The focus is on emerging from the tough period stronger and ready for the next growth phase.
Comments from the CEO
The second quarter of the 2026/27 financial year was a strong quarter. Net sales amounted to SEK 157.2 (86.4) million, corresponding to growth of 82%. Gross margin recovered from the first quarter to 36% (38%) despite write-down of receivables and inventory of SEK 15 million. EBITDA margin of 19% (10%) also recovered compared with Q1 and the previous year's Q2. No products were launched and two were added to the pipeline. Mellozzan has been launched in Turkey and Memprex has been launched in France under the brand name Altaromin. In addition, marketing authorizations for the first three significant Specialty Generics products were obtained during the quarter. EQL is going through a transformation phase aimed at emerging from the tough period the company is still in and building a base for future growth. The sales forecast for the full year 2026/27 is growth of around 15%.
Financial overview for the second quarter
Net sales amounted to SEK 157.2 million, growth of 82% against a weak comparison quarter. The relatively high sales were driven by competitors being out of stock on a key product where EQL was able to supply the market, accumulated sales milestones for Mellozzan, and a generally better inventory position. The market shortage for the key product is assessed to be temporary. Adjusted for positive one-off effects in the quarter, underlying sales are assessed to be approximately SEK 120 million. The continued review of the balance sheet, which was flagged in Q1, has resulted in write-downs of SEK 15 million. These relate to provisions for claims against suppliers, where we cannot currently assess the outcome, and for destruction of stock. We see no further write-down needs beyond ongoing provisions for destruction of stock and any pruning of projects or products as a result of the transformation work. Operating profit (EBIT) increased to SEK 22.4 (3.6) million and EBITDA margin to 19% (10%). OPEX increased by 17% to SEK 33.9 million. Cash and cash equivalents amounted to SEK 52.4 (78.3) million and the unutilized working capital facility to SEK 33.4 (30.2) million. CAPEX was SEK 8.3 (9.7) million and leverage 6.6x EBITDA, still above the target. Adjusted for negative one-off items over the past three quarters, leverage was 3.7x. Leverage is expected to remain above the target during 2026/27 and then stabilize at lower levels, driven by EBITDA recovery.
Financial targets and forecasts for the current financial year
The sales forecast for the full year 2026/27 is growth of around 15%, below the long-term target of 30%, which remains in place for the time being. EQL is evaluating whether the tough period the company is going through will affect the possibilities of reaching the long-term targets. This work is ongoing and the company will revert when a conclusion has been reached, probably during the current financial year. The primary focus at present is on operational upgrading. The situation regarding delivery disruptions continues to look better for the rest of the year. If this persists, Q1 of the current year will remain the low point of EQL's tough period. However, it is too early to sound the all clear, and a sustainable, long-term improvement depends entirely on the transformation program continuing to deliver structural improvements that make EQL ready for the next growth phase.
Product launches and market dynamics
No products were launched during the quarter and the portfolio therefore consists of 49 products. We expect four additional launches during the financial year, but the forecast is uncertain. In Q1 the ambition was eight products, but four of them now look likely to be launched next financial year. Improving the launch process plays a central role in the transformation program. Two products were added to the pipeline, giving 46 products in total. As the company closely monitors liquidity, caution is applied with new signings until the tough period is over. At present, only products where the payment model for the rights is back-loaded are signed. Marketing authorizations for the first three Specialty Generics products with more significant potential were obtained during the quarter. The objective is for these to be launched next financial year. Thereafter it is estimated to take 2-3 years before they reach their full potential. For Memprex, Hungary has been added with the partner Pharmacenter. Launch volumes have been sold to our partner in France, but the product has not yet been placed on the market. For BeNeLux, marketing authorization has been obtained and launch preparations are ongoing. In Israel a launch is expected during the current financial year, and in Ireland registration is ongoing. For Mellozzan, EQL's partner Abdi Ibrahim has launched in Turkey and a launch in Kazakhstan is expected later in the financial year. Launch preparations are also ongoing in Italy, where a launch is expected next financial year. Applications are ongoing in the GCC and Ireland. Medice continues to increase sales, mainly in Germany and Switzerland, which triggered a first accumulated sales milestone to EQL. Discussions on further territories are ongoing for both Mellozzan and Memprex.
Other
Although Q2 was a stronger quarter, and the outlook for Q3 and Q4 continues to look stable, it is too early to conclude that the tough period is behind us. The sharp growth of recent years and the addition of new products, suppliers and customers have created a complexity that requires an operational and organizational upgrade. The focus is on emerging from the tough period stronger and ready for the next growth phase. We assess that the acute problem-solving phase is behind us and that the key right now is sustainable, structural improvement of the company's key processes to create a robust and scalable platform.
This disclosure contains information that EQL Pharma is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 05-11-2026 07:00 CET.
For more information contact:
Axel Schörling,
CEO & President EQL Pharma AB (publ)
Phone: +46 (0) 76 317 90 60
E-mail: axel.schorling@eqlpharma.com
Web: www.eqlpharma.com
EQL Pharma AB (publ) in short
EQL Pharma AB specializes in developing and selling generics, i.e., drugs that are medically equivalent to original drugs. The company currently has 49 niche generics (i.e., generics with limited competition apart from the original drug) launched in the Nordic markets. In addition to these, there is a significant pipeline of additional niche generics for launch in 2026 and beyond. The business is currently focused entirely on prescription drugs, including hospital products, mainly in the Nordics and European markets. EQL Pharma AB has its operations in Lund and is listed on Nasdaq Stockholm stock market. EQL Pharma AB carries out extensive development work in collaboration with leading contract manufacturers and major pharmaceutical companies in the EU and Asia, among others.
