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

CEO statement

Our journey towards achieving the company's strategic goals has continued during the second quarter. We have worked purposefully towards a positive cash flow, which has yielded results in the form of an improved operating profit of 24% by the first half of 2024, compared to the same period the year before.

Our pipeline in the form of ongoing discussions and sent offers is still high and is around SEK 30 million. We see that customers are still waiting and taking longer before deciding on our offers. The general situation for the life science industry globally, a number of major reorganizations at several pharmaceutical companies and a continued tough investment climate for funding research projects are some of the underlying reasons that have affected us. However, we are hopeful and are working purposefully to convert a larger number of quotes into signed orders as soon as possible.

The ongoing research collaboration with the US FDA for our DissolvIt module continues to be delivered according to plan and we look forward to the final result in the second half of 2024. This will be a significant milestone for the company and given a positive result, it could lead to great opportunities and collaborations in inhalation and In-Vitro research.

We are also in continued dialogue with potential partners regarding clinical application and our goal is to be able to present one or more forms of collaboration shortly.

After our re-prioritization in accordance with our new strategy, with the focus now on the service side (IRS), we have supplemented our services further together with, among others, the German company Actarmo GMBH and this work will continue in the future.

More customers are now becoming more aware of ISAB, our unique technology and our services. During the first half of 2024, we have expanded our network and the work now remains to build on this and convert these contacts into formal contracts. The second half of the year will be very interesting for ISAB and together with my team and the board I am very much looking forward to new business opportunities and a continued improved result.

Huddinge

28 August 2024

Manoush Masarrat

CEO

Summary of the interim report

• Improved operating profit by 24% for the first half of 2024 compared to the same period the year before.
• Continued delivery of data according to plan for the ongoing research collaboration with the US FDA for the company's In-Vitro platform DissolvIt. The final report is expected to be delivered in the second half of 2024.
• Pipeline with a total value of approximately SEK 30 million.

Jan – June 2024

• Net revenues 7,277 kSEK (9,026)
• Operating result -893 kSEK (-2,206)
• Earnings per share before and after dilution -0.11 SEK (-0.19)

Order intake during the period. SEK 1,822 (7,218)

Order backlog at the end of the period SEK 3,745 thousand (9,348)

April – June 2024

• Net revenues 3,357 kSEK (5,788)
• Operating result -1,688 kSEK (-107)
• Earnings per share before and after dilution -0.06 SEK (-0.02)

Order intake during the period. SEK 1,420 (4,689)

Order backlog at the end of the period SEK 3,745 thousand (9,348)

Order intake is the value of products and services sold during the current period, i.e. sales, 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 the customers, where work is still in progress and delivery has not yet taken place to the customer.

Significant events during second quarter (April - June 2024)

• On April 10, the company announced that it had been invited by the FDA to present the company's technology during the FDA's public workshop GDUFA (Generic Drug User Fee Amendments) on May 20, 2024. This workshop will be available to the public and the purpose is to inform on the ongoing research which can contribute to and improve the development of generic medicines.
• On May 21, the company announced a product order with a value of approx. SEK 700,000. This order is from a repeat 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 June 13, the company announced an IRS order with a value of approximately SEK 600,000. This order is from a repeat customer who is one of the top 10 pharmaceutical companies in the world.

Significant events during reporting period Jan - March 2024

• On January 22, the company announced that it has entered into a strategic partnership with the German company Actarmo Medical GmbH. This is in line with the company's stated strategy to expand its portfolio within 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 total addressable market (TAM) is expanded by 30% to a total sum of approx. 630 MEUR.
• On March 11, the company announced the publication of the company's feasibility study for clinical use of the PreciseInhale platform in the respected newspaper the European Journal of Pharmaceutical Sciences. This enables in-depth collaborative 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 April 10, the company announced that it had been invited by the FDA to present the company's technology during the FDA's public workshop GDUFA (Generic Drug User Fee Amendments) on May 20, 2024. This workshop will be available to the public and the purpose is to inform about the ongoing research which can contribute to and improve the development of generic medicines.
• On May 21, the company informed about a product order with a value of approx. SEK 700,000. This order is from a repeat 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 June 13, the company announced an IRS order with a value of approximately SEK 600,000. 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 August 12, the company announced its intention to call an extraordinary general meeting to elect Ulf Ericsson as a new board member. Ulf Ericsson, born in 1966, has 28 years of experience in life science and has specialized in pharmaceuticals, inhalers and inhalation formulations. He has worked within Astra Zeneca for over twenty years, mostly in senior positions with global responsibility. He is today his own consultant in business development and strategy in life science.
•  On August 15, the company informed about several orders with a total value of approx. SEK 600,000. These mostly apply to service assignments (IRS) from ISAB's recurring customers.

Company events

The nomination committee has announced its intention to propose Ulf Ericsson as a new member in connection with the planned extraordinary general meeting on September 4, 2024

Selected financial data in summary

	2024Apr-Jun	2023Apr-Jun	2024 Jan-Jun	2023 Jan-Jun	2023Jan-Dec
Net revenues, kSEKr	3,357	5,788	7,277	9,026	17,504
Operating profit kSEK	-893	-107	-1,668	-2,206	-3,756
Profit after tax kSEK	-918	-259	-1,717	-2,535	-4,744
Balance sheet total kSEK	14,952	23,287	14,952	23,287	18,168
Cash flow for period, kSEK	-2,131	7,591	-2,184	9,361	5,986
Cash flow for period per share (SEK)	-0.14	0.50	-0.14	0.71	0.45
Cash and cash equivalents kSEK	5,641	11,200	5,641	11,200	7,825
Earnings per share before and after dilution kSEK	-0.06	-0.02	-0.11	-0.19	-0.36
Equity, kSEK	11,238	14,808	11,238	7,553	12,954
Equity per share kSEK	0,74	0,98	0,74	0,98	0,85
Equity ratio, %	75.16%	63.59%	75.16%	58.17%	71.30%
R&D costs, operating costs	49.63 %	38.99%	47.08%	38.69%	38.75%
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.

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.