, as we showed in the presentation, it looks like it will increase. So of course, when our patients are doing better, when funding is better, then, of course, our consumable sales will also be better. So yes, we hope for continued growth on the cassettes, and it looks decent, yes.

And then we have one more from Ludvig, who is asking, you highlighted some backorder instrument deliveries. Is it possible to elaborate on the magnitude of these?

It's difficult because I will say it's not a lot. It's mainly what we sold this quarter is a few instruments to many customers, which is also what we actually want because you can imagine if you want a lot of replacements of the 200 later on, you want to get started with a lot of validation. So we haven't received any larger orders. I think the largest one has probably been 20. So it's still to come, but it's very good to see many customers buying a few because we know what that means. It means selling a lot in the future.

Then we have one from [ Fredrik Aanla ] who is asking, NC-203 sales were about 4x the Q4 level, and you mentioned distributor stocking in some markets. How much of Q1 demand reflects end customer purchases versus distributor inventory? And what have you seen in orders since quarter end?

We mainly sold a few NC-203s to distributors. It hasn't really penetrated in Asia yet.

Then we have a question from [ Michael Howen ], who is asking, as the NC-203 gradually replaces the existing NC-200 installed base, what will sustain the current level of revenue?

Yes. Hopefully, it will mean that we can do more upselling because the whole new platform will also have what we call first, the API license, which means you are able to integrate into our instrumentation. First of all, means you can control the instrumentation, but you can also extract data. So mainly today, when we sell an XcytoMatic product, our customers are paying a fee for API licenses, which is 100% margin. So that's also why you see increased margins. And then afterwards, they'll basically also pay for a yearly subscription on service and support for that API license. And later on, we will be launching XM Octopus with a lot of features where we'll also do some upselling. We have showcased XM Octopus to all our customers in France at the XM user days, and we have a lot of demand for it.

So we'll be starting the test very soon also because actually, one of the customers came to me and said, specifically what they do right now is they're doing a lot of testing worldwide. And we have this customer in Germany who are also testing in Singapore, he's also testing in California. And when they do the test today, they have to extract the data and send it. The problem was when he came in the morning, they forgot to send it. So he lost a day. And with XM Octopus, every time you do a test, a sample, you'll actually have it synchronized so everyone can basically extract in real time.

So this is very useful for our customers. We have big hopes for it. We need to make sure it works perfectly for them, but we'll begin testing in 2027, and we have a big queue for it already. So it's quite exciting. And basically, that's the XcytoMatic platform in the future, you will basically be able to do a lot of upselling compared to today. So it will increase consumable service and software spending per instrument.

Then we have one last question left, which is from Peder Philipsen, who is asking, following the Tecan partnership, are you actively pursuing similar strategic partnerships with other major players in the bioprocessing and life science industry, such as Sartorius, Thermo Fisher and Danaher? And should we expect further partnership announcement as part of your growth strategy?

Yes, it's definitely a strategy. And what's important for us is when we do the partnerships, they are nonexclusive. So what we hope for is one day when our customers are approaching a liquid handler company, a bioreactor company, whatever, they will basically offer our XcytoMatic platform and be sold combined with the solution they offer. So first of all, that will increase our margins because it's less cost per sale. And also, you will have -- you'll get this huge exposure to a market where today with a limited amount of employees we are, you'll get a huge help here. So that's also some of it we have here with Roche. They will present our product. They will basically showcase it to customers. And just that, of course, will increase our inbound leads. And we definitely -- we definitely believe that, that is how to penetrate the bioprocessing market, yes.

All good?

That was the last question. So thank you, everyone, for joining.

Perfect.

Thank you for joining today's conference call. This concludes the presentation.

Okay. It is now 3:00 p.m., so let's get started. Thank you all for joining, and welcome to ChemoMetec's conference call. Today, CEO, Martin Helbo; and CFO, Phillip Massie Price will take you through this year's annual report, followed by Q&A where you can type in questions, and then I will read them out loud.

Okay. So let's get started. Over to you, Martin.

Yes. Thank you everyone, and welcome to conference call. Today, I have with me our new CFO, Phillip, who will give a short presentation here at first. But also I want you to basically give us a little bit of feedback on this new setup. We have had a lot of feedback from investors on previous conference calls. So today, we're trying something new and hope you will provide us with some feedback afterwards.

