Interim report
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Embla Medical hf Q1 2025 Company Announcement 1 Interim Report Q1 2025 Announcement no. 19/2025 Sveinn Sölvason, President and CEO, comments: “Sales in Q1 2025 amounted to USD 203 million and organic growth came in at 4% driven by a strong finish to the quarter. Growth was strong in our Prosthetics & Neuro Orthotics segment supported by continued momentum and solid volume growth in EMEA and APAC regions, while the year started out softer in Americas following a strong end to 2024. Our Navii® and Icon® bionic knees advanced into full launch during the quarter following successful pre-launch activities and promising user feedback. Both Navii® and Icon® are great innovations that will help us reach more users across different lower limb functional levels, including some of the active functional level K2 patients from the US Medicare coverage expansion, which took effect last fall. EBITDA margin was 18% in Q1 2025; up 1% -point from Q1 2024. The stronger margin was driven by the positive effects from the cost reduction initiatives implemented in manufacturing during Q1 2024 as well as positive contributions from product mix and continued cost control in SG&A. We iterate our guidance for the full year of 5-8% organic sales growth and 20-21% EBITDA margin before special items.” Highlights Q1 2025 ▪ Sales amounted to USD 203 million and organic growth was 4%, compared to 7% in Q1 2024. ▪ Prosthetics & Neuro Orthotics sales grew by 9% organic, while our Bracing & Supports and Patient Care sales ended flat in the first quarter of 2025, compared to 10%, 1% and 6% respectively in Q1 2024. ▪ Gross profit margin was 63%, compared to 62% before special items in Q1 2024 (60% reported). The increase is supported by the manufacturing cost reduction initiatives implemented in Q1 2024 as well as favorable product mix and efficiency. ▪ EBITDA was USD 36 million, and EBITDA margin was 18% of sales, compared to 17% before special items in Q1 2024. The EBITDA margin expansion was driven by an increasing gross profit margin following cost reduction initiatives implemented in Q1 2024 and continued cost control in SG&A. ▪ Net profit grew by 45% and was USD 12 million with a net profit margin of 6%, compared to 4% in Q1 2024. ▪ Free cash flow amounted to USD 8 million or 4% of sales, compared to negative free cash flow of USD 7 million or negative 4% of sales in Q1 2024. Free cash flow was solid, benefiting from strong operating results , but it should be noted that cash flow is seasonally low in the first quarter of the year. ▪ NIBD/EBITDA was 2.5x at the end of Q1 2025 , which is within our target range of 2 -3x EBITDA. In line with our capital structure and capital allocation policy a share buyback program was reinitiated in early February. During Q1 2025, Embla Medical bought back 295,653 shares at a market value of approximately USD 1.3 million. Other highlights ▪ André Rocha has been appointed as Executive Vice President of R&D at Embla Medical. André Rocha previously served as Partner at McKinsey & Co and brings 25 years of experience and a proven track record across all organizational levels. ▪ Conal Harte has been appointed Executive Vice President of Patient Care, having served as Vice President Patient Care Europe since 2023, and prior to that, held various roles at Össur and Touch Bionics. 2025 Outlook ▪ Organic sales growth guidance is unchanged at 5-8%. ▪ EBITDA margin before special items guidance is unchanged at 20-21% *Impact is expected due to the US trade tariffs but significant uncertainty and frequent changes in the global tariff environment, makes it too speculative to quantify an exact impact on Embla Medical’s financial results as of today. Q1 2025 Q1 2024 FY Guidance 2025 Sales growth, organic 4% 7% 5-8%* EBITDA margin, before special items 18% 17% 20-21%*
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Embla Medical hf Q1 2025 Company Announcement 2 USD millions Q1 2025 Q1 2024 FY 2024 FY 2023 FY 2022 FY 2021 Income Statement Net sales 203 200 855 786 719 719 Gross profit 128 120 535 486 440 455 Operating expenses (excl. other income / exp.) 106 105 422 398 373 360 EBITDA 36 29 169 139 114 149 EBITDA before special items 36 33 173 139 128 149 EBIT 22 15 113 89 65 97 Net profit 12 8 69 59 43 66 Sales Growth Sales growth USD % 1 10 9 9 0 14 Growth breakdown: Organic growth % 4 7 6 9 4 10 Currency effect % (2) 0 0 (1) (7) 3 Acquired business % 0 3 3 1 3 1 Balance Sheet Total assets 1,589 1,545 1,539 1,386 1,325 1,247 Equity 802 734 781 705 636 627 Net interest-bearing debt (NIBD) 437 482 414 395 404 363 Cash Flow Cash generated by operations 23 13 160 126 92 128 Free cash flow 8 (7) 77 52 35 74 Key Ratios Gross profit margin % 63 60 63 62 61 63 EBIT margin % 11 8 13 11 9 14 EBITDA margin % 18 15 20 18 16 21 EBITDA margin before special items % 18 17 20 18 18 21 Equity ratio % 50 48 51 51 48 50 Net debt to EBITDA before special items* 2.5 3.3 2.4 2.8 3.2 2.4 Effective tax rate % 23 24 24 23 23 24 Return on equity* % 9 8 9 9 7 11 CAPEX / Net sales % 3.0 5.7 4.6 5.4 3.6 3.7 Market Market value of equity 1,742 2,078 2,125 1,713 2,035 2,724 Number of shares in millions 428 428 428 421 423 423 Basic EPS in US cents 2.8 1.9 16.2 14.0 10.3 15.6 Diluted EPS in US cents 2.8 1.9 16.2 14.0 10.3 15.5 * Financial ratios are based on operations for the preceding 12 months.
