Good day and thank you for standing by. Welcome to the Vistin Pharma Quarterly Report Q2 2025 Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Alternatively, you may submit your question via the webcast. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Magnus Tolleshaug, CEO. Please go ahead.
Thank you very much, and welcome all to this second quarter and year-to-date presentation of Vistin Pharma. My name is Magnus Tolleshaug, CEO of the company, and with me today I have our CFO, Mr. Alexander Karlsen. I will now go through the highlights. The revenue in the second quarter ended at NOK 118 million compared to NOK 106 million in the second quarter last year, an increase of 11%. The increased revenue was driven by 17% higher sales volumes compared to the same quarter last year. The year-to-date revenue ended at NOK 233 million compared to NOK 210 million year-to-date last year, an increase of 11%. The EBITDA at the second quarter ended at NOK 30 million compared to NOK 27 million in the second quarter 2024, an increase of 11%. The EBITDA was positively affected by increased sales volumes and our continuous focus on cost improvements.
EBITDA year-to-date ended at NOK 60 million compared to NOK 48 million year-to-date 2024, an increase of 27%. Approximately 1,500 metric tons were produced in the second quarter. The first part of April was influenced by a gradual startup after the planned reactor replacement on line one. This reactor was nearly 10 years old and needed replacement after wear and tear, so that was a planned replacement. We do see some volatile freight lead times from Asia to Europe of raw materials and some bottlenecks on offloading in the European harbors. However, no impact on production since we have a safety stock of critical raw materials. Currently, we see no changes in demand from customers after the U.S. tariff discussions. Regarding U.S., less than 5% of our sales is to U.S. directly.
We had a net debt of NOK 40 million as of the end of June, and an ordinary cash dividend of total NOK 1.25 per share was paid in June, corresponding to NOK 55 million. Vistin, we are a pure-play metformin company supporting patients worldwide in a growing market. Diabetes is really one of the largest health emergencies in the 21st century, and metformin is the gold standard treatment of type 2 diabetes. Therefore, we like to say that Vistin Pharma has a good growth opportunity, being a leading global producer of premium quality metformin. The market demand for metformin is expected to grow between 4%- 6% annually on a compound annual growth rate according to the International Diabetes Federation. Today, Vistin has a market share of approximately 10%, and we will also continue to have 10% when the new capacity expansion is fully utilized.
The reason for that is we are growing in a growing market, so the underlying growth and demand is increasing. This slide shows the latest numbers and estimates from the International Diabetes Federation. These are updated in 2025. About 590 million adults in the world today are living with diabetes. This is expected to increase by 45% within 2050. For some information, out of the 590 million, approximately 10% of these patients are diabetes type 1, and 90% are type 2 diabetes, where typically metformin is used to treat the type 2 diabetes. You can also see an expected increase in all parts of the world in the coming years. Some key diabetes facts. As mentioned, diabetes is really a global emergency. An estimated 589 million adults in the age of 20 to 79 are living with diabetes. This represents 11% of the world's population in this age group.
The total number of adults living with diabetes is predicted to rise to around 850 million, up to 13% of the adult population by 2050. Also, an estimated 250 million adults are living with diabetes today and are aware that they have the condition. More than 3 million people died as a result of diabetes in 2024. This corresponds to more than 9% of the global deaths from all causes. More than $1 trillion was spent on the indication diabetes in 2024, representing almost 12% of the global health expenditure. In addition to this, an additional 635 million adults in the age of 20 to 79 years old are living with something called impaired glucose tolerance, which is 12% of the population. This is typically a precondition of diabetes before you develop diabetes. Here, metformin is normally used to treat this condition.
In Vistin Pharma, we have sales all over the world, all the way from Japan in the east to LATAM and the U.S. in the west. However, our largest sales volumes are going to Europe, where typically our customers, being large and medium-sized reputable pharmaceutical companies, produce the finished product with our API and then sell all over the world. Today, we have Vistin API material used in more than 100 countries in the world in drug products. In Vistin, we've had a long and successful track record, something we are proud of. This slide shows the revenue development past 15 years. In 2023, we can see the investment in our second manufacturing line started to materialize into sales. With that, I think I will hand over to our CFO, Mr. Alexander Karlsen, who will bring us through the financial details.
Thank you, Magnus. Let's have a more deep dive into the figures. Starting here with the sales volume, we can see the historic on the graph to the left side there. In the second quarter this year, we had an all-time high sales volume of 1,460 tons, a nice increase compared to 1,250 tons same quarter last year. Year to date, or the first half of 2025, we've closed to 2,900 tons, and then around a 400 tons increase from around 2,500 tons in the first half of 2024, or a 15% increase. Looking at the revenue, NOK 118 million increased from around NOK 106 million same quarter last year. As Magnus mentioned, it is mainly driven that we have had some good production months, meaning that we have more volumes available sales, and then materialize this volume to revenue and sold to customers.
Current sales prices are reflecting the raw material and freight cost as of today. We've seen rather stable raw material prices in 2025 compared to 2023 and 2024, where we saw a lot of volatile raw material prices. Total revenue for the first half, NOK 233 million compared to NOK 210 million last year, again driven by a nice sales volume increase of 15%. Looking at the gross margin, I would say we continue to deliver a very solid gross margin, well above our long-term target of 60%. We have good volume growth now, gives a favorable economic scale in purchasing, and also more stable raw material prices help on the gross margin. When it comes to the EBITDA, very satisfied with another quarter with NOK +30 million in EBITDA. We had NOK 27 million in the same quarter last year, so 11% increase.
