Q2 2026 I-Tech AB Earnings Call

August 21, 2026

Speaker #1: And also, then, reducing emissions to the oceans, because Selektope is a very, very effective and efficient product. So you need very little of it to get a good effect.

Markus Jönsson: And also then reducing emissions to the oceans, because Selektope is a very effective and efficient product, so you need very little of it to get a good effect. I-Tech has been built around the product of Selektope. Our customers are the top coating manufacturers that are making the antifouling coating, which is coated then on the underwater surface area of ships.

Speaker #1: So I-Tech has been built around the product Selectope, and our customers are the top coating manufacturers that are making the antifouling coating, which is coated then on the underwater surface area of ships.

Speaker #1: And it's a quite consolidated market. We have commercial relationships with the majority of the customers and are working very actively with additional good manufacturers, like Selektope, into their formulations and products.

Markus Jönsson: It is a quite consolidated market. We have commercial relationships with the majority of the customers and working very actively with additional coating manufacturers to get Selektope into their formulations and products. It is quite a unique technology. We are a company based, you could say, on intellectual property and formulation know-how. Our production is outsourced. The penetration of Selektope is still rather low. We estimate that it is today on approximately 3,500 ships then, out of a global fleet of 110,000.

Speaker #1: So it's quite a unique technology. We are a company based, you could say, on intellectual property and formulation know-how. Our production is outsourced. The penetration of Selektope is still rather low.

Speaker #1: We estimate that it's today on approximately 3,500 ships, out of a global fleet of 110,000. So, much more to do as well in terms of, you know, penetrating the market with Selektope.

Markus Jönsson: So much more to do as well in terms of penetrating the market with Selektope. I-Tech was introduced to the Nasdaq Stock Exchange in 2018, and since then we have had a tremendous nice growth journey. So nearly 30% year-on-year growth. That continues, at least for the H1 of this year. So it is very good development. Now we come in then to the quarterly results, and then I would like to hand over to Magnus Henell, the CFO and head of operations. Here you go.

Markus Jönsson: Much more to do as well in terms of penetrating the market with Selektope. I-Tech was introduced to the Nasdaq Stock Exchange in 2018, and since then we have had a tremendous nice growth journey. So nearly 30% year-on-year growth. That continues, at least for the H1 of this year. So it is very good development. Now we come in then to the quarterly results, and then I would like to hand over to Magnus Henell, the CFO and Director of Operations. Here you go.

Speaker #1: I-Tech was introduced to the Nasdaq Stock Exchange in 2018, and since then we've had a tremendously nice growth journey—nearly 30% year-on-year growth.

Speaker #1: So, and that continues at least for the first half of this year. So, it's very good developments. And now we come in then to the quarterly results.

Speaker #1: And then I would like to hand over to Ms. Anel, the CFO and Head of Operations. Here you go.

Speaker #2: Thank you very much, Marcus. It's really nice being here today to talk to you about the quarterly report. And as you can see in the picture in front of us, we have a tremendous development for this quarter.

Magnus Henell: Thank you very much, Markus. It is really nice being here today to talk to you about the quarterly report. As you can see in the picture in front of us, we have a tremendous development for this quarter. Of course, compared to last year, it is a huge development. But on the other hand, we are comparing with quite weak numbers in Q2. We should be very open to say that, but given the fact that we are comparing to weak numbers, last year we still have almost 10% growth compared to our best quarter so far, which was the previous quarter, Q1 in 2026, which means that this is, of course, the best quarter we have had on the sales side as well as the result side. We have done this by increasing the volume both with almost all our existing customers.

Speaker #2: Of course, compared to last year, it's a huge development. But on the other hand, we are compared with quite weak numbers in Q2. We should be very open to say that.

Magnus Henell: But on the other hand, we are comparing with quite weak numbers in Q2. We should be very open to say that, but given the fact that we are comparing to weak numbers, last year we still have almost 10% growth compared to our best quarter so far, which was the previous quarter, Q1 in 2026, which means that this is, of course, the best quarter we have had on the sales side as well as the result side. We have done this by increasing the volume both with almost all our existing customers.

Speaker #2: But given the fact that we are comparing to weak numbers last year, we still have almost 10% growth compared to our best quarter so far, which was the previous quarter, Q1 2026.

Speaker #2: Which means that this is, of course, the best quarter we have had on the sales side, as well as the results side. And we have done this by increasing the volume with almost all our existing customers. It's very much based on the top two customers.

Magnus Henell: It is very much based on the top two customers, where the top one has had very nice growth as well as the second one, which come back quite much better than previous year when they have a significant drop, and we can come back to that later on, maybe in the Q&A as well. So given the hard facts, we have an 86% growth compared to previous year, almost SEK 60 million in net sales for the quarter, which is very nice. If we look on the volume side, it is roughly 100% growth. The main difference here is mainly the volume price list that we have. We have customers who have taken the next step in their pricing, which means that they have reduced the price a little bit, but also the general mix, as well as the currency effect, of course.

Speaker #2: The top one has very nice growth, as does the second one, which has come back much better than the previous year, when they had a significant drop. We can come back to that later on, maybe in the Q&A as well.

Speaker #2: So, given the hard facts, we have an 86% growth compared to the previous year—almost 60 million in net sales for the quarter, which is very nice.

Magnus Henell: So given the hard facts, we have an 86% growth compared to previous year, almost SEK 60 million in net sales for the quarter, which is very nice. If we look on the volume side, it is roughly 100% growth. The main difference here is mainly the volume price list that we have. We have customers who have taken the next step in their pricing, which means that they have reduced the price a little bit, but also the general mix, as well as the currency effect, of course.

Speaker #2: If we look on the volume side, it's roughly 100% growth. The main difference here is mainly the volume price list that we have.

Speaker #2: We have customers who have taken the next step in their pricing, which means that they have reduced the price a little bit, but also the general mix.

Speaker #2: And as well as the currency effect, of course. In the previous quarter, we were talking a little bit about gross margin and that we were a little bit afraid that it would drop a little bit for this quarter and the coming quarters.

Magnus Henell: Previous quarter, we were talking a little bit about gross margin and that we were a little bit afraid that we should drop a little bit for this quarter and the coming quarters. We have so far been able to manage all of these risks. There is still a small risk that for the coming quarters will reduce the gross margin a little bit, but for now, we see that we have managed the large risks in this together with our suppliers and our customers, of course. The effect of this growth in top line as well as the continued high gross margin is, of course, that we are coming into a quarter with very nice EBITDA.

Speaker #2: We have so far been able to manage all of these risks. There is still a little risk that, for the coming quarters, we will reduce the gross margin a little bit.

Magnus Henell: There is still a small risk that for the coming quarters will reduce the gross margin a little bit, but for now, we see that we have managed the large risks in this together with our suppliers and our customers, of course. The effect of this growth in top line as well as the continued high gross margin is, of course, that we are coming into a quarter with very nice EBITDA.

Speaker #2: But for now, we see that we have managed the sort of large risks in this, together with our suppliers and our customers, of course.

Speaker #2: So, the effect of this growth in top line, as well as the continued high gross margin, is of course that we are coming into a quarter with very nice EBITDA.

Speaker #2: We have an EBITDA level of 40%. We have an EBIT level of 36%, which is very strong. And of course, we are comparing to weak numbers from last year, which were significantly lower.

Magnus Henell: We have an EBITDA level of 40%, we have an EBIT level of 36%, which is very strong, and of course, we are comparing to weak numbers last year where they were significantly lower. But on the other hand, we have had the same EBIT and EBITDA level for the first two quarters this year, and we show that we have a stable cost base, even though we have this significant cost for the EU regulation, et cetera, still hanging over us. We are growing, but we are also growing on a stable cost base. Finally, maybe I should point out that we still have a very nice cash conversion, almost in line with the EBITDA level.

Speaker #2: But on the other hand, we have had the same EBIT and EBITDA levels for the first two quarters this year. We show that we have a stable cost base, even though we have this significant cost for the EU regulation, et cetera, still hanging over us.

Speaker #2: But we are growing. But we are also growing on a stable cost base. Finally, maybe we should point out that we still have a very nice cash conversion.

Speaker #2: Almost in line with the EBITDA level, of course this is not something that we can keep on for eternity. But as long as we have these sort of one-time effects every year for the tax from previous years, then we will continue, for at least three out of four quarters, to have almost the same cash conversion as the EBITDA.

Magnus Henell: Of course, this is not something that we can keep on for eternity, but as long as we have these one-time effects every year for the tax for the previous years, then we will continue for at least three out of four quarters, have almost the same cash conversion as the EBITDA. When looking into the different markets, of course, Asia is still very much the highest. We have taken even further step, 96% this quarter compared to the 4% in Europe. We have very small also to the rest of the world, but not shown on this screen. To point out here maybe is that Korea has significantly improved compared to the previous quarters, and that is main to the two largest customers that I was talking about there. A large part of their increase was in Korea when we are comparing quarter by quarter.

Speaker #1: When looking into the different markets, of course Asia is still very much the highest market. We have taken an even further step—96% this quarter compared to 4% in Europe.

Speaker #1: We have very small also to the rest of the world, but that's not shown on this screen. To point out here, maybe, is that Korea has significantly improved compared to the previous quarter.

Magnus Henell: We have taken even further step, 96% this quarter compared to the 4% in Europe. We have very small also to the rest of the world, but not shown on this screen. To point out here maybe is that Korea has significantly improved compared to the previous quarters, and that is main to the two largest customers that I was talking about there. A large part of their increase was in Korea when we are comparing quarter by quarter.

