Interim report January–March 2010 Vitrolife AB (publ)

Vitrolife is a global biotechnology/medical device Group that works with developing, manufacturing and selling advanced products and systems for the preparation, cultivation and storage of human cells, tissue and organs. The company has business activities within three product areas: Fertility, Transplantation and Stem Cell Cultivation. Vitrolife today has approximately 170 employees and its products are sold in more than 85 markets. The company is headquartered in Gothenburg, Sweden, and there are subsidiaries in USA, Australia, France, Italy, Great Britain and Japan. Production facilities are located in Sweden and the USA. The Vitrolife share is listed on NASDAQ OMX Stockholm, Small Cap.

Continuous strong underlying growth with good profitability and cash flow

Quarter in brief

• Growth in local currency was 15 percent.Sales amounted to SEK 75 (72) million, corresponding to an increase of 5 percent in SEK.
• Operating income before research and development costs increased by 21 percent and amounted to SEK 21 (17) million.
• Operating income (EBIT) increased by 14 percent and amounted to SEK 10 (9) million. The operating margin was 13 (12) percent.
• The Group's net income amounted to SEK 10 (8) million, which gives earnings per share of SEK 0.50 (0.43)
• The cash flow from operating activities was SEK 7 (-3).
• The clinicalstudy on STEEN Solution™ was completed during the period.
• A collaboration agreement was entered into with Finn-Medi Research Ltd concerning the Stem Cells area.

CEO's comments

"Sales growth during the first quarter of 2010 continued to be strong, 15 percent in local currencies, and is in line with the development of the last two quarters of

Particularly pleasing is the growth in the North American market, which has begun to recover, and that Asia, in particular China, continues to grow strongly. It is in the southern part of Europe where there is now uncertainty about the development of the market due to the local economic climate. The quarter was characterized by intensive development activities in all three product areas which is expected to result in a strengthening of the product portfolio in the latter half of the year onwards. Despite countervailing changes in exchange rates and investments in both research and development to market we performed a strong performance for the quarter.

The clinical development within the transplantation area is accelerating and, as is also the case for the fertility area, several clinical results will be presented in the time ahead. Past studies are expected to contribute to strengthening the competitiveness of existing product portfolio and will form the basis for further regulatory approvals."

Magnus Nilsson, CEO

Koncernens nyckeltal

		Quarter	Apr 2009	Whole year
MSEK	2010	2009	– Mar 2010	2009
Net Sales	75	72	278	275
Gross Profit	52	49	196	193
Gross Margin, %	69	69	71	70
Operating income (EBIT)	10	9	32	30
Operating margin, %	13	12	12	11
Income after financial items	10	9	32	31
Net income	10	8	35	34
Equity/assets ratio, %	87	86	87	87
Income per share, SEK	0.50	0.43	1.81	1.75
Shareholders'equity pershare, SEK	16.62	15.33	15.75	15.94
Share price on closing, SEK	40.50	22.60	n/a	34.80
Market cap at closing,	792	442	n/a	680

Financial objectives

Vitrolife's Board considersthat Vitrolife should have a strong capital base in order to enable continued high growth,both organically and through acquisitions.The company's equity/assetsratio should not normally fall below 40 percent.The objective for Vitrolife's growth over a three-year period is an increase in sales of on average 20 percent per year and that the company reports positive net income.

Key figures January – March 2010 ²¹⁴ ³⁰ ¹⁹³ ²⁰² ²⁷ 2 24 2 25

Net Sales 172

Vitrolife's netsalesfor the first quarter increased by 5 percent and amounted to SEK 75 (72) million. Sales growth in local currencies was 15 percent.

