Half Year 2026 FamiCord AG Earnings Call
Speaker #1: We've seen the news published today in the second quarter; we continue to operate in a challenging market environment while stabilizing profitability and significantly improving operating cash flow.
Speaker #1: As always, we have prepared a short presentation covering the key developments and figures. However, today's call is primarily about the Q&A session that will follow, where we look forward to addressing your questions directly.
Speaker #1: Please note that the entire call, including the Q&A session, will be recorded and made publicly available on our website after the call. With that, I'm pleased to hand you over to the CEO of Famicort AG, Jakub Baran.
Speaker #1: Jakub, over to you.
Speaker #2: Thank you, Ingo. So, welcome everybody. We don't have many slides to show, as Ingo mentioned; we are rather ready for Q&A session. We announced our results today, and I believe they were not that much surprising.
Speaker #2: Reflecting what we already communicated before, we expect challenging year. However, we are pretty happy that from a cash perspective we are doing a little bit better than expected.
Speaker #2: And we also see that Q1 was worse than Q2. If we compare to last year, we can also see that Q2 did relatively better versus Q2 2025 than Q1 2026 versus Q1 2025.
Speaker #2: So there is a kind of improvement going on. Revenue-wise, I don't like to walk through all the tables because you see the numbers, right?
Speaker #2: So revenue is more or less stable. EBITDA dropped, but the drop is much lower than it was in Q1. So it looks like we are recovering.
Speaker #2: But that is also related with the structure that Drop IFRS EBITDA drop is related with the structure of the contracts. As last year, we have a little bit bigger, let's say, IFRS effect; it improved our reported results.
Speaker #2: While this year, with our current structure, cash is looking better than reported EBITDA. And this is unfortunately our story that we cannot really predict behavior of consumers in terms of how they are selecting payment options, whether they are more pushing for recurrent or more for prepayment.
Speaker #2: Cash flow increased, as mentioned, right? And part of that is related with changes in networking capital because of the structure of the contracts. So we have now less future liabilities because more people prepaid, right?
Speaker #2: So it is constructed then reflected differently in balance sheet, yes? Overall, we see more people selecting subscription, which has classes and minuses because from one angle we have less cash in from these clients.
Speaker #2: From the other angle, obviously the future cash flows are better, and overall these clients paying subscription are bringing us more money in time. Also including cost of cash in time.
Speaker #2: So we confirm also our guideline, nothing changed. It's precocious and at the moment we don't see any risk of substantial risk that may change.
Speaker #2: So environment is challenging, as said by Ingo. Certain factors are independent from industry, right? We have fragile economy, war around, changing prices of energy and predictability of US politics.
Speaker #2: Household budgets under pressure, allowing number of children that will not change, yes? Obviously Germany's hit by that. We have also lowest numbers of births since Second World War finished.
Speaker #2: However, from the other angle, our position in the sector is continuously strong. We see also more and more people prolonging prepaid contracts which finished, yeah?
Speaker #2: They paid in the past 10, 20 years ago different forms of prepayments, and they are prolonging. That is strengthening our results. And that mass of people finishing prepaid contracts will grow over time, yes?
Speaker #2: So this is like additional cash injection and they are usually selecting subscription. However, some of them are also prepaying. We have positive signals not only signals but even more from CDMO area.
Speaker #2: So we announced signing of the contract with Artek. Last month, let's say six weeks ago, and it's a new client for CDMO and we expect to close another transaction in September.
Speaker #2: And another one October-November, depends, yes? But that would be also a new clients. So new references. And this is something we really need in CDMO because we are newcomer.
Speaker #2: Somehow, yeah? We are in that area, but not really broadly recognized. And new clients will help. In terms of outlook, yeah, I already told, pretty precocious.
Speaker #2: Not so much different than we had last year, right? In terms of revenue and EBITDA. And obviously we have to carefully monitor our liquidity and cash position because this is something which is of first priority in such times.
Speaker #2: We also continued with certain restructuring activity. Particularly in Portugal. And I think we'll finish it in Q1 next year, maybe Q2, depends. We have a new board in Portugal.
Speaker #2: The guys are, they were involved in the company. One of them worked for us a couple of years ago. He came back. So we had some luck that he could join us.
Speaker #2: Anotherwise, from positive side, I can see that Middle East investment is doing well. Investment meaning to remind you, we require UK company. They had a branch in the UK.