Speaker #1: And that is mainly attributed to the two largest customers that I was talking about. A large part of their increase was in Korea when we are comparing quarter by quarter.

Speaker #2: So, to summarize Q2, the highlights are: of course, we have a 100% volume growth, which is the strongest quarterly volume so far.

Magnus Henell: To summarize the Q2, the highlights are, of course, we have 100% volume growth, which is then the strongest quarterly volume so far. We are continuing to diversify, and we have a Korea that is really strong for the quarter and strength for this position. We need to point out again, we did point out last quarter as well, but we have a stable high gross margin, 59%, and which then results in a very strong EBITDA and the EBIT on 40% respective 36%. Now, having that said about the numbers, I think, Markus will talk a little bit about the upcoming events and other development in the company.

Speaker #2: We are continuing to diversify, and we have Korea, which is really strong for the quarter—strength to this position. And we need to point out again, as we did last quarter as well.

Speaker #2: But we have a stable, high gross margin of 59%, which then results in a very strong EBITDA, and the EBIT at 40% and 36%, respectively.

Magnus Henell: We need to point out again, we did point out last quarter as well, but we have a stable high gross margin, 59%, and which then results in a very strong EBITDA and the EBIT on 40% respective 36%. Now, having that said about the numbers, I think, Markus will talk a little bit about the upcoming events and other development in the company.

Speaker #2: So now, having said that about the numbers, I think, Marcus, we can talk a little bit about the upcoming events and other developments in the company.

Speaker #1: Thank you, Magnus. Really strong results indeed, and happy to see that we are able then to preserve the margins as well. All right, looking then a little bit into the future and starting with the outlook.

Markus Jönsson: Thank you, Magnus. Really strong results indeed, and happy to see that we are able to preserve the margins as well. All right, looking a little bit into the future and starting with the outlook. Those of you who know us, you have seen this slide many times, right? This is essentially the market that we are operating in, right? We were mentioning a fleet of roughly 110,000 commercial vessels. There are approximately 2,000 vessels being built each year. That number will go up this year because output is increasing. There are more importantly around 20,000 dry dockings events happening, right, where fresh antifouling paint is applied. We estimate the opportunity for Selektope for other premium antifouling components to be around 3 to 500 million USD.

Speaker #1: So those of you who know us, you've seen this slide many times, right? But this is essentially the market that we are operating in, right?

Speaker #1: So, we were mentioning a fleet of roughly 110,000 commercial vessels. There are approximately 2,000 vessels being built each year. That number will go up this year because output is increasing.

Markus Jönsson: We were mentioning a fleet of roughly 110,000 commercial vessels. There are approximately 2,000 vessels being built each year. That number will go up this year because output is increasing. There are more importantly around 20,000 dry dockings events happening, right, where fresh antifouling paint is applied. We estimate the opportunity for Selektope for other premium antifouling components to be around 3 to 500 million USD.

Speaker #1: But there are, more importantly, around 20,000 dry docking events happening, right? Where fresh antifouling paint is applied. So we estimate the opportunity for Selektope and for other premium antifouling components to be around $300 to $500 million US dollars.

Speaker #1: So China has really further strengthened their dominating position within, sort of, the shipbuilding, but also ship service market, right? It’s a very, very important market.

Speaker #1: And it's also a key growth market for I-Tech going forward. But you can also see Japan and Korea, where we have a very strong position, right?

Markus Jönsson: China has really further strengthened their dominating position within the shipbuilding, but also ship service markets, right? It is a very, very important market, and it is also a key growth market for I-Tech going forward. You can see also Japan and Korea, where we do have a very strong position, right? It is also very, very important. That is the market, right? If we look at recent developments, I think geopolitically, shipping has been on the frontline for the good part of this year with the Strait of Hormuz issues, right? Despite actually that loss of volume, you could say, from the trade through the Strait of Hormuz, the shipping industry, if you just look at the macro, is actually doing quite well, right?

Speaker #1: It's also very, very important. So that's the market, right? If we look at sort of recent developments then, I think geopolitically, shipping has been on the front line for the good part of this year with the Strait of Hormuz issues, right?

Markus Jönsson: That is the market, right? If we look at recent developments, I think geopolitically, shipping has been on the frontline for the good part of this year with the Strait of Hormuz issues, right? Despite actually that loss of volume, you could say, from the trade through the Strait of Hormuz, the shipping industry, if you just look at the macro, is actually doing quite well, right?

Speaker #1: But despite that actual loss of volume, you could say, from the trade through the Strait of Hormuz, the shipping industry—as if you just look at the macro—is actually doing quite well, right?

Speaker #1: Because, as an effect of this squeeze in the Strait of Hormuz, the charter rates have actually gone up significantly this year. So at this stage, you know, the ClarkSea Index, which is sort of the average charter rate that shipping companies can exert from the market, is up 61%.

Markus Jönsson: Because as an effect of this squeeze through the Strait of Hormuz, the charter rates have actually gone up significantly this year. At this stage, the ClarkSea Index, which is the average charter rates that the shipping companies can exert from the market, is up 61%. Of course, that cash, that fuels, you could say, their future investment into their business as well. We see that also panning out because there has been a really high uptick in the ordering of new ships or new vessels, right, as a consequence of this also, right? You could say that a large part of the fleet is old, it needs to be renewed. Also, up until recently, we had a consensus, you could say, on the climate ambition and the decarbonization of shipping. This is still a factor as well, right?

Speaker #1: And of course, that cash fuels, you could say, their future investment into their business as well. So we see that also panning out because there has been a really high uptick in the ordering of new ships, or new vessels, right?

Speaker #1: As a consequence of this also, right? So you could say that a large part of the fleet is old. It needs to be renewed.

Markus Jönsson: We see that also panning out because there has been a really high uptick in the ordering of new ships or new vessels, right, as a consequence of this also, right? You could say that a large part of the fleet is old, it needs to be renewed. Also, up until recently, we had a consensus, you could say, on the climate ambition and the decarbonization of shipping. This is still a factor as well, right?

Speaker #1: And also, up until recently, we had a consensus, you could say, on the climate ambition and the decarbonization of shipping. This is still a factor as well, right?

Speaker #1: But now we see that recent events are actually spiking the new orderings as well, right? So shipyard output continues to increase as well. It's up 14% year-on-year.

Speaker #1: And then Chinese shipbuilding, and shipyards in particular, have been growing their capacities. Also, as a consequence, you could say, of the Strait of Hormuz, we have very elevated fuel costs, right?

Markus Jönsson: Now we see that recent events is actually spiking the new orderings as well, right? Shipyard output continues to increase as well. It is up 14% year on year. Chinese shipbuilding and shipyards in particular have been growing their capacities. Also, as a consequence, you could say, of the Strait of Hormuz, we have very elevated fuel costs, right? That really continues to underscore the value of premium antifouling. You could see here the graph in the bottom here, the bunker fuel price has increased by 70% so far this year. Of course, every liter or every ton of fuel that you can save means a huge thing, right, for the shipping company's bottom line. We see geopolitical issues is a major risk to the business, but it is also actually one of the underlying drivers to our growth momentum in the company, right?

Speaker #1: And that really continues to underscore the value of premium antifouling. So you could see here the graph in the bottom here, you know, the bunker fuel price has increased by 70% so far this year.

Speaker #1: So, of course, every liter or every ton of fuel that you can save means a huge thing, right, for the shipping companies' bottom line.

Markus Jönsson: That really continues to underscore the value of premium antifouling. You could see here the graph in the bottom here, the bunker fuel price has increased by 70% so far this year. Of course, every liter or every ton of fuel that you can save means a huge thing, right, for the shipping company's bottom line. We see geopolitical issues is a major risk to the business, but it is also actually one of the underlying drivers to our growth momentum in the company, right?

Speaker #1: So we see, I mean, geopolitical issues are a major risk to the business, but they're also actually one of the underlying drivers of our growth momentum in the company, right?

Speaker #1: Because shipping is doing sort of, kind of okay, right? Or really good, actually, as a result of these various geopolitical issues. So that's sort of the market context.

Speaker #1: For I-Tech, and for those of you who have attended a number of these meetings, you know that our ongoing re-registration process in Europe is a recurring item of discussion, right?

Markus Jönsson: Because shipping is doing kind of okay, right? Or really good, actually, as a result of these various geopolitical issues. That is the market context. For I-Tech then, and for those of you who have attended a number of this meeting, you know that our ongoing re-registration process in Europe is a reoccurring item of discussion, right? To give you the latest update, we know now that, in the June meeting of the Standing Committee on Biocidal Products in Europe, you could say, where the member states and the EU Commission meets to discuss various renewal processes and market approvals of biocides, that they actually discussed the draft proposal for non-renewal that we actually made a press release from in December last year. That suggestion was now on the table and was discussed.

Speaker #1: And then, to give you the latest update, we know now that in the June meeting of the Standing Committee on Biocidal Products in Europe, you could say, where the member states and the EU Commission meet to discuss various renewal processes and, yeah, market approvals of biocides.

Markus Jönsson: To give you the latest update, we know now that, in the June meeting of the Standing Committee on Biocidal Products in Europe, you could say, where the member states and the EU Commission meets to discuss various renewal processes and market approvals of biocides, that they actually discussed the draft proposal for non-renewal that we actually made a press release from in December last year. That suggestion was now on the table and was discussed.

Speaker #1: They actually discussed the draft proposal for non-renewal that we made a press release about in December last year. So that suggestion is now on the table and was discussed.