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Embla Medical hf Q1 2025 Company Announcement 3 Management’s report Financial performance Sales Sales in Q1 2025 amounted to USD 203 million, compared to USD 200 million in Q1 2024, corresponding to 4% organic growth and a 1% reported growth (USD growth). The currency impact on sales was negative by 2%-points in the quarter. Sales by geographical segment (USD million) Q1 Organic growth Δ Acq. Δ Curr. effect USD growth 2025 Americas 85 (1%) 0% (1%) (3%) EMEA 101 7% 0% (3%) 4% APAC 16 13% 0% (5%) 8% Total 203 4% 0% (2%) 1% Sales by business segment (USD million) Q1 Organic growth Δ Acq. Δ Curr. effect USD growth 2025 Prosthetics & Neuro Orthotics 111 9% 0% (3%) 6% Bracing & Supports 35 0% 0% (2%) (3%) Internal product sales (9) 11% 0% (3%) 8% External sales 137 6% 0% (2%) 4% Patient Care 66 0% 0% (2%) (3%) Total 203 4% 0% (2%) 1% Growth in Q1 2025 was driven by solid volume growth in Prosthetics & Neuro Orthotics ; especially in EMEA and APAC regions while sales were soft in Americas. Sales growth in the EMEA region was strong in the first quarter with 7% organic growth. In Prosthetics & Neuro Orthotics the strong growth trajectory from 2024 continued in key European markets during the first quarter. Growth was driven by strong volume growth coupled with increased uptake of our recently launched innovation such as Navii ® (bionic knee) and Pro-Flex® Terra (mechanical f eet solution). Our Neuro Orthotics business ( Fior & Gentz) is moving ahead according to plan following the expansion into new international markets last year . Sales performance in Patient Care was mixed with strong sales in select European markets while sales were soft in other markets. Sales in B racing & Supports were soft, with pockets of growth in select markets but were offset by softer performance in others. In APAC, organic sales were strong or 13% in Q1 2025 with solid performance in Prosthetics & Neuro Orthotics and Patient Care . Growth was strong in Australia driven by continued improvements in reimbursement approval backlogs. Growth in the region was partly offset by softer sales in Bracing & Supports in markets such as China. In Americas sales declined by 1% mainly due to soft sales across markets in our Patient Care segment, where we observed lower patient volume than usual during the first couple of months of the year. Sales in Prosthetics and Neuro Orthotics came in modestly for Q1 following a strong end to 2024 , somewhat correlated with the softness we see in Patient Care. Sales in Bracing & Supports were soft, similar to what we observed in EMEA. 30 April 2020 Announcement no. 27/2020 Interim report Q1 2024 Sales performance in line with expectations Össur guidane suspended Sales increased by 4% organic Strong growth in EMEA and APAC while Americas declined
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Embla Medical hf Q1 2025 Company Announcement 4 As expected, we are yet to see any material impact from the US Medicare coverage expansion for K2 patients as upgrades for eligible K2 patients are rolled out on a selective basis. Fittings are expected to increase in the periods to come as prosthetists are gaining experience from fitting the first patients and submitting reimbursement claims. As communicated previously, we expect our recently launched bionic knees Navii® by Össur and Icon® by College Park to address active K2 amputees consistent with the coverage standards published by Medicare. We have received encouraging initial feedback on our launches from a clinical performance perspective and will continue our efforts to enable more active K2 functional level amputees to gain access to advanced bionic knee technology, which previously was restricted to functional level K3 and K4 users. Operations Gross profit in Q1 2025 amounted to USD 128 million or 63% of sales, compared to USD 12 3 million excluding special items or 62% of sales in Q1 2024 (60% reported in Q1 2024). The 1%-point gross profit margin expansion was supported by cost reduction initiatives in manufacturing implemented during Q1 2024 in addition to positive product mix, scalability, and manufacturing efficiency. Operating expenses (OPEX) OPEX amounted to USD 106 million or 52% of sales in Q1 2025, compared to USD 10 4 million excluding special items or 52% of sales in Q1 2024 (USD 105 million or 53% of sales reported). OPEX ratio remains stable with continued focus on cost control within SG&A. EBITDA EBITDA amounted to USD 36 million or 18% of sales, compared to EBITDA before special items of USD 33 million or 