So over to you, Phillip.

Thank you, Martin. Just a few words from my side, as this is first earnings call here at ChemoMetec. I joined the company in August as a CFO, so I've now been here for a little more than a month now. I can tell that it's been a busy start but also a great opportunity to getting to know the company and the organization. And I really look forward to the journey ahead.

With that, let's turn to the financial performance for the fiscal year 2025, '26. All numbers I'll refer to will be in Danish crowns. Revenue for the year came in at DKK 511 million, which is equivalent to 3% growth compared to last year or 7% at constant exchange rates. EBITDA ended at DKK 281 million, 9% growth compared to the year before. And our EBITDA margin increased from 52.1% to 55%, equivalent to 2.9 percentage point increase, which is mainly explained by the increase in revenue, improved profitability and a reduction in staff cost.

Looking across our product categories, the main growth driver for the year was our instrument sales. Our instrument revenue went up with 13% compared to the year before, which was mainly driven by our sales of XM trucks, including NC-203, that increased from DKK 27.7 million last year to DKK 68.1 million this year. Our service revenue increased by 4% and consumables declined by 4%. The decline in consumables is mainly explained by the U.S. federal government shutdown in the fall of 2025, during which several of our largest customers saw a decline in number of patients treated.

Looking at the geographical development. U.S. and Canada, our largest market decreased by 6% in reported terms, however, increased slightly by 1% at constant exchange levels. Europe increased by 14%, while we saw growth of 21% in the rest of the world. Looking at our 2 business areas. Life Science continued to grow with revenue increasing by 6% to approximately DKK 485 million and is now representing 95% of group revenue. Our animal semen, beer and milk declined by 32% to approximately DKK 26 million, reflecting our continued exit from this market.

And looking specifically at Life Science, it's worth noting that the reported growth does not fully reflect the underlying development in our core business. During the year, we were impacted by lower activity among some of our largest U.S. customers, including the checks from the U.S. government shutdown as well as some larger players leaving the market. This naturally had an impact on our consumable sales in short term. And finally, also reminding the negative FX impact, as mentioned earlier, the underlying growth is more around double digits for this area.

We ended the year with a strong balance sheet. Cash position of around DKK 290 million, equity of approximately DKK 725 million. And during the year, we invested around DKK 100 million in growth initiatives, including software, automation, product development and our facilities here in lab. And finally, our ongoing share buyback program, we have repurchased 105,000 shares at year-end, equivalent to approximately DKK 39 million. As of today, we have repurchased around 206,600 shares, equivalent to 1.2% of the share capital.

Thank you, Phillip. And once again, a record year. And as I'll walk you through a hopefully, also a record year this year. First, I'll walk you through the market conditions than our products and product launch than at last product development before Phillip will take you through our guidance. We're first, market conditions, still really exciting to see all these approved CAR-T cell therapies doing well, mainly we still see growth. And you can though see here that some cell therapies are struggling a little bit. And the one, of course, doing best is heavily our customer. But again, it has been a year with less treated patients. And of course, that is also affecting our consumables.

Overall, we do see some recovery in the field. If you look at this chart, you can see that it starts looking better. Also, when you're in the field talking to customers, actually seeing what's happening, it's easy to see that the flow is definitely getting better. Also, we reported at the year-end that it starts -- we start to see more demand from our customers. And of course, that has something to do with the market. If you look at the start-up environment, which is important to us, we start to see some recovery, and that is, of course, crucial because many of our customers are still in preclinical Phase I and Phase II.

So of course, this is an area which is very important for us. We keep investing specifically at incubator sites where we are very well represented with our instruments. And incubators for those who doesn't know that is where usually you have shared labs. So you'll have early start-ups, maybe professor and an assistant, who are doing some exciting work. They will be then testing a lot, doing a lot of research and then adding our instrumentation into the SOPs. So we have been investing a lot, made sure that when this market is recovering, we have a lot of our products written in their SOPs. Also something interesting is the layoff trigger. I think when I trailed around a couple of years ago, we spoke to customers and started to see a lot of empty spaces in Enbridge, for example. We saw a lot of layoffs, which also layer -- and that, of course, with fewer people, they do less sampling also means less testing and in the end less sales from us -- for us.