Speaker #2: We established a local facility there in Dubai two year, two and a half years ago, two years ago. And that is doing very well.
Speaker #2: And growing. Certain markets are resistant. Hong Kong is also stable. Smaller markets are fine, right? We are mostly focused on improvements in core markets, particularly Germany.
Speaker #2: It is mentioned in our report that we are considering entering into a new area. So there are some candidates we had maybe 15, 17 potential directions of development.
Speaker #2: We decided obviously to shorten at least to three, four. And now we are collecting information from experts, let's say market players, ex-employees, and so to understand better the dynamics of these markets, which are not that far away from, let's say, core banking, but they are somehow related, you know?
Speaker #2: Because we cannot jump suddenly to completely other industry. We simply like to do kind of vertical expansion. So that is more or less in a natural summary of current developments.
Speaker #2: Well, Omar, sorry, what I may say also, we can see increasing number of core blood samples used for treatment, particular experimental treatment. This is something actually which is very, very important from strategic point of view because this is the key motivation for our clients to bank, right?
Speaker #2: If needed, they will have a chance to use core blood. And that is going relatively well. Thank you.
Speaker #1: Great. Thank you, Jacob, for your short summary on Q2. As you all know, this is a pretty hands-on call format that we're choosing here.
Speaker #1: So we're not having a Q&A line or things like that. You all know the basics. Please just unmute yourself. I already Tim, please. Your first question.
Speaker #3: As always. Yeah, thanks for the quick update and encouraging to see that Q2 is sort of on a slight upward tick, I would say.
Speaker #3: I mean, you mentioned half years a bit lower than last year, but Q2 is up from last year. So that's I guess a positive trend.
Speaker #3: I'd like to double click on the revenue split, Jacob. And Thomas obviously also, if you want to add something. I mean, you said you don't really have a choice or you can't really influence what the consumer which kind of revenue model he goes for.
Speaker #3: I would maybe add that you do and you have in the past by incentivizing with rebates or.
Speaker #2: Yeah, that.
Speaker #3: Advertising, etc. So.
Speaker #2: Sure. That is, I should be more precise. Obviously, if you offer a discount to existing annual paying clients, you may attract some of them prepaying, yes?
Speaker #2: So from the perspective of tools we have in terms of cash generation, we have it in place. What I meant is that if we don't do any action, we have limited influence, you know?
Speaker #2: Because they are still.
Speaker #3: Exactly. That would be my question. Yeah, I know exactly. That was sort of my implied question is I gather you didn't really have emphasis on the one or the other in the quarter.
Speaker #3: So it was more like an organic kind of selection by the.
Speaker #2: Yeah. And we have no clue really how it because there are so many factors, you know, influencing that you cannot, we cannot really predict it, yes?
Speaker #2: But obviously, and we in Poland, we have a small action. We continue calling some annual paying clients, whether they would consider prepayment. While in Poland, because that is the biggest group of annual paying clients, but we have not decided to expand it more broadly because we have to balance current cash inflows and annual paying clients.
Speaker #3: Understood. So I would, from my gathering, you said at the moment there's a slight trend to sort of subscription model, which I think would probably correspond with a sort of more consumer spending cautious environment, I would say.
Speaker #3: That sort of, in my mind, that kind of adds up to the overall picture. Yeah. Yeah. But then encouraging to see that the cash flow, even though is very positive, maybe Thomas on a quick question there.
Speaker #3: Is there sort of any special things we should keep in mind or is that a pretty normal picture overall?
Speaker #1: It's recurrent business revenues are increasing by 1 million. I think this quarter, how are you today? And it's also the price effect. So we can pricing for the product is a little bit higher.
Speaker #1: So it's also an impact that we have on our cash flow. So there are several factors. Coming together here.
Speaker #3: Okay. But sort of no positive one-offs or anything. So more like a normal?
Speaker #1: Yeah, normal business.
Speaker #2: I mean, that is one thing which is going super well. These are after we last year solved, let's say, certain legal issues we have related with the bankrupted cryosafe.
Speaker #2: That group of former clients of bankrupted company we really massively increased our activity and these clients are let's say converting well becoming our clients, right now.
Speaker #2: So that is something which is maybe interesting.
Speaker #3: Okay. And then one sort of other question on the CDMO. Congratulations first on sort of increasing your reach there. Can you remind us like how the revenue usually and the business is structured there?
Speaker #3: Is it like continuous kind of, yeah, funding or is it a bit more lumpy like project business? Or it depends?