17% of sales in Q1 2024 (15% reported in Q1 2024). The EBITDA margin expansion for the quarter was driven by an expanding gross profit margin and continued cost control in SG&A cost, in addition to positive effects from currencies by approximately 30 basis points (net of hedging). Financial items, income tax and net profit Net financial expenses in Q1 2025 amounted to USD 7 million, compared to USD 5 million in Q1 2024. The increase is due to currency developments impacting net financial expenses negatively by USD 3 million Q1, compared to neutral effect in Q1 2024, following a weakened US dollar. Income tax amounted to USD 4 million in Q1 2025, corresponding to a 23% effective tax rate, compared to USD 3 million in Q1 2024, corresponding to a 24% effective tax rate. Net profit grew by 45% in Q1 2025 and amounted to USD 12 million or 6% of sales, compared to USD 8 million or 4% of sales in Q1 2024. Increase is driven by stronger operating results and absence of special items this quarter compared to Q1 2024. Diluted earnings per share in Q1 2025 amounted to 2.8 US cents, compared to 1.9 in Q1 2024. Gross profit margin of 63% EBITDA margin before special items of 18% Net profit margin of 6% OPEX ratio of 52% Effective tax rate of 23%
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Embla Medical hf Q1 2025 Company Announcement 5 Cash flow Cash generated by operations Cash generated by operations amounted to USD 23 million or 11% of sales in Q1 2025, compared to USD 13 million or 7% of sales in Q1 2024. Cash generation was solid in the quarter, mainly benefitting from strong operating results. It should however be noted that cash generation is seasonally low in the first quarter of the year. Capital expenditures Capital expenditures in Q1 2025 amounted to USD 6 million or 3% of sales, compared to USD 11 million or 6% of sales in Q1 2024. CAPEX has returned to a normalized level of 3-4% of sales as facility expansion programs in 2024 have been concluded. Free cash flow Free cash flow in Q1 2025 amounted to USD 8 million or 4% of sales, compared to negative free cash flow of USD 7 million or negative 4% of sales in Q1 2024. Solid free cash flow during the quarter; mainly benefitting from strong operating results and less CAPEX than in the comparable period , partly offset by changes in net working capital. It should be noted that free cash flow is seasonally low in the first quarter of the year. Bank balances and cash equivalents Bank balances and cash equivalents amounted to USD 92 million at the end of Q1 2025 and USD 66 million of existing facilities were undrawn. Bank balances and cash equivalents in addition to undrawn credit facilities at the end of Q1 2025, therefore, amounted to USD 157 million. Capital structure Net-interest bearing debt Net interest-bearing debt, including lease liabilities, amounted to USD 437 million at quarter-end Q1 2025 compared to USD 482 million at quarter-end Q1 2024. Net interest-bearing debt to EBITDA before special items corresponded to 2.5x at quarter-end Q1 2025, within the target range of 2.0-3.0x. Share buybacks and treasury shares The purpose of the program is to reduce the Company’s share capital and adjust the capital structure with a desired capital level of 2.0-3.0x net interest-bearing debt to EBITDA before special items, by distributing capital to shareholders in line with the Company’s Capital Structure and Capital Allocation Policy. During Q1 2025, Embla Medical bought back 295,653 shares at a market value of approximately USD 1.3 million. At the end of Q1 2025, treasury shares totaled 997,300. NIBD/EBITDA before special items at 2.5x Share buybacks reinitiated 14 February 2025 Cash and undrawn facilities amounted to USD 157 million Free cash flow was 4% of sales Cash generation of USD 23 million
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Embla Medical hf Q1 2025 Company Announcement 6 2025 Financial guidance Guidance Guidance FY 2025 Actual FY 2024 Sales growth, organic 5-8% 6% EBITDA margin before special items 20-21% 20% For modelling purposes CAPEX as % of sales 3-4% 5% Effective tax rate 23-24% 24% Guidance for organic sales growth remains unchanged and is expected to be in the range of 5 -8%. We expect strong performance in Prosthetics & Neuro Orthotics across regions supported by solid growth in the core business, contributions from the recently launched Navii® and Icon® bionic knees, and positive impact from the US Medicare Coverage Expansion for active K2 patients . It’s worth noting that sales related to the US Medicare expansion are expected to