So here, I think this is very positive. Also, when we're in the field, we start seeing customers hiring. We start seeing less empty spaces. If you move into the incubator space, you actually have everything occupied by now. So very, very interesting and very good news for the whole industry. As we've just said, we had some, I will say, it was pretty rocky back in November. And you can also see here with the cutting of NIH funding. We saw some clinical trials getting canceled and since we have a decent share of the market, of course, we get hit as well. Majorly, we also saw some of the largest companies out there, Novo Nordisk, Galapagos, Takeda actually exiting the market. And of course, that is hurting ChemoMetec's revenue as well.

Overall, though, we are seeing a recovery, a pretty decent recovery. And again, I think if we move on to the next slide, you can basically see the growth of this company. We only have 45 approvals, and if you look at this charge, sky is the limit. And of course, as we are seeing more approvals in cell and gene therapy specifically, of course, we will grow with that. But also, of course, we have the exciting opportunity for bioprocessing in the future, which I'll come back to you. If you move on to the products, we are now talking a lot about axiomatic and NC-203, and that's mainly because it is the future of the company. We have spent so much time in the field validating the 40, the 30 and the 203 million.

And I will say, I think many of you have by now read a lot of articles and interviews about our XM30 and XM40, and the feedback is amazing. The 203 is also very exciting for us since we have, of course, announced the discontinuation of the 200. So many customers who are used to the flow of the cassette-based instrument will basically replace the 200 with the 203, but also many of them are looking now into automating some processes with the 30. So it actually will be a combination of the 203 and XM30, I believe, in the future for cell therapy. Again, it was a record year for XcytoMatic. And I remember, I think it was just a year ago. I had many investors asking, can you even sell this product? Is it even good? And I think these numbers justifying that it's not only ChemoMetec now saying this product is sellable. A lot of customers feedback [indiscernible], you have seen it all, they love this product.

So hopefully, of course, in the future, we'll start seeing ChemoMetec to expand even more in this area. And as you know, we're also reporting that basically we expect most of our instrument revenue coming from XcytoMatic in the future. For the Q4, specifically, if you include NC-203, we have a record quarter, again, DKK 17.7 million. And of course, most of that revenue, not of course, but most of that revenue actually happened in June. So what we started to see with the discontinuation also with the market improvement and automation. We saw a lot of demand. And again, we mainly had more than 50% of our instrument sales coming from this area. So we are very looking forward to the future.

Again here, some extra numbers. Of course, the growth -- it's explaining itself, and we have, of course, a big hope for the new year. Mainly the trend, which happened in June and Q4 is something we expect to continue into next year, current year. And the key drivers are basically the replacement of the 200. We have sold thousands of NC-200 so many customers, they have to now basically start replacing which means, first of all, they need to make sure they can produce for the next 3 years with NC-200. So we are seeing some last time buys as well as actually some departments already starting to basically validate our NC-203 or XM30, XM40.

Automation, again, is very interesting, I believe, because when we start seeing replacements for the 200, we also have customers saying, well, it would be nice to automate some process flows now when we are actually looking into validation. So we do see a lot of customers doing validations between the Hamilton system and XM30 and also basically a Tecan system in XM30. It also helps that the market conditions are getting better. We can see that, and we can also feel that when we're negotiating I remember a couple of years ago, getting budget for a customer for XM40 specifically was almost impossible, where today, we do see it is easier for them basically to purchase our instrumentation.

And not only that, we do also have been working on some strategic partnerships. And the strategic partnerships is something you only have to do once. Specifically here, I mean the validation into their systems. We have been working very hot in this area to ensure the best possible agreement for ChemoMetec also for the future. And mainly, many of these partnership has happened through customer land because when we have been presenting our XM30, XM40 and 203 in the field, we've had customers saying, why don't you actually start integrating into other systems. So instead of buying specifically from ChemoMetec, we can buy a combined solution, a system. So we started talking to [indiscernible] and Hamilton, Roche, to basically integrate our product into a larger solution, and I think we will see a lot from this in the future.

And then over to product development, where we also have some exciting projects for the future. I think what we're trying to show is mainly that in the future, Nomadic won't only be a cell counter company because one thing is doing an on-site cell count, but many customers actually also are looking into how can we treat more patients? How can we scale this business. So mainly, we're trying to with this cell management system, for example, to automate some procedures to help them scale, to actually help them do way more testing than they're doing today. And I've met with many, many operators also Head of Operations, who sits in the future -- we don't want too many operators in the app, in the manufacturing. They actually won hands free. So it's basically the car manufacturing all over again.

