Good morning and welcome to the presentation of Polygiene Group's second quarter. I am Ulrika Björk, and I am the CEO of the company, and I'm here together with Niklas Blomstedt, who is the CFO. We will do, as we always do, we will have a short highlight of the quarter. Then we will go into the financials, and then I will give you an update on the different business segments. And then we have a Q&A in the end, as usual. So the quarter has been a really, really positive one. As you know, we had a strong Q1, and this positive trend continues into the second quarter. We see a strong growth compared to last year. We have profitable results in the bottom line, and we can also see strong positive cash flow and a lower cost base.
So all the key performance indexes are actually pointing at a very, very positive direction. And the financial position of the company is still strong. We have a debt-free balance sheet, and as I said, a strong positive cash flow and also cash in the bank. So the financials have been really, really positive for this quarter. If we're moving ahead, you can see here on the sales curves the last years that we have a trend disruption that we can see that now the rolling 12 is pointing upwards. And as you can see, we had a couple of quarters where we are above SEK 40 million. I think it was five quarters that we had in 2021 and 2022, and we are definitely heading on that way again. And then some highlights from the business.
We can see the market is recovering, but it's also very, very hard work from the team. I want to thank all of them for the hard work. We have to come back on track again. The measures we took last year in terms of reducing the team and also to put some new strategies in place have actually been paying off. To separate the two business areas, Polygiene and Addmaster, it makes a more stronger and clearer message out to the different target groups. As we wrote in the report, we can see that July has started very well so far. Now over to some financial key figures.
Yes, let's start with a short summary, overall summary. The sales have increased from SEK 25.4 million to SEK 36.4 million. We have a gross margin of 65.2% versus 74.2% last year. Operating cost is down to SEK 20.1 million versus SEK 20.6 million last year. And we have an EBITDA of SEK 2.6 million this year versus -SEK 4 million last year. EBIT of SEK 1.2 million versus -SEK 5.3 million last year. And cash flow, as Ulrika said, very strong with SEK 5.6 million during the quarter versus -SEK 2.8 million in Q2 last year. The cash in the bank is SEK 54.3 million versus SEK 47.1 million. If we look into a little bit more deeply into the sales, as we said, we had a strong quarter versus last year, it's up 43%. It's also slightly better than Q1 this year.
And the shares of sales, we can see that the Polygiene part is 46% versus 39% last year, and Addmaster is 54% versus 61%. We had an increase in Polygiene of 68%, and Addmaster increased with 27%. Looking on the different markets, we can see that the biggest increase has been done in APAC, which increased over 100%, mainly driven by China. We also see a good growth in India with 23%, while America has been more or less flat during the quarter. And the increase in APAC is driven in both segments. There are also a part of distribution orders that has fallen into quarter three due to some of the small problems we've seen in the supply chain. If we then look into the other parts of the P&L, we can see, as we said, the sales was up 42%.
We see a lower margin this quarter versus last quarter. It's mainly driven by currency impact and product and customer mix in the increased sales we have seen in the Addmaster business. Cost is down 2.4%, driven mainly by the relocations of consultants to employees. I think it's important to have in mind that the commission is higher in those numbers with SEK 700,000, and that's driven by the sales numbers. So even if we see that the sales is increasing and driving the commission, we can still see that the cost base is lower this year versus last year. We have an EBITDA of SEK 2.6 million versus the -0.4, and an EBIT of SEK 1.2 million versus -5.3. And as we said, the cash flow was very strong with 5.6 versus -2.8.
If you put in the FX effect as well, it's still strong with SEK 5.4 this year versus SEK -500,000 last year.
Thank you, Niklas. Now I will go into the different business segments, Polygiene and Addmaster. Just to show you how Polygiene looks like now, if you go into the website, we have separated the communication to the market. Polygiene Freshness is now all about textiles. It's all about building this ingredient brand where we can have a demand from the end consumers. This area is mainly driven by sustainability and also to help our brand partners to become more sustainable and make their products be even better and prolong the lifetime of those. This is how the website looks when you get into the Polygiene side now, and the message is more clear, it's more understandable, and it makes more sense for this audience. Polygiene is focused on building this ingredient brand.
The communication is very much B2C to prove to the end consumer that there is a value for them to choose garments with Polygiene inside. This is quite different, sorry, from what Addmaster is achieving. Some highlights from Polygiene. As Niklas said, we see a very strong start of the year and also in the quarter, both 68% and 70%, I think, if we look year to date. The distributors have started placing orders again. We had some orders come in in June, but due to some challenges in the supply chain, we had to push those into the third quarter. But this challenge is not about shortages. It's just that we have to be able to plan better now when we see that the demand increases, especially in China.