grow gradually in the initial phase as prosthetists continue to build experience fitting select K2 patients. In Neuro Orthotics (Fior & Gentz) we expect the international expansion to new markets to continue to contribute to growth leveraging Össur’s global commercial infrastructure and the ForMotion footprint within O&P clinics. In Patient Care, we expect growth to be moderate reflecting market growth across regions. All else equal we expect good volume growth, with increased efficiency to drive growth bearing in mind that growth in EMEA may be somewhat impacted by a strong comparison in 2025 compared to 2024. Lastly, Bracing & Supports is expected to grow approximately in line with market growth, with growth driven by key product categories, but with some competitive pressure in selected markets. The guidance for EBITDA margin before special items remains unchanged and is expected to be in the range of 20-21%. The EBITDA margin is expected to be positively impacted by solid sales performance, a favorable product mix from high -end solutions, continued efficiency gains in manufacturing, and cost control in SG&A. Potential impact from US trade tariffs An impact is expected due to the US trade tariffs but significant uncertainty and frequent changes in the global tariff environment makes it too speculative to quantify an exact impact on Embla Medical’s financial results as of today. The main impact would be on Bracing and Supports products manufactured in China and sold in the US. It is our expectation that adjustments could be made to our manufacturing setup to mitigate a large part of additional direct cost. Potential tariff impact on other manufacturing sites is deemed minimal as the tariff situation looks today.
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Embla Medical hf Q1 2025 Company Announcement 7 Foreign exchange Sales are particularly exposed to fluctuations in the EUR/USD exchange rate. Additionally, the ISK has a relatively high impact on operating results as part of manufacturing, R&D and some corporate functions are based in Iceland, while sales in ISK are minimal. A breakdown of sales and costs by main currencies can be found in note 4 of the accompanying Condensed Consolidated Financial Statements. All else being equal, a +/- 5% movement in EUR/USD is estimated to have an annual impact on EBITDA in the range of +/- USD 3.5-4.5 million when unhedged. The same movement in ISK/USD is estimated to have an annual impact on EBITDA in the range of +/- USD 3.5-4.5 million when unhedged. Embla Medical utilizes forward contracts to hedge approximately 50% of the estimated net currency exposure in ISK. Currency overview USD EUR ISK Average exchange rate FY 2024 1.082 0.0073 Average exchange rate in Q1 2025 1.052 0.0072 Opening rate April 28 2025 1.136 0.0078 Estimated average exchange rate for FY 2025* 1.115 0.0077 Change in estimated exchange rate FY 2025 compared to last year’s average +3% +5% *Estimated average exchange rate is calculated as the exchange rate of Q1 combined with the exchange rate (open) on 28 April 2025 for the remainder of the year Other highlights Product launches during last 12 months Launch quarter Segment Product name Product description Q3 2024 Prosthetics Upper limb NP 3rd generation (Naked Prosthetics) The third generation of Naked Prosthetics technology features significant enhancements to the PIPDriver®, MCPDriver®, ThumbDriver®, and GripLock Finger®. With a refreshed color palette, new surface textures, and customizable hardware, this update delivers greater personalization and improved durability, driven by market feedback and advanced manufacturing. Q2 2024 Prosthetics Liners Iceross Seal-In® X Locking TF (Össur) Build for comfort and stability, the Icelock 850 Hybrid Lock and Iceross Seal-In X Locking TD liner bring the benefits of advanced vacuum suspension of the Seal- In system to users with lower limb amputations of all activity levels who prefer or rely on locking or lanyard suspensions. Q2 2024 (Full launch Q1 2025) Prosthetics Bionic knee Icon® (College Park) Icon® features responsive sensors, streamlined setup, and the intuitive Stride Studio app. Icon® is the versatile solution for low to high activity users. Q2 2024 (Full launch Q1 2025) Prosthetics Bionic knee Navii® (Össur) Navii® is a fully waterproof bionic knee featuring a powerful actuator provided to support consistency for stair and ramp descent. Navii® posses a variable - position mechanical lock that can securely lock at three different angles and stay locked for standing during longer periods of time.
