Okay. Welcome everybody. I assume you can hear me. Is that correct, Axel and Emanuel? Everything is fine. Today we will start the presentation. We're talking a little about CEO succession here that, as you understood, has been in the plans for a while. We'll sort of do that one and clear any questions. Then we jump into the numbers. Next slide, please, Emanuel. Yeah. By the way, basically, most of the management team is down at CPhI in Milan. It's one of the. Well, it is the biggest generics fair in Europe, taking place every year basically. Last year it was COVID, so really nothing. This year it's back almost to normal.
The Asians and the Indians are not really here, but all the Europeans or most of the Europeans. The CEO succession planning. I plan to step down from the CEO position as of AGM, which in our case, with a sort of a different calendar year means mid-August. August 15, I think we set the date to. I will remain active in the company but from a board horizon, board platform and as a well, the current largest or together with Cadila, one of the two biggest owners of the company. The reason for this is that the timing is good right now for this. We have an internal candidate, most importantly, in Axel Schörling, who is willing and able to do this and of excellent caliber.
We'll return a little bit to him in a bit here. Myself, I do not have 24 hours to spend on EQL Pharma. Instead, I have some other activities as well in the background. This company, with the current pace we are doing things and the current growth rate where we have ambitions to continue to hit, it is a very intensive work going on in the company. Therefore, the CEO also needs to be committed to this not only in spirit and soul but also in terms of hours committed every day and every month. I think that's another reason why this is a very good transition for us.
The company is in good shape. We have an alignment on strategy within the management team, which we worked on here for a few years, which we believe is promising and the right track to go. It also means there is no disruptions ahead of us. Of course, we will need to monitor and change this, and that will be Axel's responsibility here going forward together with the Board. From my own perspective, I am extremely committed to this company. I see it still as a platform company. I mean, although we have sales here of between SEK 100 million and SEK 200 million on an annual basis and growing rapidly, we are still a fairly small company compared to what I think we can become.
It's definitely a company I want to remain the owner in for the following decades rather than the following years. We have really good opportunities ahead of us, not only in taking our current pipeline into the market, the Nordic market, expanding the same products into Europe, and also going after other niche generics in other European countries will be key drivers. At some stage, we will also obviously look on M&A opportunities, which serves two purposes. One is the inorganic growth of the company, the other one is by having platforms in countries where we believe we have good products to sell, we can add those products onto the platform we are acquiring.
In our case, the M&A truly is very much interwoven with the organic growth of the company long term. Okay, next slide. Emanuel?
We don't see the next slide.
We don't. Yeah. Yes, we do. We do. A little bit on Axel Schörling here, who is taking control of this company. Well, I guess you at this call here, many of you have seen Axel on these calls, and as you have noticed, he is very much driving large parts of the company. He has a background with double degrees from Gothenburg School of Business, Economics and Law, and Engineering Physics, so it's two of the sort of best programs in the country done simultaneously. He has a management consultant background at BearingPoint before joining as operations controlling in Perstorp. At that position, I was able to get him hooked on the EQL story and growth opportunities.
Since 2018, he's been working here four years almost now by a few months. We named him Deputy CEO one or one and a half years ago in order sort of to further prepare this transition. I mean, needless to say, I mean, Axel has done a fantastic job and is continuing to do so. He's hardworking. He's committed to growing this company, and we have a very good alignment in our way of thinking and planning things in strategy terms. From a personal horizon, I mean, Axel is one of those persons that is so nice to work with on a personal level. From a social point of view, he's a fantastic team colleague to everyone here.
Yet he is constantly driving forward things that can be improved and ways we can expand the company. It's a true and growth engine for the company embodied in a person. I really look forward to this. To see Axel take this role and drive the company forward. He will do that brilliantly. I'm convinced about. If not, I will make sure that he does so from a board horizon as an owner position. This will be great for the company, and it will be very interesting for me to take this new role in the company.
Okay. I'll let Axel present himself a bit, and then I think we pause and take questions on the CEO transition, if there are any, before we go into the numbers of the second quarter. Please, Axel.
Thanks a lot, Christer. Thank you for those very kind words. A lot to live up to, of course, and very big shoes to fill. As everybody knows, Christer has done an amazing job here ever since the company was founded in 2006 and taking us to where we are today, so very big shoes to fill. I'm, of course, extremely honored to get the chance to lead this company. It's a company, for me, that I see has enormous potential. When I started back in 2018, we had five, six molecules in the marketplace.