Speaker #1: We also know that they have started, you could say, the last formal step of this re-registration process, which is the so-called WTO TBT process.

Speaker #1: So, it's the World Trade Organization's Technical Barrier to Trade, and this is a 60-day process where other members of the WTO—other member states outside Europe—have the chance and opportunity, then, to comment on new proposed legislation in Europe, right?

Markus Jönsson: We also know that they have started, you could say, the last formal step of this re-registration process, which is the so-called WTO TBT process. It is World Trade Organization's Technical Barrier to Trade. This is a 60-day process where other members of the WTO, other member states outside Europe, have the chance and opportunity then to comment on new proposed legislation in Europe, right? They have then, you could say, the opportunity to comment on this non-renewal proposal. As I said, this is a 60-day process. The earliest that you could see that the Standing Committee on Biocidal Products could vote on this proposal then would be end September. Theoretically, it is a possibility maybe at their meeting in end of September.

Speaker #1: So they have, then, you could say, the opportunity to comment on this non-renewal proposal. So, as I said, this is a 60-day process. So the earliest that you could see the Standing Committee on Biocidal Products vote on this proposal would be sort of end of September.

Markus Jönsson: They have then, you could say, the opportunity to comment on this non-renewal proposal. As I said, this is a 60-day process. The earliest that you could see that the Standing Committee on Biocidal Products could vote on this proposal then would be end September. Theoretically, it is a possibility maybe at their meeting in end of September.

Speaker #1: Theoretically, it's a possibility maybe at their meeting at the end of September. But more likely, a voting can take place either at their December meeting or between the meetings with the so-called written procedure.

Speaker #1: So, if—I mean, until then, you could say I-Tech continues, of course, to advocate and to have a close dialogue with the member states and also with the commissions regarding this re-registration case.

Markus Jönsson: More likely than the voting can take place either at their December meeting or between the meetings with the so-called written procedure. Until then, you could say I-Tech continues, of course, to advocate and to have a close dialogue with the member states and also with the commissions regarding this re-registration case. If there would be a negative decision in the end, I want to stress that we are ready then with the appeal process to simply make a legal case out of this. Which is on one hand good because it is the first opportunity that we have to challenge, actually, the recommendation or the conclusion that medetomidine or Selektope should be viewed as an endocrine disruptor. That is ready, that legal case.

Speaker #1: So, if there would be a negative decision in the end, then I want to stress that we are ready, then, with the appeal process to simply make a legal case out of this. Which is, on one hand, good, because it's a first opportunity then we have to challenge actually the recommendation or the conclusion that Medetomidine or Selectope should be viewed as an endocrine disruptor.

Markus Jönsson: If there would be a negative decision in the end, I want to stress that we are ready then with the appeal process to simply make a legal case out of this. Which is on one hand good because it is the first opportunity that we have to challenge, actually, the recommendation or the conclusion that medetomidine or Selektope should be viewed as an endocrine disruptor. That is ready, that legal case.

Speaker #1: So that is ready, that legal case. The current approval, in any case, expires on December 31st this year, and it was extended, you could say, from mid-year until the end of the year during the March meeting.

Speaker #1: So this is the latest status on the EU process. We have also talked about our business development pipeline, and I'm happy to say that there is a lot of momentum and good progress here. But essentially, we are looking at, you could say, complementing technologies and products to our existing customers.

Markus Jönsson: The current approval, in any case, expires on 31 December this year, and it was extended, you could say, from mid-year until end of the year during the March meeting. This is the latest status on the EU process. We have also talked about our business development pipeline, and I am happy to say that there is a lot of momentum and good progress here. Essentially we are looking at, you could say, complementing technologies and products to our existing customers, but also then looking at other marine markets such as aquaculture and yacht market where we are not so present today, and also looking into various new technologies and new business models. Essentially with the aim then of broadening I-Tech's product offers and also our focus markets. We are intending to stay within the marine space and, of course, antifouling, that is where we have our expertise.

Speaker #1: But also then looking at other marine markets such as aquaculture and the yacht market, where we are not so present today. And also looking into various new technologies and new business models.

Speaker #1: But essentially, with the aim then of broadening I-Tech's product offerings and also our focus markets. But we are really intending to stay within the marine space—and, of course, antifouling. That's where we have our expertise, right?

Markus Jönsson: Essentially we are looking at, you could say, complementing technologies and products to our existing customers, but also then looking at other marine markets such as aquaculture and yacht market where we are not so present today, and also looking into various new technologies and new business models. Essentially with the aim then of broadening I-Tech's product offers and also our focus markets. We are intending to stay within the marine space and, of course, antifouling, that is where we have our expertise.

Speaker #1: So today we're going to talk a little bit about aquaculture. This is a very busy slide, so forgive me for that. But I think what is important to actually state here is that fisheries and aquaculture are substantial businesses, right?

Speaker #1: Almost as much as the trade, you could say, of terrestrial meat products, right? So the fish and crustaceans, etcetera, coming from the sea is really, really important, you could say, for food security, and sort of for poverty alleviation, and for nutrition actually, for the world's population.

Markus Jönsson: Today we are going to talk a little bit about aquaculture, this is a very busy slide, so forgiveness for that. I think what is important here to actually state that fisheries and aquaculture is a substantial business. Almost as much as the trade, you could say, of terrestrial meat products. The fish and crustaceans, et cetera, coming from the sea is really, really important, you could say, for food security and for poverty alleviation and for nutrition, actually, for the world's population. I think what is important is actually the graph in the bottom left on this slide. Aquaculture, which is, you could say, the farming of fish and various aquatic animals, has increased a lot during that. It is actually the majority today of the volumes that are coming out.

Speaker #1: And I think what is important is actually the graph in the bottom left on this slide. You know, aquaculture—which is, you could say, the farming of fish and various aquatic animals—has increased a lot during the last.

Markus Jönsson: The fish and crustaceans, et cetera, coming from the sea is really, really important, you could say, for food security and for poverty alleviation and for nutrition, actually, for the world's population. I think what is important is actually the graph in the bottom left on this slide. Aquaculture, which is, you could say, the farming of fish and various aquatic animals, has increased a lot during that. It is actually the majority today of the volumes that are coming out.

Speaker #1: And it's actually the majority today of the volumes that are coming out, right? It's actually being farmed and produced in aquatic farms, both inland and coastal farms, right?

Speaker #1: And actually, this is also where all the growth in the future is set to come from—mainly from expansion of various aquacultures. And if you look at the graph next to that one at the bottom, you see, okay, who are the leading producers?

Speaker #1: And here again, Asia is really dominating: China, almost two-thirds; India, Indonesia, Vietnam, et cetera, right? And this is of course in terms of produced volume, but you also have to look into the value and sort of the export patterns.

Markus Jönsson: It is being actually farmed and produced in aquatic farms, both inland and coastal farms. This is also where all the growth in the future is set to come exactly, mainly from expansion of various aquacultures. If you look at the graph next to that one in the bottom, you see, okay, who are the leading producers? Here again, Asia is really dominating. China, almost two-thirds, India, Indonesia, Vietnam, et cetera. This is, of course, in terms of produced volume. You also have to look into the value and the export patterns. Here, our neighboring country, Norway. They are actually the second biggest in the world in terms of export value. That is largely thanks to their salmon production, and salmon business.

Speaker #1: And here, our neighboring country, Norway, right? They're actually the second biggest in the world in terms of export value, right? And that's largely thanks to their salmon production, right?

Markus Jönsson: Here again, Asia is really dominating. China, almost two-thirds, India, Indonesia, Vietnam, et cetera. This is, of course, in terms of produced volume. You also have to look into the value and the export patterns. Here, our neighboring country, Norway. They are actually the second biggest in the world in terms of export value. That is largely thanks to their salmon production, and salmon business.

Speaker #1: And salmon business. So it is also an important business, you could say, close here in Europe. Also in other places like Scotland, and also in the Mediterranean, right?

Speaker #1: So, aquaculture we see as a very interesting market segment for I-Tech to explore further, right? And what is the link between what we are doing in aquaculture?

Speaker #1: Well, in reality, you could say that the problem with biofouling also exists in aquaculture. And you can see here to the right, there is actually a picture of one farm, right?

Markus Jönsson: It is also an important business, you could say, close here in Europe, also in other places like Scotland and also in the Mediterranean. Aquaculture, we see as a very interesting market segment for I-Tech to explore further. What is the link between what we are doing and aquaculture? Well, in reality, you could say that the problem with biofouling also exists in aquaculture. You can see here to the right, there is actually a picture of one farm. You can see then, in this case, the fish, they are kept in these large nets, net cages that is sitting here anchored to the bottom of the sea, but really out, in this case, in the fjords of Norway. The protective cages and the nets, they also get fouled.

Speaker #1: And you can see then, in this case, the fish are kept in these large, large nets, right? Net cages. That is, they're sort of anchored to the bottom of the sea, but really out—in this case, in the fjords of Norway, right?

Markus Jönsson: What is the link between what we are doing and aquaculture? Well, in reality, you could say that the problem with biofouling also exists in aquaculture. You can see here to the right, there is actually a picture of one farm. You can see then, in this case, the fish, they are kept in these large nets, net cages that is sitting here anchored to the bottom of the sea, but really out, in this case, in the fjords of Norway. The protective cages and the nets, they also get fouled.

Speaker #1: And these, the protective cages and the nets, they also get fouled, right? Because it's even worse, you could say, than for ships, because they are not moving through the water.