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Embla Medical hf Q1 2025 Company Announcement 8 Conference call and financial calendar Conference call details Embla Medical will host a conference call on April 29, 2025, at 9:00 CET / 7:00 GMT / 3:00 ET. To actively participate in the telephone conference, please use the dial-in details provided below: DK: +45 78 76 84 90 UK: +44 20 3769 6819 US: +1 646 787 0157 Participant access code: 274982 The webcast will be available through following link: Embla Medical Q1 2025 webcast Financial calendar and events 2025 April 29 2025 Interim report Q1 2025 April 29 2025 Q1 2025 HCA Capital virtual presentation and Q&A April 29 2025 Q1 2025 Road Show Copenhagen (Carnegie) April 30 2025 Q1 2025 Road Show Frankfurt (Carnegie) May 5 2025 Q1 2025 Virtual Road Show US (Danske Bank) May 6 2025 Q1 2025 Virtual Road Show UK (DNB) May 7 2025 Q1 2025 Virtual Road Show Helsinki (Nordea) May 8 2025 Redeye MedTech Day, Stockholm May 19 2025 AktieInfo investor event, Copenhagen May 28 2025 Carnegie/Embla Expert Call: Navii (vitual) June 3 2025 Carnegie Healthcare Day, Paris July 22 2025 Interim report Q2 2025 Aug 27 2025 Økonomisk Ugebrev Life Science Conference, Copenhagen Sept 4 2025 Goldman Sachs MedTech conference, London Sept 16 2025 Pareto Securities Annual Healthcare Conference, Stockholm Sept 18 2025 HC Andersen Investor Seminar, Copenhagen October 21 2025 Interim report Q3 2025 Nov 26 2025 Danske Bank Winter Seminar, Copenhagen Dec 2 2025 Nordea Focus Seminar, Paris For further information Contact details Klaus Sindahl, Head of Investor Relations +45 5363 0134 ksindahl@emblamedical.com Embla Medical corporate announcements by e-mail If you wish to receive Embla Medical’s e-mail alerts, please register on our website: https://emblamedical.com/investor-relations Forward-looking statements This press release includes "forward-looking statements" which involve risks and uncertainties that could cause actual results to differ materially from results expressed or implied by these statements. Embla Medical hf. undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. You are cautioned not to place undue reliance on these forward -looking statements, which speak on ly as of the date of this press release. All forward-looking statements are qualified in their entirety by this cautionary statement.
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Embla Medical hf. Condensed Interim Consolidated Financial Statements 31.3.2025 Embla Medical hf Grjóthálsi 5 110 Reykjavík Id-no. 560271-0189
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Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 10 Statement by the Board of Directors and President and CEO The Condensed Interim Consolidated Financial Statements of Embla Medical hf. for the period from 1 January 2025 to 31 March 2025 consist of the Financial Statements of Embla Medical hf. and its subsidiaries (together referred to as “the Company“ or “Embla Medical“). The Condensed Interim Consolidated Financial Statements are prepared in accordance with International Financial Reporting Standards for Interim Financial Reporting, IAS 34, as adopted by the EU. The Condensed Interim Consolidated Financial Statements are neither audited nor reviewed by the Company's auditors. The total Net sales of the Company amounted to USD 202.8 million and the Net profit amounted to USD 12.0 million. Total assets of the Company amounted to USD 1,588.7 million at the end of period, liabilities were USD 787.0 million and equity was USD 801.7 million. It is our opinion that these Condensed Interim Consolidated Financial Statements present all the information necessary to give a true and fair view of the Company's financial position at 31 March 2025 and financial performance and cash flow for the period ended 31 March 2025. The Board of Directors and the President and CEO of Embla Medical hf. hereby confirm the Condensed Interim Consolidated Financial Statements for the period from 1 January 2025 to 31 March 2025 with their signatures. Reykjavík, 29 April 2025 Board of Directors Niels Jacobsen Chairman of the Board Svafa Grönfeldt Vice Chairman of the Board of Directors Arne Boye Nielsen Alberto Esquenazi Member of the Board of Directors Member of the Board of Directors Tina Abild Olesen Caroline Vagner Rosenstand Member of the Board of Directors Member of the Board of Directors President and CEO Sveinn Sölvason
