Q2 2016: Continued healthy growth and a transforming acquisition

SECOND QUARTER OF 2016

  · NET SALES amounted to MSEK 73.3 (59.0).
  · OPERATING PROFIT totalled MSEK 20.7 (15.7). Operating profit includes
acquisition costs in the amount of 7.5 MSEK
  · PROFIT AFTER TAX amounted to MSEK 17.1 (10.8).
  · PROFIT AFTER TAX PER SHARE was SEK 1.87 (1.19).
  · CHANGES IN CASH AND CASH EQUIVALENTS amounted to MSEK 16.4 (neg: 5.1). Probi
paid dividends of MSEK 9.1 (7.7).

ACCUMULATED 2016

  · NET SALES amounted to MSEK 160.3 (127.9).
  · OPERATING PROFIT totalled MSEK 56.0 (43.0). Operating profit includes
acquisition costs in the amount of 7.5 MSEK
  · PROFIT AFTER TAX amounted to MSEK 44.0 (33.2).
  · PROFIT AFTER TAX PER SHARE was SEK 4.83 (3.64).
  · CHANGES IN CASH AND CASH EQUIVALENTS amounted to MSEK 26.4 (13.4). Probi
paid dividends of MSEK 9.1 (7.7).

SIGNIFICANT EVENTS DURING THE SECOND QUARTER:

  · Probi signed an agreement to acquire Nutraceutix and strongly expand its
North American presence
  · Resolution on rights issue of approximately MSEK 600 at an Extraordinary
General Meeting
  · New agreement with Ipsen Pharma for the launch of Probi’s digestive health
capsules in 18 markets
  · Agreement on launch of Probi FerroSorb® in the first market outside
Scandinavia

CEO COMMENTS ON THE OPERATIONS:
I am very pleased that we succeeded in signing an agreement regarding this major
and transforming acquisition of Nutraceutix. The companies have highly
complementary business models and customers, as well as strong entrepreneurial
values. I envisage an excellent combination for continuing the development of
Probi by working on merging Probi’s strong R&D expertise with Nutraceutix’s know
-how in technologies and manufacturing in the future. This acquisition also
creates a strong platform for pursuing growth in the US and in the global
market. The approved rights issue will ensure financing of the acquisition at a
very healthy financial level.

While much energy has been invested in the acquisition, it is, of course, highly
satisfying to note that we succeeded in retaining Probi’s healthy organic sales
growth during the quarter, at the same time as we also expanded our operating
margin. Net sales for the first six months totalled MSEK 160.3, corresponding to
a 25% increase year-on-year. The operating margin of 34.9% (33.6%) for the first
half of the year was an improvement compared to the same period previous year.
Excluding acquisition costs of MSEK 7.5, the operating margin was 39.6%.

We laid the foundation for stable future performance in new markets and new
fields of application with a number of new agreements and product development
projects during the period.

FOR FURTHER INFORMATION, PLEASE CONTACT:
Peter Nählstedt, CEO, Probi, tel: +46 (0)46-286 89 23 or +46 (0)723-86 99 83, e
-mail: peter.nahlstedt@probi.se

This information is such that Probi AB is required to disclose in accordance
with the Swedish Securities Market Act and/or the Financial Instruments Trading
Act. The information was submitted for publication on 15 July 2016 at 8:45 a.m.

This is a translation of the Swedish version of the interim report. When in
doubt, the Swedish wording prevails.

ABOUT PROBI
Probi AB is a Swedish publicly traded bioengineering company that develops
effective and well-documented probiotics. Through its world-leading research,
Probi has created a strong product portfolio in the gastrointestinal health and
immune system niches. Probi’s products are available to consumers in more than
30 countries worldwide. Probi’s customers are leading food, health-product and
pharmaceutical companies in the Functional Food and Consumer Healthcare
segments. Probi had sales of MSEK 216 in 2015. The Probi share is listed on
Nasdaq Stockholm, Small Cap. Probi has about 4,000 shareholders. For more
information, please visit www.probi.se.