Speaker #1: They are sitting still. And in the summer period, you know, there is plenty of nutrition available, so a lot of fouling species can settle onto the net.

Speaker #1: And this affects, you could say, the operating costs very negatively, but it also affects animal health and welfare, right? And it results in a lot of yield loss.

Markus Jönsson: Because it is even worse, you could say, than for ships, because they are not moving through the water, they are sitting still. In the summer period, there is plenty of nutrition available, so a lot of fouling species can settle onto the net. This affects, you could say, the operating costs very negatively, but also it affects the animal health and welfare. It results in a lot of yield loss. Essentially, fishes and crustaceans, they die as a consequence of fouling. Also to manage this fouling is a compliance issue. You want to be compliant with the various local regulations around the production of aquatic organisms. Here, fouling is really presenting itself with a big challenge for the producers. One popular strategy today, then, is to actually impregnate these net cages with an impregnation coating.

Speaker #1: So essentially, you know, fishes and crustaceans, they die as a consequence of fouling, right? And also, to manage this fouling is a compliance issue, right?

Speaker #1: So you want to sort of be compliant with the various local regulations around the production of aquatic organisms, and here, fouling is really presenting itself as a big challenge for the producers.

Markus Jönsson: Essentially, fishes and crustaceans, they die as a consequence of fouling. Also to manage this fouling is a compliance issue. You want to be compliant with the various local regulations around the production of aquatic organisms. Here, fouling is really presenting itself with a big challenge for the producers. One popular strategy today, then, is to actually impregnate these net cages with an impregnation coating.

Speaker #1: So, one popular strategy today, then, is to actually impregnate these net cages with a sort of impregnation coating, right? And that's the graph here to the right, where we are showing, you could say, the market size roughly in million liters in the Western Hemisphere, which is sort of an area that we are focusing on from the beginning.

Speaker #1: You can see there, in total, we estimate this to be around 20 million liters, and that should be compared to antifouling coatings for ships, where we are operating today, which we estimate to be around 75 million liters, right?

Markus Jönsson: And that is the graph here to the right where we are showing, you could say, the market size roughly in million liters in sort of the Western Hemisphere, which is sort of an area that we are focusing on from the beginning. You can see there in total, we estimate this to be around 20 million liters, and that should be compared then to antifouling coatings for ships where we are operating today, which we estimate to be around 75 million liters. So a little bit smaller in terms of the number of liters. But I think also the market characteristics are somewhat different from antifouling for ships. So actually, the life cycle of these nets is much shorter. It is essentially one season, around one year that the coating has to survive, so you have a much quicker replacement of the coatings.

Speaker #1: So, a little bit smaller in terms of the number of liters, but I think also the market characteristics are somewhat different from antifouling for ships.

Speaker #1: So actually, the life cycle of these nets is much shorter. It's essentially one season—around one year—that the coating has to survive. So you have a much quicker replacement of the coatings.

Speaker #1: And it's also, you could say, quicker qualification periods and quicker turnaround to test new innovation, which is an interesting feature compared to the markets we're in today.

Markus Jönsson: But I think also the market characteristics are somewhat different from antifouling for ships. So actually, the life cycle of these nets is much shorter. It is essentially one season, around one year that the coating has to survive, so you have a much quicker replacement of the coatings.

Speaker #1: So we actually announced two days ago that I-Tech has acquired new technology and this is a natural inspired or nature inspired technology. So it's a naturally occurring microorganisms that it's actually producing then a biological additive.

Markus Jönsson: And it is also, you could say then, quicker qualification periods and quicker way turnaround to test new innovation, which is an interesting feature compared to the markets where we are in today then. We actually announced then two days ago that I-Tech has acquired new technology, and this is a natural-inspired or nature-inspired technology. So it is a naturally occurring microorganism that is actually producing then a biological additive that can be used as an additive for these net impregnation coatings, for example, to modify the surface characteristics. And this really then reduces the fouling settlement. So it is a quite neat and nice technology if you want to create sustainable antifouling solutions. And I think the market where we have come the furthest here is actually within aquaculture.

Speaker #1: That can be used as an additive for these net impregnation coatings, for example, to modify the surface characteristics. And this really then reduces the fouling settlement.

Speaker #1: So, it's quite a neat and nice technology if you want to create sustainable antifouling solutions, right? And I think the market where we have come the furthest here is actually within aquaculture.

Markus Jönsson: So it is a naturally occurring microorganism that is actually producing then a biological additive that can be used as an additive for these net impregnation coatings, for example, to modify the surface characteristics. And this really then reduces the fouling settlement. So it is a quite neat and nice technology if you want to create sustainable antifouling solutions. And I think the market where we have come the furthest here is actually within aquaculture.

Speaker #1: But you could say over time it also opens up new opportunities for other areas, such as yachts, but also traditional, you could say, commercial shipping.

Speaker #1: And various industrial applications as well. So, we see this as a very nice technology that we now bring into the portfolio, and that we will be working to qualify with customers.

Speaker #1: And you could say commercial sales is probably, or likely, a few years into the future. But we are quite excited, as I-Tech, to take this technology on board.

Markus Jönsson: But you could say over time, it also opens up new opportunities for other areas, such as yachts, but also traditional, you could say, commercial shipping and various industrial applications as well. So we see this as a very nice technology that we now bring into the portfolio, and that we will be working to qualify that with customers. And you could say commercial sales is probably or likely a few years into the future. But we are quite excited as I-Tech to take this technology on board. All right. So we come to the final, the business outlook then. Next to this business development opportunity, we are also working then to extend other strategic partnerships. So that continues to be a focus area for us to really work on the business development pipeline.

Speaker #1: All right, so we come to the final business outlook then. So you could say, next to this business development opportunity, we are also working to extend other strategic partnerships.

Speaker #1: So that continues to be a focus area for us—to really work on the business development pipeline. Also then, as you can imagine, advocacy is linked to regulations in Europe, but also in other places.

Markus Jönsson: And you could say commercial sales is probably or likely a few years into the future. But we are quite excited as I-Tech to take this technology on board. All right. So we come to the final, the business outlook then. Next to this business development opportunity, we are also working then to extend other strategic partnerships. So that continues to be a focus area for us to really work on the business development pipeline.

Speaker #1: We didn't talk about, you could say, the new registrations that we are doing in the USA and New Zealand and so on today, but these continue to be active projects that we are running, you could say, within the regulatory space.

Speaker #1: And of course, then business developments—to continue to work on expanding the business for Cellectope, and then also for these new technologies that we have—then, to actually create successful future businesses out of this.

Markus Jönsson: Also then, as you imagine, advocacy then linked to regulations in Europe but also other places. We did not talk about, you could say, the new registrations that we are doing in the USA and New Zealand and so on today. But these continue to be active projects that we are running, you could say, within the regulatory space. And of course then business development, to continue to work on expanding the business for Selektope and then also for these new technologies that we have then to actually create successful future businesses of this. So that will be the focus in the coming period. All right. Thank you very much.

Speaker #1: So that will be the focus in the coming period. Right, thank you very much. Thank you as well, Marcus. And Magnus will also be joining us here for the Q&A.

Speaker #1: I will not be opening this Q&A. I will turn to the analysts who are joining us here on the call: Lara Motade, who will ask their questions from Abigail Collier.

Markus Jönsson: And of course then business development, to continue to work on expanding the business for Selektope and then also for these new technologies that we have then to actually create successful future businesses of this. So that will be the focus in the coming period. All right. Thank you very much.

Speaker #1: Welcome.

Speaker #3: Thank you very much. I just have a couple of questions. My first one is regarding the recovered customer that, well, essentially contributed to—I don't know if it was nothing, but—not a lot of volumes in Q2 2025.

[Company Representative] (I-Tech): Thank you as well, Markus, and Magnus will also be joining us here for the Q&A. I will now be opening this Q&A. I will turn to one of the analysts who are joining us here on call, Laleh Motlakh, who will ask their questions from ABG Sundal Collier. Welcome.

Speaker #3: And now, they're back to more normal levels. Are they now at a stable rate, or would you say that this is some sort of catch-up that may not repeat in the coming quarters?

Laleh Motlakh: Thank you very much. I just have a couple of questions. My first one is regarding the recovered customer that essentially contributed to, or I don't know if there was nothing, but not a lot of volumes in Q2 2025. Now they are back to more normal levels. Are they now at a stable run rate, or would you say that this is some sort of catch up that may not repeat in the coming quarters?

Lara Mohtadi: Thank you very much. I just have a couple of questions. My first one is regarding the recovered customer that essentially contributed to, or I don't know if there was nothing, but not a lot of volumes in Q2 2025. Now they are back to more normal levels. Are they now at a stable run rate, or would you say that this is some sort of catch up that may not repeat in the coming quarters?

Speaker #2: No, I think it's fair to assume that we are on a more stable run rate as of now, and if they have caught up fully or a little bit more than previously.

Speaker #2: That won't be said, but we should assume that we are on a stable path moving forward.

Speaker #3: Okay. And the CMP, they grew 21% in volume in 2025, and you said that they grew 35% organically for the first part of this year.

Magnus Henell: No, I think it's fair to assume that we are on a more stable run rate as of now. If they have caught up fully or a little bit more than previously, that won't be said, but we should assume that we are on a stable path moving forward.

Speaker #3: Could you comment a little bit about CMP? Are they re-accelerating? Maybe you could comment a little bit about its total share of sales, if you're comfortable with that.

