===== SIDA 1 ===== 1 Q3 2023 BioGaia AB (publ.) Interim Management Statement January –September 2023 BioGaia AB Interim Management Statement January – September 2023 ===== SIDA 2 ===== Q3 2023 2 BioGaia AB (publ.) Interim Management Statement January –September 2023 THIRD QUARTER 2023 Figures in parentheses refer to the corresponding period last year, unless otherwise specified. Net sales amounted to SEK 317.7 million (257.7), an increase of SEK 60.0 million, o r 23% (excluding foreign exchange effects, 17%). Net sales in the Paediatrics segment amounted to SEK 255.8 million (205.7), a change of 24% (excluding foreign exchange effects a n increase of 18%). Net sales in the Adult Health segment amounted to SEK 59.2 million (50.5), an increase of 17% (excluding foreign exchange effects, an increase of 11%). Operating expenses amounted to SEK 116.3 million (92.0), an increase of SEK 24.3 million (26%). Operating expenses, excluding items affecting comparability, increased by 26% to SEK 116.3 million (92.0). Operating profit increased by 28% to SEK 119.5 million (93.7), which corresponds to an operating margin of 38% (36%). Adjusted operating profit increased by 28% to SEK 119.5 million (93.7), which corresponds to an adjusted operating margin of 38% (36%). Profit after tax amounted to SEK 101.5 million ( 79.5), an increase of 28%. Earnings per share amounted to SEK 1.01 (0.79) before and after dilution. 1) Cash flow amounted to SEK 88.4 million ( 37.3). Cash and cash equivalents at 30 September 2023 amounted to SEK 1,452.5 million (1, 402.4 at 30 September 2022). Key events in the third quarter of 2023 5 July . A clinical study with Protectis was shown to increase SARS - CoV-2 antibody titres when 28 days or more had elapsed from vaccination. 2 August . BioGaia´s Board of Directors announced that Theresa Agnew ha d been appointed as the new Chief Executive Officer (CEO). 7 August . A paper written by a team of researchers from the University of Gothenburg and BioGaia published in the journal Nature report ed a novel method to overcome oxygen sensitivity to beneficial resident bacteria in the human gut, which are significantly reduced in metabolic conditions and cardiovascular disease. 25 September. Theresa Agnew beg an as CEO. JANUARY - SEPTEMBER 2023 Figures in parentheses refer to the corresponding period last year, unless otherwise specified. Net sales amounted to SEK 998.7 million ( 829.7 ), an increase of SEK 169.1 million, or 20% (excluding foreign exchange effects, 1 3%). Net sales in the Paediatrics segment amounted to SEK 793.5 million (661.0 ), an increase of 20% (excluding foreign exchange effects, 1 2%). Net sales in the Adult Health segment amounted to SEK 198.8 million (165.5), an increase of 20% (excluding foreign exchange effects, an increase of 13%). Operating expenses amounted to SEK 362.2 million (303.6 ), an increase of SEK 58.6 million (19%). Operating expenses, excluding items affecting comparability, increased by 20% to SEK 361.1 million (300.3). Operating profit increased by 25% to SEK 362.6 million (290.3 ), which corresponds to an operating margin of 36% (35%). Adjusted operating profit increased by 24% to SEK 363.7 million (293.6), which corresponds to an adjusted operating margin of 36% (35%). Profit after tax amounted to SEK 298.0 million (234.3 ), an increase of 27%. Earnings per share amounted to SEK 2.95 (2.32) before and after dilution. 1) Cash flow amounted to SEK -33.6 million ( -101.8). Cash flow includes dividends of SEK 292.8 million (301.3). Key events after the end of the third quarter 16 October. BioGaia announced that results for the third quarter exceeded market expectations. Jul–Sep 2023 Jul–Sep 2022 Net sales, SEK 000s 317,694 257,733 Growth in net sales 23% 48% Operating profit, SEK 000s 119,538 93,735 Operating margin 38% 36% Profit after tax, SEK 000s 101,501 79,503 Number of shares, thousands 100,982 100,982 Earnings per share, before and after dilution, SEK 1) 1.01 0.79 1) Key ratio defined according to IFRS. For definitions of other key ratios, see page 16. This information is information that BioGaia AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the CEO , at 08.00 a.m. CEST on 2 0 October 2023. Jul–Sep 2023 Operating margin 38% Operating profit 120 SEK million Net sales 318 SEK million Change in sales 23% 17% excl. FX Jan–Sep 2023 Operating margin 36% Change in sales 20% 13% excl. FX Operating profit 363 SEK million Net sales 999 SEK million ===== SIDA 3 ===== Q3 2023 3 BioGaia AB (publ.) Interim Management Statement January –September 2023 When this strong financial report is published, I will have held the role as BioGaia's CEO for a month. In this short time, I have gained a positive feeling for the professionalism and passionate corporate culture that characteri ses the company – which is ultimately confirmed by this financial report. During the quarter, we increased net sales by 23% compared to t he corresponding quarter last year. Operating profit increased by 28% to SEK 120 million and the operating margin was 38%. Sales grew in all market regions. In EMEA , sales grew by 25% in the quarter, partly due to quarterly variations for individual orders . In APAC , sales grew by 17% mainly due to strong demand in China, a recovery in Japan and the favourable performance of other markets , such as Korea and Vietnam. In the Americas , sales grew by 25% due to good performance in the US and Canada (our direct markets ), but also due to strong demand in South and Latin America. In the US and Canada , growth is driven by online sales, where Amazon continues to be an important sales channel. In general, w e see that direct sales through our subsidiaries have proven to be successful. In these markets , we can focus more intently on our own products, launch a broader selection of our product portfolio and further strengthen the BioGaia brand. At the same time, our partnerships with our distributors are extremely valuable to us and during the quarter, we expanded our partnership with our distributor Abbott to also include the Middle East. We have had positive experiences with Abbott as a collaborative partner in several other markets , and the Middle East is a growing and attractive region for BioGaia. The Paediatric segment increased by 24% and the Adult segment increased by 17%. Despite the uncertain global outlook, high inflation, and we ak economic development, we see resilience for our Protectis drops and our other products. During the quarter, we launche d several products from our existing