Interim report
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Embla Medical hf Q1 2025 Company Announcement 1 Interim Report Q2 2025 Announcement no. 33/2025 Sveinn Sölvason, President and CEO, comments: “Sales in Q2 2025 amounted to USD 232 million , representing 7% reported growth, of which 5% was organic . Growth was strong in the Prosthetics & Neuro Orthotics segment , primarily driven by continued momentum in EMEA and supported by solid contribution from our recently launched innovation . Growth in Americas and APAC regions was also good, led by the Prosthetics & Neuro Orthotics segment . In contrast, sales in the Patient Care segment remained flat, while Bracing and Supports experienced a slight decline. The EBITDA margin was strong at 21% in Q2 2025 and 20% for the first half of the year , compared to 19% (before special items) in the first half of 2024. The margin increase was driven by robust sales in Prosthetics & Neuro Orthotics, solid efficiency in manufacturing, and continued cost discipline in SG&A. In line with our performance in the first half of the year and expectations for stronger growth in the second half, we are narrowing our full- year guidance for organic sales growth to 5-6% (previously 5-8%). We reiterate our guidance for the EBITDA margin before special items at 20-21%.” Highlights Q2 2025 ▪ Sales amounted to USD 232 million and organic growth was 5%, compared to 6% in Q2 2024. ▪ Prosthetics & Neuro Orthotics sales grew by 9% organic, Bracing & Supports (B&S) sales declined by 2% organic and Patient Care sales were flat, compared to 6%, 2% and 9% respectively in Q2 2024. ▪ Gross profit margin was 62%, compared to 64% in Q2 2024. For 1H 2025 the gross profit margin increased to 63% compared to 62% in the same period 2024. The gross profit margin in the quarter was positively impacted from strong performance in Prosthetics & Neuro Orthotics, in addition to efficiency in manufacturing, but the margin was adversely impacted by soft sales in B&S and Patient Care due to lower scale on fixed manufacturing cost, in addition to some impact from US tariffs. ▪ EBITDA was USD 49 million, and EBITDA margin was 21% of sales, compared to 22% in Q2 2024. EBITDA margin in the 1H 2025 was 20% compared to 19% before special items in 1H 2024. The EBITDA margin in the quarter was positively impacted by solid cost discipline in SG&A but negatively impacted by a softer gross profit margin than in the comparable period. ▪ Net profit grew by 5% and was USD 21 million, and the net profit margin was 9% of sales, the same as in Q2 2024. Net profit growth was 17% in 1H 2025. Net profit in Q2 and 1H was negatively impacted by net exchange differences. ▪ Free cash flow amounted to USD 12 million or 5% of sales, compared to 8% of sales in Q2 2024. Free cash flow benefitted from strong operating results but was partly offset by temporary working capital investments and elevated CAPEX in the quarter. ▪ NIBD/EBITDA before special items was 2.6x at the end of Q2 2025. The leverage ratio is within the target range of 2.0-3.0x and the share buyback program is ongoing. Embla Medical bought back 627,624 shares for approximately USD 3 million in the quarter. Other highlights ▪ Agreement signed on 17 July 2025 to invest in a majority share (51% of the shares) in privately owned Streifeneder ortho.production GmbH, an international developer and supplier of orthopaedic mobility solutions, employing around 100 people, with sales of EUR 25 million in 2024 (USD 29 million). Closing of the transaction is subject to regulatory approval. ▪ Fior & Gentz (Neuro Orthotics) has been awarded a new reimbursement code in the United States (L-2006 code) for the “NEURO HiTRONIC MPKAFO” (bionic knee joint), which is the smallest and lightest microhydraulic knee joint on the market, a significant milestone in the introduction of Neuro Orthotics products in the United States. ▪ EUR 50 million loan signed with Nordic Investment Bank (NIB). ▪ Halfway through unifying our Patient Care facilities under the ForMotion brand. Patient care facilities in Iceland, Sweden , and Finland were rebranded to ForMotion in Q2 2025. 2025 Outlook ▪ Organic sales growth guidance narrowed to 5-6% (previously 5-8%). ▪ EBITDA margin before special items guidance is unchanged at 20-21% *Potential impact from US trade tariffs continues to be an uncertain element to quantify given the frequent changes in the global tariff environment. Consequently, we deem it too speculative to quantify and guide an exact impact from potential tariffs on Embla Medical’s financial results, but some absorption of tariffs is assumed in the guidance. H1 2025 H1 2024 Q2 2025 Q2 2024 Guidance (current) Guidance (previously) Sales growth, organic 4% 6% 5% 6% 5-6% 5-8% EBITDA margin, before special items 20%* 19% 21% 22% 20-21%* 20-21%*
