OrganoClick

Translation from CEO Mårten Hellbergs comments to the Interim Report.

Q1, 1 January - 31 March 2024

The Group compared with 2023

» Net revenue amounted to SEK 38.2 (43.5) million

» The gross margin amounted to 29.3 (25.9) %

» EBIT amounted to SEK 0.2 (0.1) million

» Cash-flow from operating activities amounted to SEK -10.4 (-15.2) million

A word from the CEO

For the second year in a row, we show a positive operating profit for the first quarter. This despite weak construction and consumer markets that resulted in a negative sales development of -12% to MSEK 38.2 (43.5). Thanks to a positive change in product mix and good sales of our own consumer brands, the Group’s gross margin strengthened to 29 (26) %. This, in combination with sound cost control, resulted in a slightly improved operating profit of MSEK 0.2 (0.1).

Cash flow from operating activities strengthened during the quarter as a result of a lower tied-up working capital, where we seasonally tie up working capital in both inventories and accounts receivable during the first quarter. Accumulated for the rolling twelve months, cash flow from operating activities strengthened sharply to MSEK 5.3 (-20.1).

The biggest decrease in sales came in the business unit Nonwoven & fiber technologies where sales decreased by -29 (2,097) % to MSEK 12.4 (17.5). The decrease was due to a large stock build-up by a customer last year, while the restaurant industry, an important end-customer market for the business unit, showed weak development during the quarter. Our new customers in the segment continue with their market introduction, and we assess that we will have gradually increasing volumes during the year. Positive news during the quarter was that our partner PulPac is now launching coffee lids made of dry molded fiber with our binders. The production at their customers is expected to start during the fall.

The Green coatings & maintenance products business unit had a very solid quarter with a sales increase of 30 (-22) % to MSEK 14.1 (10.8). New customer sales were very good for OrganoTex with several new retailers, including Swedish Jaktia, Danish Friluftsland and Belgian A.S.Adventures. Our BIOkleen brand also had strong new customer sales where an agreement was signed with Swedish Bauhaus, the leading DIY chain in Sweden.

The Functional wood business unit continues to be adversely affected by the weak construction market. Sales decreased by -23 (-15) % to MSEK 11.7 (15.2). The Swedish sales accounts for the largest decrease, while sales in Germany and Finland are doing better.

Our consumer products have continued to perform strongly in the beginning of the second quarter. Our positive product mix change continues. We have three business units that are equivalent in terms of sales, which provides both an improved gross margin and better risk diversification.We focus on supporting our new customers and put great effort into new customer sales with the ambition to regain positive sales growth. All in line with our mission to help our customers with their green transition by replacing hidden plastics and harmful chemicals with our biobased solutions.

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.