product portfolio in order to expand our market . For example, we launched Prodentis Kids on the Sw edish market, a product that is already available on the US market and where we have seen growing demand for oral health products such as this. During the quarter, we reached an important and exciting milestone in the develop ment of next-generation probiotics. In an article published in the journal Nature , a team of researchers from BioGaia and the University of Gothenburg report ed a novel method to overcome oxygen sensitivity to beneficial resident bacteria in the human gut, which are significantly reduced in metabolic conditions and cardiovascular disease. We will continue to develop next - generation probiotics to replace missing bacteria in individuals with an increased risk of developing these diseases. BioGaia ’s continued double -digit growth demonstrates one of the company ’s strengths , and was one of the reasons why I accepted the role as CEO. With my background of leading life science and consumer health brands, I hope that I can contribute to BioGaia ’s continued success based on the company ’s existing strategy and future opportunities. It is exciting to lead a comp any where the focus is on sustainable growth through high - quality science, research and development. This will help us to achieve BioGaia ’s vision to be come the most trusted probiotic brand in the world. I look forward to continuing BioGaia ’s growth journ ey in the global context where more and more people are prioriti sing their own and their children ’s health. There sa Agnew CEO and President , BioGaia 20 October 2023 BioGaia AB (publ.) Interim Management Statement 2023 The Board of Directors and the CEO of BioGaia AB hereby present the interim management statement for the period 1 January – 30 September 2023. CEO’s comments Teleconference: Investors, analysts, and the media are invited to take part in a teleconference on the interim management statement to be held today, 20 October 2023, at 09:30 a.m. CEST with CEO Theresa Agnew and CFO Alexander Kotsinas . More information about the teleconference is available here https://f inancialhearings.com/event/46022 . ===== SIDA 4 ===== Q3 2023 4 BioGaia AB (publ.) Interim Management Statement January –September 2023 Revenue SALES THIRD QUARTER Consolidated net sales amounted to SEK 317.7 million (257.7), which is an increase of SEK 60.0 million, or 23% (excluding foreign exchange effects, 17%). Sales in EMEA amounted to SEK 128.9 million ( 103.1), an increase of 25%, which was due to higher sales in the Paediatrics segment while the Adult Health segment decreased slightly . Sales increas ed mainly in Eastern Europe , Turkey , and Spain . Sales were positively affected by quarterly variations for individual orders. Sales in APAC amounted to SEK 61.7 million (52.8), an increase of 17%, which was due to higher sales in both the Paediatrics and Adult Health segment s. Sales increased mainly in Japan , Korea , and Vietnam. Sales in Americas totalled SEK 12 7.1 million ( 101.8 ), up 2 5% due to increased sales in both the Paediatrics and Adult Health segments. Sales mainly increased in BioGaia USA , Brazil and Canada. Net sales bridge third quarter SALES JANUARY-SEPTEMBER Consolidated net sales amounted to SEK 998.7 million (829.7 ), which is an increase of SEK 169.1 million, or 20% (excluding foreign exchange effects, 1 3%). Over the past 12 -month period, sales rose 23%. Sales in EMEA amounted to SEK 400.1 million (383.1 ), an increase of 4%, which was due to higher sales in the Paediatrics segment and the Adult Health segment. Sales in EMEA increased mainly in Eastern Europe and Turkey while sales declined mainly in Italy and France . Sales in APAC totalled SEK 207.9 million (163.0), up 28% due to increased sales in both the Paediatrics and Adult Health segments. Sales increased primarily in China , Korea , and Hong Kong . Sales in Americas totalled SEK 390.7 million (283.6 ), up 38% due to increased sales in both the Paediatrics and Adult Health segments. Sales mainly increased in BioGaia USA, Canada and Brazil. Net sales bridge January -September SEKm Jul–Sep Jul–Sep Change Jan–Sep Jan–Sep Change 2023 2022 2023 2022 Paediatrics 255.8 205.7 24% 793.5 661.0 20% Adult Health 59.2 50.5 17% 198.8 165.5 20% Other 2.7 1.5 78% 6.5 3.3 99% Total 317.7 257.7 23% 998.7 829.7 20% SEKm Jul–Sep Jul–Sep Change Jan–Sep Jan–Sep Change 2023 2022 2023 2022 EMEA 128.9 103.1 25% 400.1 383.1 4% APAC 61.7 52.8 17% 207.9 163.0 28% Americas 127.1 101.8 25% 390.7 283.6 38% Total 317.7 257.7 23% 998.7 829.7 20% SEKm Change 2022 257.7 Foreign exchange 16.8 7% Organic growth 43.2 17% 2023 317.7 23% SEKm Change 2022 829.7 Foreign exchange 63.9 8% Organic growth 105.1 13% 2023 998.7 20% ===== SIDA 5 ===== Q3 2023 5 BioGaia AB (publ.) Interim Management Statement January –September 2023 Paediatrics The Paediatrics segment accounts for approximately 80% of BioGaia’s total sales. BioGaia Protectis drops remain the most sold product and are sold in more than 100 countries. Other key products within the Paediatrics segment include Protectis tablets, oral rehydration soluti on as well as cultures to be used as ingredients in licensee products. SALES THIRD QUARTER Sales in the Paediatrics segment amounted to SEK 255.8 million (205.7), an increase of 24% (excluding foreign exchange effects 18%). Sales of BioGaia Protectis drops increased compared to the corresponding period last year. Sales increased in all regions , mainly in BioGaia USA , Canada and Turkey . Sales of BioGaia Protectis tablets within Paediatrics increased compared to the corresponding period last year. Sales increased in EMEA and Americas, mainly in Brazil and Canada . SALES JANUARY-SEPTEMBER Sales in the Paediatrics segment amounted to SEK 793.5 million (661.0 ), an increase of 20% (excluding foreign exchange effects, 12%). Over the past 12 -month period, sales rose 2 3%. Sales of BioGaia Protectis drops increased compared to the corresponding period last year. Sales increased in the Americas, primarily in the USA and Canada, and in APAC, mainly in China. Sales decreased slightly in EMEA, mainly in Italy. Sales of BioGaia Protectis tablets within the Paediatrics segment increased compared to the corresponding period last year. Sales increased in all regions , mainly in Brazil and Canada. SEKm Jul–Sep 2023 Jul–Sep 2022 2022 Change Paediatrics 255.8 205.7 24% Jan–Sep 2023 Jan–Sep 2022 2022 Change 793.5 661.0 20% ===== SIDA 6 ===== Q3 2023 6 BioGaia AB (publ.) Interim Management Statement January –September 2023 Adult Health The Adult Health segment accounts for approximately 20% of BioGaia’s total sales. Sales mainly comprise BioGaia Protectis, Bi oGaia Gastrus, BioGaia Prodentis, BioGaia Osfortis, as well as cultures as an ingredient in a licensee’s dairy products and Nutrace utics’ own products. SALES THIRD QUARTER Sales in the Adult Health segment amounted to SEK 59.2 million (50.5), an increase of 17% (excluding foreign exchange effects, 11%). Sales of BioGaia Protectis tablets increased compared to the corresponding period last year . Sales increased in APAC and EMEA , mainly in Hong Kong. Sales of BioGaia Gastrus increased compared to the corresponding period last year. Sales increased in EMEA and Americas , mainly in the USA. Sales of BioGaia Prodentis increased compared to the corresponding period last year. Sales increased in APAC and Americas, mainly in Japan and the USA. SALES JANUARY-SEPTEMBER Sales in the Adult Health segment amounted to SEK 198.8 million (165.5), an increase of 20% (excluding foreign exchange effects, 13%). Over the past 12-month period, sales rose 19%. Sales of BioGaia Protectis tablets increased compared to the corresponding period last year. Sales increased in EMEA and APAC, mainly in Hong Kong. Sales of BioGaia Gastrus increased compared to the corresponding period last year. Sales increased in all regions, mainly in the USA. Sales of BioGaia Prodentis increased compared to the corresponding period last year. Sales increased in APAC and Americas, mainly in Japan and the USA. SEKm Jul–Sep 2023 Jul–Sep 2022 2022 Change Adult Health 59.2 50.5 17% Jan–Sep 2023 Jan–Sep 2022 2022 Change 198.8 165.5 20% ===== SIDA 7 ===== Q3 2023 7 BioGaia AB (publ.) Interim Management Statement January –September 2023 Earnings Third quarter Gross margin The total gross margin amounted to 74% (72%). The gross margin for the Paediatrics segment amounted to 75% (74%) and for the Adult Health segment to 68% (64%). Operating expenses and operating profit Operating expenses amounted to SEK 116.3 million (92.0), an increase of SEK 24.3 million ( 26%). Operating expenses, excluding items affecting comparability, increased by 26% to SEK 116.3 million (92.0). Selling expenses amounted to SEK 88.1 million (77.0), an increase of 14%, mainly due to higher costs for sales and marketing activities. R&D expenses amounted to SEK 20.6 million ( 22.6), a decrease of 9%. Administrative expenses amounted to SEK 7.9 million (7.6), an increase of 5%. Other operating expenses refers to exchange losses/gains on receivables and liabilities of an operating nature and amounted to SEK -0.3 million (-15.1). Operating profit amounted to SEK 119.5 million (93.7), an increase of 28%. The operating margin was 38% (36%). Adjusted operating profit amounted to SEK 119.5 million ( 93.7), an increase of 28%. The adjusted operating margin was 38% (36%). Net financial items amounted to SEK 8.5 million (5.1). The increase was due to higher interest income. Profit after tax and earnings per share Profit after tax amounted to SEK 101.5 million (79.5), an increase of 28%. The effective tax rate was 21% (2 0%). Earnings per share amounted to SEK 1.01 (0.79). There are no dilutive effects. January -September Gross margin The total gross margin amounted to 73% (72%). The gross margin for the Paediatrics segment amounted to 74% (73%) and for the Adult Health segment to 66% (64%). Operating expenses and operating profit Operating expenses amounted to SEK 362.2 million (303.6), an increase of SEK 58.6 million ( 19%). Operating expenses, excluding items affecting comparability, increased by 20% to SEK 361.1 million (300.3). Items affecting comparability in the quarter primarily include restructuring costs for personnel and costs related to terminating rental premises in Lund. Selling expenses amounted to SEK 265.9 million ( 232.3), an increase of 14%, mainly due to higher costs for sales and marketing activities. R&D expenses amounted to SEK 78.1 million ( 75.4), an increase of 4%. The increase in R&D expenses was mainly attributable to higher study expenses during the period. Administrative expense s amounted to SEK 2 9.1 million ( 26.4), an increase of 1 0%. The increase in administrative expenses was primarily due to costs related to terminating rental premises in Lund. Other operating expenses refers to exchange losses/gains on receivables and liabilities of an operating nature and amounted to SEK -10.8 million (-30.4). Operating profit amounted to SEK 362.6 million (290.3), an increase of 25%. The operating margin was 36% (35%). Adjusted operating profit amounted to SEK 363.7 million (293.6 ), an increase of 24%. The adjusted operating margin was 36% (35%). Net financial items amounted to SEK 18.1 million (4.8). The increase was due to higher interest income. Profit after tax and earnings per share Profit after tax amounted to SEK 298.0 million (234.3), an increase of 27%. The effective tax rate was 22% (21%). Earnings per share amounted to SEK 2.95 (2.32). There are no dilutive effects. ===== SIDA 8 ===== Q3 2023 8 BioGaia AB (publ.) Interim Management Statement January –September 2023 Balance sheet and cash flow Balance sheet 30 September 2023 Total assets amounted to SEK 2, 304.3 million (2, 161.4) at 30 September 2023. Goodwill from the acquisition of Nutraceutics was adjusted for currency translation . The financial liability for the additional purchase price was value adjusted. For more information, see Note 4. Compared with the preceding year, trade receivables, trade payables and inventories increased. During t he quarter the lease agreement for the Group headquarter s was renewed , thereby increas ing right-of use assets and liabilities by SEK 26.4 million respectively. Cash and cash equivalents at 30 September 2023 amounted to SEK 1,452.5 million (SEK 1,488.4 million at 31 December 2022). Cash flow third quarter Cash flow amounted to SEK 88.4 million ( 37.3). Cash flow from operating activities amounted to SEK 99.0 million (47.3). The increase in cash flow in operations compared with the year-earlier period was mainly due to higher operating profit and interest recei ved despite a negative change in working capital. Investments in property, plant and equipment amounted to SEK 8.9 million ( 4.5). The increase was primarily attributable to investments in production capacity in BioGaia Production. Cash flow January -September Cash flow amounted to SEK -33.6 million ( -101.8). The cash flow includes a dividend payment of SEK 292.8 million ( 301.3). Cash flow from