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Embla Medical hf Q2 2025 Company Announcement 2 USD millions Q2 2025 Q2 2024 1H 2025 1H 2024 FY 2024 FY 2023 FY 2022 FY 2021 Income Statement Net sales 232 217 435 417 855 786 719 719 Gross profit 144 139 272 259 535 486 440 455 Operating expenses (excl. other income / exp.) 111 105 217 211 422 398 373 360 EBITDA 49 47 85 76 169 139 114 149 EBITDA before special items 49 47 85 80 173 139 128 149 EBIT 34 33 56 49 113 89 65 97 Net profit 21 20 33 28 69 59 43 66 Sales Growth Sales growth USD % 7 8 4 9 9 9 0 14 Growth breakdown: Organic growth % 5 6 4 6 6 9 4 10 Currency effect % 2 (1) 0 0 0 (1) (7) 3 Acquired business % 0 3 0 3 3 1 3 1 Balance Sheet Total assets 1,677 1,559 1,677 1,559 1,539 1,386 1,325 1,247 Equity 836 754 836 754 781 705 636 627 Net interest-bearing debt (NIBD) 472 470 472 470 414 395 404 363 Cash Flow Cash generated by operations 34 41 57 54 160 126 92 128 Free cash flow 12 18 20 10 77 52 35 74 Key Ratios Gross profit margin % 62 64 63 62 63 62 61 63 EBIT margin % 15 15 13 12 13 11 9 14 EBITDA margin % 21 22 20 18 20 18 16 21 EBITDA margin before special items % 21 22 20 19 20 18 18 21 Equity ratio % 50 48 50 48 51 51 48 50 Net debt to EBITDA before special items* 2.6 3.1 2.6 3.1 2.4 2.8 3.2 2.4 Effective tax rate % 24 24 24 24 24 23 23 24 Return on equity* % 9 9 9 9 9 9 7 11 CAPEX / Net sales % 4.4 5.0 3.8 5.4 4.6 5.4 3.6 3.7 Market Market value of equity 2,250 1,811 2,250 1,811 2,125 1,713 2,035 2,724 Number of shares in millions 428 428 428 428 428 421 423 423 Basic EPS in US cents 5.0 4.7 7.8 6.6 16.2 14.0 10.3 15.6 Diluted EPS in US cents 6.1 4.7 9.0 6.6 16.2 14.0 10.3 15.5
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Embla Medical hf Q2 2025 Company Announcement 3 Management’s report Financial performance Sales Sales in 1H 2025 amounted to USD 435 million, compared to USD 417 million in 1H 2024, corresponding to 4% organic growth and a 4% reported growth (USD growth). Sales in Q2 2025 amounted to USD 232 million, compared to USD 217 million in Q2 2024, corresponding to 5% organic growth and a 7% reported growth (USD growth). Reported sales were USD 5 million higher in Q2 2025 due to changes in FX when compared to Q2 2024, which corresponds to a 2%-point positive effect on the reported growth rate. Sales by geographical segment (USD million) Q2 2025 Organic growth Δ Acq. / div. Δ Curr. effect USD growth 1H 2025 Organic growth Δ Acq. / div. Δ Curr. effect USD growth EMEA 113 7% 0% 6% 13% 215 7% 0% 2% 9% Americas 102 3% 0% (0%) 2% 187 1% 0% (1%) 0% APAC 18 3% 0% (2%) 1% 34 8% 0% (3%) 4% Total 232 5% 0% 2% 7% 435 4% 0% 0% 4% Sales by business segment (USD million) Q2 2025 Organic growth Δ Acq. / div. Δ Curr. effect USD growth 1H 2025 Organic growth Δ Acq. / div. Δ Curr. effect USD growth Prosthetics & Neuro Orthotics 126 9% 0% 3% 12% 237 9% 0% 0% 9% Bracing & Supports 38 -2% 0% 1% -1% 73 (1%) 0% 0% (2%) Internal product sales (10) -8% 0% 7% -1% (19) 0% 0% 2% 2% External sales 154 8% 0% 2% 9% 291 7% 0% 0% 7% Patient Care 78 0% 0% 3% 3% 144 0% 0% 1% 0% Total 232 5% 0% 2% 7% 435 4% 0% 0% 4% Growth in Q2 2025 was driven by solid volume growth in Prosthetics & Neuro Orthotics. Sales growth in the EMEA region was strong in the second quarter with 7% organic growth. In Prosthetics & Neuro Orthotics the strong growth momentum seen over several quarters continued across key European markets in Q2. Growth was driven by strong volume growth coupled with good uptake in Bionics and from our recent innovation such as Navii (bionic knee) and Pro-Flex Terra (mechanical feet solution). Sales performance in Patient Care was good in several European markets but partly offset by softer sales in selected markets. Sales in Bracing & Supports were soft during the quarter. In Americas sales increased by 3% in Q2, partly ascribed to signs of improvement in Prosthetics & Neuro Orthotics versus previous quarters coupled with good growth in select categories such as bionics, with positive impact from our recently launched innovation. Sales in B&S continued to be soft, partly ascribed to lower patient volumes for elective procedures and moderate price pressure. Lastly, sales in our Patient Care business showed increased momentum following a soft first quarter. In APAC organic sales ended at 3% in Q2 2025 with solid growth in Prosthetics & Neuro Orthotics as well as Bracing and Supports, while sales in Patient Care were temporarily impacted by shifts between quarters. Sales performance i n Prosthetics & Neuro Orthotics was strong in APAC , mainly driven by markets such as Australia and New Zealand. In Bracing & Supports some recovery from previous quarters was seen. 30 April 2020 Announcement no. 27/2020 Interim report Q2 2024 Sales performance in line with expectations Össur guidane suspended Positive FX impact of USD 5 million in Q2 2025 Sales increased by 5% organic in Q2 2025 Growth across all regions in Q2 2025 with stronger sales growth in EMEA
