Embla Medical hf Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Martin Brenoe - Nordea - Analyst : Thank you very much and thank you for taking my questions. I have 3 if I may 1st of all, the question on tariff, I understand that it's very uncertain right now, but if we exclude all of this bigulation part and just say right now how much of your cost base. Is raising and support from China to US out of your total cost base just to have a. Understanding of the magnitude of that, that's the first question I'll just go through each of them and then you can answer them in the order that you want to, the second one is on APAC really strong growth, quite impressive. How much of that is driven by this, backlog, being, sort of, improving in one, and. If you cannot be completely clear, can you maybe just say whether you would still be in the double digit territory in APAC if you hadn't had that, sort of backlog extra growth in there. And then just the last question is on the K2 patients. I think this is the first time where you actually state quite clearly that you expect positive impact from the US Medicare coverage expansion for active K2 patients. So I'm just a bit curious when you say that, is that because you expect to see some meaningful impact already from this quarter, or is it more still a very back end loaded, support you expect to get from the current expansion? That will be the three questions for me. Thank you.

Question: Martin Brenoe - Nordea - Analyst : That's very clear. Thank you for taking my questions then I'll jump back on the line.

Question: Tobias Nissen - Danske Bank - Analyst : Good morning Sveinn. I have a couple of questions. So to start with patient care. You have seen this lower pa patient volumes in the US for the first couple of months, but this is like, been better for the, at the ending of the quarter. So I'm just wondering what are you seeing in April, so far, and when do you expect this to more to normalize? And also does this mean that will be like a pent up demand for this with some catchup effect later in the year? And then I also have a question following up on Martins on the APAC region on this backlog. How much more backlog do we have for the remaining of the year in part to Australia and to expect this to materialize in in or on the second half of the year. That's my question. Thanks.

Question: Tobias Nissen - Danske Bank - Analyst : Year in APAC. Thanks, that's very clear.

Question: Yiwei Zhou - SEB - Analyst : Sorry, what's the technical issue. I also have a question, here, and firstly, on the US, I record that you previously expected that there will be a recovery here in 2025, but then the 1% decline here doesn't look very impressive. I was just thinking that if there is any sort of structure issue in the US market, I know I have asked the same question last year where you had almost flat and the more my growth, but here the 1% is still not very impressive.

Question: Yiwei Zhou - SEB - Analyst : All right, but I still want to follow up here. I mean, you mentioned you expect the, the volume to pick up later this year, but given the new administration in the US has done this, cost-cutting and in the Medicare, Medicaid, I was just thinking that how realistic is that you will see the pick up here later this year given the staff reduction. And must have delayed the process and the impressment process as you mentioned. I mean, how confident are you, in that guidance.

Question: Yiwei Zhou - SEB - Analyst : Okay, great. And then, you highlight the new Navy in the US, market launch. Could you maybe indicate a bit on your orders, so far?

Question: Yiwei Zhou - SEB - Analyst : Is it possible to indicate a bit on the orders so far?

Question: Yiwei Zhou - SEB - Analyst : Okay, great. And my last question is on M&A, given the leverage now is it goes down to below the 2 times and the EBITDA and your range is 2times to 3 times. I guess is there like any M&A on the agenda now? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 29, 2025 / 7:00AM, EMBLA.CO - Q1 2025 Embla Medical hf Earnings Call

Question: Yiwei Zhou - SEB - Analyst : Okay, great. Thanks. I'll jump back to the queue. Thanks, bye.

Question: Niels Granholm-Leth - Carnegie - Analyst : Good morning. On the topic of tariffs, how quickly would you be able to relocate manufacturing of the relevant brazing and support products to new countries to avoid the High tariffs on China imports. Secondly, could you talk about the expected FX effect on revenue and the EBITDA given where the US dollar is today for the full year 2025. Thank you.

Question: Niels Granholm-Leth - Carnegie - Analyst : Sounds good thank you So much.

Question: Dominic Rose - Intron Health Research - Analyst : Hi, this is Dominic coming from Health. Thanks for taking my question I was hoping you could give A little bit on [roing] and supports. In which you said there were pockets of growth in some markets. Just Wondered a bit kind of what where these were and what's driving that. Whether we can expect to see, the persistence. There, whether they might improve further, what kind of long term view on this, segment is.

Question: Dominic Rose - Intron Health Research - Analyst : Okay, thank you very much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 29, 2025 / 7:00AM, EMBLA.CO - Q1 2025 Embla Medical hf Earnings Call

Question: Tobias Nissen - Danske Bank - Analyst : Yes, okay, so I just have a follow up on the tabs we mainly talk about raising and support here, but I just want to confirm, on prosthetics that these are exempt, from the US, you can confirm that also if you have slipped any prosthetics you're doing due to any delays or whatever or whatever that could be from these new, tariffs if you can have any comments on that, thanks.

Question: Tobias Nissen - Danske Bank - Analyst : Perfect, that's very clear, thanks.

Question: Martin Brenoe - Nordea - Analyst : I thank you for taking my follow up question here. It's just a brief one on the K2. I just wanted to understand how you think you will go from here from a product, perspective and sorry if I missed it. I got cut off, for a moment, but. As far as I understand, the K2 segment is a quite broad audience compared to maybe the K3 and K4, which is sort of more of a similar group of people. And as I understand it, your products as you have it now is targeting the more active part of the K2 population. So the ones that did. That meet the threshold of getting into the high active patients. What are your plans for targeting the K2 patients with a less or lower need for these kind of products, and when should we expect you to, broaden out your portfolio in the segment?

Question: Martin Brenoe - Nordea - Analyst : And thank you for that. And is that something that is in sort of a near term pipeline let's say within the next 12 months or is that something that is a bit further out in the future?

Question: Martin Brenoe - Nordea - Analyst : Okay. Fair enough, thank you, so much.