Speaker #1: Actually, I don't have that figure on top of mind, Laura, right? But since they have been growing so nicely the first half, right? So since they represent such an important part of the overall business, you know, being number one, I would assume that they have extended actually the total share a little bit then during the first half, right?

Laleh Motlakh: Okay. CMP, they grew 21% in volume in 2025, and you said that they grew 35% organically for the first part of this year. Could you comment a little bit about CMP? Are they re-accelerating? Maybe if you can comment a little bit about its total share of sales, if you are comfortable with that.

Lara Mohtadi: Okay. CMP, they grew 21% in volume in 2025, and you said that they grew 35% organically for the first part of this year. Could you comment a little bit about CMP? Are they re-accelerating? Maybe if you can comment a little bit about its total share of sales, if you are comfortable with that.

Speaker #1: But to comment on the reason for that, I believe that CMP has had a really good first half as well, right? And we look forward, of course, to reading their next report as well, to see how their business develops.

Speaker #1: But we believe that they have been successful, you could say, with the products containing Cellectope in particular, and actually have been able then to expand their business as well, as a consequence of sort of where the shipping industry is today.

Markus Jönsson: Actually, I do not have that figure on top of mind, Laleh. But since they have been growing so nicely this H1, and since they represent such an important part of the overall business, being number one, I would assume that they have extended actually their total share a little bit then during the H1. But to comment on the reason for that, I believe that CMP has had a really good H1 as well. We look forward, of course, to read their next report as well to see how their business develops. But we believe that they have been successful, you could say, with the products then containing Selektope in particular, and actually have been able then to expand their business as well as a consequence of sort of where the shipping industry is today.

Speaker #3: Okay, very clear. And in this quarter, personnel costs were up a little bit year-on-year. And I think you mentioned something about bringing on three new full-time employees this year.

Markus Jönsson: We look forward, of course, to read their next report as well to see how their business develops. But we believe that they have been successful, you could say, with the products then containing Selektope in particular, and actually have been able then to expand their business as well as a consequence of sort of where the shipping industry is today.

Speaker #3: Where are you in that hiring? How should we sort of think about operational costs through the second part of the year? Is this a new base level, or is there more to come?

Speaker #1: No, I think we are done with the three new recruitments, Laura, that we referred to during the last quarter calls, right? So, they are now part, you could say, of the permanent pool of employees, and, you know, we're happy to have them on board as well and contributing to the team.

Laleh Motlakh: Okay. Very clear. In this quarter, personnel costs were up a little bit year-on-year. I think you mentioned something about bringing on three new full-time employees this year. Where are you in that hiring? How should we sort of think about the operational costs through the second part of the year? Is this a new base level or is there more to come?

Lara Mohtadi: Okay. Very clear. In this quarter, personnel costs were up a little bit year-on-year. I think you mentioned something about bringing on three new full-time employees this year. Where are you in that hiring? How should we sort of think about the operational costs through the second part of the year? Is this a new base level or is there more to come?

Speaker #1: So that's really great. So, there are no major expansions in the plan now, right? So, we should see this as sort of the new base going forward.

Speaker #3: And on the.

Speaker #2: Yeah, maybe just come back to that because we have indicated earlier that we might start a quite large regulatory study in the fall. That could have an effect on that.

Markus Jönsson: No, I think we are done with the three new recruitments, Laleh, that we referred to during the last quarter calls. So they are now part, you could say, of the permanent pool of employees, and we are happy to have them on board as well and contributing to the team. So that is really great. So there are no major expansions now in the plan. So you should see this as sort of the new base then going forward.

Speaker #3: Total fixed costs.

Speaker #1: Yes, indeed, indeed. Yeah.

Speaker #2: So you wouldn't forget that part.

Speaker #3: Yeah, that was actually my follow-up question. I was going to ask how you're—well, it might be hard for you to tell now—but how you're going to book those costs?

Speaker #2: This regulatory study that we are to—if we're going to do it—we're going to conduct it in line with the EU renewal process.

Speaker #2: And which means that this is a project where we have an existing approval, so to speak. It's nothing new. So it's just defending costs for our existing approval, which means then that we will take the cost on the profit and loss as a normal, just study cost.

Laleh Motlakh: On the-

Lara Mohtadi: On the-

Magnus Henell: Maybe just come back to that because we have indicated earlier that we might start a quite large regulatory study in the fall.

Markus Jönsson: Yeah.

Magnus Henell: That could have an effect on the-

Markus Jönsson: On the total fixed cost.

Magnus Henell: Yes.

Markus Jönsson: Indeed. Yeah.

Magnus Henell: We wouldn't forget that part.

Laleh Motlakh: That was actually my follow-up question. I was going to ask how you're, well, it might be hard for you to tell now, but how you're going to book those costs.

Lara Mohtadi: That was actually my follow-up question. I was going to ask how you're, well, it might be hard for you to tell now, but how you're going to book those costs.

Speaker #2: It's not a new investment, so we won't put anything in the balance sheet. We will take it over the P&L.

Speaker #3: Okay. And half of the cost will be this year, and half of the cost will be next year, in 2027.

Magnus Henell: This regulatory study, if we're going to do it, we're going to conduct it in line with the EU renewal process, which means that this is a project where we have an existing approval, so to speak. It's nothing new, so it's just defending cost for our existing approval, which means then that we will take the cost on the profit and loss as a normal, just a study cost. It's not a new investment, so we won't put anything in the balance sheet. We will take it over the P&L area.

Speaker #2: Yeah, a maximum of half the cost. This year, I would say it depends on when and if we are able to start it.

Speaker #3: Okay. And the costs associated with the regulatory process—you wrote in your report, well, these aren't one-off costs because you have them for a longer period of time.

Speaker #3: And usually, these are around 2 million kronor per quarter. Was it in line this quarter, or was it slightly elevated?

Speaker #2: No, it's been a little bit up and down, but that level is quite a good assumption. And of course, these costs have differed between lobbying costs or legal costs, preparing the legal case, et cetera.

Laleh Motlakh: Okay. Half of the cost will be this year, and half of the cost will be next year in 2027?

Lara Mohtadi: Okay. Half of the cost will be this year, and half of the cost will be next year in 2027?

Markus Jönsson: Yeah, maximum half the cost.

Laleh Motlakh: Yes

Lara Mohtadi: Yes

Markus Jönsson: This year, I would say. Depends on

Laleh Motlakh: Okay

Lara Mohtadi: Okay

Markus Jönsson: when and if we are able to start it.

Speaker #2: But now, depending on what happened, at least we shouldn't elevate those kinds of costs anymore. But let's see what's happening moving forward.

Laleh Motlakh: Okay. The cost associated to the regulatory process, you wrote in your report, well, these are not any one-off costs because you have had them for a longer period of time.

Lara Mohtadi: Okay. The cost associated to the regulatory process, you wrote in your report, well, these are not any one-off costs because you have had them for a longer period of time.

Speaker #3: Very clear. And, well, I just have a few questions on the newly acquired technology—very exciting, obviously. Can you maybe tell us a bit more about what's the moat here?

Laleh Motlakh: Usually these are around 2 million kronor per quarter. Was it in line this quarter too, or was it finally elevated?

Lara Mohtadi: Usually these are around 2 million kronor per quarter. Was it in line this quarter too, or was it finally elevated?

Markus Jönsson: No, it's been a little bit up and down, but that level is quite a good assumption. Of course these costs have differed between lobbying costs or legal costs, preparing the legal case, et cetera, but now, depending on what happened, at least we shouldn't elevate those kind of costs anymore. Let's see what's happening moving forward.

Speaker #3: You mentioned that there are already conventional copper-based net coatings, and you said that there are some other technologies. Why use this technology?

Speaker #1: I would say, Laura, from an I-Tech perspective, the moat is really then to, you could say, on one hand, broaden our available portfolio of solutions that we can offer the customers.

Speaker #1: And also look into adjacent markets, right? So, new markets like agriculture and so on, to complement the focus that we have today on commercial shipping, right?

Laleh Motlakh: Very clear. Well, I have a few questions on the newly acquired technology. Very exciting, obviously. Can you maybe tell us a bit more, what's the moat here? There is already conventional copper-based net coatings, and you said that there are some other technologies. Why use this technology?

Lara Mohtadi: Very clear. Well, I have a few questions on the newly acquired technology. Very exciting, obviously. Can you maybe tell us a bit more, what's the moat here? There is already conventional copper-based net coatings, and you said that there are some other technologies. Why use this technology?

Speaker #1: So, you could say from a strategic point of view, from the customer’s perspective, it’s a very interesting technology. It is biologically derived, it’s readily biodegradable, and, you know, it comes from nature.

Speaker #1: It goes back to nature, right? So, it is potentially a very interesting technology then to build new sustainable net coatings on, for instance, right?

Markus Jönsson: I would say, Laura, from an I-Tech perspective, the motive is really to, you could say on one hand, broaden our available portfolio of solutions that we can offer the customers, and also look into adjacent markets, right? So new markets like aquaculture and so on, to complement the focus that we have today on commercial shipping, right? So that you could say from a strategic point of view. From the customer's perspective, it's a very interesting technology. It is biologically derived, it's readily biodegradable, and it comes from nature, it goes back to nature, right? So it is potentially a very interesting technology to build new sustainable net coatings on, for instance, right? Today, like you mentioned, copper and other biocides are also used in net coating.

Speaker #1: Today, like you mentioned, copper and other biocides are also used in net coating. But we also see that some producers choose to go biocide-free and instead use more of a cleaning or net exchange approach, right?