operating activities amounted to SEK 304.2 million (227.6). The increase in cash flow in operations compared with the year-earlier period was mainly due to higher operating profit and interest received despite a negative change in working capital. Investments in property, plant and equipment amounted to SEK 34.7 million (1 8.4). Other disclosures Employees The number of employees in the Group at 30 September 2023 totalled 213 (195 at 30 September 2022). The company has an incentive programme for all employees based partly on the company’s sales and profit and partly on qualitative targets. The maximum bonus is equal to 12% of annual salary. In addition to this programme , BioGaia has also implemented a subscription warrants programme as resolved by the 2021 Annual General Meeting. Future outlook BioGaia’s goal is to create strong value growth and a good return for its shareholders. This will be achieved through a greater emphasis on the BioGaia brand, online sales, increased sales to both existing and new customers and a controlled cost level. The long-term financial target is an operating margin (operating profit in relation to sales) of at least 34% with continued strong growth and increased investments in research, product development, brand building and the sales organisation. BioGaia’s dividen d policy is to pay a shareholder dividend equal to 50% of profit after tax in the Group excluding non -recurring items. In view of the company’s strong portfolio consisting of an increased number of innovative products that are sold predominantly under the BioGaia brand, successful clinical trials and a strong distribution network that covers a large share of key markets for BioGaia, BioGaia’s future outlook remains bright. Significant risks and uncertainties – Group and Parent Company Significant risks and uncertainties are described in the administration report of the annual report for 2022 on pages 92 and 93 and in Notes 27 and 28. No significant changes in these risks and uncertainties are assessed to have taken place at 30 September 2023. Related party transactions The Parent Company owns 100% of the shares in BioGaia Probiotics Canada Inc, BioGaia UK Ltd, BioGaia Finland Oy, BioGaia Invest AB, MetaboGen AB, BioGaia Biologics Inc. USA, BioGaia Japan Inc, BioGaia Production AB, CapAble AB and Tripac AB. The Parent Company also owns 96% of the shares in BioGaia Pharma AB and 80% of the shares in Nutraceutics Inc. Annwall & Rothschild Investment AB owns 3,703,340 class A shares and 500,000 class B shares, corresponding to 4.2% of the share capital and 27.9% of the voting rights in BioGaia AB. Annwall & Rothschild Investment AB is owned by Peter Rothschild and Jan Annwall. Peter Rothschild is Chairman of the Board of BioGaia AB and receives a director’s fee of SEK 730,000 per year. During the quarter, Peter Rothschild received additional remuneration for significant working duties, in addition to his assignment on the Board, of SEK 150,000 in accordance with the decision of the Annual General Meeting and the Board of Directors. ===== SIDA 9 ===== Q3 2023 9 BioGaia AB (publ.) Interim Management Statement January –September 2023 Key events in the third quarter of 2023 Launches in the third quarter of 2023 Distributor Country Product BioGaia Sweden BioGaia Prodentis Kids Nestl é Colombia , Peru NanCare Protectis minipack , NanCare B.lactis drops 5 ml Agefinsa Guatemala , El Salvador, Honduras BioGaia drops vitamin D 5 ml, BioGaia tablets vitamin D Delta Medical Kyrgy zstan BioGaia Protectis drops 5 ml Ewopharma Poland BioGaia Protectis drops easydropper 5ml BioGaia Canada BioGaia Prodentis mint and apple BioGaia Ireland BioGaia Protectis tablets Strawberry , BioGaia Pharax 5 ml HealthExport Tunisia BioGaia Prodentis drops 5 ml Grace Korea BioGaia Protectis minipack Abbott Singapore Singapore BioGaia Protectis easydropper 5 ml Axero Sri Lanka BioGaia Protectis minipack Lenus Med Mongolia BioGaia Prodentis drops 5 ml Biowelltech Hong Kong BioGaia Prodentis apple BioGaia’s probiotic Protectis increases SARS -CoV-2 antibody response in adults. On 5 July, BioGaia announced that a randomised, triple -blinded, placebo -controlled study with Protectis was shown to increase SARS -CoV-2 antibody titres in healthy volunteers when 28 days or more had elapsed from vaccination. It suggests that probiotic supplementation may enhance the long -term protection against breakthrough infections. BioGaia appoints Theresa Agnew as new CEO . On 2 August , BioGaia´s Board of Directors announced that Theresa P. Agnew had been appointed as the new Chief Executive Officer (CEO). Theresa Agnew is a global business leader with consumer healthcare, OTC, and medical device experience from leading companies such as GlaxoSmithKline (GSK), Essilo r and Johnson & Johnson. BioGaia and University of Gothenburg reach an important milestone towards next -generation probiotics. On 7 August, BioGaia announced that in a paper published in the journal Nature, a team of researchers from the University of Gothenburg and BioGaia report ed a novel method to overcome oxygen sensitivity to beneficial resident bacteria in the human gut, which are significantly reduced in metabolic conditions and cardiovascular disease. BioGaia announces that Theresa Agnew begins her role as CEO. On September 25 , BioGaia announced that Theresa Agnew had begun her role as the CEO of BioGaia . Key events after the end of the third quarter of 2023 BioGaia announced third quarter results. On October 16, BioGaia announced that results for the third quarter exceeded market expectations. Accounting policies This interim management statement was prepared in all material respects in accordance with Nasdaq OMX Stockholm’s guidance for preparing interim management statements. Disclosures according to IAS 34 Interim Financial Reporting are provided both in notes and elsewhere in the interim management statement. The accounting policies applied in the consolidated income statement and balance sheet are cons istent with the accounting policies applied in preparation of the most recent annual report. The financial accounts and segment information correspond to the statements used in interim financial reporting prepared in accordance with IAS 34 to provide compa rability in the presentation between quarters. The interim management statement includes a Message from the CEO, even if this is not a requirement of Nasdaq Stockholm’s guidance. The information is nevertheless deemed important in satisfying user needs. New accounting standards