Paxman aktie • PAX

VD:s kommentar

Dear Shareholders, I hope you are all enjoying the summer holiday period. The year started with pace and that momentum has not slowed. We are excited about the momentum seen in both Paxman and Dignitana’s revenues, most importantly from the insurance-based billing. “It gives me great pleasure to present this quarterly report, one of our strongest performances to date, demonstrating that our team is delivering and our investments are providing returns. The new group achieved net revenues of 105 MSEK for the quarter, compared to 74.9 MSEK for the same period in 2025. This represents a growth of 40% and our strongest group sales performance to date. Of this, 19.9 MSEK of revenue is attributable to Dignitana, primarily from the US entity as we slowly finalise sales and operations in Sweden. Paxman alone delivered a strong performance generating revenues of 85 MSEK during the quarter. For true indicators of performance, it is important to look at the revenue streams separately: • Paxman US Inc. delivered our strongest revenue to date of $5.1m compared to $3.4m for same quarter in 2025. US revenue in Q1 2026 was $4.0m. The majority of this increase has been driven by IBBM, equating to a total of $2.4m. • Paxman Coolers Ltd. achieved revenues of £2.9m of external sales compared to £2.7m for the same quarter in 2025. • Dignitana revenue in Q2 was 19.9 MSEK compared to 20.7 MSEK for Q2 2025 of which only 6.89 MSEK was included in Paxman Group’s results in 2025. Albeit, in total revenue terms there has been no growth, however looking at the US alone, performance is positive. We are excited about the momentum seen in both Paxman and Dignitana’s revenues, most importantly from the insurance-based billing. Paxman US revenue is up 50.8% on Q2 2025. For the quarter, the company delivered an EBITDA of 13.9 MSEK, representing an EBITDA margin of 13%, alongside an operating profit of 3.8 MSEK. The profit and loss impact of our growth investments during the quarter was SEK 5.6 million. Based on this our adjusted EBITDA margin would equate to 19%. As noted previously, the majority of additional acquisition-related costs have now been accounted for, although goodwill amortisation is at 5.3 MSEK for the quarter. The overall cash outflow equated to 5 MSEK, with an operating cash outflow of 3.2 MSEK. Cash flow has been primarily affected by increased debtors through trade and repayment of financing. The quarter closed with cash and cash equivalents of 105.6 MSEK, a solid base for CIPN commercialisation, investment, and working capital for growth through 2026 and 2027, giving us a position of strength. As you will see from the US and insurance-based billing model (IBBM) results, we are now seeing strong development in both companies. In Q2 for Paxman, 1,326 caps were sold under our IBBM. This demonstrates a 54% growth from Q1 2026 and represents 47% of total caps sold. For Dignitana, 172 caps were sold under the IBBM, compared to 81 caps sold in the prior quarter, representing 16% of the total amount of caps sold. Looking at our utilisation tracking for Paxman, the self-pay model in Q2 2026 saw 3.1 patients per location vs 8.6 under the IBBM for the quarter. If we then look at per system installed, we see 1.6 patients per system under self-pay and 3.6 patients per system under IBBM. For Dignitana in the quarter, we see 3.5 patient per location under self-pay and 10.1 under IBBM. Per systems installed, we are seeing an average of 2 patients under self-pay vs 4.9 under IBBM. These are positive trends across the board, not only from an increase in utilisation when a location switches, but also an improvement in quarterly utilisation. Contracting with health systems has shown a remarkable improvement with many more sites looking to switch or start with the model. We have now seen New York University (NYU) go live, supporting Q2 numbers, with Yale following suit in Q3. Although not yet affecting these results, our agreement with OneOncology is now progressing with a number of practices actively working on transitioning to the IBBM model. We look forward to understanding the impact in the coming months and quarters, and the influence this will have on other community oncology providers. Legislative momentum continued to accelerate as policymakers increasingly recognised the importance of preserving quality of life for patients undergoing chemotherapy. Paxman has been at the forefront of these efforts, working alongside legislators, patient advocates, oncology societies, advocacy organisations, and healthcare providers to advance evidence-based policies that improve access to FDA-cleared scalp cooling. During the first half of 2026, Connecticut, Maryland, and West Virginia joined New York and Louisiana in enacting insurance coverage legislation for scalp cooling, bringing