#Denmark #biotechnology #Water Technology #Aquaporin #Kongens Lyngby

Aquaporin's Performance in 2024

Aquaporin A/S, the avant-garde company pushing the boundaries of water technology, recently announced its financial results for the entirety of 2024. The year proved to be a tumultuous period characterized by shifts in revenue and the pivot towards greater efficiency in operations.

Highlights of 2024

In the words of Matt Boczkowski, Aquaporin's CEO, 2024 was significant for the company’s aspirations in the biotechnology-driven water purification sector. Although revenue took a hit—declining by 32% to DKK 40.6 million—the company managed to enhance its operational efficiency and make strides in product innovation.

Despite the setbacks in demand, particularly from a crucial account in their Drinking Water segment, Aquaporin demonstrated resilience through continued focus on cost management and strategic partnerships that can bolster its future prospects. Klaus Juhl Wulff, the CFO, stated, "Strong cost control ensured improved EBIT" for the year, reflecting a concerted effort to reduce operational costs amidst challenges.

Business Developments

Aquaporin made notable progress across various fronts:

• - Strategic Partnerships: The company entered a pivotal partnership with Brenntag, which promises to enhance their reach in Asia-Pacific, Turkey, and China. This relationship is aimed at delivering cutting-edge wastewater treatment solutions.
• - Product Innovation: Initial results from the new Aquaporin Inside® Generation 2 membranes have shown promising performance enhancements ahead of pilot tests. Additionally, the launch of the Brackish Water Reverse Osmosis CLEAR Series illustrates the company's commitment to advancing energy-efficient solutions for municipalities and industries alike.
• - New Market Contracts: Amidst challenges, new orders for brackish water membranes were secured, including a landmark contract valued at $300,000 for a municipal drinking water treatment plant in Central Asia.
• - Consumer Products: Collaborating with technological leader Vestel, Aquaporin launched the Rafine PRO water purifier in Turkey, designed to significantly reduce water contamination in residential settings.
• - Rights Issue: A successful rights issue raised DKK 172 million, strengthening the company’s financial position for future strategic initiatives.

Financial Breakdown

The financial report illustrates a stark contrast in revenue streams:

• - Revenue from Industrial Water witnessed a remarkable 192% increase to DKK 10.5 million, suggesting a growing demand for efficient water solutions in this segment.
• - Conversely, the Drinking Water segment saw a 55% decrease to DKK 18 million, reflecting changes in customer demand and project timelines.
• - The Forward Osmosis division also faced declines, dropping 27% to DKK 12 million.

The gross profit margin remained stable at 31%, a slight decrease from the previous year's 32%. Operating costs decreased as well, registering at DKK 95.6 million, down by DKK 17.3 million from 2023 due to a focused effort on organizational restructuring and cost management. This resulted in an EBIT loss (before special items) of DKK 83 million, which, while negative, was an improvement from DKK 90 million lost in 2023.

Cash reserves as of the end of 2024 stood at DKK 77.3 million, a considerable recovery from just DKK 2.8 million at the end of the previous year, illustrating better liquidity management.

Looking Ahead to 2025

For 2025, Aquaporin forecasts revenue between DKK 60-80 million and an expected EBITDA loss of DKK 45-55 million as they continue to navigate their commercial strategies. The company’s management will discuss these projections further in an upcoming webcast scheduled for March 20, 2025.

Aquaporin remains dedicated to tackling global water purification challenges through innovative biotechnology, with a commitment to sustainability and efficiency in their operations. With strategic partnerships and a focus on product innovation, the company is poised for potential recovery and growth in the years ahead. For those interested in learning more, details on their upcoming earnings webcast can be found on their investor relations website.