So we have to just extend the delivery times from the supplier to be shipped to the distributors in China. So it's just temporary, and this will be up and on track again in July. And as Niklas also said, that APAC is the winner. We have doubled the sales the first half year, and China is, of course, the driver in this growth. And the reason why China is going so well now, I would say it's actually three main factors. The first one is, of course, that we have a local team over there. So it's a very strong team, and we work really, really close to the customers there. We've seen sales coming back from existing customers, but they also onboarded quite a lot of new customers this year. And you can see in the picture here, it's from Pelliot.
It's an outdoor brand in China selling mainly through the big Alibaba, the Tmall, all these big online sites. And then, of course, we have seen really, really good results from the partnership with STT that we onboarded last year. They have been having recurring orders coming back with quite some good volumes coming regularly, which is very good for our business. So I would say that Asia is definitely a winner, and especially China for Polygiene. Another very positive news is that the European Commission has been extending the decision for the biocides program until the 31st of December 2030. And what does that mean?
Yes, the review program is an evaluation program where they actually go through all biocides on the market in all kinds of product types, and then they go one by one and decide for the future. This program has been going on for 20 years. Now they can see that they will not be in time. The goal was to be finished by this year, but they have to extend. So another six years for the silver that we use is absolutely safe and legal and compliant to work with. This is very good news for those who thought that this is something that will be banned. That is not the case. So for six years more, until we have a decision, and hopefully that decision will be positive when that happens. Just some comments on the ShedGuard development.
I promised to come back in Q2 and see how it's going. It's a technology to reduce microfiber shedding and to protect clothes from pilling. This started out as an innovation project in the beginning of the year. We have finalized the first phase that was to start first testing with 6 different innovation partners. Those test results have come back, and now we decided to move on to phase two, which is actually to share these test results with 16 chosen brand partners and mills. And now we go into another testing round with those. And the challenge here is to get consistent data, and we need a lot of data points to be sure to find the absolutely right mix, the right fabrics, the right application methods. So it is a time-consuming project. We will not see any commercial orders this year.
I think if the results are going to be positive, that we really hope and think they will, we can see commercial orders first next year. We will give you a new update in the end of Q3 when we hopefully have some new results from the second phase of this very interesting project. Moving into Addmaster and the hard surfaces, this is how you can see on the website now how Addmaster is a completely different messaging. It's more tech and data-driven. It's more science-based. It's a completely other counterpart on the other side. That's why the Addmaster website has been changed to be more technical and more B2B aligned. The look and feel is, as you see, quite different. If Polygiene is driven by the sustainability, Addmaster is driven by hygiene, hygienic surfaces.
To be a thought leader in this industry, we have started to write these really good educational articles, and we have them on the website, but we also present them in social media to show and educate people how important it is with hygiene. Here are some highlights from Addmaster. Also strong growth in the quarter compared to last year. The margin has been a little bit lower than expected, but it's because of the product and customer mix. There has been a bigger share of distributor orders this quarter. We can also see that the top customers are ordering again. We have seen big orders from the packaging industry. We have seen big orders from distributors in Vietnam. Yes, and as we can see, APAC, the same as in Polygiene, the fastest growing market and 78%.
Even if EMEA is still the largest region and APAC is quite small, it's really good to see how it's picking up in other regions as well. Very positive is also that we saw the first geotextile order since the new agreement was signed in January. This order will be delivered somewhere in Q3, Q4 this year. The team has been very active. We have many trade shows we have attended in medtech, flooring, aerospace, automotive. This is to meet with existing customers, but also to find new potential leads. Last, the new website is performing according to the plan. We have a goal to get the Addmaster website back to the numbers we had when the old Addmaster site was online.
Then we have some general updates. In the annual meeting, we have a new board member, which is Sofia Sessel. We have then also reduced the board members to four people. We started, I would say, the CSRD process journey, and we will try to implement this during 2025 and have a sustainability report. We launched, as Ulrika said, within the split of the Addmaster and Polygiene. We also then launched an overall Polygiene group website focusing more for the investors. During the annual meeting, we also finalized the warrant program for 2024 to 2027.