Management’s assessment is that new and amended standards and interpretations that came into force in 2023 have not had a material effect on the Group’s financial statements. Management’s assessment is that new and amended standards and interpretations that have not yet come into effect will not have a material effect on the Group’s financial statements for the period of initial application ===== SIDA 10 ===== Q3 2023 10 BioGaia AB (publ.) Interim Management Statement January –September 2023 *) In view of the 5:1 share split, which took place in May 2022, historical key ratios based on the number of shares have bee n restated. Summary consolidated statements of comprehensive income (Amounts in SEK 000s) Jul–Sep 2023 Jul-Sep 2022 Jan–Sep 2023 Jan–Sep 2022 Jan–Dec 2022 Oct 2022– Sep 2023 Oct 2021– Sep 2022 Net sales (Note 1) 317,694 257,733 998,732 829,674 1,103,957 1,273,015 1,035,837 Cost of sales -81,847 -71,952 -273,935 -235,737 -302,028 -340,226 -282,866 Gross profit 235,847 185,781 724,797 593,937 801,929 932,789 752,971 Selling expenses -88,068 -77,003 -265,859 -232,260 -320,798 -354,397 -298,865 Administrative expenses -7,934 -7,575 -29,075 -26,395 -39,818 -42,498 -38,552 Research and development expenses -20,630 -22,557 -78,130 -75,374 -106,805 -109,561 -105,853 Other operating income/expenses 323 15,089 10,840 30,425 26,951 7,366 33,723 Operating profit 119,538 93,735 362,573 290,333 361,459 433,699 343,424 Financial income 10,733 5,266 20,664 10,112 91,540 102,092 10,155 Financial expenses -2,249 -200 -2,594 -5,281 -5,386 -2,699 -5,780 Profit before tax 128,022 98,801 380,643 295,164 447,613 533,092 347,799 Tax -26,521 -19,298 -82,650 -60,819 -73,840 -95,671 -75,178 Profit for the period 101,501 79,503 297,993 234,345 373,773 437,421 272,621 Gains/losses arising on translation of the statements of foreign operations -35 22,709 12,526 41,568 25,722 -3,320 42,312 Comprehensive income for the period 101,466 102,212 310,519 275,913 399,495 434,101 314,933 Profit for the period attributable to: Owners of the Parent Company 101,501 79,503 297,993 234,345 373,773 437,421 272,621 Non-controlling interests – – – – – – – 101,501 79,503 297,993 234,345 373,773 437,421 272,621 Comprehensive income for the period attributable to: Owners of the Parent Company 101,466 102,212 310,519 275,913 399,495 434,101 314,933 Non-controlling interests – – – – – – – 101,466 102,212 310,519 275,913 399,495 434,101 314,933 Earnings per share Earnings per share before dilution, (SEK) *) 1.01 0.79 2.95 2.32 3.70 4.33 2.70 Earnings per share after dilution, (SEK) *) 1.01 0.79 2.95 2.32 3.70 4.33 2.70 Number of shares (thousands) 100,982 100,982 100,982 100,982 100,982 100,982 100,982 Average number of shares before dilution, (thousands) *) 100,982 100,982 100,982 100,982 100,982 100,982 100,982 Average number of shares after dilution, (thousands) *) 100,982 100,982 100,982 100,982 100,982 100,982 100,982 ===== SIDA 11 ===== 11 Q3 2023 BioGaia AB (publ.) Interim Management Statement January –September 2023 Consolidated balance sheets Summary (amounts in SEK 000s) 30 Sep 2023 30 Sep 2022 31 Dec 2022 Assets R&D projects in progress 46,172 46,409 46,075 Goodwill 177,906 182,343 171,517 Right -of-use assets 40,479 14,174 13,557 Property, plant and equipment 168,297 149,147 144,168 Financial assets 28,013 25,793 25,793 Deferred tax assets 8,804 15,154 15,325 Deposits 52 52 50 Total non -current assets 469,723 433,072 416,485 Current assets excl. cash and cash equivalents 382,002 325,890 309,115 Cash and cash equivalents 1,452,528 1,402,409 1,488,366 Total current assets 1,834,530 1,728,299 1,797,481 Total assets 2,304,253 2,161,371 2,213,966 Equity and liabilities Equity attributable to owners of the Parent Company 1,985,271 1,848,841 1,972,416 Non-controlling interests 2 2 2 Total equity (Note 2) 1,985,273 1,848,843 1,972,418 Deferred tax liability 13,274 14,166 12,552 Non-current liabilities 88,218 124,995 64,005 Current liabilities 217,488 173,367 164,991 Total liabilities and equity 2,304,253 2,161,371 2,213,966 ===== SIDA 12 ===== Q3 2023 12 BioGaia AB (publ.) Interim Management Statement January –September 2023 Consolidated cash flow statements Summary (amounts in SEK 000s) Jul–Sep 2023 Jul–Sep 2022 Jan–Sep 2023 Jan–Sep 2022 Jan–Dec 2022 Operating activities Operating profit 119,538 93,735 362,573 290,333 361,459 Depreciation/amortisation 5,250 5,119 18,218 17,250 23,890 Other non -cash items 3,568 582 -1,551 -12,048 -9,103 Paid tax -17,200 -20,727 -72,729 -56,670 -54,910 Interest received and paid 10,653 2,179 20,238 -2,889 2,248 Cash flow from operating activities before changes in working capital 121,809 80,888 326,749 235,976 323,584 Changes in working capital -22,831 -33,619 -22,565 -8,352 -4,641 Cash flow from operating activities 98,978 47,269 304,184 227,624 318,943 Purchase of property, plant and equipment -8,899 -4,537 -34,706 -18,433 -17,916 Purchase of intangible assets -18 – -97 – -225 Purchase of financial assets - - -2,221 - - Cash flow from investing activities -8,917 -4,537 -37,024 -18,433 -18,141 Dividend - - -292,8 49 -301,331 -301,331 Repayment of lease liability -1,695 -2,536 -7,529 -6,540 -9,143 Provision to Foundation to Prevent Antibiotic Resistance – -2,900 – -2,900 -2,900 Repurchase of warrants – – -417 -206 -214 Cash flow from financing activities -1,695 -5,436 -300,795 -310,977 -313,588 Cash flow for the period 88,366 37,296 -33,635 -101,786 -12,786 Cash and cash equivalents at the beginning of the period 1,369,566 1,356,344 1,488,366 1,484,680 1,484,680 Exchange difference in cash and cash equivalents -5,404 8,769 -2,203 19,515 16,472 Cash and cash equivalents at the end of the period 1,452,528 1,402,409 1,452,528 1,402,409 1,488,366 ===== SIDA 13 ===== Q3 2023 13 BioGaia AB (publ.) Interim Management Statement January –September 2023 Note 1. Reporting by segment – Group Executive Management has analysed the Group’s internal reporting and determined that the Group’s operations are monitored and evaluated based on the following segments: - Paediatrics segment (drops, gut health tablets, oral rehydration solution (ORS) and cultures to be used as ingredients in licensee products (such as infant formula). – Adult Health segment (gut health tablets, oral health lozenges and cultures as an ingredient in a licensee’ s dairy products, Nutraceutics’ own products as well as royalty revenues for Adult Health products). – Other segment (smaller segments such as royalty from packaging solutions). For the above segments BioGaia reports revenue and gross