Speaker #2: Yes. And we have certain categories, yes? So one category is business we are doing in Germany and in Poland related with production of bone marrow, peripheral blood for transplantation, let's say, clinics.
Speaker #2: That is growing. Steadily growing. Actually, in Germany is flat and in Poland is growing. And it is continuous, yes? So I don't expect any sudden changes here.
Speaker #2: Rather positive because we are acting now to get some more clinics in Germany. And Poland is still growing, as I said. So this is one part of CDMO.
Speaker #2: Second part are experimental therapies in Poland where we are supplier both for private and public hospitals providing them advanced therapy medicinal products in hospital exemption procedure.
Speaker #2: And that is growing as well. Since three years before we had it relatively large a couple of years ago, then due to certain regulatory issues, we dropped a lot and pandemic did not help, but we are recovering.
Speaker #2: And I expect further growth in that area. Then we have another part which is classic, more classical CDMO that you have a client like Artek, right?
Speaker #2: We have to win. And then you stay with such client for a couple of years, yeah? I would guess at least three. And if the FDA outcome of that cooperation is positive, but it's not about manufacturing.
Speaker #2: It's more about the results of the clinical study because usually that manufacturing is for clinical study. If there's and they have funds, they continue for a while, right?
Speaker #2: So these are project-based, but with an option of longer relationship. And then the new clients we are expecting will be of that nature as well.
Speaker #2: So this is the category number three. And in CDMO, we have also some smaller categories like cell and tissue sourcing, analytics, this kind of stuff.
Speaker #2: And that is going on slowly. And these are small amounts of money. And so here, we believe in growth. However, we are still at relatively low level, yes?
Speaker #2: And we will also internally, we are treating CDMO like a, let's say, separate business sector, let's say. It's not from reporting point of view, because it's too small.
Speaker #2: But for, let's say, monitoring from management perspective, yes. We see the growth.
Speaker #1: Great. Thank you, Jakub. And thanks, Tim. Oh, please, a follow-up question. Yes.
Speaker #3: Yeah, just one more. If I look at sort of the guidance for EBITDA, and we look at Q2, half year, so yeah, if we can continue on this level, CDMO may be growing up a bit.
Speaker #3: It doesn't have a big effect yet. But I think still it would be fair to assume that the lower end of that range is more the probable outcome from today's point of view.
Speaker #2: Yes.
Speaker #3: Yeah. Okay. Thank you. And all the best.
Speaker #2: Thank you.
Speaker #1: Thank you, Tim. So this call is from contribution. Folks, please just unmute yourself after questions. Yes, Niels, thank you. Thank you, Niels.
Speaker #4: Hi. Nice to see you again, Jakub and Thomas. Thank you very much for taking my question. Really glad that you are doing this and that you also pushing the video afterwards onto your website.
Speaker #4: So that other participants can listen to it. So Jakub, thank you very much for giving some light on the cryosafe case. Could you give us some hint into how many clients you already signed up?
Speaker #4: From cryosafe specifically?
Speaker #2: We are not sharing that information publicly.
Speaker #4: Okay. But just from my clarification in the past, you spoke about 225,000 direct cryosafe clients. What do you expect is a realistic target to reach within the next one or two years as potential customer?
Speaker #2: One or two years? It's a short perspective. I think that we should think from the perspective of rather three to five years and why?
Speaker #2: Because cryosafe was the most successful between 2007, 2010, and these clients prepaid for 2025 years. So this is the biggest pool of these clients, right?
Speaker #2: So this is why not one, two years, but rather three to five. I would aim for 100,000, maybe. Maybe 80. It's very difficult to say.
Speaker #2: Let's say 80 is safe. 100,000 would be ambitious. So this is, let's say, 35% of these B2C clients. The biggest problem we see I mean, actually, there are two.
Speaker #2: First is Spain. The largest market of cryosafe. I would say that out of these 225, 230,000 families, 85,000 were from Spain. And they were sold the service through insurance policies they had.
Speaker #2: So they were buying private healthcare insurance. And that healthcare insurance had a component of private corporate banking. So many of them they even don't know or did not know now.
Speaker #2: They forgot. They had that service done. And so they did not buy corporate banking consciously. They bought it because they had this healthcare insurance.
Speaker #2: Now this had such a client is not so easy to convince, right? Because he does not care. He did not spend any extra money from his perspective.
Speaker #2: So that is first issue. And also quality of data is second issue. The data we got from cryosafe are not so good overall in terms of contact data up to date data.