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Embla Medical hf Q2 2025 Company Announcement 4 As communicated previously, we expect to see a gradual uptake of eligible K2 patients in the periods to come as prosthetists are gaining experience from fitting the first patients and submitting reimbursement claims. We are however yet to see any material impact from the US Medicare coverage expansion for K2 patients but expect some contribution in the second half of the year as upgrades for eligible K2 patients are rolled out on a selective basis. In this context, we expect our recently launched bionic knees Navii ® by Össur and Icon ® by College Park to address some of the 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 1H 2025 amounted to USD 272 million or 63% of sales, compared to USD 259 million or 62% of sales in 1H 2024 (63% before special items). Gross profit in Q2 2025 amounted to USD 144 million or 62% of sales, compared to USD 139 million or 64% of sales in Q2 2024. The gross profit margin in the quarter was positively impacted from strong performance in Prosthetics & Neuro Orthotics, in addition to continued solid efficiency in manufacturing, but the margin was adversely impacted by soft sales in B&S and Patient Care due to lower scale on fixed manufacturing costs in addition to some impacts from US tariffs. Operating expenses (OPEX) OPEX amounted to USD 217 million or 50% of sales in 1H 2025, compared to USD 211 million or 51% of sales in 1H 2024. OPEX amounted to USD 111 million or 48% of sales in Q2 2025, compared to USD 105 million or 49% of sales in Q2 2024. OPEX growth was 2% organic in the quarter, compared to organic sales growth of 5%, highlighting strong cost discipline in the quarter. EBITDA EBITDA amounted to USD 85 million or 20% of sales in 1H 2025, compared to EBITDA before special items of USD 80 million or 19% of sales in 1H 2024 (18% reported). EBITDA amounted to USD 49 million or 21% of sales in Q2 2025, compared to EBITDA of 47 million or 22% of sales in Q2 2024. Financial items Net financial expenses in 1H 2025 amounted to USD 17 million, compared to USD 13 million in 1H 2024. Net financial expenses in Q2 2025 amounted to USD 10 million, compared to USD 8 million in Q2 2024. The increase in net financial expenses is mainly due to non-cash currency fluctuations, impacting net financial expenses negatively by USD 5 million in Q2 (USD 8 million in 1H 2025), compared to USD 2 million in Q2 2024 (USD 2 million in 1H 2024). Income tax Income tax amounted to USD 10 million in 1H 2025, corresponding to a 24% effective tax rate, compared to USD 9 million in 1H 2024, corresponding to a 24% effective tax rate . Income tax amounted to USD 7 million in Q2 2025, corresponding to a 24% effective tax rate , compared to USD 6 million in Q2 2024, corresponding to a 24% effective tax rate. Gross profit margin of 62% in Q2 2025 EBITDA margin of 21% in Q2 2025 Effective tax rate of 24% in Q2 2025 OPEX ratio of 48% in Q2 2025
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Embla Medical hf Q2 2025 Company Announcement 5 Net profit Net profit grew by 17% in 1H 2025 amounted to USD 33 million or 8% of sales, compared to USD 28 million or 7% of sales in 1H 2024. Net profit grew by 5% in Q2 2025, amounting to USD 21 million or 9% of sales, compared to USD 20 million or 9% of sales in Q2 2024. Diluted earnings per share in 1H 2025 amounted to 7.8 US cents, compared to 6.6 in 1H 2024. Diluted earnings per share in Q2 2025 amounted to 5.0 US cents, compared to 4.7 in Q2 2024. Cash flow Cash generated by operations Cash generated by operations amounted to USD 57 million or 13% of sales in 1H 2025, compared to USD 54 million or 13% of sales in 1H 2024. Cash generated by operations amounted to USD 34 million or 14% of sales in Q2 2025, compared to USD 41 million or 19% of sales in Q2 2024. Cash generation was negatively impacted by net working capital investment, mainly attributed to a temporary increase in accounts receivable (AR) due to strong sales in the latter half of the quarter . The increase is driven by new receivables and therefore the expectation is that the accounts receivable level will normalize in the coming quarter. Capital expenditures Capital expenditures in 1H 2025 amounted to USD 16 million or 4% of sales, compared to USD 22 million or 5% of sales in 1H 2024. Capital expenditures in Q2 2025 amounted to USD 10 million or 4% of sales, compared to USD 11 million or 5% of sales in Q2 2024. CAPEX in the quarter is elevated mainly due to timing of investments in manufacturing equipment in Iceland and Mexico. CAPEX ratio in the 1H 2025 is in line with guidance for the full year. Free cash flow Free cash flow in 1H 2025 amounted to USD 20 million or 5% of sales, compared to USD 10 million or 2% of sales in 1H 2024. Free cash flow in Q2 2025 amounted to USD 12 million or 5% of sales, compared to USD 18 million or 8% of sales in Q2 2024. Free cash flow was temporarily adversely affected in the quarter due to temporary net working capital investments and elevated CAPEX. Bank balances and cash equivalents Bank balances and cash equivalents amounted to USD 94 million at the end of Q2 2025 and USD 56 million of existing facilities were undrawn. Bank balances and cash equivalents in addition to undrawn credit facilities at the end of Q2 2025, therefore, amounted to USD 150 million. Cash generation of USD 34 million in Q2 2025 Cash and undrawn facilities amount to USD 150 million CAPEX was 4% of sales in Q2 2025 Net profit margin of 9% in Q2 2025 Free cash flow was 5% of sales in Q2 2025