As Magnus mentioned, the EBITDA was positively affected by the increased sales volume and the cost focus, as we always have. For example, now we're really starting to see or really seeing a big benefit of the water recycling project, where we now in the second quarter have basically recycled 80% of our water. Margin in the second quarter was 26%. Again, very strong, being an API producer. I think this is also in addition to the cost focus represents good commercial execution from the salespeople. When comparing the EBITDA this quarter compared to the same quarter last year, the net effect from the USD and euro is insignificant for the quarter. Year to date, an EBITDA of NOK 60 million compared to NOK 48 million last year. Again, here a very, very nice growth.
Looking at some of the key figures in the income statement, I think we went through some of these. Going below the EBITDA, slightly increase in depreciation compared to the same quarter last year. Just capitalize some more investment, for example, the recycling project in the second quarter. I expect the depreciation to be rather stable for the rest of the year. Earnings before taxes ended at close to NOK 25 million compared to close to NOK 22 million last year. For the net finance, we had an expense in this quarter compared to a gain in the same quarter last year. This is just mainly related to market-to-market value of FX hedging contracts. We have hedged a good portion of our sales, our expected sales for the rest of 2025 and 2026. Euros is better than we see now in the spot market.
Profits before loss, close to NOK 24 million versus NOK 24.5 million last year, while net profit for every period came in at close to NOK 18.5 million compared to NOK 19 million for the same quarter last year. Looking a bit more on the balance sheet side for the assets, non-current assets are rather stable on the fixed asset side. As you see, we have fully utilized the tax assets, deferred tax assets. That's no more on the balance sheet. When it comes to the current assets, as we have commented in the report, there are some working capital increases in the quarter, mainly driven by more inventory. As Magnus mentioned, we see a lot of volatile lead times. We have decided and planned to increase both the raw materials and the finished goods slightly from previous to have some more safety stock.
That's just to make sure that we can deliver in full on time to our customers when they want materials. Receivables slightly higher. Again, increased sales driven more receivables, but we also see that some of our Asian customers will not pay before they receive their goods in Asia. The lead times have gone from around seven, eight weeks to around 12 to 13 weeks saving time. Slightly increase also driven by the lead time on the sale. Total assets, around NOK 420 million compared to around NOK 400 million last year. Looking at the equity and liabilities, total equity rather stable. Some decrease in share premium driven by the dividend payments done in June. Long-term liabilities, only change there is the tax liability as we now are in a tax position. Not the whole amount is actually taxes payable, but part of it.
For the short-term liabilities, no big changes, I would say, compared to the same quarter last year. For the other current liabilities, around 50% of that balance is raw materials. I see as we have taken out responsibility, but not yet paid because we don't pay until it's received at our harbor. I mentioned the working capital, which has increased. I also want to mention that we have some net debt as of end June, mainly driven by the dividend payout and also some slight increase in working capital. We also have credit facilities needed or available if needed. With that, I think I am mainly done with the figures, Magnus, and I give the word back to you.
Thank you, Alexander. I will now go through a summary of the report and presentation. We have had another strong quarter with an EBITDA of NOK 30 million in the second quarter 2025. We had a sales volume increase of 17% compared to the same quarter last year and a 15% increase in sales volume year to date compared to last year. We have an increased operational performance with a higher run rate in this quarter compared to the last quarter last year, some more units per time. It goes together with our ramp-up projects and our continued focus on costs and good commercial execution, as Alexander mentioned, is showing positive effect year to date. Currently, we do not see any changes in demand from customers after the U.S. tariff announcements. However, of course, we are continuously monitoring the situation for potential supply chain knock-on effects.
The metformin market is expected to continue to grow with a 4%- 6% compound annual growth rate. We see an attractive growth potential as the remaining manufacturing capacity becomes fully available and optimized. Also, it is worth mentioning that our long-term renewable energy supply agreement signed with Statkraft until 2032 provides us very predictable power prices irrespective of market volatility and secures 100% green renewable hydropower long term. We believe that Vistin is strategically well positioned as many European clients and also Asian clients prefer high-quality supplies and in Europe, near-shore production and an attractive ESG profile. An ordinary cash dividend of NOK 1.25 per share was paid out to shareholders in June. With that, I think we're done with the second quarter and the year-to-date presentation and can open up for questions.
Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again.
Yeah. There's a question here. If we could elaborate a bit more about our strategic plans with our 15% stake in CF Pharma. Last year, we purchased a minority post in CF Pharma, which we acquired at a modest price. This gives us, I would say, access to management and an ability to monitor the business. We are currently evaluating our options and looking into some projects. That's the status there. Having said that, we are opportunistic when it comes to growth. I mean, further growth for Vistin might also be organic, or it could be via M&A activities. There's another question here about what is limiting the growth in the near future. Is it the production capacity or the demand for products or something else is the question. We are steadily ramping up our manufacturing capacity.
If you take the manufacturing volume of the quarter and multiply by four, you have an approximate annual volume. We are selling volume as we ramp up, and our target is to get to 7,000 metric tons of production. Typically, when you do technical big ramp-ups like this, the Pareto rule is also valid, where let's say 80% is normally the easiest part, and then the last 20% is more tricky, where you need to have technical tweaking and optimizations to get to the target. We are, let's say, in a balanced way ramping up the volumes and also the sales. The demand in the market out there is good.
I think that was all the questions for now.
Yes.
I think we can close the call.
Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.