Speaker #1: So there is definitely—we see an opportunity for new sustainable technology also in this space, right? So there's definitely, you could say, a positive momentum for that in the agriculture market.

Markus Jönsson: So that you could say from a strategic point of view. From the customer's perspective, it's a very interesting technology. It is biologically derived, it's readily biodegradable, and it comes from nature, it goes back to nature, right? So it is potentially a very interesting technology to build new sustainable net coatings on, for instance, right? Today, like you mentioned, copper and other biocides are also used in net coating.

Speaker #3: And just to follow up on that, from the strategic point of view, do you see this as—if I understood you right—you can maybe use this as a complementary technology alongside the Mediterranean, or is this a standalone alternative? And can you use this in the commercial shipping space as well?

Speaker #1: There have been tests, you could say, also in traditional or commercial antifouling formulations, to our knowledge, that have been positive, right? In theory, you could say that this may have a broader effect than Cellectope, right?

Markus Jönsson: But we also see that some producers, they choose to go biocide-free and then have more of a cleaning or net exchange approach, right? So there is definitely, we see an opportunity for new sustainable technology also in this space, right? So there is definitely, you could say, a positive momentum for that in the aquaculture market.

Speaker #1: Cellectope is very specific, you could say, to prevent barnacles, right? And here, you could say we can address maybe more fouling types with this type of technology.

Laleh Motlakh: And just to follow up on that, from the strategic point of view, do you see this as, if I understood you right, you can maybe use this as a complementary technology alongside medetomidine, or is this a standalone alternative, and can you use this in the commercial shipping space as well?

Lara Mohtadi: And just to follow up on that, from the strategic point of view, do you see this as, if I understood you right, you can maybe use this as a complementary technology alongside medetomidine, or is this a standalone alternative, and can you use this in the commercial shipping space as well?

Speaker #1: But I think it's too soon to say. It won't be a one-to-one competitor to Cellectope. I think that we can say that with certainty, right?

Speaker #1: But exactly how it can complement Cellectope or sort of offer other benefits to the customer—I think we still need to validate that. I think the market that we are furthest along in developing here is agriculture, right?

Markus Jönsson: There has been tests, you could say, also in traditional or commercial antifouling formulations, to our knowledge, that have been positive, right? In theory, you could say that this may have a broader effect than Selektope, right? Selektope is very specific, you could say, to prevent the barnacles, right? And here you could say we can address maybe more fouling types with this type of technology. But I think it is too soon to say. It will not be a one-to-one competitor to Selektope. I think that we can say with certainty, right? But exactly how we can complement Selektope or sort of offer other benefits to the customer, I think we still need to validate. I think the market that we are the furthest to develop here is aquaculture, right? And that is also our initial focus for this product.

Speaker #1: And that's also our initial focus for this product.

Speaker #3: Very clear. And is this similar to Cellectope, also seen as a premium coating?

Speaker #1: Most likely, yes. Yeah.

Speaker #3: Okay, very clear. And just a last one here on the technology: does it bring you to a different customer base, or is it the same? Because in commercial shipping, you have nine major coating manufacturers.

Markus Jönsson: It will not be a one-to-one competitor to Selektope. I think that we can say with certainty, right? But exactly how we can complement Selektope or sort of offer other benefits to the customer, I think we still need to validate. I think the market that we are the furthest to develop here is aquaculture, right? And that is also our initial focus for this product.

Speaker #3: In other words, will you be selling to these existing customers, or are we looking at a whole different customer base?

Speaker #1: It's partially overlapping, you could say, Laura. So, some of our current customers also have business in agriculture—CMP, for instance, to mention one.

Speaker #1: However, it's also like you said, there are new customers to us, right? That sort of specialize in agricultural coating formulations. So, it is a bit of both here in this case.

Laleh Motlakh: Very clear. Is this similar to Selektope, also seen as a premium coating?

Lara Mohtadi: Very clear. Is this similar to Selektope, also seen as a premium coating?

Markus Jönsson: Most likely, yes.

Laleh Motlakh: Okay. Very clear. Just a last one here on the technology. Does it bring you to a different customer base, or is it just because in the Well, for the commercial shipping, you have nine major coating manufacturers.

Lara Mohtadi: Okay. Very clear. Just a last one here on the technology. Does it bring you to a different customer base, or is it just because in the Well, for the commercial shipping, you have nine major coating manufacturers.

Speaker #3: Okay, very clear. That was all from my end. Thank you very much.

Speaker #1: Thank you very much, Laura. We have a lot of questions from the chat as well, so I'll read them out. And Laura, if you have any more questions, you only need to raise your hand and make yourself known, and we'll get to you shortly.

Speaker #1: Following up on the acquisition, there is a viewer who asks: For the recent acquisition, can you describe the purchase consideration, payment structure, and expected return on invested capital?

Laleh Motlakh: In other words, will you be selling to these existing customers or are we looking at a whole different customer base?

Lara Mohtadi: In other words, will you be selling to these existing customers or are we looking at a whole different customer base?

Markus Jönsson: It is partially overlapping, you could say, Laura. So some of our current customers, they also have business in aquaculture, CMP, for instance, to mention one. However, it is also like you say, there are new customers to us, right? That specialize in aquaculture coating formulations. So it is a bit of both here in this case.

Speaker #2: Yeah, I mean, we were talking a little bit about the rationale, right? The strategic fit for this product, right? So I won't repeat that.

Speaker #2: But I mean, exactly, the return on investments—I would say we describe it as medium maturity. So, there's still validation work to be done, right?

Speaker #2: So, when we have actually, say, sized and defined the opportunity, we will come back, you could say, with more firm numbers on that. It's not really possible to say that at this stage.

Laleh Motlakh: Okay. Very clear. That was all from my end. Thank you very much.

Lara Mohtadi: Okay. Very clear. That was all from my end. Thank you very much.

[Company Representative] (I-Tech): Thank you very much, Laura. We have a lot of questions from the chat as well, so I will read them up. Laura, if you have any more questions, you need only raise your hand and make yourself known, and we will get to you shortly. Following up on the acquisition, there is a viewer who asks, "For the recent acquisition, can you describe the purchase consideration, payment structure, and expected return on invested capital?

Speaker #1: Do you think, viewer, also asks, given I-Tech's SEK 165 million net cash position, why do you need authorization to issue up to 10% new shares, and under what circumstances would you use it?

Speaker #2: Well, that is just a standard procedure that we repeat every year. And the only reason why we would use it is if we come up with a very nice M&A proposal where we need to issue shares in order to finance that.

Markus Jönsson: Yeah, we were talking a little bit about the rationale, right, the strategic fit for this product, right? So I will not repeat that, right? But exactly the return on investments, I would say we describe it as medium maturity, so there is still validation work to be done, right? So when we have actually, you could say, sized and defined the opportunity, we will come back, you could say, with more firm numbers on that. It is not really possible to say that at this stage.

Speaker #2: To be honest, we don't have any such case on the radar right now where we need that kind of money and need to use this authorization.

[Company Representative] (I-Tech): Mm-hmm. The same viewer also asks, "Given I-Tech's SEK 165 million net cash position, why do you need authorization to issue up to 10% new shares, and under what circumstances would you use it?

Speaker #2: But we should really see it as a standard procedure in order to have the maneuverability for management and the Board.

Speaker #1: To be ready, really, if the opportunity arises, right?

Speaker #2: Yeah.

Speaker #1: Some more questions, then. You said in Q1 that there were higher sales, decrease, and distributors. Given that there are so few paint makers, why do you even need a distributor in Korea?

Markus Jönsson: Well, that is just a standard procedure that repeatedly every year. The only reason why we would use it is if we come up with a very nice M&A proposal, where we need to issue shares in order to finance that. To be honest, we don't have any such case on the radar right now where we need that kind of money and need to use this authorization. We should really see it as a standard procedure in order to have the maneuverability for management and the board.

Speaker #1: Do you use distributors in other countries?

Speaker #2: We do use distributors, you could say, in various different markets. And they perform, you could say, services that are sort of asked for by the customers, right?

Speaker #2: Sort of really local market services that they do better than we do.

Speaker #1: Another question here from Henrik: your top priority is to further penetrate the maintenance market in China. What are you doing specifically to address this signal?

Speaker #2: Actually, both: new build and maintenance in China. We don't discriminate. We want to further penetrate both of these markets—it's important to us. And what we are doing now is looking into various ways to boost and strengthen our presence.

[Company Representative] (I-Tech): To be ready, really, if the opportunity arises, right?

Markus Jönsson: Yeah.

[Company Representative] (I-Tech): Some more questions then. You said in Q1 that there were higher sales to Korean distributors. Given that there are so few paint makers, why do you even need a distributor in Korea? Do you use distributors in other countries?

Speaker #2: We announced, you could say, in December that we have initiated a dialogue with a local company called Highway, or Habei, which is a binder producer.

Markus Jönsson: We do use distributors, you could say, in different various markets, and they perform services that are asked for by the customers. Really local market services that they do better than we do.

Speaker #2: And these discussions are also progressing, right? In terms of finding new ways to collaborate specifically on the Chinese markets, right? So we are having various initiatives to see how we can strengthen and boost our access to the market in China.

[Company Representative] (I-Tech): Another question here from Henrik. Your top priority is to further penetrate the maintenance market in China. What are you doing specifically to address this segment?

Speaker #1: Yeah, you and Laura talked a lot about the costs related to EU regulations. There's a question here in the chat about that.

