To read the whole report (in Swedish) visit: http://inhalation.se/investors/finansiella-rapporter/

CEO statement

Order intake in the third quarter was higher than in the same period last year, although revenues were slightly lower because of weaker order intake in the January-September reporting period.

During the third quarter, we continued our strategy of actively engaging in close dialogue with all customers who have requested quotes, as well as engaging in several new customer dialogues. We have also managed to adjust our costs efficiently in response to the lower order intake and turnover in the reporting period. The adjustment of costs is also part of the objective to bring the company to profitability and positive cash flow.

During the reporting period, we see an improved operating profit of 12% and have a steady pipeline of sent offers around SEK 40 million. We are working hard to convert these quotes into formal orders as soon as possible.

Our ongoing research collaboration with the FDA and our DissolvIt module is in its final stages. We are working with the FDA to present initial data before the end of the year, followed by publication of full data in the first half of 2025. This research collaboration with the FDA is a significant milestone in the company's history and we look forward to presenting the results and the future market potential of DissolvIt.

We plan to organise a webinar with our clinical contract partner, CTC, where the very good results from our clinical study will be discussed. We will also present the clinical market potential of "regional/precision targeting" which is important for clinical research and which we have been able to demonstrate in our clinical study.

The fourth quarter is an intensive quarter as we strive to finalise ongoing customer assignments and ensure order intake in the open offers negotiated with customers. We have adapted our costs to prevailing market conditions, which brings us closer to our goal of achieving profitability.

During the year, management and the Board continued to evaluate different strategic options for the company, with the aim of securing growth, expanding the portfolio of services, being a broader provider of inhalation services and laying the foundations for long-term financial stability.

Huddinge, 20 November 2024,

Manoush Masarrat

CEO

Interim report 1 January - 30 September 2024

Summary of the interim report

• Sales in the third quarter came in slightly higher, while turnover was lower compared to the same period last year. We are still experiencing a challenging market where customers are still interested in our services but are slow to make decisions on offers. We also see that many customers do not have their funding secured and are reprioritising their research budgets. Despite lower sales, we have managed to effectively adjust the company's costs and improved operating profit by 12% during the period January-September. Our pipeline of sent quotes remains steady at 40 MSEK and we are in close dialogue with all potential customers to convert these quotes into formal orders as soon as possible.
• Our ongoing research collaboration with the FDA and our DissolvIt module is in its final stages and we are working with the FDA to present initial data before the end of the year, followed by publication of full data in the first half of 2025. This research collaboration with the FDA is a significant milestone in the company's history and we look forward to presenting the final results and the future market potential of DissolvIt.

Jul-Sep 2024

• Net revenues 2 277 kSEK (3 361)
• Operating profit -1 001 kSEK (-984)
• Earnings per share before and after dilution SEK -0.07 (-0.10)
• Order intake during the period 843 kSEK (330)
• Order backlog at the end of the period 2 174 kSEK (6 276)

Jan-Sep 2024

• Net turnover 9 555 kSEK (12 662)
• Operating result -2 669 kSEK (-3 007)
• Earnings per share before and after dilution SEK -0.18 (-0.29)
• Order intake during the period 2 665 kSEK (7 548)
• Order backlog at the end of the period 2 174 kSEK (6 276)

Order intake is the value of products and services sold in the current period, i.e. sales and not to be confused with net sales.

Order backlog is signed customer contracts for both products and services that have not yet been invoiced to customers, where work is still in progress and delivery has not yet taken place to the customer.

Significant events during the third quarter (Jul-Sep) 2024

• On 12 August, the company announced its intention to call an Extraordinary General Meeting to elect Ulf Ericsson as a new member of the Board of Directors. Ulf Ericsson, born in 1966, has 28 years of experience in life sciences, specialising in pharmaceuticals, inhalers and inhalation formulations. He has worked for Astra Zeneca for over twenty years, mostly in senior positions with global responsibility. He is currently an independent consultant in business development and strategy in life sciences.
• On 15 August, the company announced several orders with a total value of approximately SEK 600 thousand. These are mostly service assignments (IRS) from ISAB's regular customers.