Now we have some 21 products, and we have expanded the pipeline continuously up to now, 35 products in the pipeline, and a couple of products that could be really interesting for European expansion and so on. For me, it's a company with huge potential. As I see it, huge potential also brings on huge responsibility for us who are in the leading positions in the company to really utilize them in the best possible way. I mean, it's also, for me, a company I have grown extremely emotionally attached to here over the years. We have managed, I think, to grow in a way that I am really proud of.
I think EQL turned over some EUR 3 million, something like that, when I started in 2018, and now we are soon reaching EUR 20 million here, including the COVID tests and so on. That is a very cool journey, I think. I think that we also have now a fantastic team in place, so that is also, I think, something that gives me a lot of energy and a lot of belief in the future. With Emanuel here, for example, in the CFO position, and we have some other key roles now really falling into place. Yeah, I'm extremely energized, but of course, extremely humble as well for the responsibility that this brings.
I thought, yeah, you've all seen me a little bit before, but mainly as operational updates, so I thought I'd just take the chance to introduce myself very shortly. I'm 35 years old, have two small kids, and married, live in Bjäre in Skåne, but come from Gothenburg originally on the west coast. When I don't work or take care of children, which is basically what I do most of the time, but I like training, fitness. For example, I've completed Swedish Vasaloppet seven times. It's a 90 km skiing race, which I think is very fun. I also enjoy sport fishing whenever I get the chance.
What I think most of you probably don't know about me is that I actually won Swedish championships in saltwater angling for youth in 2003. That was fun. I think, Christer, you already presented most of my background, but the bulk of my background comes from management consulting, where I focused on operations and supply chain, larger turnaround and transformation projects in different geographies. In the end, I did a lot of projects in Eastern Europe, focusing on turning around companies that were in big challenges. This was extremely developing years for me. I spent a couple of years as a controller for the COO and CFO of Perstorp Group in Skåne. They have an extremely high caliber management team.
Those couple of years there, I had daily interactions with the whole management team and that was extremely developing to really get to see how C-levels in a large company think and work on a daily basis. As I said, they are extremely high caliber. Yeah. I think that's it about me. I thought I also just take the chance to just give a brief sort of summary on how I see the coming years here at EQL and what will be important.
First of all, I would just like to state very clearly here that I don't see now any reasons to alter or to change the financial targets that Christer and we in the team, the management team, have communicated already. I am 100% committed to delivering on those targets, which for repetition are that we're gonna grow now on an average pace of 40% per year, our top line, up until 2024, 2025. We're going to reach an operating profit of 21%, 25%, sorry. I mean, this is something. These are challenging goals, but we are a group of people who like to set challenging goals and then really go above and beyond to achieve them. There we are working extremely hard together in the management team, especially on the profitability part.
Emanuel and me are working closely together now to really identify where we need to improve to reach 25% operating profit because that will be a journey for us where we really need to rethink. I would also like to state that I mean for me it's perfectly natural for the next four-year period to set extremely aggressive goals. Let us come back to what those will be, but that's how I see the future. Looking at some more sort of deep dives here and there, I think now, as you know, we have a big pipeline of 35 products and we have a lot of products submitted to authorities in the Nordic countries. I see it now as really key to transform these pipeline products into portfolio products and launch them and have them become profit generating assets.
As we talked about before, we are going to build now a hospital tender function. Hospital tenders and hospital tender products are historically not so big for EQL, but we are now continuously submitting these products to authorities. In a couple of years, this will be a large part of our revenue and profit streams. There we need to build that function and set processes and so on. That's something we work heavily on.
We have European expansion, which we talked about many times before. There I basically see it as two sort of high-level main tracks where we're going to out-license some of our key assets to the European geographies where we select to not launch ourselves. We have geographies where we are really interested to set up shop ourselves. We talked about that also. Germany is one such market, for example. There we think it's now very, very important to wait for some regulatory milestones. The products that will be key for our success in Germany, we need to make sure that we're actually going to get the MAs in time before we really push the button here because this is a large and challenging undertaking.