Markus Jönsson: Actually, both new build and maintenance in China, we do not discriminate. We want to further penetrate both of these markets. It is important to us, Mike. What we are doing now, we are looking into various ways to boost and strengthen our presence. We announced, you could say, in December that we have initiated the dialogue with a local company called Chugoku Marine Paints, which is a binder producer, and these discussions are also progressing in terms of finding new ways to collaborate specifically on the Chinese markets. We are having various initiatives to say, how can we strengthen and boost our access to the market in China?

Speaker #1: But I believe this one asks the question a little bit more concretely. What was the level of cost in both Q1 and Q2 this year relating to the process?

Speaker #2: We've been talking about it, and it is roughly $1.5 to $2 million per quarter.

Markus Jönsson: We announced, you could say, in December that we have initiated the dialogue with a local company called Chugoku Marine Paints, which is a binder producer, and these discussions are also progressing in terms of finding new ways to collaborate specifically on the Chinese markets. We are having various initiatives to say, how can we strengthen and boost our access to the market in China?

Speaker #1: So, four million in that sort of ballpark, yes. Moving on then, Henrik asks: I assume that you have started making price adjustments to companies for higher raw material costs.

Speaker #1: What's the order of magnitude when will they feed through into your sales?

Speaker #2: Yeah, as I was talking about in the presentation, we have so far managed the threat of increased costs from our producers and the increased raw material cost.

[Company Representative] (I-Tech): You and Laura talked a lot about the cost relating to the EU regulatory, and there is a question here in the chat about that, but I believe this one asks the question a little bit more concretely. What was the level of cost in both Q1 and Q2 this year relating to the process?

Speaker #2: So actually, we haven't introduced, well, slight increases of the production costs so far. We are continuing to work together with our producers in order to find ways, either through yield or through other means, by other suppliers.

Markus Jönsson: We have been talking about it, and it is roughly SEK 1.5 to 2 million per quarter.

Speaker #2: Sub-suppliers and that sort of thing to reduce and keep the raw material cost level. So far, we have managed to control it.

[Company Representative] (I-Tech): 4 million in that sort of ballpark. Yes. Moving on then, Henrik asks, I assume that you have started making price adjustments to compensate for higher raw material costs. What is the order of magnitude? When will they feed through into your sales?

Speaker #1: And also, the top line part, right? We talked about it in the last quarterly call, right? That we have been adjusting prices as well, right?

Markus Jönsson: As I was talking about in the presentation, we have so far managed the threat of increased cost from our producers and the increased raw material cost. So actually, we have not introduced, well, slight increases of the production costs so far. We are continuing to work together with our producers in order to find way, either through yield or through other means by other suppliers, sub-suppliers, and sort of that to reduce and keep the raw material cost level. So far, we have managed to control it.

Speaker #1: To accommodate for this. And I think that it's one of the great achievements, besides, you could say, all the other financial goodies, right? We were actually able to preserve the gross margin.

Speaker #1: So it is, of course, thanks to Magnus and the hardworking team on the operations side, but also, I think, you know, from sales as well, right?

Speaker #1: To actually achieve price adjustments, Henrik continues, if I understand correctly, you have four sizable customers. Are any of the others planning to scale up in a more meaningful way during 2026 and 2027?

Speaker #2: I would say our customers do not have full transparency with us in terms of their future plans, right? So, of course, we have a continuous dialogue, you could say, on the forecasts and their offtake, et cetera.

[Company Representative] (I-Tech): Also on the top-line part. We talked about it in the last

Markus Jönsson: Yes

[Company Representative] (I-Tech): quarterly call, that we have been adjusting prices as well to accommodate for this. I think that is one of the great achievements, besides all the other financial goodies. It is actually we are able to preserve the gross margin. So it is, of course, thanks to Magnus and the hardworking team for the operation side, but also I think from sales to actually achieve price adjustments. Henrik continues, "If I understand correctly, you have four sizable customers. Are any of the others planning to scale up in a more meaningful way during 2026 and 2027?

Speaker #2: I would say that we are not expecting any unusual developments, right, this year. I think that would be fair to say, I guess.

Speaker #1: Another question from the chat: How much order visibility do you currently have into the second half of this year and 2027? And should we expect any pull-forward of customers talking into Q3?

[Company Representative] (I-Tech): So it is, of course, thanks to Magnus and the hardworking team for the operation side, but also I think from sales to actually achieve price adjustments. Henrik continues, "If I understand correctly, you have four sizable customers. Are any of the others planning to scale up in a more meaningful way during 2026 and 2027?

Speaker #2: Very good question. Normally, we don't have very much visibility into the future—perhaps a month or two. Actually, when we talk about real orders, of course we have discussions with our customers.

Speaker #2: We know fairly well how they look in the coming half-year, I would say. But as we have never done it before, we will not do it today.

Markus Jönsson: I would say our customers do not have full transparency with us in terms of their future plans. Of course, we have a continuous dialogue, you could say, on the forecasts and their offtake, et cetera. I would say that we are not expecting any unusual development this year. I think that would be fair to say, I guess.

Speaker #2: We will not talk about the future-looking statements. But when you're talking about stocking, of course, there could always be a small part of stocking between quarters, because since we are delivering quite large volumes in every shipment, if a shipment ends up before—.

[Company Representative] (I-Tech): Another question from the chat. How much order visibility do you currently have into the H2 of this year and 2027, and should we expect any pull forward of customer stocking into Q3?

Speaker #2: Or after the sort of quarterly break, that could be quite a significant change. But that is the only sort of stocking that we see today, at least.

Markus Jönsson: Well, very good question. Normally, we don't have very much visibility in the future. A month or two, actually, when we talk about real orders. Of course, we have discussions with our customers, so we know fairly well how they look on the coming half year, I would say. But as we have never done it before, and we will not do it today, we will not talk about the future-looking statements. But when you're talking about stocking, of course, there could always be a small part of stocking between quarters, because since we are delivering quite large volumes in every shipment, if a shipment ends up before or after the quarterly break, that could be quite significant change. But that is the only sort of stocking that we see today, at least, and that we know of.

Speaker #2: And that we know of.

Speaker #1: That was the final question so far from the chat. So, I'll ask a few more while waiting for potentially more questions. To begin with, Magnus, you mentioned in the presentation that you had high cash conversion in line with EBITDA.

Markus Jönsson: But as we have never done it before, and we will not do it today, we will not talk about the future-looking statements. But when you're talking about stocking, of course, there could always be a small part of stocking between quarters, because since we are delivering quite large volumes in every shipment, if a shipment ends up before or after the quarterly break, that could be quite significant change. But that is the only sort of stocking that we see today, at least, and that we know of.

Speaker #1: And while it was high, you also mentioned that this can't go on forever. But just for how long do you expect it to?

Speaker #2: No, no, but of course, since we're also on the EBITDA level, you don't have any tax cost, for example—no effect of tax. And of course, we are in a tax position in Sweden.

Speaker #2: We reported last previous quarter that we took the cash flow of the tax cost for 2025 in one quarter. And most likely, we will take the cash cost for 2026 in the first quarter of 2027.

Speaker #2: But at a certain point, we will come up with a more even flow of the cash effect of the tax cost as well. I would say from 2027 and forward, we need to be in a more normal prepayment status as well.

[Company Representative] (I-Tech): That was the final question so far from the chat, so I'll ask a few more in waiting for potentially more questions. To begin with, Magnus, you mentioned in the presentation that you had high cash conversion in line with EBITDA. While it was high, you also mentioned that this can't go on forever, but just for how long do you expect it to?

Speaker #2: But we don't need to do it, so then we don't do it.

Speaker #1: Something else there that you mentioned in the presentation was the Strait of Hormuz. And you, despite the challenges there, you managed to deliver a very strong quarter. Charters were one explanation behind that.

Magnus Henell: No, but of course, since we are also on the EBITDA level, you do not have any tax cost, for example. No effect of tax. Of course, we are in a tax position in Sweden. We reported last previous quarter that we took the cash flow of the tax cost for 2025 in one quarter. Most likely, we will take the cash cost for 2026 in the Q1 of 2027. At a certain point, we will come up with a more

Speaker #1: But I'm curious how we should see I-Tech's value. Should we look at the number of holes in the water or the miles traveled?

Speaker #2: I think it's more the number, sort of how many square meters of undersurface area to some extent you could translate our opportunity to, right?

Speaker #2: I think that's more appropriate. You know, when it comes to the dry docking, right? The ships, you know, to be compliant, they have to come in at least every five years, right?

Speaker #2: So, it's a very regular and steady service business, right? And of course, then, which of the coating companies wins the contract and what coating products end up on the ship, right?

Markus Jönsson: even flow or also the cash effect of the tax cost. I would say from 2027 and forward, we need to be in a more normal prepayment status as well, but we do not need to do it, so then we do not do it.

Speaker #2: That also, to some extent, decides if we have a part of that case, right? As a share of that. But I think it's more fair then to compare it to the total underwater surface area, right?

[Company Representative] (I-Tech): Something else that you mentioned in the presentation was the Strait of Hormuz. Despite the challenges there, you managed to deliver a very strong quarter. Charters were one explanation behind that. I am curious how we should see I-Tech's value. Should we look to the number of hulls in the water or miles traveled?

Speaker #2: That needs to be recoded.

Speaker #1: I'll take a few more questions from the chat here, so I imagine I'll end with those. Has any customer indicated that a final non—oh, that question was removed.

Speaker #1: So instead, I will ask you to tell us more about the EU regulatory process right now. We're considering that the approval has been extended, but only short term, towards the end of 2026.

