Good morning, everybody. Good morning to the shareholders here in Oslo and good morning to everybody who is listening on the webcast here today. Also like to introduce CFO, Berke Serhval, who will be here together with me today to present our Q2 results for Biotech PharmaCon. The agenda is like it is always. We'll go through some highlights for Q2.
We'll spend some time with our Arctic Syme's business. We'll spend some time talking about our beta glucan business. Then Berger will come on the podium and we'll run you through the financials and I will come back and discuss the outlook for 2019. Questions, of course, always welcome and we will see if we can answer them. We also have possibilities to answer questions on the web.
So if anybody is listening in and having a question to ask, we have facilities so we can take those questions on the web and answer them here. This is a slide that we show every time we are presenting ourselves. It's just the basis of what we are and why do we have these 2 very different technologies in one company. We come from University of It's a heritage we are proud of and it is a heritage that we it's a relationship we still cherish today. So we still get a lot of benefit out of being very close to University of Tromsoo, especially in the Ensigns area.
We have a very close working relationship with the university. So that's why we have those 2 very different technologies in one company. It comes out of University of Trumpsuit and that is where we are based. So on to the highlights for Q2. We had a strong growth in sales and gross profit versus Q2 last year and something we of course are happy to realize.
Our EBITDA was minus NOK500 1,000,000 versus minus NOK3.5 million at the Q2 last year. So we definitely have seen an improvement in performance this quarter over the Q2 of 2018. Artisheims had historically high sales of €9,000,000 for the quarter and Wulgen continued to grow the business. We had about 1,200,000 sales in Q1. We had 1,400,000 sales in Q2.
If one compares to the quarters last year, it is of course a completely different picture. There we are looking in the area of we had about 500,000 sales in Q2 last year. Now we have $1,400,000 If you take the half year sales also, it goes from about it goes from about $1,100,000 in the first half of twenty eighteen to $2,600,000 in the first half of twenty nineteen. Percentages, of course, are very high because it's low numbers. But we're seeing growth here in Volcan, which, of course, is also satisfactory.
So overall, growth in our high margin business areas in Q2 versus Q2 last year, growth in our high margin business areas in the first half of this year versus the first half of twenty eighteen. And that combined with a fairly moderate cash cost base actually gives us also then a strong improvement in EBITDA performance for the half year and for the quarter. So for the half year, first half last year, we had a loss of 8.6 percent and the first half of this year, we have a loss of 4.4 percent. So we almost reduced the loss with 50% versus last year. So an active quarter and a quarter where we see and still keep that customer and have good sales with that customer and good relationship, but on the other hand also see very nice growth in business outside that one customer.
So that makes us as less vulnerable to these bigger customers. Having large customers is, of course, nice. But once you have these large customers, if they move an order from June to July, then our quarterly figures suddenly looks very strange. And therefore, the more we can get more a broader customer base we can get, the more smooth we can have our sales and easiest for us to forecast. As I said, we grew the business in Artix Times from $5,700,000 in the Q2 last year to 9,000,000 in the Q2 this year.
The business in the first half of twenty nineteen was almost 17,000,000 dollars The business of the first the Artix Haim business in the first half of twenty eighteen was $12,000,000 So we're looking at a 40% growth in Arctic Symes over the first half of twenty eighteen. A different another point was important to us is and something we have been discussing to you is the salt active nucleation, which is a product that we use when gene therapy. And we have high hopes for this product. It has taken a bit longer as we have discussed with you to see the roll in and to see the acceptance in the market. But now we actually see that this is about to become one of the top products in Arctic Symes.
Already in the first half of this year, we can see that we're really now getting the momentum. A bit later than we thought initially, but we can now see that really there's an interest in the market for this product and it is one of the becoming one of our top performers in Auryxymes and gives us hope for the future. The second thing that is interesting about the Auryxhymes business is in July and I know this is about the Q3, but we had a customer order audit visiting us in in July, an American company within the gene therapy area. And this is the salt active nucleus is a very important product for them and therefore they would like to see if they use that in a therapy, how are we doing things. Yes, we are ISO certified, but they like to see for themselves.
And they actually came back after couple days in and gave us green light all over saying the operation, the quality systems, everything we do up there is top notch and the company will use the sold action. Nucleus use that in their production, which was a nice stamp of approval to get. And it's a very it's a significant customer, something we can use in the sales to other customers going forward. July in Artes Times, just as a nation, we will talk about that when we come back in October, what was a very good month for us too. So we didn't have a summer blues in Artes Times.
