As expected, sales during the third quarter amounted to SEK0m (SEK0m) as the Neola device has not reached the market yet. Furthermore, operating expenses amounted to SEK-3.8m (SEK-3.9m), which can be compared to our estimate of SEK-5.5m. The operating expenses consisted mainly of personnel costs and other external expenses. Both these line items came in lower than anticipated; however, we learned from the conference call that personnel costs could fluctuate a bit between quarters. Overall, in absolute numbers, our estimates were fairly aligned with the actuals. Lastly, EBIT came in at SEK-2.5m (SEK-2.5m) compared to our estimate of SEK-3.4m, where the main difference between actuals and estimates is the operating expenses.

Overall, we argue the report did not include any major surprises, as the company did not disclose any sales (as expected), and costs were a bit lower than expected but still within the margins. Furthermore, we believe Neola Medical has an interesting year ahead, with the clinical validation phase and an FDA regulatory application submission about a year from now (Redeye estimate). We highlight that solid results from clinical studies and the FDA submission could act as solid triggers for the share.

As we have not made any estimate changes, it does not impact our valuation of Neola Medical. However, we have incorporated capital raisings of SEK50m into our valuation (SEK30m in 2025e and SEK20m in 2026e). This means that we base our valuation on a higher number of shares than the actual and apply current share price levels to our capital raising assumption. The Neola share price has decreased since our initial report publication of the company (from SEK2.35 to around SEK2.1). When updating the share price in our model, this has a minor effect on our fair value range. Our base and bear cases are intact at SEK3.1 and SEK1.0, respectively. However, the change has a minor effect on our bull case, which is decreased from SEK5.8 to SEK5.7.