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Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 11 Consolidated Income Statement All amounts in USD '000 Notes Q1 2025 Q1 2024 Net sales 3 202,786 199,852 Cost of goods sold (75,020) (79,418) Gross profit 127,766 120,435 Other income / (expenses) 367 236 Sales and marketing expenses (78,057) (76,307) Research and development expenses (10,569) (9,848) General and administrative expenses (17,280) (19,097) Earnings before interest and tax (EBIT) 22,227 15,419 Financial income 674 708 Financial expenses (5,250) (6,020) Net exchange rate difference (2,606) 137 Net financial expenses (7,181) (5,174) Share in net profit of associates 613 739 Earnings before tax (EBT) 15,659 10,984 Income tax (3,631) (2,682) Net profit 12,027 8,302 Attributable to: Owners of the Company 12,159 8,260 Non-controlling interests (131) 41 Net profit 12,027 8,302 Earnings per share Basic earnings per share (US cent) 2.8 1.9 Diluted earnings per share (US cent) 2.8 1.9
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Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 12 Consolidated Statement of Comprehensive Income All amounts in USD '000 Q1 2025 Q1 2024 Net profit 12,027 8,302 Items that may be reclassified subsequently to profit or loss: Change in cash flow hedges (79) 156 Exchange difference on translating foreign operations 8,541 (5,402) Income tax 1,422 (814) Other comprehensive income, net of income tax 9,883 (6,060) Total comprehensive income 21,910 2,242 Attributable to: Owners of the Company 22,042 2,201 Non-controlling interests (131) 41 Total comprehensive income 21,910 2,242
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Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 13 Consolidated Balance Sheet Assets All amounts in USD '000 Notes 31.3.2025 31.12.2024 Property, plant and equipment 5 71,565 71,824 Right of use assets 6 136,219 127,802 Goodwill 7 789,249 776,306 Other intangible assets 8 97,322 96,645 Investment in associates 23,666 20,364 Other financial assets 2,651 2,704 Deferred tax assets 48,674 46,365 Non-current assets 1,169,346 1,142,010 Inventories 153,880 143,102 Accounts receivable 125,983 121,915 Other financial assets 1,395 1,475 Other assets 46,283 44,300 Cash and cash equivalents 91,770 86,163 Current assets 419,311 396,955 Total assets 1,588,658 1,538,965
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Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 14 Consolidated Balance Sheet Equity and liabilities All amounts in USD '000 31.3.2025 31.12.2024 Issued capital and share premium 92,188 93,464 Other reserves (67,617) (75,390) Retained earnings 773,505 759,112 Shareholders equity 798,076 777,186 Non-controlling interest 3,601 3,513 Total equity 801,677 780,699 Borrowings 338,685 328,754 Lease liabilities 128,651 118,279 Deferred tax liabilities 36,755 37,478 Provisions 8,232 7,937 Deferred income 8,638 8,589 Other financial liabilities 24,952 47,946 Non-current liabilities 545,913 548,982 Borrowings 37,256 28,620 Lease liabilities 23,955 24,136 Accounts payable 34,797 27,275 Income tax payable 19,498 18,305 Provisions 12,618 12,615 Accrued salaries and related expenses 46,958 48,715 Other financial liabilities 31,450 10,258 Other liabilities 34,537 39,361 Current liabilities 241,068 209,284 Total liabilities 786,981 758,266 Total equity and liabilities 1,588,658 1,538,965
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Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 15 Consolidated Statement of Cash Flow All amounts in USD '000 Notes Q1 2025 Q1 2024 Earnings before interests and tax (EBIT) 22,227 15,419 Depreciation and amortization 5, 6, 8 14,240 13,596 Change in inventories (8,093) (2,789) Change in receivables (3,635) (4,821) Change in payables (1,678) (8,994) Change in provisions 178 2,115 Other operating activities (36) (1,506) Cash generated from operations 23,203 13,020 Interest received 654 594 Interest paid (5,100) (5,950) Income tax paid (4,946) (3,626) Net cash generated from operating activities 13,811 4,038 Purchase of fixed and intangible assets 5, 8 (6,172) (11,484) Acquisition of subsidiaries, net of cash in acquired entities (3,239) (74,629) Other investing activities (2,231) (13) Cash flows used in investing activities (11,641) (86,126) Changes in revolving credit facility 8,706 94,123 Payments of lease liabilities (6,460) (5,853) Purchased treasury shares (1,277) 0 Cash flows generated from financing activities 969 88,270 Net change in cash 3,139 6,182 Exchange rate effects on cash held in foreign currencies 2,468 (1,477) Cash and cash equivalents at beginning of period 86,163 72,653 Cash and cash equivalents at end of period 91,770 77,358