Income

Operating income increased by 14 percent and amounted to SEK 10 million (9), corresponding to an operating margin of 13 percent (12). The gross margin remained unchanged at 69 percent and gross income increased by 5 percent to SEK 52 (49) million. Selling expenses amounted to 26 (27) percent of sales, while administrative expenses for the period decreased somewhat and amounted to 13 (14) percent of sales. R&D costs increased as a consequence of investments in above all the stem cell and transplantation areas and amounted to 14 (11) percent of sales. Other operating expenses were affected negatively by the currency translation adjustment of accounts receivable attributable to the beginning of the year and amounted to SEK -1 million. Depreciation and amortization of SEK 4 (4) million were charged against net income for the period. 100 50 100 150 200 250 300 Fig 3. Income (rolling 12 months) SEK millions 80 70 60 50 40 30 20 10

In addition to current business activities, the company is also investing in new technologies and business areas, such as completely new transplantation methodologies using STEEN Solution™ and products for the cultivation ofstem cells. It is thus also relevant to assess the operating profit before R&D costs. During the period this amounted to SEK 21 (17) million, corresponding to a margin of 28 (24) percent. 50 30 20 10

Net income amounted to SEK 10 (8) million. Net financial income amounted to SEK 0 (0) million. Net financial income includes non-realized exchange rate fluctuations regarding internal receivables and liabilities of SEK 0 (1) million. The minority interest in A.T.S Srl amounted to SEK -1 (0) million. Fig 3. Income (rolling 12 months) SEK millions 60 50 0 -10 -20 -30 Q1 Q2 Q3 Q4 2009 Q1 Q2 Q3 Q4 2008

Cash Flow Kassaflöde från den löpande verksamheten Kassaflöde

The cash flow from operating activities increased and amounted to SEK 7 (-3) million. Operating income decreased during the period by SEK -7 (-12) million and is primarily attributable to the increase in accounts receivable as a consequence of increased sales, above all during the latter part of the period. Investments increased by SEK 7 (8) million and mainly come from gross investments in intangible assets, primarily in STEEN Solution™. Investmentsin property,plant and equipment amounted to SEK 1 (6) million. The cash flow from financing activities was SEK 0 (-1) million. Cash and cash equivalents at the end of the period amounted to SEK 16 million. Operating income before R&D costs Operating income EBITDA 0 -10 -20 -30 Q1 2010 Q1 Q2 Q3 Q4 2009 Q1 Q2 Q3 Q4 2008 Kassaflöde efter investeringsverksamhet

Financing Q1 Q2 Q3 Q4 2009

Vitrolife'stotal credit facilities amount to SEK 29 (22) million and are utilized mainly for the financing of business activities in the form of a bank overdraft facility in the subsidiary Vitrolife Sweden AB.Of the company's total credit facilities SEK 10 million is utilized.These consist of the company's long-term financing 5 (4) million is interest-bearing loans and SEK 2 (0) million non-interest-bearing loans. Short-term financing amounts to SEK 3 (7) million. Nettoomsättning Bruttoresultat Rörelseresultat Rörelseresultat före FoU-kostnader Rörelseresultat (EBIT) Rörelseresultat före avskrivningar (EBITDA) Exkl. engångskostnader

The equity/assets ratio was 87 (86) percent. The return on capital employed amounted to 11 (11) percent. Capital employed amounted to SEK 333 (311) million at the end of the period. 198,4 207,5 Fig 2. Omsättning och resultat per kvartal Soliditet

Shareholders'equity pershare amounted to SEK 16.62 (15.33). 31,8

Parent Company

Business activities focus on company-wide management and the company has no employees. There were no revenues for the period (-). The costs that arise are mainly attributable to the Board, to NASDAQ OMX Stockholm and the listing of the company's shares. Income before tax amounted to SEK -1 (-3) million. Liquid funds amounted to SEK 1 (0) million. No investments were made during the period (-). 120,6 Q1 Q2 Q3 Q4 2009 Q1 Q2 Q3 Q4 Årets ökning Ackumulerad ökning 2006 2002 2003 2004 2005 2006 2007 10% 43%

The Vitrolife share is listed on the NASDAQ OMX Stockholm Small Cap list under the symbol VITR. The closing price on March 31, 2010 was SEK 40.50 (22.60). Nettoomsättning Bruttoresultat Rörelseresultat 2002 2003 2004 2005 2006 2007 17%

Product Areas Fertility 2002 2003 2005 2006 2007 2008 2009

Nutrient solutions (media) and advanced single-use instruments such as needles and pipettes, for the treatment of human infertility.

• Salesfor the period amoutned to SEK 66 (61) million, corresponding to an increase of 7 percent. Sales growth in local currency was 17 percent.
• Recovery in the U.S.market and continued strong performance in Asia during the period.

Sales of both media and in particular instruments developed well during the period.