profit, which are monitored regularly by the CEO (who is regarded as the chief operating decision maker) together with the Executive Management. There is no monitoring of the company’s total assets and liabilities against the segments’ assets. (Amounts in SEK 000s) Revenue by segment Jul–Sep 2023 Jul–Sep 2022 Jan–Sep 2023 Jan–Sep 2022 Jan–Dec 2022 Oct 2022– Sep 2023 Oct 2021– Sep 2022 Paediatrics 255,805 205,730 793,486 660,965 868,355 1,000,876 811,073 Adult Health 59,216 50,502 198,782 165,456 230,205 263,530 220,616 Other 2,672 1,501 6,465 3,253 5,398 8,609 4,148 Total 317,694 257,733 998,732 829,674 1,103,957 1,273,016 1,035,836 Gross profit by segment Paediatrics 193,116 152,207 588,328 484,549 643,607 747,387 602,747 Adult Health 40,059 32,183 130,832 106,385 153,298 177,745 146,380 Other 2,672 1,391 5,637 3,003 5,025 7,659 3,843 Total 235,847 185,781 724,797 593,937 801,929 932,7 89 752,970 Selling, administrative, R&D expenses -116,632 -107,135 -373,064 - 334,029 -467,421 -506,456 -443,270 Other operating expenses/income 323 15,089 10,840 30,425 26,951 7,366 33,723 Operating profit 119,538 93,734 362,573 290,333 361,459 433,700 343,424 Net financial items 8,484 5,066 18,070 4,831 86,154 99,393 4,375 Profit before tax 128,022 98,800 380,643 295,164 447,613 533,093 347,799 Sales by geographical market Sales by geographical market APAC Paediatrics 37,559 34,890 117,681 90,675 118,684 145,689 123,458 Adult Health 21,773 16,806 85,853 69,742 100,226 116,336 109,708 Other 2,356 1,118 4,412 2,572 4,074 5,914 3,123 Total APAC 61,688 52,813 207,946 162,989 222,983 267,940 236,288 EMEA Paediatrics 113,495 87,533 351,190 337,197 450,159 464,153 411,286 Adult Health 15,105 15,314 47,702 45,346 60,190 62,546 55,963 Other 311 301 1,191 517 1,126 1,799 786 Total EMEA 128,910 103,149 400,083 383,060 511,475 528,498 468,035 Americas Paediatrics 104,752 83,307 324,614 233,092 299,512 391,035 276,328 Adult Health 22,338 18,382 65,227 50,368 69,788 84,648 54,945 Other 6 82 862 165 198 896 239 Total Americas 127,096 101,771 390,703 283,625 369,499 476,578 331,513 Total 317,694 257,733 998,732 829,674 1,103,957 1,273,016 1,035,836 ===== SIDA 14 ===== Q3 2023 14 BioGaia AB (publ.) Interim Management Statement January –September 2023 Note 2 . Summary consolidated statement of changes in equity (Amounts in SEK 000s) Jan–Sep 2023 Jan–Sep 2022 Jan–Dec 2022 Opening balance 1,972,418 1,877,367 1,877,367 New issue and repurchase of warrants -417 -206 -214 Dividend -292,849 -301,331 -301,331 Provision to Foundation to Prevent Antibiotic Resistance -4,400 -2,900 -2,900 Comprehensive income for the period 310,519 275,913 399,495 Closing balance 1,985,273 1,848,843 1,972,418 Note 3 . Largest shareholders at 30 September 2023 (source: Vantage by Euroclear ) A shares B shares Share capital No. of votes Capital Votes 1 Annwall & Rothschild Investments AB 3,703,340 500,000 840,668 37,533,400 4.16% 27.94% 2 EQT 11,164,630 2,232,926 11,164,630 11.06% 8.31% 3 Fjärde AP-fonden 7,750,182 1,550,036 7,750,182 7.67% 5.77% 4 Premier Miton Investors 5,042,053 1,008,411 5,042,053 4.99% 3.75% 5 Cargill Inc 3,000,000 600,000 3,000,000 2.97% 2.23% 6 TIN Fonder 3,000,000 600,000 3,000,000 2.97% 2.23% 7 Handelsbanken Fonder AB 2,663,261 532,652 2,663,261 2.64% 1.98% 8 AMF Fonder & Pension 2,395,985 479,197 2,395,985 2.37% 1.78% 9 Tredje AP-fonden 2,037,716 407,543 2,037,716 2.02% 1.52% 10 Juno Investment Partners 1,977,135 395,427 1,977,135 1.96% 1.47% Other shareholders 57,748,008 11,549,602 57,748,008 57.19% 43.00% Total 3,703,340 97,278,970 20,196,462 134,312,370 100% 100% Date of recognition Performance obligations met on specific date (Product sales) Jul–Sep 2023 Jul–Sep 2022 Jan–Sep 2023 Jan–Sep 2022 Jan–Dec 2022 Paediatrics 255,805 205,731 793,486 660,113 867,503 Adult Health 56,462 48,658 191,731 150,908 213,360 Other 2,377 1,247 5,437 2,858 4,488 Total 314,645 255,636 990,653 813,879 1,085,352 Performance obligations met over time (Royalty) Paediatrics - – - 852 852 Adult Health 2,754 1,844 7,051 14,548 16,844 Other 295 253 1,028 395 909 Total 3,049 2,097 8,079 15,795 18,606 Total 317,694 257,733 998,732 829,674 1,103,957 ===== SIDA 15 ===== 15 Q3 2023 BioGaia AB (publ.) Interim Management Statement January –September 2023 Note 4 . Fair value Financial liabilities BioGaia has a financial liability relating to the additional purchase price in business acquisitions that is measured at fair value through profit or loss. The additional purchase price is due to the acquisition of Nutraceutics and i s based on sales in Nutraceutics in 2026 or 2027. The amount, which will be settled in April 2027 or 2028, may also be adjusted if the agreed budget for marketing costs is exceeded. Revaluation took place during the third quarter of 2023 and BioGaia’s best assessment of fair value of the financial liability related to the additional purchase price at 30 September 2023 was therefore adjusted to SEK 37. 1 million. Estimates of fair value are based on Level 3 of the hierarchy for fair value, which means fair value is determined using valuation models where significant inputs are based on unobservable data. T he measurement was based on anticipated future cash flows discounted with a market -based interest rate. The value adjustme nt is recognised as a financial expense of SEK 2.2 million during the nine-month period . The weighted average cost of capital (WACC) amounted to 11. 65% (11.21% at 31 December 2022). (Amounts in SEK 000s) Jan–Sep 2023 Jan–Dec 2022 Opening balance 33,627 100,591 Value adjustment 2,167 -80,013 Exchange differences 1,344 13,049 Closing balance 37,138 33,627 Financial assets BioGaia owns shares in the companies Boneprox AB and Skinome AB through BioGaia Invest. These financial assets are measured at fair value through profit or loss. Estimates of fair value are based on Level 3 of the hierarchy for fair value, which means fair value is deter mined using valuation models where significan t inputs are based on unobservable data. The fair values of other receivables, cash and cash equivalents, trade payables and other liabilities are estimated to be equ al to their carrying amounts (amortised cost) due to the short maturities. ===== SIDA 16 ===== Q3 2023 16 BioGaia AB (publ.) Interim Management Statement January –September 2023 Consolidated key ratios Jan–Sep 2023 Jan–Sep 2022 Jan–Dec 2022 Net sales, SEK 000s 998,732 829,674 1,103,957 Growth of net sales 20% 43% 41% Operating profit, SEK 000s 362,573 290,333 361,459 Adjusted operating profit, SEK 000s 363,717 293,602 366,526 