Interim Report 01/01/2019 – 30/06/2019
Summary of quarter Q1-Q2 2019 The following summary refers to the period 1/1/2019 – 30/6/2019, compared to 1/1/2018 – 30/6/2018 · Net sales for this period totaled to SEK 3,097,362 (SEK 110,772) · Operating result for the period of SEK -3,876,021 (SEK -4,324,984) · Cash and bank balance SEK 3,523,113 (SEK 11,019,147) · Capitalized development costs of SEK 783,251 (SEK 851,552) · Average number of registered shares 9,877,264 (9,877,264 shares) · Result per share* SEK -0.39 (SEK -0.44) · Equity Ratio 86.7% (91.8%) *Result per share is calculated on the average number of registered shares during the period. Summary of quarter Q2 2019 The following summary refers to the period 1/4/2019 – 30/6/2019, 0compared to 1/4/2018 – 30/6/2018 · Net sales for this period totaled to SEK 2,764,479 (SEK 110,772) · Operating result for the period of SEK -1,895,406 (SEK -2,132,110) · Capitalized development costs of SEK 445,198 (SEK 446,556) · Average number of registered shares 9,877,264 (9,877,264 shares) · Result per share* SEK -0.19 (SEK -0.22)
The first quarter of 2019 was a breakthrough period for OptiFreeze, with our first sale of our machinery. The positive impact of the first quarter of 2019 remained during Q2, with the second payment for OptiCeptTMline that we installed at Syngenta’s farm in Kenya, Kenya Cuttings.
We also got some exciting results with new products within different segments, and we worked to conduct a directed issue to strengthen and widen our owner base. Now when Q2 has ended, the directed issue was conducted after the period had finished, and I’m happy to tell you that it was successful.The installation of the first OptiCeptTMline
We are getting close to the first commercialization of an OptiFlower project. In the end of May employees from OptiFreeze travelled to Kenya to install the OptiCeptTM-system and to educate the local staff. Right after the installation was completed the first trials started. When a new technology is being implemented on a production line there are always some challenges to deal with. One of them in this case was that we needed to do some adaptations on our method in order to achieve a good result when dealing with freshly harvested cuttings.
Kenya Cuttings now gets positive results with Pelargonium cuttings and the system has been up and running every day since installation. The system has not yet been used for commercial purposes. The target from both Syngenta Flowers and OptiFreeze is to be ready with product handling and the method implementation on freshly harvested cuttings when the Pelargonium season starts in December 2019.Main focus on OptiFlower
The R&D and technical department of OptiFreeze have had continued focus on the OptiFlower area during the second quarter of 2019 with a main goal to move projects from the trial phase to commercialization.
One of the projects that we started during Q2 was the Cut Flowers project. Cut flowers like roses have a short life expectancy, usually 7-10 days, since they have a long journey from the farms to our vases at home. Initially we started with one type of rose to extend their life expectancy in a vase at room temperature, and we got positive reproducible results. Later we applied the same protocol to three more cultivars of roses, and we got the same positive results with two of them. In fact, the roses stayed fresh for 14 days or longer in room temperature after being treated with the OptiFreeze technology. I presented the results of the tests at the Fleuroselect Gala Dinner in De Lier, Netherlands, in mid-June and we were very excited about the positive response and great interest from others attending.
Following this OptiFreeze decided to submit a patent application for treating cut flowers. The purpose of this is to further strengthen our position in the OptiFlower segment.OptiDry and OptiFresh
We have continued our collaborations and discussions with one customer within the OptiDry segment. During Q2 we have been working on designing a system that has a higher capacity and better working performance in terms of using energy sources more efficient. This work is now finalized, and we are now ready to produce the system during Q3 and Q4.
During this quarter we have also prepared some background for coming work in the OptiFresh segment. We have been working on mango and pineapple as well as some new products to further fine tune our method.Financial update
As mentioned earlier OptiFreeze received payment during the second quarter of 2019 for our first sold system. We have also received payments from our customer and partner Syngenta Flowers for development costs in Lund.
At the same time, the company have been investigating different ways to ensure that the company has a strong financial position when entering the next phase. In order to achieve this in a fast and efficient way the Board of Directors decided to proceed with a directed share issue. The issue was directed to external investors, several larger shareholders, the members of the Board as well as the Chairman of the Board. In July we communicated that the directed issue was successfully completed, injecting gross 17.4 MSEK into OptiFreeze. The issues also got the company some investors that have a strong belief in the company. An interesting part was that the main owners have been investing with 0 % discount on the share price.
OptiFreeze has a positive Q2 in the rearview mirror. We continued our route set, proceeded on further strengthening our finances at the same time as we got to enjoy beautiful roses for two weeks in a row at our facility in Lund! Thank you for showing interest and for following our journey.
Lund, August 29th, 2019
Eda Demir Westman, CEO OptiFreeze AB