Specifically here, you see our sample management system, but also with an integrated XM50. And we are hoping that customers can save a lot of money by basically buying our automated system, scale their samples, scale their production and actually produce cheaper cell therapies. And talking about automation, hardware alone is not enough. You also need a software to ensure you can cut some costs. I can tell you when we are on site, we usually meet service managers who are overseeing 7,000 instruments where they need to make sure their service, they work, they're up and running. They get to the dairy day. And the whole idea about XM Octopus came to life because of that because what they would love is a fleet management where you can oversee all your instruments, make sure everything is serviced. You can even see is it working as opposed to. Is anything wrong? And if anything is wrong, you can just contact the ChemoMetec service engineer.

So here by moving into the software area, it's basically customer is the customer demand, but also it just makes so much more sense because you can imagine, overseeing 7,000 instruments, which is not only ChemoMetec instruments, it's just a lot of work. So imagine if they can oversee just per system, and basically, look into that and service and everything, you will cut so much cost. Also with XM Octopus, instead of going into a lab to extract data, you can actually send the data by an API into a remote server. And by that, you can do QC approval, you can even do audits from FDA in there. So you have so many opportunities with this new software. And of course, we have big expectations for that as well.

And the next slide here, Phillip?

Thank you, Martin. So to wrap everything up. Our expectations for the fiscal year 2026, '27. We expect revenue of between DKK 545 million to DKK 575 million, equivalent to growth around 7% to 13% and EBITDA of between DKK 300 million and DKK 313 million. Also, we expect CapEx to be around DKK 120 million. So while we expect growth in both revenue and EBITDA our margin and also CapEx will be reflecting our continued growth initiatives.

With that, over to Q&A.

Okay. So let's start with the first questions. Jesper from DNB. Could you help us understand the assumptions behind '26, '27 guidance? Do you expect instrument sales, both XM and NC to be the main growth driver, while consumables and service continue to decline? And what would need to happen for you to end up at the upper versus lower end of the guidance range?

Yes. I'll take that one. And basically, the assumptions behind guidance is, of course, we have learned from last year. I think many, many investors, they reach out, of course, after our downgrade, and this is not something we are very proud of. So we have learned from that. So this year, we, of course, have seen some market improvements. We have a lot of exciting replacements to do. And mainly, we have looked into what is the worst case scenario here because we don't want to disappoint. What we expect is mainly the instrument sales to grow first because you have consumable and service growth, you need instruments to grow it first. We haven't basically had any expectations for Roche, Teek and Hamilton, those collaborations because we don't have any numbers. So mainly, that's, of course, an upside if that happens. So overall, we are looking at the guidance to say the running business itself -- how is that working out with the market and everything. But again, remember, the market improvement is basically only a couple of months old before it really started to take off. So we still have to see the trend, but we are cautiously optimistic about the future.

Okay. And the next question is also from Jesper. How do you view Novartis forcing some of its CGT programs, including YTB323 in DLBCL and PHE885 in multiple myeloma as well as BMS pausing some of its cell therapy programs in terms of what this signals for the broader CGT market and platforms such as TeCharge. And more specifically, have you seen any impact on ChemoMetec's activity or demand from Novartis BMS or related programs?

Yes. And of course, we have been reading about those programs as well. And I think if -- we're going back to the presentation, we saw more than 3,000 ongoing trials. So of course, when you have Phase I and Phase II trials, you have to expect some of them facing some issues. This is in vivo and in vivo is very different from ex vivo since the expansion happens inside the body. And I know they had some issues, but it's not something which causes too much stress or you can say we're -- from our point of view, this is what happens. So we hear it all the time. And of course, when you move into a whole new way of producing a drug, which is in vivo, you have to expect some issues throughout the clinical trials. So, no, we are not too nervous about that. And I think they're going to solve the issues, and we will see some exciting drugs in the future. And also, it is important to say that those platforms, Techar, for example, and next from BMS, they have many drugs on this platform. And so far, it has only been a couple of drugs facing issues. So the platform itself from Novartis and from BMS is to my understanding, not facing any major issues.