Profit after tax, SEK 000s 297,993 234,345 373,773 Return on equity 15% 13% 19% Return on capital employed 19% 16% 23% Capital employed, SEK 000s 1,998,547 1,863,009 1,984,779 Number of shares, thousands 100,982 100,982 100,982 Average number of shares before dilution, thousands 1) 100,982 100,982 100,982 Average number of shares after dilution, thousands 1) 100,982 100,982 100,982 Earnings per share before dilution, SEK 1) 2.95 2.32 3.70 Earnings per share after dilution, SEK 1) 2.95 2.32 3.70 Equity per share, SEK 19.66 18.31 19.53 Equity/assets ratio 86% 86% 89% Operating margin 36% 35% 33% Adjusted operating margin 36% 35% 33% Profit margin 38% 36% 41% Average number of employees 214 193 203 1) Key ratio defined according to IFRS. A list of definitions of key ratios reported in the consolidated financial statements is provided on page 121 of BioGaia’s annual report for 2022. In this report, BioGaia reports information used by Executive Management to assess the Group’s development. S ome of the key ratios presented are not defined according to IFRS. The company is of the opinion that these metrics provide valuable complementary information to stakeholders and the company’s management since they contribute to evaluation of relevant tren ds and the company’s performance. Since not all companies calculate key ratios in the same manner, these are not always comparable to metrics used by other companies. These key ratios should therefore not be seen as a replacement for metrics defined accord ing to IFRS. ESMA’s guidelines on alternative performance measures are applied, which means extended disclosure requirements regarding key ratios not defined according to IFRS. A reconciliation of key ratios that BioGaia considers relevant according to the se guidelines is provided below. ===== SIDA 17 ===== Q3 2023 17 BioGaia AB (publ.) Interim Management Statement January –September 2023 Key ratio Definition/calculation Purpose Return on equity Profit attributable to the owners of the Parent Company divided by average equity attributable to the owners of the Parent Company. Return on equity is used to measure profit generation, over time, given the resources attributable to the owners of the Parent Company. Return on capital employed Profit before net financial items plus financial income as a percentage of average capital employed. Return on capital employed is used to analyse profitability, based on the amount of capital used. Gross margin Gross profit as a percentage of net sales. The gross margin is used to measure profitability. Equity per share Equity attributable to the owners of the Parent Company divided by the average number of shares. Equity per share measures the company’s net value per share and indicates whether a company will increase the shareholders’ wealth over time. Average number of shares Time-weighted number of outstanding shares during the year taking bonus issue elements into account. Used to calculate equity and earnings per share. Adjusted operating margin Adjusted operating margin excluding items affecting comparability. The adjusted measure provides enhanced understanding of the performance of operations. Adjusted operating profit Operating profit (earnings before financial items and tax) excluding items affecting comparability. The adjusted measure provides enhanced understanding of the performance of operations. Items affecting comparability Expenses in conjunction with restructuring, impairment, changes in provisions for share -based long-term incentive programmes and other items of a nature that a ffect comparability. The separate recognition of items that affect comparability between different periods provides enhanced understanding of the company’s financial performance. Earnings per share Profit for the period attributable to owners of the Parent Company divided by the average number of shares (definition according to IFRS). EPS measures how much of net profit is available for payment to the shareholders as dividends per share. Operating margin (EBIT margin) Operating profit expressed as a percentage of net sales. The operating margin is used to measure operational profitability. Equity/assets ratio Shareholders’ equity at the end of the period as a percentage of total assets. A traditional metric to show financial risk expressed as the share of total assets financed by the shareholders. Shows the company’s stability and ability to withstand losses. Capital employed Total assets less interest -free liabilities. Capital employed measures the company’s ability, in addition to cash and liqu id assets, to meet the requirements of business operations. Growth Sales for the period less sales for the year -earlier period divided by sales for the year -earlier period. Breakdown by foreign exchange, organic growth and acquisitions. Shows the company’s realised sales growth over time. Profit margin Profit before tax as a percentage of net sales. This key ratio makes it possible to compare profitability regardless of the corporate income tax. ===== SIDA 18 ===== Q3 2023 18 BioGaia AB (publ.) Interim Management Statement January –September 2023 Key ratio Return on equity, SEK 000s Jan–Sep 2023 Jan–Sep 2022 Jan–Dec 2022 Profit attributable to owners of the Parent Company (A) 297,993 234,345 373,773 Equity attributable to owners of the Parent Company 1,985,271 1,848,841 1,972,416 Average equity attributable to owners of the Parent Company (B) 1,978,844 1,863,103 1,924,891 Return on equity (A/B) 15% 13% 19% Return on capital employed Operating profit 362,573 290,333 361,459 Financial income 20,664 10,112 91,540 Profit before net financial items + financial income (A) 383,237 300,445 452,999 Total assets 2,304,253 2,161,371 2,213,966 Interest -free liabilities -305,70 6 -298,362 -229,187 Capital employed 1,998,547 1,863,009 1,984,779 Average capital employed (B) 1,991,663 1,877,308 1,938,193 Return on capital employed (A/B) 19% 16% 23% Key ratio (Amounts in SEK 000s) 30 Sep 30 Sep 31 Dec Equity/assets ratio 2023 2022 2022 Equity (A) 1,985,273 1,848,843 1,972, 418 Total assets (B) 2,304,253 2,161,371 2,213,966 Equity/assets ratio (A/B) 86% 86% 89% Operating margin Operating profit (A) 362,573 290,333 361,459 Net sales (B) 998,732 829,674 1,103,957 Operating margin (A/B) 36% 35% 33% Profit margin Profit before tax (A) 380,643 295,164 447,613 Net sales (B) 998,732 829,674 1,103,957 Profit margin (A/B) 38% 36% 41% Equity per share Equity attributable to owners of the Parent Company (A) 1,985,271 1,848,841 1,972,416 Average number of shares (B) 