What also I think will be really key now, so the 35 products that we have in the portfolio now, they are mainly being selected with a Nordic focus. As you know, some of them opportunistically happen to have a nice potential in other European countries as well. What we need to do now over the coming years is to really boost the pipeline now with products with a continental and pan-European potential. That is also a journey for us, I think.
Christer already mentioned M&A and that's of course very exciting strategic track once our cash flow allows. As you know, we have suffered from delays in different projects and developments over the years. That is absolutely no secret. This is something we are already addressing and I would really like to zoom in on that now during the coming years to decrease our product development cycles. That's all the way from investment decisions, the commercial phase to deciding whether or not we go for a certain investment through to the development stages through to the launch phase. We know that some of our competitors do this faster than we do today and we need to be the fastest here. That is definitely the target.
Then finally, yeah, together with Emanuel, we need to maintain high cost control in the coming years. If we're going to have any chance to reach 25% operating profit, we need to address both our cost of goods sold and different components of our OpEx. That we are working heavily with. Yeah, I think I'm going to pause there. That is a little bit, I thought it would be, yeah, would be fun for you to just hear it from me, how I see the coming years.
With that, we open up for questions here on the CEO's transition. Once we're done with that, we go further into the Q report. Anyone wants to comment or question about this are welcome now.
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[Non-English content] adjustment for non-recurrent sales. As you saw, the top line was much higher than this, but we are taking away things we believe is not of long-term recurrent nature here, primarily the COVID-19 tests. The COVID-19 tests did sell well during the quarter and had better margins this quarter. First quarter, basically our margins were close to zero, but in this quarter we are getting some healthy margins on these tests as well. Profitability wise, we were up to almost SEK 6 million, which is also a healthy sign for the company and our performance.
To continue a little bit on the COVID test, we did launch our first saliva- based test. It's a test that instead of doing the nasal swab procedure you basically well gently let some of your saliva out or spit if you want to use the word into a tube and that will be enough to get the test result. That is of course a convenient way to test yourself and children or certain groups that really are not so fond of having nasal swab up your nose.
We think this is a test that will grow in the market and take some share of that. We have this on an exclusive basis for all of Nordics. It's launched in Sweden on several pharmacy chains now, and we are trying to expand it by having discussions in other Nordic countries as we speak here.
Further maybe on some of the activities internal here, Axel mentioned the pipeline of products. Our pipeline of products is continuously, of course, updated with new license or distribution deals. Many of these products now coming to submission are products we started back in 2016, 2017, and 2018, and they're now through their developmental cycle and being submitted to authorities. We have around 11 products submitted, and if things go well, and Axel and the team continue to perform well, we launch more than 10 products, both 2022-2023 and 2023-2024.
We have a couple of years ahead of us with very intense activities in terms of launching new products. Some of these are hospital products, as Axel mentioned, and even if they are—w e have an MA approval. It may sometimes be another year before we can actually sell them in the hospital channel, so to speak.
Another activity ongoing here is expanding some of our products in the European scene on the European market because we have certain products we think are better suited for licensing arrangement than fitting our own sort of sales strategy in Europe. The products and markets where we are not planning to sell actively ourselves, we are now actually in some early-stage negotiation with these products. That is kind of exciting for our team and to do that.
We think that will be a good growth engine down the road once these are in the hands of competent partners in various geographies in Europe. With that, I will leave it to deeper comments on this operational stuff by Axel and on the financial side here by Emanuel. Please continue.
All right. Thank you, Christer. Let's have a look into the numbers. A new record quarter for the core business sales. We had SEK 34.5 million rolling sales here. This is a 42% growth from last quarter last year. If we look at profitability, it was SEK 5.9 million, so also a healthy margin, 11% EBIT margin. We touched this the last call, and Axel also touched it now, 11% is of course lower than the 25% we have as a goal in the end of the financial target period, three and a half years from now. It's still, I think very nice that we can show profitability already. Most companies with a turnover of SEK 150 million on the stock market with this high growth rate are doing quite big losses. It's promising that we already now can deliver 11% profitability.
I want to show this slide as well to touch a little bit. If you look to the left, right now we have 21 products in the market. It's one down from last quarter. This is explained. We bought seven Danish licenses two quarters ago, and two of those we got for free basically, but we didn't want to keep. Now we sold that stock from one of those, and that's why it's declining. One of those we called off right away. That's why it's grown from 16 to 22. We're now 2-23 in Q3-Q4 2021.