We actually had a good month in Adersehen. It was a good month in Wuhgen actually in July even though it was a summer. So summer vacation in Tomsey was a bit busy, I have to say, but of course, good for all of us. Innovation, we launched as you know, the one thing that we are hearing from our customers in Alzheimer's is that we have too few products. They like our quality.
They like our innovation. They like the uniqueness of what we do, but they would like to see more products. And that's why we have a strategy to launch more products. And this is what we've done this quarter. Reach is an EU program that was started many, many years ago to kind of rid either get chemicals out of the environment or make sure that whatever is used is also documented to be safe and everything else.
And we are making more and more our products reach compatible and this is what we do here. And then we also did the we made a glycerol free product and that makes it easier for our customers, for instance, to freeze dried and use it again. And that makes handling and a lot of kind of logistics with the customers a lot easier. So if we can have an enzyme which is glycerol free, then they have a possibility to freeze dried and then it is easier for them to handle it. So this is what we also did this quarter in the second quarter.
Lastly, we are as we have said, and we are spending some money on it as you can see in our cost. We are actively pursuing finding mergers and acquisition partners in within the Artisan's area. And we are exploratory discussions and you can always just say when do you go from these discussions to negotiations. We are in discussions. But we are in fairly detailed discussions with companies in Europe about this.
So this is a we think a very important initiative for us. We want to do this to speed up the growth in Arctic Diamonds. We have something unique here. But as I said before, our customers think that we have too few products and we can of course develop products ourselves constantly. It just takes a long time.
Can we jump start the process by combining a couple of companies? That will be a good thing and this is what we're looking for. Whatever deals come out of it, whatever suggestion proposal comes out will, of course, be then related to the shareholders in order to see, would you like to support it or not support it, and you'll see all the details there when we get that far. Just say that it is moving ahead nicely, and we are in discussions with companies out there, European based companies. The BDK LUGENDS.
We had a growth in sales in Q2. The growth from in Q1, we had sales about 1.2. In Q2, we had a sales of 1.4. About 20%, 22% growth in sales and driven mainly by Germany. If you compare to the last year sales and of course is very high.
As I said, last Q2 we had $500,000 This Q2 we had 1.4 dollars Last first half we had $1,100,000 this 1 first half we had $2,600,000 So more than 100% growth in the Wulcan business if you compare to last year. And the first half of twenty nineteen was almost the same as the full year of twenty eighteen. So nice growth in the business. Germany is moving ahead nicely. We have repeat buys from a number of our customers there.
We have nurses out there really believing in the product and using on their patients every day. We are as I said here, we are still challenged by the U. K. And the Nordic market. Some of our shareholders were so kind to send us an article from The Guardian about having chronic wounds in England in the U.
K. And how they are treated. And this is actually very similar to a number of other countries where there is a strong strong restrictions on funding of products. And that is the case in the U. K.
And that's the case actually in a lot of the Nordic countries too. And it's difficult and it's difficult for a small company to really push the agenda. We know these KOLs and we have been in contact with some of them. But for a small company our size to move a U. K.
Health agenda or move a Danish, Swedish, Norwegian health agenda is, of course, outside what we can do. We need to work with companies that can help us out here. So still a challenge for us. We have decided or agreed with Navomedic in the Nordics that is our Nordic partner that they will focus on Sweden and Finland where we have some traction where we have some repeat business and in Denmark and in Norway, we are looking for different solutions for this going forward to find a way around this. The strategy is the same.
Germany is a core market. We will continue to look for partners and distribution companies in markets where we see there is a potential for higher priced products. And that leads out, for instance, a country like France. France is a very tough market in terms of pricing and in terms of acceptance of newer innovative products. You can do it if you will pick and powerful and you could drive an agenda for us, it's impossible to do it.
So for some countries in Europe and for instance Austria as we announced in April, we signed a deal with a company called Publiloc where we they will then get the reimbursement and we will see some sales in 2020, not in 2019. But this is a market where it's conducive to these kind of products and still accepts that new products come into the market. And this is fairly optimistic on our side, but we need to generate some momentum and make sure that we put the resources in place where we can actually see traction. We did participate in the German Wound Care Congress in May in Bremen. And we had a symposium, you can see the picture there.