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Embla Medical hf Q2 2025 Company Announcement 6 Capital structure Net-interest bearing debt Net interest-bearing debt, including lease liabilities, amounted to USD 472 million at quarter-end Q2 2025 compared to USD 470 million at quarter-end Q2 2024. Net interest-bearing debt to EBITDA before special items corresponded to 2.6x at quarter-end Q2 2025, within the target range of 2.0-3.0x. The increase in net interest-bearing debt is mainly due to currency fluctuations as part of the loan portfolio is in EUR. 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 Q2 2025, Embla Medical bought back 627,624 shares at a market value of approximately USD 3 million (923,277 shares at a market value of approximately USD 4 million 1H 2025). At the end of Q2 2025, treasury shares totaled 1,624,924. 2025 Financial Guidance Guidance Guidance FY 2025 (July) Guidance FY 2025 (April) Guidance FY 2025 (February) Sales growth, organic 5-6% 5-8% 5-8% EBITDA margin before special items 20-21% 20-21% 20-21% For modelling purposes CAPEX as % of sales 3-4% 3-4% 3-4% Effective tax rate 23-24% 23-24% 23-24% Guidance for organic sales growth is narrowed and is now expected to be in the range of 5 -6%. We continue to expect strong performance in Prosthetics across regions in the second half of 2025 supported by solid growth in the core business, including contributions from the recently launched Navii® and Icon® bionic knees. In Neuro Orthotics (Fior & Gentz) we expect the international expansion to new markets to continue to contribute to growth leveraging Embla/Össur’s global commercial infrastructure and the ForMotion footprint within O&P clinics. In the past 12 months, the distribution of Fior & Gentz products have expanded into markets such as US, UK, France, Spain, Italy, Nordics, and Australia. In Patient Care, we expect moderate growth reflecting underlying market growth across regions. All else equal, we expect to see volume growth pick up in the second half of the year supported by increased efficiency to drive growth . It should however be noted that growth in EMEA region 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 realizing that the market for Bracing & Support remains challenging due to lower patient volumes for elective procedures as well as we have seen increased competitive/price pressure in selected markets. The guidance for EBITDA margin before special items remain unchanged and is expected to be in the range of 20-21% for 2025. The EBITDA margin is expected to be positively impacted by strong sales performance, a favorable product mix from high -end solutions, continued efficiency gains in manufacturing, and cost discipline in SG&A. NIBD/EBITDA before special items at 2.6x Share buybacks of USD 3 million in Q2 2025
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Embla Medical hf Q2 2025 Company Announcement 7 Pending closing, the agreement to invest in a majority share acquire (51% of the shares) in privately owned Streifeneder ortho.production GmbH is not expected to have any material impact on the financial guidance for 2025. Potential impact from US trade tariffs Potential impact from US trade tariffs continues to be an uncertain element to quantify given the frequent changes in the global tariff environment. Consequently, we deem it too speculative to quantify and guide an exact impact from potential tariffs on Embla Medical’s financial results. Although, some absorption of tariffs is assumed in the guidance. As previously communicated, we expect the main impact would be on our 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 additi onal direct cost. Potential tariff impact on other manufacturing sites is deemed minimal as the tariff situation looks today. 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 br eakdown 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 Average exchange rate in Q2 2025 1.135 0.0078 Opening rate July 21 2025 1.165 0.0082 Estimated average exchange rate for FY 2025* 1.129 0.0078 Change in estimated exchange rate FY 2025 compared to last year’s average 4% 8% *Estimated average exchange rate is calculated as the exchange rate of H1 combined with the exchange rate (open) on July 21 2025 for the remainder of the year Other highlights Acquisition of Streifeneder ortho.production On July 17, Embla Medical announced that the Company had signed an agreement to invest in a majority share (51% of the shares) in privately owned Streifeneder ortho.production GmbH (“Streifeneder”). Today Streifeneder ortho.production is part of Streifeneder KG (Group), a supplier of orthopaedic solutions and operator of a large O&P clinic network in Bayern, Germany. Streifeneder is an international developer and supplier of orthopaedic mobility solutions, employing around 100 people. In addition to its offerings of prosthetic and orthotic components, Streifeneder ortho.production also supplies orthopaedic materials an d equipment to the O&P industry. In 2024, Streifeneder ortho.production sales of EUR 25 million (approximately USD 29m) with ~70% of sales related to prosthetics and orthopaedic materials. The majority of sales are generated in Germany, while also selling into other key European markets and distributing into the Americas and APAC regions.
