FINANCIAL SUMMARY • Net sales for the third quarter amounted to TSEK 342 (401) and for the nine-month period to TSEK 1,368 (881) • The operating loss for the quarter amounted to TSEK -10,292 (-9,610) and for the nine-month period to TSEK -34,324 (-37,599) • Loss after tax for the quarter amounted to TSEK -11,554 (-10,988) and for the nine-month period to TSEK -38,318 (-40,376) • Earnings per share before and after dilution were SEK -0.32 (-0.39) for the quarter and SEK -1.06 (-1.43) for the nine-month period • Cash and cash equivalents amounted to TSEK 22,585 (8,640) as per September 30, 2023 SIGNIFICANT EVENTS DURING THE THIRD QUARTER • No significant events during the third quarter SIGNIFICANT EVENTS AFTER THE END OF THE PERIOD • In October, silica was delivered to an insulin manufacturer in Asia against an order placed in 2022. • The organization will be strengthened with a process engineer who will be part of the team that drives the work of optimizing production. The team at the company's production line has also been strengthened with a dedicated process engineer.
DELIVERY OF SILICA TO INSULIN MANUFACTURER IN ASIA
We have now delivered silica against the order we received last year from one of the world's largest insulin manufacturers in Asia. This means that we are taking a big step towards establishing ourselves as a recognized supplier of high-quality silica for the purification of peptides. The delivery has taken longer time than expected as we wanted to be certain that the silica we deliver has the same high standard as what we have previously produced in Södertälje.
Quality has been our keyword throughout this process, and I am proud that our team has not taken any shortcuts despite heavy pressure. Therefore, we have ran some process steps at a greatly reduced speed and in other processes we have changed equipment. This has taken more time, but delivering something that is not of the highest quality has not been an option for Nanologica. When we now deliver a high-quality silica, it is therefore a true milestone that we are passing.
In parallel with this delivery, we have worked with other product types (the products are available in different particle sizes and with different surface properties) to deliver on other orders that we have previously taken. We are also working on gradually increasing the pace of production and we expect to reach a steady production state during this year.
An important next step is to intensify the work with optimizing the production line to streamline processes, shorten lead times and improve production economy. We have hired a process engineer who will strengthen the team that runs the optimization work, and since September we also have a dedicated process engineer at the factory in England.
As we have started to deliver, the focus changes for our sales team, which we have so far had to hold back. Soon we will be able to let them go full speed ahead in three of our four main markets: the US, India and China. We hope to soon be able to confirm definitive delivery times, which means that we will not only deliver to those who have already placed orders but also open up to taking new orders. During the fourth quarter, we will participate at TIDES Europe in Amsterdam and Purify Chromatography Purification Conclave in Hyderabad. These are important opportunities for us to meet customers and continue our marketing of NLAB Saga®.
Sales in the third quarter consisted solely of analytical columns. We expect sales of preparative silica to start in the fourth quarter. Following the down-prioritization of Drug Development, the company's costs will decrease from September and cash flow will improve on a monthly basis. Next year, we look forward to being able to report significant sales. Our ambition of achieving sales exceeding SEK 100 million in 2024 remains.
Sales in the third quarter consisted solely of analytical columns. During the fourth quarter, we expect sales of preparative silica to start, where a significant part of the production costs has been prepaid. This, together with reduced costs from the down-prioritized business area drug development, means that we estimate that from September cash flow will improve. Next year, we look forward to being able to report significant sales, where sales in preparative chromatography will constitute the majority of Nanologica's revenues.
Södertälje in October
/Andreas Bhagwani, CEO