We had 71 participants at the symposium. We also participated in the European Wound Care Congress in Gothenburg in June. And that is more also a, let's say, a exhibition window to the world. See, here we are, look at what we can. And we have had a number of people looking at our stand talking to us.
It also when we talk to partners, it is important that we had that. So yes, we saw you at Neuma, we saw you were there. Therefore, we come up with some self confidence, look at us, see what we can do. So we were there and we get a lot of positive reactions from people who are treating patients. When it then comes to make the move from that positive reaction in actually getting the authorities also funded is a big step.
In Germany, we have discussed that with you a few times. Reimbursement in Germany has been discussed in the wound care area for a long time about whether wounds dressings with an active ingredient should have a special class and therefore have a special price, but also then have document the insurance companies that they actually are worth that extra price because they do more. And in beginning, they made a suggestion of a law to create this class. It was then withdrawn from parliament because a lot of push from the wound care companies because they didn't understand what was going on and why the extra thing. Now they've actually agreed on the law here end of June.
The Association of Medical Device Companies in Germany in mid July came out with a fairly strong opposition against it, but it is a law. The thing is, they will now create a category of wound care products with active ingredients. We don't know what is in that category. So what does it take to get in and what is out. And we don't know what does it then take of clinical documentation to be able to get the refund from the higher category.
And that was one of the reasons why the Association of Medical Device Companies in Germany was very adamantly against us and said, you publish this law, but you don't tell us anything else. And they will have a grace period of 12 months, which is okay if there's no extra documentation needed. If they require that you do a lot of new documentation, then 12 months is nothing. You cannot do a clinical file in 12 months. And therefore, a lot of uncertainty.
We think the bottom line is we think we have all the necessary documentation. So if you do not require new documentation, we have good documentation for our product and we will get reimbursed according to the new rules. The bottom line is also that it does create some uncertainty and that is the least thing we need right now. We had it a year ago in Germany where we supplied a letter from a lawyer we had to our customers that they could give to insurance companies if they refuse to refund our product. So, well, there's uncertainty, therefore, we do not refund it.
So you cannot allow to do that. You have to refund it until there's a new legislation coming in place. So there might be we have to do something like that. We do not need the uncertainty because we have such a good momentum in Germany. And so far, we have not seen any impact of this.
And we are listening on to all the we are contacts in some of the bigger companies. So we're listening into what's going on. But this is happening. And we will keep you updated, of course, if something else happens. So we haven't seen a business impact yet of this.
So I think so far so good. And we think we are in good shape with our clinical file, but something might happen. Yes. Other beta globin segments, we are participating in a study at the Memorial Sloan Kettering Cancer Center in New York, where they started in 2009 the study. It is aimed at being finished in May 2020.
And today we have recruited more of more than 230 of the 260 patients that is planned for this study. The vaccine is the rights to the vaccine is owned by a company called Ymabs, which is listed on NASDAQ and they published their 2nd quarter results last night. And they are there we know them well And we are in as I said, we are in dialogue with them in terms of how do we do this together going forward. Is, of course, we cannot drive these clinical trials. This is a completely different expense level that you're living with if you're doing clinical trials in the cancer area.
But we are partnering with the Ymabs and we will see what the results are of the study when it comes out there in May 2020. The last 60 patients enrolled are randomly selected to have the SPG in week 1 or SPG in week 7 or yes, week 6 I mean. And in order to see is there a difference in the creation of antibody titers, can we really see an effect of the SPT coming in there. So not a lot of news there other than the Ymabs had had some issues figuring out whether they can actually produce a vaccine. And they announced in May that they have found a GMP production facility for the vaccine, which was a for us a positive signal because if they cannot produce it then there's no point in having a vaccine.
They actually found a way to produce it and identified a GMP manufacturing plant who can do it for them. So now you can actually see the vaccine on Ymab's clinical plan and we are mentioned in some of their presentations as supply of beta glucan there. Consumer Health, we see good progress. We have nice growth over last year in the business. Asia and Europe are the main drivers of the growth of the business.
We are present in some of the big fairs in Geneva is a big fair for food additives and there's another one in Shanghai. They were present in the Q2 where we go out and we talk to customers there and we actually get a lot of leads out of these discussions. Animal Health, we had a sales on par with last half year and I think that's actually a fairly good result. We may remember that we announced last April, I think it was that we lost a fairly big customer in a price auction. And there everything we can do for the customers in terms of bringing knowledge to the table help them with selling the products and explaining beta glucan they were not really interested in.
