Net Sales came in at SEK8.1m, 151% y/y, well ahead of our estimated SEK4.2m (deviation 93%). Sales were mainly related to sensors for integration, but instruments also contributed to the strong results. We were cautious going into Q2 as we believed the Gasporox order book slated for H1’23 was mainly delivered in Q1. It is unclear whether that was the case, but we conclude that H1’23 net sales were SEK10.4m above the total order book (H1’23 net sales SEK18.9m vs. order book of SEK8.5m.) Gasporox has now had four consecutive EBITDA-positive quarters, indicating it is moving closer to sustained profitability. Moreover, the results show a diminishing quarterly seasonality and Gasporox’s customer base widens.

During the quarter, we conducted channel checks on Gasporox’s US expansion. Our high-level takeaways are that Gasporox’s technology is superior to the competition but is seen as a substitute for existing solutions. Consequently, customers hesitate to switch equipment unless they replace old equipment, resulting in a slow rollout. However, Gasporox appears to have latent pricing power.

While the report was strong, and we view Gasporox favorably, we are cautious as not to extrapolate a few strong quarters. Our H2’23 net sales estimates imply a slight increase from H1’23 results, with H2’23e totaling SEK18.9m vs. SEK17.3m in H1’23. We have not changed our 2024 estimate on an absolute basis, which implies a 25% growth rate rather than 40% as our previous estimate. We believe 2024 will be a hard comparison year, particularly H1’24e, given the strong H1’23, partly driven by pent-up customer demand. We reiterate the fair value range at SEK12-45 per share with a base of SEK25.