Thank you. Sorry, I lost my voice there. Some focus areas moving ahead. We will still continue to grow the top line. We will improve the profitability. We will keep track on the key figures, and the cash flow is important, but also to guard and monitor the margins so we keep those by plan. To get the new technologies commercialized, we have the ShedGuard project running, but we also have the StayFresh Bio that we are working on now to get out in the market. We have some tests coming up here end of August with a big player. So let's see how that turns out. Also to don't rely only on the product portfolio we have today. We have to also think about what is tomorrow's demand, what kind of technologies will be on the market in the future.
So we have quite intense work with the product development, both on the Polygiene side, but also on the Addmaster side. So I hope I can come back very soon to tell you more about these projects. And then we also are doing an overview of the supply chain to avoid these shortages. Like we have to plan now since the supplier has announced that we have to order more early because they have extended lead time. So this is something we are working on to not be in the situation again when we have orders, but they can't go out in time. But that's just temporary, as I said. Okay, so let's move into the Q&A. I think, Niklas, you have the questions.
Yes, we got some questions before the meeting, and we can start with them, and then we can see if there's something coming up right now. One of the things we got questions was regarding the customer base and the loyalty, the customer loyalty, and how we do to what kind of actions we are taking to work sort of mainly with the customer loyalty.
Yeah, I would say that the separations of the two business areas have been very good for this because now we can work all in with the Polygiene customers to add value, and then we can work on the Addmaster side on the way that their customers need to be handled. We are working close to the customers. We know that the relations are key. We know that we have to stay very close to them, even if they are not like last year when they're not buying from us. We still need to be very, very close to know what's going on. So I think the support that we can offer, both from technical and marketing, is actually what keeps this loyalty to that they stay with us and not go anywhere else.
Then we got the question regarding the competitive situation, I would say, especially on our main markets. How we see that right now?
It depends on its competition in different regions. Yes, there are of course different competitions in different regions. We know that some regions are very price pressured, I have to say. But we also believe that we will not just go up from price because that is not something we can win. We always have to add the value we do to actually make the customers want to buy and stay with Polygiene, even if there is a price competitive situation in some regions.
We also got the question a little bit about the development products. I think we touched a little bit on that one, but maybe we can say a little bit more on the products and technologies. As we have right now, it's the ShedGuard and the bio. That's official. As you said, we are also looking into the next generation's products as well. But that's not really official right now.
No, we haven't announced anything yet to the market regarding the projects because we still want to work a little bit more before we announce something. There are quite extensive projects going on the development side.
Then we got a question about the cash flow. If it continues to be good, if we are thinking about investing it more like in an M&A or dividends. Yes, as you're saying, the cash flow is really good, and we have a strong cash situation. And as always, there's also a discussion internally and also with the board of what we should use the cash for, if we should use it to invest in continued growth or in M&As or dividends. The discussion is ongoing, but there's nothing that we can communicate, especially what we will do. But we have noticed the strong cash flow.
Yeah, and we are not just piling up money, of course, that will be used, but also in the best way. We still have a really ambitious growth plan for the company. We will come back on this one.
And then we also had the question about Addmaster. Been a little bit quiet, as I said, about more exciting customers.
No, I think we have the geotextile customers come in this quarter that will be delivered, as I said, during the year. That's a very interesting one. There are several projects in the pipeline, interesting ones. So I think we are not press releasing every new customer. We try to talk about these things in these meetings, and sometimes we do not even mention. But there are, of course, new customers coming in.
Maybe we can tell you because we got the question about the car industry, if there's something new there or is it still new that we're only working with officially? Maybe we can tell you.
No, we work with more customers, more automotive customers coming from the OEM in China. We also work directly with, I think, four or five big projects that we have NDA signed. We have ongoing discussions, but this is a very long-term sales cycle because if they want to approach something new in this industry, it takes a very long time to get in, and you have to be in the right window when they are changing technologies. But when you're in, you will be there for a long time. It takes quite some time to get in and get nominated as a technology. But on the other hand, if you get in, you will be there for quite some time.
Then we also got the question about the long-term forecast, if we will leave a new long-term forecast. As we said in the Q4 report when we released that, for the moment, we are not planning to leave any long-term forecast.
Not externally, no.
That was all questions we got prior to the meeting.
Are there any customers' questions?
No, not right now. Doesn't seem to be any more questions coming in.
Okay, and then I think we are ready.
We're done.
Yeah, then we are done. Thank you so much for listening, and see you in October for the Q3 webinar. Thank you. Bye.