They just want the price in an e mail and they sent us an e mail back said your price was too high and then that was it. So not a really not a customer of course you hate to lose. On the other hand, a customer if your relationship is only the price then you're somewhat nervous you like to have it but you can also lose it as we did. So the fact that we actually have the sales on the same level this first half versus last first half I think is pretty good. And we also have more and more interest from pet food manufacturers.
Beta gluugins are used quite widely in pet food in U. S. And now we see some of the pet food manufacturers also would like to use beta globins in Europe. And we have some interest from a few pet food manufacturers that we are talking to. And we have sales actually also to some.
That was basically the business, the update on what we're doing. And then I will give the word to Berge, who will run you through the financials.
Thank you, Christian. The Q2 of 2019 has been a good quarter for Biotech. We have managed to increase our sales significantly in most areas of the business as Christian touched upon. And both Alix Times and a better Glukens is working at full pace now to generate shareholder value while we are trying to while we are conserving our cash. And this brings us into the first slide.
The 2nd quarter cash flow was minus SEK6.8 million giving us a cash balance of SEK21.4 million dollars at the end of the quarter. And the cash flow is not a reflection of weak performance in that quarter. It is merely a reflection of changes in working capital. Compared to last year and end of the Q1, our receivables have increased significantly. Million and we have also seen that we have reduced our payables.
And of course, this both of these items has an impact on our working capital. And changes in working capital for the Q2 was minus SEK 5,600,000 and we expect this of course to be improved now going forward when we receive payments from our customers going forward now. And we also see that the cash flow from operations was pretty much the same in Q1 last year as this year. On the sales side, as I said, we have improved our sales significantly compared to last year. Adesheims generated SEK9 1,000,000 in sales, up from SEK5.7 million in the same quarter last year.
Animal and consumer health is up by almost 2,000,000 in the comparable quarters. And as Christian said, Volgen continues to grow the revenues now. Now we see a steady increase, a steady growth in the revenues there. Now we had SEK1.4 million in the quarter, up from SEK0.5 million in the same quarter last year. And also this gives us in total SEK16.9 million, almost SEK17 1,000,000 in sales for this quarter.
It's up almost 60% compared to the same quarter last year where we only managed to secure SEK10.8 million in revenues. So we are seeing some good traction. We saw some good traction in the second quarter now. And of course, when we are getting good sales, this will also influence our profitability. And we have seen now a positive trend with steady improvement in our EBITDA level when you look at quarter over quarter.
And for the Q2 of 2019, Biotech had a loss of minus CHF500 1,000,000 compared to CHF3.5 million in the last year. We see also that our operating expenses have gone up somewhat. And this is also because now we are running at full steam. We are at full pace now. In the Q2 last year, we were hiring new business developers for the Arctic Sands part of the business.
These people are now all in. They are now at 100% now. So also we have the full effect of those expenses in this quarter. And also we have now, as Christian talked about, we are working in the M and A side, and we have some consultants that are helping us out. And of course, it is expenses associated with this as well.
In previous years, EBITDA has been kind of a good proxy for how our cash flow is looking. But now it's not going to be the same anymore after the IFRS 16 leases was implemented. This basically means that all of our expenses related to property, plant and equipment, our production facility now, they are being now we have done an NPV on these and now they are actually booked on the balance sheet. And now you will see all of the expenses related to this is being put as a depreciation. So it won't be part of the EBITDA, it will be part of the EBIT now.
And this has an annual effect on the EBITDA level of around NOK3 1,000,000. So around NOK 750,000 per quarter is what you will see. That's a it's a steady number. It's going to be like that for the next few years As long as we have a commitment that we're going to have some production facility and offices, then it's going to be like that. Looking at the companies now or at the segments.
As I said, Adesheims, they've generated revenues. They are more than SEK3 1,000,000 up now from the same quarter last year. And they have improved by almost SEK5 1,000,000 for the first half year now on the sales side. Operating expenses, you see that they have gone up also. And as I said, it's also because of business developer hires.
We have some external consultants on this side and we have also done some reallocation of resources now. Now we are utilizing the personnel that we have on the Betelgukin side also into the Artisan side, much more than we have done in the past. We still manage to increase our EBITDA. We see that on both on the for the Q2 and for the first half year, we have improved by almost SEK1 1,000,000 on both sides, giving us SEK1.7 million in the quarter and SEK1.5 million for the first half year. So we are on track of getting good numbers now.