100,982 100,982 100,982 Equity per share (A/B) 19.66 18.31 19.53 Change in sales by segment (including and excluding foreign exchange effects) Paediatrics Adult Health Other Total (Amounts in SEK 000s) Jul–Sep 2023 Jan–Sep 2023 Jul–Sep 2023 Jan–Sep 2023 Jul–Sep 2023 Jan–Sep 2023 Jul–Sep 2023 Jan–Sep 2023 Description A Previous year’s net sales according to the average rate 205,730 660,965 50,502 165,456 1,501 3,253 257,733 829,674 B Net sales for the year according to the average rate 255,805 793,486 59,216 198,782 2,672 6,465 317,694 998,732 C Recognised change (B -A) 50,075 132,521 8,714 33,326 1,172 3,211 59,961 169,058 Percentage change (C/A) 24% 20% 17% 20% 78% 99% 23% 20% Net sales for the year according to the previous year’s average rate 242,129 742,159 56,083 186,189 2,673 6,465 300,885 934,813 E Foreign exchange effects (B –D) 13,676 51,326 3,133 12,592 - - 16,809 63,919 Percentage change (E/A) 7% 8% 6% 8% 0% 0% 7% 8% F Organic change (C –E) 36,399 81,194 5,581 20,733 1,172 3,211 43,152 105,139 Organic change, % (F/A) 18% 12% 11% 13% 78% 99% 17% 13% ===== SIDA 19 ===== Q3 2023 19 BioGaia AB (publ.) Interim Management Statement January –September 2023 Average key exchange rates Jul–Sep Jul–Sep Jan–Sep Jan–Sep Jan–Dec 2023 2022 2023 2022 2022 EUR 11.77 10.58 11.42 10.46 10.58 USD 10.76 10.43 10.54 9.82 10.03 JPY 0.0747 0.0758 0.0767 0.0775 0.0771 Closing date key exchange rates 30 Sep 30 Sep 31 Dec 2023 2022 2022 EUR 11.49 10.92 11.13 USD 10.84 11.12 10.44 JPY 0.0729 0.0771 0.0792 Pledged assets and contingent liabilities Group (Amounts in SEK 000s) 30 Sep 2023 2022 30 Sep 2022 31 Dec 2022 2021 Floating charges 0 0 0 Contingent liabilities None None None Adjusted operating profit Group (Amounts in SEK 000s) Jul –Sep 2023 Jul –Sep 2022 Jan–Sep 2023 Jan–Sep 2022 Jan–Dec 2022 Operating profit 119,538 93,735 362,573 290,333 361,459 Adjustments - - 1,144 3,269 5,067 Adjusted operating profit 119,538 93,735 363,717 293,602 366,526 ===== SIDA 20 ===== Q3 2023 20 BioGaia AB (publ.) Interim Management Statement January –September 2023 Financial calendar Stockholm, 19 October 2023 This interim management statement has not been audited. Peter Rothschild Board Chairman David Dangoor Board Vice Chairman Outi Armstrong Member of the Board Bénédicte Flambard Member of the Board Barbro Fridén Member of the Board Anthon Jahreskog Member of the Board Vesa Koskinen Member of the Board Vanessa Rothschild Member of the Board Theresa Agnew CEO Year-end Report 2023 7 FEB 2024 Annual Report 2023 MARCH 2024 Annual General Meeting 2024 7 MAY 2024 8:00 a.m. CE T Interim management statement 1 January – 31 March 2024 7 MAY 2024 8:00 a.m. CET Interim report 1 January – 30 June 2024 1 January – 30 June 2024 23 JUL 2024 8:00 a.m. CEST Interim management statement 1 January – 30 September 202 4 22 OCT 2024 ===== SIDA 21 ===== Q3 2023 21 BioGaia AB (publ.) Interim Management Statement January –September 2023 BioGaia AB The company BioGaia is a Swedish world-leading probiotic company that has been at the forefront of microbiome research for more than 30 years with a vision of becoming the world’s most trusted probiotic brand. BioGaia develops, markets, and sells probiotic products for gut, oral and bone health with documented health effects. The products are primarily based on different strains of the lactic acid bacterium Limosilactobacillus reuteri (formerly Lactobacillus). The class B shares of the Parent Company BioGaia AB are quoted on the Mid Cap List of Nasdaq Stockholm. Business model BioGaia stands on two strategic legs – sales through distribution partners and direct distribution to end consumers. The business model is based on long-term collaboration with international networks within research, production, and distribution. BioGaia’s revenue comes mainly from the sale to distributors of drops, tablets and capsules for gut health, oral rehydration solution (ORS), lozenges for oral health and c apsules for bone health. Revenue is also earned from the sale of bacterial cultures to be used in licensee products (such as infant formula and dairy products), as well as royalties for the use of L. reuteri in licensee products. The products are sold in m ore than 100 countries through distribution partnerships with nutrition and pharmaceutical companies and through direct distribution. BioGaia’s direct distribution extends across six countries (Sweden, Finland, the UK, USA, Canada, and Japan). BioGaia holds patents for the use of certain strains of L. reuteri and certain packaging solutions in all major markets. At the end of 2022, BioGaia held more than 600 approved patents for various bacteria strains. The BioGaia brand BioGaia launched its own consumer brand in 2006. Today, a number of BioGaia’s distribution partners sell finished products under the BioGaia brand in a number of markets. One important element of BioGaia’s brand strategy is to increase the percentage of sales under the BioGaia brand. Of products (drops, tablets for gut and oral health, oral rehydration, etc.) sold in 2022, 86% (81%) were sold under the BioGaia brand including co-branding. Some of BioGaia’s distributors sell finished consumer products under their own brand names. On these products, the BioGaia brand is shown on the consumer package since BioGaia is both the manufacturer and licensor. BioGaia’s licensees add L. reuteri culture to their products and sell these under their own brand names. On these products, the BioGaia brand is most often shown on the package as the licensor/patent holder. Research and clinical studies BioGaia’s strains of L. reuteri are among the most studied in the world, in particular studies in young children, with strong pre-clinical and clinical evidence. As of December 2022, over 250 clinical studies with BioGaia’s various strains of L. reuteri have been performed. These studies involved more than 21,000 individuals of all ages in total. During the year, BioGaia has performed studies in the following areas: • Colic and constipation in infants • Preventing infections in infants and adults • Functional abdominal pain in children • Antibiotic-associated diarrhoea (AAD) • Acute diarrhoea • Gingivitis (inflammation of the gums) • Periodontal disease • General health • Helicobacter pylori • Osteopenia • Autism spectrum condition • Depression • Bone health • Urinary tract infections • Immune modulation in adults BioGaia AB Box 3242 SE-103 64 STOCKHOLM Street address: Kungsbroplan 3, Stockholm Telephone: +46 8 555 293 00, Corporate identity no. 556380-8723, www.biogaia.com