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Embla Medical hf Q2 2025 Company Announcement 8 The investment in Streifeneder represents an attractive opportunity for Embla Medical to become a full range provider to a larger part of the global O&P market, ultimately reaching more patients. The majority investment in Streifeneder will furthermore strengthening Embla Medical’s presence in Germany, the second largest O&P market in the world. Streifeneder is estimated to grow in line with the global prosthetics market in the range of 5-7% in the near-term, in addition to realizing commercial synergies by leveraging Embla Medical/Össur’s global footprint. The closing of the transaction is subject to regulatory approvals. In connection with the investment and when closing conditions are met, the Board of Directors of Embla Medical will resolve to utilize the authorization in Article 5, paragraph 1, of the Articles of Association to issue 2,805,135 new shares in Embla Medical, raising the total share capital in nominal value by 0.7% from ISK 427,636,122 to ISK 430,441,257. The price of each new share is DKK 33.26, and the total value of the share capital increase is thus DKK 93 million (EUR 12.5 million). Pending closing, the transaction is not expected to have any material impact on the financial guidance for 2025. Proposed CMS Bidding Rule on OTS Orthoses On July 2, CMS (US Medicare) released a proposed rule with a section dedicated to its competitive bidding program, which is designed to reduce Medicare's spending on certain types of medical devices 1. Back in 2021, CMS included off -the-shelf braces in the program for the first time. Focused on spinal and knee braces, the bidding process resulted in lower prices in selected categories. Since those competitive bidding contracts expired, CMS has been in a self -declared "gap period" during which it has evaluated the program and developed proposed changes to it. It published those proposed changes on July 2 for notice and comment from the public. The proposed rule does not identify which OTS braces will be subject to the next competitive bidding round, nor does it specify the timeline for implementation. In the past, the competitive bidding process has taken roughly 18 months. If CMS operated on the same timeline here, the earliest we would expect to see the next round go live would be sometime in 2027. As several factors remain uncertain, we believe it’s still too premature to discuss potential impact at this stage. EUR 50 million loan from Nordic Investment Bank In June 2025 the Nordic Investment Bank (NIB) could announce that Embla Medical and NIB had entered into a loan agreement worth EUR 50 million. The loan has a term of seven years. ForMotion Global rebranding: Halfway through unifying our Patient Care facilities under one brand During Q2 2025 patient care facilities in Iceland, Sweden and Finland were rebranded to ForMotion. Embla Medical Recognized for Leadership in Accessibility and International Reach Embla Medical has been honored by Forbes Magazine for championing accessibility and by Iceland’s President for excellence in global exports. Embla Medical is internationally recognized for its pioneering role in enhancing peoples’ mobility and its business leadership. Forbes Magazine has named Embla Medical to its first -ever global Accessibility 100 list, recognizing the company’s history of innovative prosthetics, neuro orthotics, and bracing solutions, in addition to high-quality patient care services.
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Embla Medical hf Q2 2025 Company Announcement 9 Product launches during the last 12 months Launch quarter Segment Product name Product description Q1 2025 (Limited launch Q2 2024) 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. Q1 2025 (Limited launch Q2 2024) 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. 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.
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Embla Medical hf Q2 2025 Company Announcement 10 Conference call and financial calendar Conference call details Embla Medical will host a conference call on July 22, 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 Q2 2025 webcast Financial calendar and events 2025 July 22 2025 Interim report Q2 2025 July 22 2025 Q2 2025 HCA Capital virtual presentation and Q&A July 22 2025 Q2 2025 US Virtual Road Show (SEB) Aug 19 2025 Q2 2025 Road Show Copenhagen (SEB) Aug 20 2025 Nordea Small & Midcap Days Stockholm Aug 27 2025 Økonomisk Ugebrev Life Science Conference, Copenhagen Sept 4 2025 Goldman Sachs MedTech conference, London Sept 9 2025 Aktiespararna investor event (Retail), Falkenberg Sweden Sept 16 2025 Pareto Securities Annual Healthcare Conference, Stockholm Sept 18 2025 HC Andersen Investor Seminar, Copenhagen Oct 1 2025 European MidCap Event, Paris Oct 21 2025 Interim report Q3 2025 Nov 17 2025 InvestorDagen Dansk Aktionærforening, Copenhagen Nov 18-20 2025 Jefferies Global Healthcare Conference, London Nov 24-25 2025 AktieInfo Investor Event (Retail), Aalborg & Kolding 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 only as of the date of this press rel ease. 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 30.06.2025 Embla Medical hf Grjóthálsi 5 110 Reykjavík Id-no. 560271-0189