Markus Jönsson: I think it is more the how many square meters of undersurface area to some extent you could translate our opportunity to. I think that is more appropriate. When it comes to the dry dockings, the ships, to be compliant, they have to come in at least every 5 years. So it is a very regular and steady service business. Of course, then who of the coating companies wins the contract and what coating products end up on the ship. That also to some extent decides if we have a part of that cake, as a share of that. I think it is more fair than to compare it to the total underwater surface area that needs to be recoated.

Speaker #1: Does that cause some uncertainty among your European clients?

Speaker #2: Yes, but I think this is the environment that we have been in since 2023, right? So, I mean, regarding the future of the EU market, right?

Markus Jönsson: Of course, then who of the coating companies wins the contract and what coating products end up on the ship. That also to some extent decides if we have a part of that cake, as a share of that. I think it is more fair than to compare it to the total underwater surface area that needs to be recoated.

Speaker #2: It is uncertain. As you can see in our numbers, right? It's varying between 2% to 4% of the total sales, right? But of course, if Selectope does not get a renewed approval for the EU, right?

Speaker #2: It will not be possible for our coding customers to produce and sell the product to be used in the EU, right? They most likely could still produce, but export the product, right?

[Company Representative] (I-Tech): There is a few more questions from the chat here, so I imagine that I will end with those. Has any customer indicated that a final. Oh, that question was removed. Instead, I will ask, tell us more about the EU regulatory process right now. We are considering that the approval has been extended, but only short term towards the end of 2026. Has that caused some uncertainty among your European clients?

Speaker #2: So, exactly the impact, right? We will have to see, right? But it does create uncertainty, right? And it definitely has had a cooling effect, I think, for some global customers to adopt that technology as well, right?

Speaker #2: There has been a preference to, you could say, to work with globally approved technologies. This becomes harder and harder for the coding companies because also other markets, you could say, like South Korea, for instance, are developing their own more strict regulation, which takes a different approach than the EU, for instance.

Markus Jönsson: Yes, but I think this is the environment that we have been in since 2023. Regarding the future of the EU market, it is uncertain. As you can see in our numbers, it is varying between 2% to 4% of the total sales. But, of course, if Selektope does not get a renewed approval for the EU, it will not be possible for our coating customers to produce and sell the product to be used in the EU. They most likely could still produce but export the product. So exactly the impact, we will have to see. But it does create uncertainty, and it definitely has had a cooling effect, I think, for some global customers to adopt the technology as well. There has been a preference, you could say, to work with globally approved technologies.

Speaker #2: So it becomes difficult, you could say, to have products that are globally compliant going forward, right? So I think we can definitely see a scenario where you have more regional antifouling products in the future.

Speaker #1: What is the contingency plan if the approval gets delayed or doesn't arrive?

Speaker #2: Yeah, as I mentioned, I think that if there was a vote and that was negative, right? That Selectope would not secure, you could say, a renewed approval, the first thing that we would do is to appeal that decision, right?

Markus Jönsson: They most likely could still produce but export the product. So exactly the impact, we will have to see. But it does create uncertainty, and it definitely has had a cooling effect, I think, for some global customers to adopt the technology as well. There has been a preference, you could say, to work with globally approved technologies.

Speaker #2: Of course, we believe that we have to state strong legal arguments for why the conclusion that Melatonidine is an endocrine disruptor is not correct at this stage, right?

Speaker #2: We also believe, you know, that the process, as such, right, has not been conducted in the most optimal way. So, we, of course, would like to appeal such a decision in that case.

Markus Jönsson: This becomes harder and harder for the coating companies because also other markets, you could say, like South Korea, for instance, are developing their own more strict regulation, which takes a different approach than the EU, for instance. So it becomes difficult, you could say, to have products that are globally compliant going forward. So I think we can definitely see a scenario where you have more regional antifouling products in the future.

Speaker #2: So that's the first step. Then Magnus was also talking about the additional tox study that we are sort of preparing to start, right?

Speaker #2: That is the next level. But because, of course, we have the opportunity to generate new data around, you could say, the effect of Selectope.

Speaker #2: We'll be able to remove uncertainties, regarding sort of how Selectope and Melatonidine affects the endocrine system, right? So that is the next, you could say, level of battlefield, you could say, with Europe then, if the sort of a legal case wouldn't be unsuccessful, you could say.

[Company Representative] (I-Tech): What is the contingency plan if the approval gets delayed or does not arrive?

Markus Jönsson: Yeah, as I mentioned, I think if there was a vote, then that was negative. That Selektope would not secure, you could say, a renewed approval. The first thing that we would do is to appeal that decision. Of course, we believe that we have, we say, strong legal arguments for why the conclusion that medetomidine is an endocrine disruptor is not correct at this stage. We also believe, you could say, that the process as such has not been conducted in the most optimal way. So we, of course, would like to appeal such a decision in that case. So that's the first step. Then Magnus was talking also about the additional tox study that we are preparing to start. That is the next level, because of course, we have the opportunity to generate new data around, you could say, the effect of Selektope.

Speaker #1: We have more questions in the chat, and I will address them shortly. But before that, could you answer very briefly about the new technology that you have in biofouling with regard to aquaculture?

Speaker #1: Is the EU regulatory process relevant there?

Markus Jönsson: We also believe, you could say, that the process as such has not been conducted in the most optimal way. So we, of course, would like to appeal such a decision in that case. So that's the first step. Then Magnus was talking also about the additional tox study that we are preparing to start. That is the next level, because of course, we have the opportunity to generate new data around, you could say, the effect of Selektope.

Speaker #2: To some extent, but not the bio-side legislation, right? So it's more the, you know, natural or normal chemical regulation that is effective, right?

Speaker #2: But this, as we see so far, is a physical effect, you could say, rather than a bio side effect.

Speaker #1: Looking at the chat then, some more questions. With inventories done for the 8%, is this mainly better efficiency or a sign of tighter supply?

Speaker #2: No, it's just a normal effect. If you look at the inventory levels that we have, they are very small compared to the sales. We only keep the inventories in Sweden in order to provide swift deliveries to certain customers.

Markus Jönsson: Hopefully such new studies then will be able to remove uncertainties regarding how Selektope and medetomidine affect the endocrine system. So that is the next, you could say, level of battlefield, you could say, in Europe then, if the legal case would not be unsuccessful, you could say.

Speaker #2: So all the normal deliveries are run through our suppliers' warehouse, which never ends up in our inventory. So you shouldn't focus too much on the current inventory levels or not.

[Company Representative] (I-Tech): We have more questions in the chat, and I will address them shortly. But before that, could you answer very briefly the new technology that you have in biofouling in regards to aquaculture? Is the EU regulatory process relevant there?

Speaker #1: Another question: Has the Hormuz situation generated any useful comparison data between Selectope formulations and conventional ones?

Markus Jönsson: To some extent, but not the biocide legislation. So it's more the natural or normal chemical regulation that is affected. But what we see so far is a physical effect, you could say, rather than the biocidal effect.

Speaker #2: To this date, I mean, we are still waiting to have, you could say, the black-and-white proof. I mean, there have been a lot of articles published around how challenging this situation has been for the ship.

Speaker #2: We have been stuck, you could say, on the inside of the Hormuz Strait, right? We have seen pictures and videos of ships that are completely covered in barnacles and other types of biofouling, right?

[Company Representative] (I-Tech): Looking at the chat then, some more questions. With inventories down 48%, is this mainly better efficiency or a sign of tighter supply?

Speaker #2: So, definitely, we know that this has had a huge impact, you could say, on the ship stock there. We are, of course, looking for having comparative cases where we can see the relative value of Selectope in this case.

Magnus Henell: No, it is just a normal effect where if you look on the inventory levels that we have, they are very small compared to the sales. The inventories, we only keep them in Sweden in order to have swift deliveries to certain customers. All the normal deliveries are run through our supplier's warehouse, which never ends up in our inventory. So you shouldn't focus too much about the current inventory levels or not.

Speaker #2: So, if we get that, we will definitely come back.

Speaker #1: And finally, a chat from the viewer wishes to congratulate you and the I-Tech team on a great quarter. And with that, I think it's a good place to end this broadcast.

Speaker #1: Thank you very much for being here, presenting, and answering our questions. Thank you very much.

[Company Representative] (I-Tech): Another question, has the Hormuz situation generated any useful comparison data between Selektope formulations and conventional ones?

Markus Jönsson: To this date, we are still waiting to have, you could say, the black or white proof. There has been a lot of articles published around how challenging this situation has been for the ship who have been stuck, you could say, on the inside of the Hormuz Strait. We have seen pictures and videos of ships that are completely covered in barnacles and other types of biofouling. So definitely we know that this has had a huge impact, you could say, on the ships back there. We are, of course, looking for having comparative cases where we can see the relative value of Selektope then in this case. If we get that, we will definitely come back.

Markus Jönsson: We have seen pictures and videos of ships that are completely covered in barnacles and other types of biofouling. So definitely we know that this has had a huge impact, you could say, on the ships back there. We are, of course, looking for having comparative cases where we can see the relative value of Selektope then in this case. If we get that, we will definitely come back.

[Company Representative] (I-Tech): Finally, a shout from the viewer wishes to congratulate you and the I-Tech team on a great quarter. With that, I think it is a good place to end this broadcast. Thank you very much for being here, presenting and answering our questions.

Markus Jönsson: Thank you very much. Have a good day.

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Q2 2026 I-Tech AB Earnings Call

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