Okay. The next one is also from Jesper. You recently announced the discontinuation of the NC-200 platform with sales ending in April '27 and service ending in April '29. We hear that some labs have started making last time buys ahead of the April '27 deadline. Should we expect this to drive any meaningful uplift in instrument sales over the coming quarters?

Yes. And that's actually a very good question, Jesper. So thank you for that. So mainly, our visibility is -- might be 45 days. So from our point of view, of course, when we do a last time buy, we have some expectations for some last time buy. If you're producing with NC-200 and you know the last time buy is in April '27, you need to buy some instruments at some point. You basically cover up for the lag over the next couple of years. So yes, we expect some last time buy on -- related to the 200, and we also expect some NC-203 sales for validation. The difficult you can say, thing for us is basically to estimate it because last year, we tried to estimate it. We heard a lot of numbers, and we believed it. And this year, we're more cautious because we don't want to disappoint again.

And the next question is from Simon Larsson from Danske Bank. What about the push XM order triggering the PW last year, the old FY '25, '26 guidance set at DKK 565 million to DKK 580 million. We ended up at DKK 511 million, and now we have a new guidance pointing towards DKK 560 million at midpoint for FY '26, '27. Can you talk about what happened to those XM orders that you thought would end up in H2 last year? It seems like you're not counting on them materializing this year?

Yes. And mainly, it's because we haven't received the orders yet. So from our point of view, we will wait until we see the PO this year before we start reporting to any investors. So mainly still expect them at some point. It's very difficult for us to say when because these validations, we had a pretty great example last year in our annual report, I believe. Those validations, they take time. We have had validation running for a couple of years with many customers. Some of the sales you see right now is mainly from those validations running over a couple of years. So we also know at some point, these customers, they will buy more instruments. It's just very difficult for us to estimate. So right now, they're mainly not a part of the guidance since we are not familiar with the exact numbers and estimates even if they will arrive this year, next year or in 2 years. So that's the main case here.

The next question is from Ludvig from Arctic. And there's 2 questions. The first one, when it comes to the change in IFRS accounting, you highlighted a DKK 50 million effect on instrument sales in fiscal Q3. What was the effect in fiscal Q4, if excluding the accounting effects in '25, '26 and '26, '27, what is the implied sales growth range assumed in your guidance?

First of all, the DKK 50 million effect was one -- DKK 15 million, in fact, was a one-off, so we don't have any effect this quarter. So if we're looking at the expectation of our product development and investments, mainly, we are looking into investing more in our XM Octopus. We believe software is the future in this area. Also, we are looking to automation, sample management system, autosampler, we have some XM50 coming pretty soon. So we're looking to keep investing. And I think what's important for chemo medic is the next 5, 10 years, sell a lot of cell counters. But at some point, we have to look at what is the next growth leg from our point of view. So we're investing a lot in automation and in software, because we believe the future is systems and to sell a system, you need hardware, software, mainly automated. Also, of course, a big piece of this is for XM Octopus.

And the second question is, when it comes to the expected DKK 120 million product development expense in '26, '27, does this entail only capitalized investments?

Mainly is going to be CapEx, but of course, there will be some P&L as well. But mainly, it's going to be CapEx.

And the next question is from Peter from Posting Invest. Gosh, how far along are you with the collaboration? And when do you expect commercialization to begin? Is the validation process different or easier compared with standard customer validation losses?

Yes. And our expectations from Roche and for the Roche deal, I get the question a lot. And the difficult part from our point of view is, first of all, we're not allowed to talk too much about it. Second of all, we do not have any numbers. But we do expect -- we do expect to start selling next year 2027. And the validation process itself is difficult because when you're replacing driven blue based instrument, there will be differences between our method and driven Blue. Positive part here is we have spent some of our R&D expenses this year to basically develop protocols. So we are able to help the customer to basically do it an easier check transfer. So it will be some work for the customer. It will take time, but mainly, if you move straight to integrating it, that itself is not a problem. It's basically to replace an existing method that can be more difficult. But again, since the product will leave the market, they basically have no option. So they will have to do a validation, no matter what.

And the next question is from Mads from Bernberg. He has 2 questions. Number one, please help me understand what the underlying consumable growth was excluding legacy, for example, animal reproduction and government shutdown and excluding large customers leaving the market.