BBG has also managed to increase their sales, the quarterly sales and the half year sales Going they have managed to have now SEK 7,900,000 in the quarter, up from SEK 5,200,000 in the same quarter last year and SEK 14,800,000 compared to SEK 13 1,000,000 in the first half last year. And even though we were trailing sales in the Q1 this year, Now we have seen a good ramp up in the 2nd quarter now. So now we have actually managed to have almost SEK2 1,000,000 better first half year sales than we had last year. So that is good. Q2 was a good quarter for the better glucan segment.
And of course, one of the explanation here is that we are generating sales now on the bullion side. It is going up all the time now, and that $1,400,000 we saw in the 2nd quarter, it has an effect on our numbers now. And also with that $1,200,000 we had in the 1st quarter, it does influence our numbers. And also we see here that we have reduced our operating expenses on this side. We are now as I said, we are utilizing some of the production staff from the BVG side over now to the Arctic sand side.
This has, of course, a positive effect on the beta glucan side and a negative effect on the Arctic science side. But it is what is needed. There's so much more activities going on now in Arctic science. So it's good. And by combining increased sales and reduced expenses, our profitability in the better glucan side has improved.
We have gotten that down from SEK3.2 million in Q2 last year to minus SEK0.7 $1,000,000 this year. And also we see a good increase on the first half year going down from $6,900,000 to 2.8 So we have done a lot of good things now in the first quarter and the first half of twenty nineteen. And then with that in mind and in conclusion, I think we see that biotech, we continue to improve our business. We continue to be very diligent with the way we take on commitments that has a cash effect. So we are really concerned about how our cash is.
And I think with that, I leave it to you, Christian, and take us through the outlook. Yes.
Thank you. So the outlook. And this is a slide you have seen before, twice before actually, in January and in April. This is the same outlook as we have not changed the outlook for 2019. We expect revenue growth in the 2 focus areas, ADXANZ and WULDEN.
To be strongest in the second half and there I have to probably make a little of a position that when we say strongest, it's in 1,000,000 and not in percentages. Because if you then come back to me in January and say what your percentage was actually lower in the second half than it was in first half year, but the million should be higher. So this is our expectation. We will see higher growth in the business for this year and we will see the higher growth in the second half. That's what we expect.
We expect the Artisan to grow the business organically and launching new products, but also we are seeking inorganic growth opportunities as we have debated here. And lastly, we will focus on Wulgen and do what we can to grow the business. We have a number of good partners out there, especially in Germany who is doing a very good job for us. And we will see what we can do to support further sales in Germany and also find other markets where that are conducive to a product like WUGEN. In the medical device area, unfortunately, it is not enough to have a good product, especially when you're dealing with products that are used at home.
And therefore, you need a powerful sales force, you need some commercial power to get out there with a message and change people's behavior. A lot of treatment behavior out there that needs to be changed. That is a tough job. If that's in combined with a tough reimbursement environment, then it is difficult for small company to succeed, not because the product is not good, but because of the commercial power you need in order to be successful there. But we believe in it and we push on and we are fairly optimistic in our way to do this.
And whenever we see a good opportunity coming up, we do it. We are supplying a Tour de France team with Wogen and they brought the Wulcan also with them to the Weltier. So we'll see if it is being used there. So we are now open for all ideas And also we are in discussion with partners, not only about wound care but also using SPG in some of their products. If they have a wound care product and they would like to use our active ingredient SPG, we are discussing with some companies about that.
So very open minded here. We think we have a great technology. We think we have a great product. We need to get it out there and we need to find somebody to help us. And this is what we're doing.
So as Berge said, we are happy with the progress in Q2. We of course would like to see it go faster and be quicker and have more be more successful and higher numbers. The world unfortunately is not really going that fast as we would like it to do, but we are happy with the progress we're seeing in the second quarter here. And we expect it to continue for the rest of 2019, as I say here, especially in the Wulgen and the Artaxams area that we continue to see growth and thereby also reducing, as far as the cash consumption of the company. With that, I think that finishes our presentation and I'll open up for questions.
Any questions?
Anybody in the web? No?
Not today.
Well, then thank you for your time. Here for the people who came to the CLC in Oslo. Thank you for people listening on the web. I'd like to thank you the colleagues in Biotech Pharmakon for their hard work and for a very good summer where we did a lot of good things despite the fact that we had some summer vacation to mix in, but a lot of good work being done. So thank you for that.