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Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 16 Consolidated Statement of Changes in Equity Share- Non- Share Share Other Retained holders controlling Total All amounts in USD '000 capital premium reserves earnings equity interests equity Balance at 1 January 2024 4,781 61,479 (64,045) 699,667 701,882 3,123 705,005 Net profit 8,260 8,260 41 8,302 Change in cash flow hedges 125 125 125 Transl. diff. of shares in subsidiaries (6,184) (6,184) (0) (6,184) Total comprehensive income 0 0 (6,060) 8,260 2,201 41 2,242 Share option charge for the period (77) (77) (77) Issued new shares 48 27,156 27,205 27,205 Change in non-controlling interests 382 382 (382) 0 Balance at 31 March 2024 4,829 88,635 (70,181) 708,310 731,593 2,782 734,375 Balance at 1 January 2025 4,829 88,635 (75,390) 759,112 777,186 3,513 780,699 Net profit 12,159 12,159 (131) 12,027 Change in cash flow hedges (63) (63) (63) Transl. diff. of shares in subsidiaries 9,946 9,946 9,946 Total comprehensive income 0 0 9,883 12,159 22,042 (131) 21,910 Share option charge for the period 344 344 (0) 344 Share option vested during the period (2,454) 2,454 0 0 Purchase of treasury shares (2) (1,275) (1,277) (1,277) Change in non-controlling interests (219) (219) 219 0 Balance at 31 March 2025 4,827 87,361 (67,617) 773,505 798,076 3,601 801,677
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 17 1. Summary of Material Accounting Policies Statement of compliance The Condensed Interim Consolidated Financial Statements are prepared in accordance with International Financial Reporting Standard (IFRS) for Interim Financial Reporting, IAS 34 as adopted by the EU. The Condensed Interim Consolidated Financial Statements are presented in accordance with the new and revised IFRS accounting standards and new interpretations (IFRIC), applicable for the period. New and amended IFRS accounting standards that are effective for the current year have minor impact on the Company´s Financial Statements. The Company has not early applied new and revised IFRS accounting standards that have been issued but are not yet effective. The Financial Statements are presented in USD, which is the Company’s functional currency. They do not include all of the information required for full Annual Consolidated Financial Statements and should be read in conjunction with the Company's Annual Consolidated Financial Statements for the period ended 31 December 2024. The Company's Annual Consolidated Financial Statements can be found on the Company’s website www.emblamedical.com. Basis of preparation The Condensed Interim Consolidated Financial Statements have been prepared under the historical cost basis except for certain financial instruments that are measured at fair value. Historical cost is generally based on the fair value of the consideration given in exchange for assets. The Condensed Interim Consolidated Financial Statements are presented in USD and all values are rounded to the nearest thousand ('000), except when otherwise indicated. This rounding may have impact on the total sum. The accounting policies adopted are consistent with those followed in the preparation of the Company's Annual Consolidated Financial Statements for the period ended 31 December 2024.
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 18 2. Quarterly statements Q1 Q4 Q3 Q2 Q1 2025 2024 2024 2024 2024 Net sales 202,786 224,781 213,528 216,727 199,852 Cost of goods sold (75,020) (82,663) (79,916) (78,192) (79,418) Gross profit 127,766 142,117 133,612 138,535 120,435 Gross profit margin 63% 63% 63% 64% 60% Other income / (expenses) 367 (86) 123 126 236 Sales and marketing expenses (78,057) (80,628) (75,333) (78,882) (76,307) Research and development expenses (10,569) (11,005) (9,498) (10,481) (9,848) General and administrative expenses (17,280) (18,532) (16,263) (16,072) (19,097) EBIT 22,227 31,867 32,641 33,225 15,419 Net financial expenses (7,181) (8,041) (5,171) (7,543) (5,174) Share in net profit of associates 613 1,055 668 878 739 EBT 15,659 24,882 28,138 26,559 10,984 Income tax (3,631) (6,263) (6,165) (6,493) (2,682) Net profit 12,027 18,619 21,973 20,066 8,302 EBITDA 36,467 46,502 46,568 47,040 29,016 EBITDA margin 18% 21% 22% 22% 15% EBITDA before special items 36,467 46,502 46,568 47,040 33,154 EBITDA margin before special items 18% 21% 22% 22% 17% 3. Net Sales Q1 2025 Q1 2024 Sales by geographical segment: EMEA 101,471 97,584 Americas 85,171 87,361 APAC 16,144 14,908 Total 202,786 199,852 Sales by business segment: Prosthetics & Neuro Orthotics 111,142 105,066 Bracing & Supports 35,007 35,905 Internal product sales (8,879) (8,377) External product sales 137,270 132,594 Patient Care 65,516 67,258 Total 202,786 199,852
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 19 4. Sales and expenses split by main currencies Q1 2025 LCY USD % Sales USD 76,462 76,462 38% EUR 58,689 61,741 30% ISK 132,981 961 0% Nordic curr. (SEK, NOK, DKK) 24,109 12% Other (GBP, AUD, CAD & Other) 39,513 20% Total 202,786 100% COGS and OPEX USD 74,185 74,185 41% EUR 40,065 42,149 23% ISK 2,941,578 21,249 12% Nordic curr. (SEK, NOK, DKK) 23,019 13% Other (GBP, MXN, CAD & Other) 19,957 11% Total 180,559 100% Q1 2024 LCY USD % Sales USD 77,944 77,944 39% EUR 54,906 59,618 30% ISK 110,906 808 0% Nordic curr. (SEK, NOK, DKK) 23,319 12% Other (GBP, AUD, CAD & Other) 38,163 19% Total 199,852 100% COGS and OPEX USD 72,074 72,074 39% EUR 41,949 45,550 25% ISK 3,071,453 22,366 12% Nordic curr. (SEK, NOK, DKK) 22,538 12% Other (GBP, MXN, CAD & Other) 21,905 12% Total 184,433 100% Currency split is derived by using best available information at each time.
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 20 5. Property, plant and equipment 2025 Leasehold improvements Machinery & equipment Office equipment Computer equipment Total Cost At 1 January 51,273 80,116 14,939 13,941 160,269 Additions 763 1,898 148 880 3,689 Eliminated on disposal (43) (89) (14) (10) (157) Exchange rate differences 667 452 401 277 1,798 At 31 March 2025 52,659 82,377 15,473 15,088 165,598 Depreciation At 1 January 19,654 50,499 9,850 8,442 88,445 Charge for the period 1,352 1,978 386 897 4,613 Eliminated on disposal (21) (49) (14) (2) (86) Exchange rate differences 383 239 250 189 1,061 At 31 March 2025 21,368 52,667 10,472 9,526 94,033 At 31 March 2025 31,292 29,710 5,001 5,562 71,565 Depreciation classified by functional category: Q1 2025 Q1 2024 Cost of goods sold 2,613 2,371 Sales and marketing expenses 871 989 Research and development expenses 263 191 General and administrative expenses 866 970 Total 4,613 4,521
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 21 6. Leases Right of use assets 2025 Buildings & sites Machinery & equipment Total At 1 January 123,789 4,012 127,802 Additions and renewals 11,177 450 11,627 Depreciation charge for the period (6,153) (586) (6,740) Exchange rate differences 3,352 177 3,530 At 31 March 2025 132,165 4,053 136,219 Depreciation classified by functional category: Q1 2025 Q1 2024 Cost of goods sold 2,583 2,333 Sales and marketing expenses 2,120 1,166 Research and development expenses 729 700 General and administrative expenses 1,308 1,847 Total 6,740 6,046 7. Goodwill 31.3.2025 31.12.2024 At 1 January 776,306 690,855 Business combinations 0 104,489 Exchange rate differences 12,943 (19,038) At end of period 789,249 776,306
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q1 2025 Condensed Consolidated Financial Statements 22 8. Other intangible assets 2025 Customer & distribution relationships Patents & development costs Trademarks Software & other Total Cost At 1 January 36,701 32,214 8,156 63,175 140,246 Additions 0 97 8 494 599 Additions - internally generated 0 0 0 1,884 1,884 Exchange rate differences 900 100 213 73 1,286 At 31 March 2025 37,600 32,411 8,377 65,627 144,015 Amortization At 1 January 9,393 9,789 523 23,896 43,601 Charge for the period 806 522 8 1,551 2,887 Exchange rate differences 129 43 0 32 204 At 31 March 2025 10,329 10,354 531 25,479 46,692 At 31 March 2025 27,272 22,057 7,846 40,148 97,322 Amortization classified by functional category: Q1 2025 Q1 2024 Cost of goods sold 245 449 Sales and marketing expenses 1,821 1,302 Research and development expenses 396 405 General and administrative expenses 426 874 Total 2,887 3,030