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Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 12 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 30 June 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 435.2 million and the Net profit amounted to USD 33.1 million. Total assets of the Company amounted to USD 1,676.9 million at the end of period, liabilities were USD 841.0 million and equity was USD 835.9 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 30 June 2025 and financial performance and cash flow for the period ended 30 June 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 30 June 2025 with their signatures. Reykjavík, 22 July 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. Q2 2025 Condensed Consolidated Financial Statements 13 Consolidated Income Statement All amounts in USD '000 Notes 1H 2025 1H 2024 Q2 2025 Q2 2024 Net sales 3 435,203 416,580 232,418 216,727 Cost of goods sold (162,950) (157,610) (87,931) (78,192) Gross profit 272,253 258,970 144,487 138,535 Other income / (expenses) 814 362 447 126 Sales and marketing expenses (160,586) (155,190) (82,529) (78,882) Research and development expenses (22,420) (20,329) (11,851) (10,481) General and administrative expenses (34,097) (35,169) (16,817) (16,072) Earnings before interest and tax (EBIT) 55,964 48,644 33,737 33,225 Financial income 1,151 1,488 476 780 Financial expenses (10,318) (12,463) (5,069) (6,443) Net exchange rate difference (7,778) (1,743) (5,172) (1,880) Net financial expenses (16,945) (12,718) (9,764) (7,543) Share in net profit of associates 4,314 1,617 3,701 878 Earnings before tax (EBT) 43,333 37,543 27,674 26,559 Income tax (10,192) (9,175) (6,561) (6,493) Net profit 33,141 28,368 21,113 20,066 Attributable to: Owners of the Company 33,069 28,209 20,911 19,949 Non-controlling interests 72 159 203 118 Net profit 33,141 28,368 21,113 20,066 Earnings per share Basic earnings per share (US cent) 7.8 6.6 5.0 4.7 Diluted earnings per share (US cent) 7.8 6.6 5.0 4.7
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Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 14 Consolidated Statement of Comprehensive Income All amounts in USD '000 1H 2025 1H 2024 Q2 2025 Q2 2024 Net profit 33,141 28,368 21,113 20,066 Items that may be reclassified subsequently to profit or loss: Change in cash flow hedges (391) 646 (312) 490 Exchange difference on translating foreign operations 21,478 (5,152) 12,937 251 Income tax 4,370 (2,216) 2,948 (1,402) Other comprehensive income, net of income tax 25,457 (6,722) 15,573 (662) Total comprehensive income 58,598 21,646 36,686 19,405 Attributable to: Owners of the Company 58,526 21,487 36,483 19,287 Non-controlling interests 72 159 203 118 Total comprehensive income 58,598 21,646 36,686 19,405
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Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 15 Consolidated Balance Sheet Assets All amounts in USD '000 Notes 30.06.2025 31.12.2024 Property, plant and equipment 5 75,823 71,824 Right of use assets 6 153,381 127,802 Goodwill 7 815,146 776,306 Other intangible assets 8 99,528 96,645 Investment in associates 25,719 20,364 Other financial assets 3,190 2,704 Deferred tax assets 52,886 46,365 Non-current assets 1,225,673 1,142,010 Inventories 157,003 143,102 Accounts receivable 144,999 121,915 Other financial assets 1,083 1,475 Other assets 54,040 44,300 Cash and cash equivalents 94,116 86,163 Current assets 451,241 396,955 Total assets 1,676,914 1,538,965
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Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 16 Consolidated Balance Sheet Equity and liabilities All amounts in USD '000 30.06.2025 31.12.2024 Issued capital and share premium 89,183 93,464 Other reserves (51,721) (75,390) Retained earnings 794,652 759,112 Shareholders equity 832,115 777,186 Non-controlling interest 3,804 3,513 Total equity 835,919 780,699 Borrowings 360,884 328,754 Lease liabilities 145,471 118,279 Deferred tax liabilities 37,206 37,478 Provisions 8,751 7,937 Deferred income 10,038 8,589 Other financial liabilities 26,108 47,946 Non-current liabilities 588,458 548,982 Borrowings 32,085 28,620 Lease liabilities 27,253 24,136 Accounts payable 35,965 27,275 Income tax payable 21,435 18,305 Provisions 12,825 12,615 Accrued salaries and related expenses 49,801 48,715 Other financial liabilities 34,552 10,258 Other liabilities 38,622 39,361 Current liabilities 252,538 209,284 Total liabilities 840,996 758,266 Total equity and liabilities 1,676,914 1,538,965