the total to five states with enacted mandates. In total, twelve states introduced scalp cooling legislation during the 2026 legislative session, with legislative efforts still active in California, New Jersey, Ohio, and Pennsylvania, where legislative sessions extend beyond mid-year. Building on this progress, discussions with policymakers and advocacy partners have already begun for the 2027 legislative cycle, with new states expected to pursue scalp cooling legislation and others expected to reintroduce legislation when their legislatures reconvene in January. From a coverage perspective, Aetna, a CVS company, has updated its policy to recognise scalp cooling as medically necessary for eligible patients receiving chemotherapy. The Paxman Scalp Cooling System is also specifically named in the updated policy. Aetna’s decision expands access and supports greater choice in cancer care but also is a strong signal to other payers. We also saw that The Centers for Medicare & Medicaid Services (CMS) has released its Calendar Year (CY) 2027 proposed Hospital Outpatient Prospective Payment System (OPPS) and Medicare Physician Fee Schedule (MPFS) rules affecting mechanical scalp cooling. The proposed OPPS rule would establish separate payment for CPT® code 97008, following continued dialogue between Paxman and CMS regarding appropriate Medicare reimbursement for mechanical scalp cooling. This is a very positive move – the unpackaging of these codes is an important step to fairer reimbursement, and we are pleased with the progress. Our research and development projects continue to grow in parallel. On 1 July 2026, Paxman commenced a £682,000, two-year collaborative research and development project funded through Innovate UK’s Biomedical Catalyst programme. This project alongside the University of Leeds’ world-class research excellence in Healthcare Technologies and Mechanical Engineering, advances our Personalised Healthcare research theme. It aims to develop a next-generation scalp cooling device capable of delivering personalised treatment, driving greater consistency in scalp cooling success across diverse patient populations. It has also been a very busy quarter for our neuropathy technology. Soft launch activities were undertaken at both ASCO in the USA and MASCC in Australia with an overwhelming amount of interest. We have successfully extended the scope of our UK Conformity Assessed (UKCA), European Conformity (CE), International Organization for Standardization (ISO) 13485 and Medical Device Single Audit Program (MDSAP) certifications to include our new cryocompression technology, meaning we are now free to commercialise in the UK and Europe. As we shift to the De Novo regulatory pathway for FDA clearance in the U.S., our commercialisation efforts will now accelerate for the UK and Europe in late Q4 and Q1 2027, which will support a return on our investments. We are working on finalising the 510K De Novo application and aim to submit this within the month of August. The FDA work on a 150-day review, but throughout we may see additional information requests. Published average timelines are between 7-12 months. Our expectation is therefore that commercialisation will happen between April 2027 and August 2027. With regard to additional costs, we only anticipate regulatory-related expenses. It is also likely we will slow some of our US commercialisation costs, which would have started to impact P&L in Q4 and Q1 2027. The manufacture of 50 devices is now nearing completion, and these are being deployed across the UK in both private and NHS settings. They are soon to be in several European locations too, such as France, Germany, Spain, and The Netherlands. We are gearing up now for our V2 devices that will go into build in Q4 2026, with 150 systems planned. Further pilots and trials are also being planned in the US including a well-known New York health system and a Californian-based cancer centre. We remain committed to our commercialisation timelines, with V2 devices sold and installed in November 2026 to coincide with our new brand launch. It is set to be an exciting end to the year. The results of this quarter have reflected the hard work and effort of the team, and we are excited to continue with this momentum, delivering strong results and helping many patients and their families around the world. Thank you to all of the team for their continued commitment. I am delighted at our early progress this year and confident we shall build even more momentum through the year. As always, thank you to my colleagues for your continued efforts to deliver on our promises to our stakeholders and patients around the world. We are truly positioning ourselves as clear leaders in side-effect management globally. Huddersfield, August 2026, Richard Paxman OBE, CEO Paxman AB (publ)