If we look on top to the right, as already mentioned, it's 18 products now in launch phase or review phase. Before the products under development was quite big, but not so much in launch phase. If you look to the bottom of the right, we've changed the layout of this picture. Before we displayed it the way that everything goes as planned, but that's not always the case. I think it's more reasonable to show sort of buffers here that we show some delays. What we have done now is that if you look at the launch and review phase, we count six months of delays, and if you look at products under development, we count twelve months delays.
This will be a more fair picture for the investors, we believe. This means that some products will be delivered on time before what you see here. Some might be delayed more, but on an aggregate level, this will be a more accurate way of displaying the company. Here we have the profitability sheet. We look at the third column here. It's SEK 52 million turnover. That's including the COVID tests. That's SEK 18 million from COVID test this quarter. Look at the gross margin. That's down to 31%. The COVID test has a little bit lower margin than our core business.
I just want to show you this picture. If you look at the inventory, you can look at the trade receivables. If you look at the cash you can see that—this is the picture of the last of September and at that point we have SEK 50 million in trade receivables, which means that the cash position looks a little bit weak. But SEK 50 million for a company like our is not common, so this ties up a lot of cash at this day, but in general, this is not how much we will tie up in trade receivables.
Thanks a lot, Emanuel. Just a brief operational update, what's been going on in the quarter a little bit here and there. As you know, ondansetron EQL Pharma was approved, and it has also been granted interchangeability in Sweden for 4 mg and 8 mg, which is good. That will go into the launch phase. This is a licensed product, and it's not a huge market. It's about SEK 50 million between three to six active competitors. It's not gonna be a game changer in any way, but it's nevertheless a type of product that is going to add on profitability streams without really adding on any significant OpEx.
I think it's a type of product we should also have respect for and try to add on these kind of products here in the future. We have also taken over the potassium chloride sales in Denmark from our distribution partner, which will once that is up and running full scale. We took it over now in the middle of the quarter, which is also why it didn't have a full effect in the quarter as was pointed out here. This is something that will add on profit basically in the end and a little bit of top line as well. We think this is a good and important step for us.
There are also the hospital tender part where we are starting now to be active in tenders in new markets. Not only Denmark as historically, we have also won some minor tenders in the Finnish market. Nothing that is going to add on significant sales in the coming months or so. Nevertheless, it opens up a new territory in the sense that it creates a platform in Finland. We have also won some minor Swedish tenders, which also requires us to work through the whole launching procedure for a tender in these countries, which means that once we have the larger hospital product MAs later down the road, we will already have a platform to launch efficiently.
European expansion, I think we already touched upon. We are still submitting many of these interesting hospital tender products during this year. We have submitted four or five already and have a couple of them left. Continuously, we are recruiting and strengthening the team. As I said there, I really think, on a more sort of colloquial note, I really think we have taken our step change during 2021, the quantum leap in the team. We really have a good team in place now, and I think that will enable us to deliver on a level we have not been able to do so far. I think that is a very positive sign. Happy to answer any questions on operations.
All right. You are on mute, Christer.
Yes. Well, our financial targets are, have not changed. I mean, as we said here a couple of times, we are aiming to grow at an average 40% for the following four years. That's also the forecast for this year because some years might be lower and some years might be higher in our sort of internal four-year planning. This year's plan is around 40% growth. Yeah, I don't think we need to say more about that. I mean, the starting point is the SEK 95 million of recurrent sales or of adjusting for non-recurrent items in 2020, 2021. That's the numbers that we are then multiplying by 1.44x to reach the sales in 2024, 2025 with a target of 25% EBIT margin.
Okay. I think with that we can open up for Q&A. I don't know if you are. Are you taking those, Emanuel, on the written ones? I think we got a couple of ones in the email as well.
No, we think we do it so that we take it in Swedish for those who want it, because it is still for investors and so later you can of course ask a question. You are welcome to write in the chat. You may raise your hand here if you want to ask it orally. We can raise what we got in mail as well. We can do that. We will see. There we have got one here in the chat. Anders Nilsson. "Thanks for a good presentation. Here are some questions. You have previously mentioned that you have launched a product in Norway. Are there any further products on the way?" You have. Yes, we can start there.
Axel, do you take that?
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Ja.
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