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Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 17 Consolidated Statement of Cash Flow All amounts in USD '000 Notes 1H 2025 1H 2024 Q2 2025 Q2 2024 Earnings before interests and tax (EBIT) 55,964 48,644 33,737 33,225 Depreciation and amortization 5, 6, 8 29,168 27,412 14,930 13,815 Change in inventories (6,779) (7,583) 1,314 (4,794) Change in receivables (23,938) (14,353) (20,303) (9,532) Change in payables 1,013 (1,943) 2,691 7,052 Change in provisions 481 2,739 304 623 Other operating activities 809 (741) 846 765 Cash generated from operations 56,718 54,174 33,519 41,154 Interest received 1,034 1,287 380 693 Interest paid (9,920) (12,147) (4,820) (6,197) Income tax paid (11,826) (10,793) (6,880) (7,168) Net cash generated from operating activities 36,006 32,521 22,199 28,482 Purchase of fixed and intangible assets 5, 8 (16,396) (22,371) (10,224) (10,887) Acquisition of subsidiaries, net of cash in acquired entities (4,259) (77,226) (1,020) (2,597) Other investing activities 1,651 101 3,881 114 Cash flows used in investing activities (19,004) (99,496) (7,363) (13,370) Proceeds from long-term borrowings 57,732 0 57,756 0 Repayments of long-term borrowings (57,483) 0 (57,419) 0 Changes in revolving credit facility 3,776 84,875 (5,017) (9,248) Payments of lease liabilities (13,404) (11,743) (6,944) (5,890) Purchased treasury shares (4,281) 0 (3,004) 0 Cash flows generated from financing activities (13,660) 73,132 (14,629) (15,138) Net change in cash 3,343 6,157 207 (26) Exchange rate effects on cash held in foreign currencies 4,610 (1,596) 2,139 (118) Cash and cash equivalents at beginning of period 86,163 72,653 91,770 77,358 Cash and cash equivalents at end of period 94,116 77,214 94,116 77,214
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Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 18 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) 699,667 701,883 3,123 705,005 Net profit 28,209 28,209 159 28,368 Change in cash flow hedges 517 517 517 Transl. diff. of shares in subsidiaries (7,238) (7,238) (7,238) Total comprehensive income 0 0 (6,722) 28,209 21,487 159 21,646 Share option charge for the period 403 403 403 Share option vested during the period (1,042) 1,042 0 0 Issued new shares 48 27,156 27,205 27,205 Change in non-controlling interests 382 382 (382) 0 Balance at 30 June 2024 4,829 88,635 (71,405) 729,301 751,360 2,899 754,259 Balance at 1 January 2025 4,829 88,635 (75,390) 759,112 777,186 3,513 780,699 Net profit 33,069 33,069 72 33,141 Change in cash flow hedges (313) (313) (313) Transl. diff. of shares in subsidiaries 25,770 25,770 25,770 Total comprehensive income 0 0 25,457 33,069 58,526 72 58,598 Share option charge for the period 902 902 902 Share option vested during the period (2,690) 2,690 0 0 Purchase of treasury shares (7) (4,274) (4,281) (4,281) Change in non-controlling interests (219) (219) 219 0 Balance at 30 June 2025 4,822 84,361 (51,721) 794,652 832,115 3,804 835,919
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 19 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. Q2 2025 Condensed Consolidated Financial Statements 20 2. Quarterly statements Q2 Q1 Q4 Q3 Q2 2025 2025 2024 2024 2024 Net sales 232,418 202,786 224,781 213,528 216,727 Cost of goods sold (87,931) (75,020) (82,663) (79,916) (78,192) Gross profit 144,487 127,766 142,117 133,612 138,535 Gross profit margin 62% 63% 63% 63% 64% Other income / (expenses) 447 367 (86) 123 126 Sales and marketing expenses (82,529) (78,057) (80,628) (75,333) (78,882) Research and development expenses (11,851) (10,569) (11,005) (9,498) (10,481) General and administrative expenses (16,817) (17,280) (18,532) (16,263) (16,072) EBIT 33,737 22,227 31,867 32,641 33,225 Net financial expenses (9,764) (7,181) (8,041) (5,171) (7,543) Share in net profit of associates 3,701 613 1,055 668 878 EBT 27,674 15,659 24,882 28,138 26,559 Income tax (6,561) (3,631) (6,263) (6,165) (6,493) Net profit 21,113 12,027 18,619 21,973 20,066 EBITDA 48,666 36,467 46,502 46,568 47,040 EBITDA margin 21% 18% 21% 22% 22% There were no special items in the above quarters. 3. Net Sales 1H 2025 1H 2024 Q2 2025 Q2 2024 Sales by geographical segment: EMEA 214,625 197,635 113,155 100,051 Americas 186,753 186,517 101,581 99,156 APAC 33,825 32,427 17,681 17,519 Total 435,203 416,580 232,418 216,727 Sales by business segment: Prosthetics & Neuro Orthotics 237,123 217,454 125,982 112,382 Bracing & Supports 73,088 74,334 38,085 38,417 Internal product sales (18,804) (18,379) (9,930) (9,984) External product sales 291,407 273,409 154,137 140,815 Patient Care 143,796 143,171 78,281 75,912 Total 435,203 416,580 232,418 216,727