Yes. And it's a good question because if you look at the Life Science leg alone, the growth was pretty decent. And semens and our milk and beer has been struggling a little bit because it's not a focus area for us. Also, if you're taking those shutdowns into account, of course, it would be -- we'll be looking very differently. So we'll probably be a little above the 10% you see, I would say, probably around 15% for Life Science alone. Consumable wise, we did take a hit from those closures, so that would also have been a little higher. Yes.

And the second question from Mads. He wants an understanding of how many customers you're speaking to on the XM platform and how that compared to the beginning of the year. And in addition, how many potential instruments does that equate to?

Yes. we're talking to so many by now that I do not have the exact number, but it's in the 100s. So it's a lot. And I think the difference from our point of view to last year is that now we do not have to showcase the product before people show interest. We have a lot of customers and potential customers reaching out to they have heard about integration opportunities. So they definitely just want to see, can we just integrate XM30 into Hamilton, we have seen the webinar or et cetera. So the difference is definitely way more demand, way more, you can say, validations, and it's so many that I don't have the exact number, but way above 100.

The next question is from Yiwei Zhou from SEB. You mentioned that you're seeing improved demand towards the year-end. Can you elaborate if the demand improve for both NC and XM instruments?

And mainly, it's for XM and that is due to the discontinuation, the market improvements and many of those validations we have done prior to this year. So it's mainly XM and we definitely expect XM to be the leading instrument in the future, and it will also probably exceed NC next year.

And the next one is from Jesper from DNB. You are guiding for around DKK 120 million of CapEx in '26, '27, up from around DKK 100 million in '25, '26 and equivalent to more than 20% of revenue. how much of this relates to software development, how long should we expect CapEx to remain at more than 20% of revenue? And what would you consider a more normalized level once the current investments are completed?

Yes. And I'll say it always depends if our revenue goes through the sky, we will probably invest even more. We will have limited -- you have limits because you cannot keep investing unlimited. This year, we believe we need DKK 120 million. And mainly, the split is probably quite even between the different areas. But something our investors might not know is we're also spending a lot of R&D expenses for biology, creating protocols, easier tech transfers for our customers. So we have a lot of different areas. So the software itself might be 20%, 25% of our R&D expenses in the future, will we increase? It depends on the revenue and also actually the demand from customers because we expect to launch XM Octopus at some point. If they want something different, we'll build it. So I think this is an ongoing thing. And of course, I think you know is we have decent margins. We are pretty good with math. So if it makes sense, we'll keep investing. If it doesn't, we won't do it. So that's going to be the answer to that.

And then we have a question from Simon from Danske Bank. You stated in the report that before making their financial decision, customers expect documentation that the XM30, the XM40 and the NC-203 all produced comparable results for different cell types as well as country sites. You say it's a new development for customers to express these wishes. Does this mean that you're in discussions with customers looking to also replace competing products with ChemoMetec's cell counters and using ChemoMetec's cell counters as a platform solution.

Yes. And that's exactly what we're working on. That's also why the validation takes a little longer because usually, you might hear from a department, they want to buy 10 instruments. And then they say, "Oh, actually, we now are moving into global alignment because we actually want to replace everything with this new platform." So that what usually happens is that we're talking to one department, then other departments have other different instrumentation. And suddenly, this moves into a bigger project, and down the line, yes, we are expecting to replace a lot of competitor instruments and basically be the one cell counter in the field. I would say cell counter platform, actually.

And then we just have one question left. And the question is from Jesper from DNB. On the Roche collaboration, given the significantly higher throughput of XcytoMatic compared with the legacy [indiscernible], how should we think about the replacement ratio, is there any reason to expect something close to a 1-for-1 replacement, perhaps because customers typically operate the cell counter alongside acidic bioanalyzer. Or should we assume materially fewer XcytoMatic units will be needed?

Yes, and that's a good question again, Yes.So Mainly, if you want to integrate into the CDx bio analyzer, it's going to be a one-to-one replacement, but we have seen when we're replacing competitor instruments in the field that they can actually replace 2:1, which is also a big USP for the customer because our instruments are so fast. So it depends on the setup. But if it's a stand-alone, usually, they will replace 2 old instruments compare instruments with 1 instrument from ChemoMetec unless we're talking integration because then it is a one-to-one specifically.

And that was the last question for today. Thank you all for joining. See you in the next conference call.