Significant events during the reporting period (Jan-Sep) 2024

• On 22 January, the company announced that it has entered a strategic partnership with the German company Actarmo Medical GmbH, in line with the company's stated strategy to expand its portfolio of inhalation research services. Actarmo has an established customer base and expertise in formulation development, analytical testing under full good manufacturing practice (GMP) and consulting services for all aspects of inhaler delivery devices. With this collaboration, ISAB's potential market (TAM) is expanded by 30% to a total of approximately EUR 630 million.
•  On 11 March, the company announced the publication of its feasibility study for clinical use of the PreciseInhale platform in the prestigious European Journal of Pharmaceutical Sciences. This enables in-depth collaboration discussions with companies active in the clinical market that ISAB did not have access to before and a market with an estimated value of SEK 5 billion.
•  On 10 April, the company announced that it had been invited by the FDA to present its technology at the FDA's GDUFA (Generic Drug User Fee Amendments) public workshop on 20 May 2024. This workshop will be open to the public and aims to inform about the ongoing research that can contribute and improve the development of generic drugs.
•  On 21 May, the company announced a product order with a value of approximately SEK 700 thousand. This order is from a recurring customer who is among the top 5 in the world in generics and has ISAB's PreciseInhale instrument and DissolvIt module installed for several years.
•  On 13 June, the company announced an IRS order with a value of approximately SEK 600 thousand. This order is from a repeat customer who is one of the top 10 pharmaceutical companies in the world.

Significant events after the reporting period

• On 10 October, the company announced the publication of the successful study with the company's In Vitro module, XposeALI® together with Karolinska Institutet. The publication was made in Frontiers in Medicine (Pulmonary Medicine Section).
• On 16 October, the company provided an update on the status of the ongoing DissolvIt study with the US FDA.

Selected financial data in summary

	2024Jul-Sep	2023Jul-Sep	2024Jan-Sep	2023Jan-Sep	2023Jan-Dec
Net revenues, kSEK	2 277	3 361	9 555	12 622	17 504
Operating profit, kSEK	-1 001	-984	-2 669	-3 007	-3 756
Profit after tax, kSEK	-1 018	-1 305	-2 734	-3 841	-4 744
Balance sheet total, kSEK	13 437	18 493	13 437	18 493	18 168
Cash flow for period, kSEK	-234	-1 511	-2 418	7 850	5 986
Cash flow per share for period (SEK)	-0,02	-0,10	-0,16	0,59	0,45
Cash and cash equivalents, kSEK	5 407	9 689	5 407	9 689	7 825
Earnings per share before and after dilution (SEK)	-0,07	-0,10	-0,18	-0,29	-0,36
Equity, kSEK	10 220	13 859	10 220	13 859	12 954
Equity per share (SEK)	0,67	0,91	0,67	0,91	0,85
Equity ratio, %	76,06%	74,94%	76,06%	74,94%	71,30%
Research and	40,72 %	33,32%	44,57%	38,15%	38,75%
development costs/operating costs, %
Number of shares	15 167 637	15 167 637	15 167 637	15 167 637	15 167 637

Multi-year overview

ksek	2023	2022	2021	2020	2019
Net revenues	17 504	12 194	9 422	10 137	8 949
Result after net financial items	-4 744	-12 125	-16 609	9 875	-4 345
Balance sheet total	18 168	12 985	26 112	18 488	23 198
Equity ratio, %,	71	58	75	57	22
Average number of employees	8	9	9	8	7

To read full report (in Swedish) go HERE. (https://inhalation.se/investors/finansiella-rapporter/)

For more information about Inhalation Sciences, please contact:

Manoush Masarrat, CEO

E-mail: Manoush.masarrat@inhalation.se

Mobile: +46 (0)73 628 9153

About Inhalation Sciences Sweden AB (publ)

Inhalation Sciences Sweden AB (publ) develops and commercializes world-leading instruments and services for research into inhalation. The company’s patented lab instruments PreciseInhale® and DissolvIt® enable researchers in the pharma industry to make drug pipeline decisions at an early stage, saving time and resources for R&D departments, and enables researchers in academic institutions to define how aerosols and small particles impact our lungs, and so our health, when being inhaled.