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 21 4. Sales and expenses split by main currencies 1H 2025 Q2 2025 LCY USD % LCY USD % Sales USD 167,129 167,129 38% 90,667 90,667 39% EUR 119,627 130,891 30% 60,938 69,150 30% ISK 263,866 1,979 1% 130,885 1,018 0% Nordic curr. (SEK, NOK, DKK) 52,902 12% 28,793 12% Other (GBP, AUD, CAD & Other) 82,303 19% 42,790 19% Total 435,203 100% 232,418 100% COGS and OPEX USD 154,153 154,153 41% 79,968 79,968 40% EUR 80,700 88,259 23% 40,634 46,110 23% ISK 5,849,540 43,871 12% 2,907,962 22,622 11% Nordic curr. (SEK, NOK, DKK) 49,095 13% 26,076 13% Other (GBP, MXN, CAD & Other) 43,861 12% 23,905 12% Total 379,239 100% 198,681 100% 1H 2024 Q2 2024 LCY USD % LCY USD % Sales USD 165,851 165,851 40% 87,907 87,907 41% EUR 109,104 117,958 28% 54,197 58,340 27% ISK 239,932 1,734 0% 129,026 926 0% Nordic curr. (SEK, NOK, DKK) 50,938 12% 27,619 13% Other (GBP, AUD, CAD & Other) 80,099 19% 41,935 19% Total 416,580 100% 216,727 100% COGS and OPEX USD 147,779 147,779 40% 75,705 75,705 41% EUR 80,779 87,347 24% 38,830 41,792 23% ISK 5,754,636 41,633 11% 2,683,182 19,267 11% Nordic curr. (SEK, NOK, DKK) 46,645 13% 24,106 13% Other (GBP, MXN, CAD & Other) 44,532 12% 22,632 12% Total 367,936 100% 183,501 100% 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. Q2 2025 Condensed Consolidated Financial Statements 22 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 2,970 5,877 709 1,702 11,258 Eliminated on disposal (46) (136) (14) (10) (206) Exchange rate differences 2,221 1,321 1,136 725 5,402 At 30 June 2025 56,418 87,178 16,769 16,357 176,723 Depreciation At 1 January 19,654 50,499 9,850 8,442 88,445 Charge for the period 2,808 3,979 787 1,803 9,379 Eliminated on disposal (23) (147) (14) (2) (186) Exchange rate differences 1,350 720 731 462 3,262 At 30 June 2025 23,789 55,052 11,355 10,705 100,900 At 30 June 2025 32,629 32,126 5,415 5,653 75,823 Depreciation classified by functional category: 1H 2025 1H 2024 Q2 2025 Q2 2024 Cost of goods sold 4,965 4,759 2,352 2,388 Sales and marketing expenses 2,001 2,095 1,130 1,106 Research and development expenses 624 395 361 204 General and administrative expenses 1,788 1,990 922 1,020 Total 9,379 9,239 4,766 4,718
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 23 6. Leases Right of use assets 2025 Buildings & sites Machinery & equipment Total At 1 January 123,789 4,012 127,802 Additions and renewals 30,620 1,986 32,606 Depreciation charge for the period (12,793) (1,248) (14,041) Eliminated on disposal and termination (1,958) 0 (1,958) Exchange rate differences 8,476 497 8,973 At 30 June 2025 148,134 5,247 153,381 Depreciation classified by functional category: 1H 2025 1H 2024 Q2 2025 Q2 2024 Cost of goods sold 5,476 4,814 2,893 2,481 Sales and marketing expenses 4,493 2,407 2,373 1,241 Research and development expenses 1,545 1,444 816 744 General and administrative expenses 2,527 3,529 1,220 1,681 Total 14,041 12,194 7,302 6,147 7. Goodwill 30.06.2025 31.12.2024 At 1 January 776,306 690,855 Business combinations 0 104,489 Exchange rate differences 38,840 (19,038) At end of period 815,146 776,306
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Notes to the Condensed Consolidated Financial Statements Embla Medical hf. Q2 2025 Condensed Consolidated Financial Statements 24 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 0 313 18 868 1,199 Additions - internally generated 0 0 0 3,939 3,939 Exchange rate differences 2,925 360 692 223 4,200 At 30 June 2025 39,626 32,887 8,866 68,204 149,584 Amortization At 1 January 9,393 9,789 523 23,896 43,601 Charge for the period 1,662 1,123 16 2,948 5,749 Exchange rate differences 453 136 0 117 706 At 30 June 2025 11,508 11,049 539 26,960 50,056 At 30 June 2025 28,118 21,838 8,327 41,244 99,528 Amortization classified by functional category: 1H 2025 1H 2024 Q2 2025 Q2 2024 Cost of goods sold 474 837 230 388 Sales and marketing expenses 3,492 2,895 1,671 1,594 Research and development expenses 868 784 472 379 General and administrative expenses 914 1,463 489 589 Total 5,749 5,979 2,862 2,950 9. Subsequent event On 17 July 2025 Embla Medical signed an agreement to invest in a majority share (51% of the shares) in privately owned Streifeneder ortho.production GmbH, an international developer and supplier of orthopaedic mobility solutions, employing around 100 people, with sales of EUR 25 million in 2024 (USD 29 million). Closing of the transaction is subject to regulatory approval. As a consequence of submission and approval of the Q2 2025 Condensed Interim Consolidated Financial Statement is close to the signing date of the agreement, the preparation of the purchase price allocation in accordance with IFRS 3 is not finalized. Therefore, assets acquired and liabilities consumed, consideration and profit and loss effects have not been disclosed within these Condensed Interim Consolidated Financial Statements.