Speaker #2: It's normal that after many years, the clients are not updating contact data and so on and so. But in case of this pool of clients, it's worse than statistically.
Speaker #2: And in our case, yes, of our clients. So these are two major obstacles. But overall, I'm pretty happy with performance now after we solved this legal issues and then the perspectives are rather positive.
Speaker #2: Whether we reach this whatever 80,000 or even more, I cannot predict. But at the moment, it is going well. At least I can see.
Speaker #2: We also find out about these are small streams. We also convinced two more partners of former partners of cryosafe. They were storing their clients with cryosafe to sign with us.
Speaker #2: So there will be also small revenue stream from B2B. Yes, here.
Speaker #4: And could you coming back to Tim's last question, regarding the guidance, could you narrow the guidance a little bit? Because at the end of the day, we are already in September now or close to September.
Speaker #4: H1 is always the lower or weaker year and quarter of the year. So we already have like 43 million in revenues so it shouldn't be too ambitious to reach like 88 million in revenues, right?
Speaker #2: I mean, it's the market which is really unpredictable. That's the issue. I mean, while we cannot expect surprises in number of children, right? In terms of reaction, of consumers, to what is going on, energy prices changing like they are changing and one move of Russia or US or Iran is suddenly changing the behavior of consumers, yes?
Speaker #2: So it's very difficult to say we are safe saying that we will reach the same revenue like last year. So I'm as said before, we are precautious this year.
Speaker #2: And we knew it that it will be like that. Unfortunately, I would be glad to say, yes, I'm sure that we will deliver X, Y, Z, but I cannot say so even we are now in August.
Speaker #2: End of August. I cannot unfortunately. I mean, if I would see, for example, either positive or negative, one factor, it's not the case, yes?
Speaker #2: Besides, CDMO, what I already commented, where we see clearly where we are with certain contracts, right? And clients, in terms of other developments, it's hard to say.
Speaker #2: We are Thomas did not mention, but we also we are keeping control over costs, right? That is important. You notice we have much less FTEs in the group now.
Speaker #2: We are simply not rehiring if someone leaves for some positions. Certain positions we had in the budget, we are not filling, right? Because we have to be careful.
Speaker #4: And regarding CDMO and the two contracts which are in the pipeline, how large would be the revenue impact if you sign them?
Speaker #2: We have to talk with the clients whether they will allow us to share that information. Likely, yes, because we initially we asked them, they told they have nothing against, but I need a permit, yes, first.
Speaker #2: But these are not breakthrough contracts. Otherwise, we'll have an ad hoc, right? And then these are contracts which will last a couple of years with possible extension.
Speaker #2: What I can tell today that one is from Eastern Europe, one is from Western Europe. And that production would be in Poland, yes, in Warsaw, because we have by far the largest capacity here.
Speaker #4: And regarding cost measures, is there any update on Germany and how you can streamline the organization there?
Speaker #2: There is, but again, we cannot disclose that information yet because we have clear picture what we should do. We analyzed several scenarios. But we need to simply discuss things with our supervisory board.
Speaker #2: And I expect that will come in next couple of weeks, yes? And then we'll start potential implementation. And that is also dependent on also regulatory topics and so and so.
Speaker #2: So what happened in Germany that we went down to scale, yes, market actual to save money, yes? Because with our market cap and we are not fitting prime market or so that was one of the measures relatively simple.
Speaker #2: Surprisingly, and as said before, we have less people now in Germany already because we did not hire people. We originally planned. Yeah. And we merge Eticure into Vitra, our Famicort AG, yes?
Speaker #2: So we maintain brand of Eticure, but Eticure itself is non-existing company. We saved some money with that. And according to our calculations, the Eticure brand itself, if you deduct one of related with merger, first time in history is over break even.
Speaker #2: Because the company has never been profitable.
Speaker #4: Okay. Thank you very much for my side.
Speaker #2: Thank you.
Speaker #4: Thank you.
Speaker #3: Is there anybody who would like to add something to this Q&A? Nope. Doesn't look like this, but half an hour call is a good call from our perspective.
Speaker #3: So thanks you all for joining again. It's been a pleasure having you. We meet again next time in November for this next call on Q3.
Speaker #3: Until then, I wish you all a great time and for now, a happy weekend. Enjoy the time. Bye-bye.
Speaker #2: Thank you.
Speaker #1: Thanks.
