Ortelius International aktie • ORTIN

VD:s kommentar

The second quarter of 2026 was a challenging quarter for ORTELIUS. Net sales amounted to SEK 10.7 million and operating profit (EBIT) amounted to SEK -10.7 million. The result is not acceptable, and is related to a number of non-recurring and unplanned events. A couple of projects ended earlier than expected during the quarter, negatively affecting both utilisation and revenue. One of the most significant impacts came from the early termination of a larger regional transformation programme where ORTELIUS participated as one of several suppliers and provided six consultants. The assignments ended with limited notice, creating an immediate negative impact on both utilisation and revenue. Combined with delayed project starts and weaker sales than expected, this contributed significantly to the quarter's result and will also have effect on the third quarter. When I assumed the role of Interim CEO earlier this year, my first priority was clear: adapt the business to current market conditions and reduce our cost base. During the first half of 2026, we conducted a comprehensive review of the organisation. As a result, the number of employees has been reduced from 48 at the beginning of the year to 34 today. Most of these reductions were made within support and overhead functions. During the quarter, we outsourced both our HR and finance functions and closed our marketing and investor relations departments. As a result, we reduced our internal overhead organisation from approximately eight employees to the equivalent of only one and a half full-time positions, including myself in my dual role as CFO and Interim CEO. These changes have only been possible because many people across the organisation have stepped up and taken on additional responsibilities. I would like to thank my colleagues for their commitment and willingness to support the Company during this period. The flexibility and dedication shown by our team have been critical in executing these changes while continuing to serve our customers. The business carried a cost structure that had become too large relative to current revenue levels. To address this situation, we have adjusted parts of our delivery organisation to reflect current demand and utilisation levels. Today, ORTELIUS operates with a significantly leaner organisation and a cost base that is much better aligned with the current size of the business. We expect these measures to begin having a positive impact on cash flow and profitability during the latter part of the third quarter, with increasing effects throughout the fourth quarter and into the first quarter of 2027. One consequence of operating a leaner organisation is that we have less capacity in certain administrative functions than before. This includes communication with shareholders and other stakeholders. I would therefore like to thank our shareholders for their patience and understanding during this period. At times, response times may be longer than we would like, simply because we are operating with significantly fewer internal resources than in the past. At the Annual General Meeting held on 31 July 2026, we welcomed a new Board of Directors. Peter Thörn was elected Chairman of the Board and Danne Persson joined as a new Board member, while Magnus Pårup continues in his role. I am looking forward to working with the new Board. The combination of operational experience, technology expertise and business leadership strengthens ORTELIUS considerably. I would also like to thank Anders Berglund and Tanu Tandan for their contributions to the Company. What I personally find most appealing is that ORTELIUS operates in exactly the right market at exactly the right time with a fantastic business potential. Organisations across all industries are investing heavily in AI and digital transformation. Yet many companies still struggle with the same fundamental challenges: understanding their data, improving data quality, establishing governance and creating business value from information assets. These are precisely the challenges ORTELIUS has been helping customers solve for more than twenty years. The reality is that we have not yet converted this market opportunity into enough business. Changing that is now one of management's highest priorities. Together with the new Board, we will focus on making ORTELIUS more visible in the market, strengthening our commercial efforts and ensuring that we capture a larger share of the opportunities available. We are beginning to see encouraging signs from the investments made in our sales organisation. I do not expect a dramatic turnaround overnight, but I do expect progress. Our focus is on winning new customers while also increasing our presence within existing accounts where we already have strong relationships. We have also communicated the delays affecting the framework agreement within the automotive sector announced in autumn 2025. Based on our current assessment, we believe there is a high probability that activities related to this agreement will commence towards the end of 2026 or the beginning of 2027, albeit initially on a smaller scale than originally anticipated. While the timing has been disappointing, we still view the agreement as an important commercial opportunity. Another major focus area has been our balance sheet. Following the reverse takeover, acquisitions and a period of lower sales than anticipated during 2025 and the first half of 2026, ORTELIUS accumulated a debt burden that became too large for a company of our size. Together with the Board, we concluded that reducing debt had to be a priority. During the quarter, and in the period following quarter-end, we successfully converted approximately SEK 52 million of debt into equity and completed several debt restructuring initiatives. These measures have reduced indebtedness, extended debt maturities and improved our financial flexibility. I understand that these transactions have been dilutive for shareholders. Nobody likes dilution, including me. However, after reviewing the alternatives, we concluded that reducing debt through equity conversions was the most responsible path forward. Simply put, we saw no realistic alternative if we wanted to create a healthier company with a sustainable balance sheet. Our objective has been straightforward: reduce debt, lower financial risk and ensure that future cash flow can be used to develop the business rather than service historical liabilities. I believe we have now completed a large part of this work. The balance sheet today is significantly stronger than it was at the beginning of the year and several important measures have been implemented. However, there is still significant work ahead of us. We have made meaningful progress, but we must continue to strengthen our financial position, improve our capital structure and secure the long-term financing required to support the business. While the measures taken during the first half of the year have significantly improved our financial position and reduced our funding requirement, the Company remains dependent on securing additional external financing in order to continue its operations and execute its long-term plans. As part of this effort, ORTELIUS entered into a financing facility of up to SEK 20.8 million with Loft Capital during the third quarter. I am aware that there have been questions regarding both the structure of the facility and the associated collateral shares, and I would therefore like to provide some additional context. The facility is not a traditional loan where the full amount is made available on day one. Instead, it provides ORTELIUS with access to capital through a number of separate drawdowns over a period of up to 24 months. This allows us to access capital when needed and provides greater flexibility than raising the full amount upfront. To date, we have utilized the first tranche of the facility. The nominal amount of the first loan was SEK 3.5 million. From this amount, commitment fees and legal costs totalling SEK 0.7 million were deducted, resulting in net proceeds of approximately SEK 2.8 million received by the Company. After evaluating the alternatives available to us, the Board and management concluded that the Loft facility was the most viable financing solution available to the Company. Given our financial position, balance sheet and ongoing capital restoration process, traditional bank financing was not available on reasonable terms. Access to conventional lending would have required security and collateral that the Company was unable to provide. The facility therefore became an important step in securing funding for the business and strengthening our ability to continue executing our operational and strategic plans. It also provides flexibility by allowing us to access capital when needed, rather than raising the full amount upfront. I do not view the Loft facility as a complete solution to the Company's long-term financing needs. Rather, I see it as an important financing tool that supports our working capital and provides flexibility while we continue to work on the broader financing of the business. The Board and management continue to actively evaluate financing alternatives and discussions are ongoing. While additional funding will be required, I believe we have taken important steps during the year to reduce the Company's risk profile and improve our ability to secure the capital required going forward. During the first half of the year, we reduced costs, streamlined the organisation and strengthened the balance sheet. The focus now shifts towards rebuilding growth, improving profitability and securing the financing required to support the business going forward. I firmly believe that ORTELIUS has the expertise, customer relationships and market position required to succeed. We now have a leaner organisation, a stronger Board and a clearer focus than we had at the beginning of the year. There is still a lot of work ahead of us, but I am convinced that we are moving in the right direction. Finally, I would like to thank our employees, customers, partners and shareholders for their continued support and trust during a challenging period. It is greatly appreciated, and I look forward to updating you on our progress in the quarters ahead. Herman Weberg CFO and Interim CEO ORTELIUS International AB.