Sales in the Europe/Middle East region increased by 6 percent during the period. In local currencies this corresponds to an increase of 15 percent. The Middle East and Africa developed strongly, as did most countries in Europe. The exceptions are in the souther part of Europe, where the economic situation in the countries is at present unstable.

In the Rest of the World region sales increased by 26 percent. Development in China and Japan continues to be very strong. Australia displays strong growth through new customers, primarily for instrument products. Europa / Mellanöstern Q1 Q2 Q3 Q4 2008 Q1 Q2 Q3 Q4 2009

In the American region a recovery can be noted in the markets, with increased growth of 11 percent in local currencies.

Transplantation Nettoomsättning per geografiskt område (rullande 12 mån)

163,4 157,8 143,7 151,5 46,6 Solutions and equipment to keep tissue in optimal condition for the required time outside the body while awaiting transplantation.

• Salesfor the period amounted to SEK 10 (10) million, a decrease of 3 percent. Calculated in local currency growth was 10 percent.
• The clinicalstudy on STEEN Solution™ has now been completed and the result of the study will be presented in the beginning of May. Q1 Q2 Q3 Q4 2009 Q1 Q2 Q3 Q4

Sales of transplantation products, primarily Perfadex®, decreased by 3 percent. Calculated in local currencies the increase was 10 pecent during the period. So far more than 40 lung transplantations in total have been performed in the world using the STEEN Solution™ method and interest is continuously growing among internationally leading researchers and clinics. During the period further European hospitals, amongst other things in Spain, England and Austria, have used the STEEN Solution™ method clinically in lung transplantations.

The clinicalstudy in Canada on STEEN Solution™ has now been completed and the results from the study will be presented in the beginning of May. Increased efforts are being made to establish the revolutionary technology in opinion-leading clinics through training and demonstrations and the like. More than forty of the world'sleading lung transplant surgeons have now undergone the training. Development is also ongoing of the peripheral products necessary for lung evaluation using STEEN Solution in connection with the clinical trials. The plan is that these products will be launched at the same time as STEEN Solution™ in the USA.Research is ongoing about the use of technology in other organs such as liver. 0 10 20 30 40 50

Stem Cell Cultivation

Media and instruments for the cultivation and handling of stem cells for therapeutic purposes.

• Salesfor the period amounted to SEK 0.2 (0.7) million.
• A collaboration agreement was entered into with Finn-Medi Research Ltd during the period.

Research resources for the development of new products for clinical use of stem cells has increased over the past few years. At the beginning of the year a separate business development organization was formed within Vitrolife with a view to focusing on the development of clinical stem cell media. Vitrolife entered into a collaboration agreement with the Finnish company Finn-Medi Research Ltd regarding a patent and know-how for media intended for the cultivation of pluripotent stem cells.

Vitrolife viewsthe product area's prospectsincreasingly positively, as there are more and more reports of clinical trials having been started using stem cells, which indicates that the point in time when this will become an established clinical treatment is approaching. This will then increase the demand for media produced in accordance with authority requirements regarding medical devices, which Vitrolife has great experience of. Vitrolife will therefore continue to gradually increase investments in product development within the area together with leading industrial and scientific collaboration partners.

Prospects for 2010

During the year the focus will be on strengthening and expanding the product portfolios in order to achieve market synergies through our own product and if the opportunity arise through acquisitions. Programs on making the production processes more efficient with a view to maintaining good gross margins are ongoing. The work on strengthening the global marketing and sales organization continues and is expected, together with expanded product portfolios, to gradually enable continued good and profitable sales growth. Q1 Q2 Q3 Q4

Other information

Organization and personnel

Comprehensive training is ongoing of all of Vitrolife's personnel regarding the LEAN production concept. The LEAN concept aims to make all parts of the organization even more efficient. Training will continue during parts of 2010. ³⁰ x2006

During the three first months the average number of employees was 170 (152), of whom 100 (91) were women and 70 (61) were men. 123 (112) people were employed in Sweden, 36 (35) in the USA and 11 (5) in the rest of the world. Some employees in Sweden are working on several other markets The number of people employed in the Group at the end of the period was 173 (154).

Information on transactions with related parties

No transactions that have substantially affected the company's financial position and results have been carried out with related parties during the period. For information on related parties, see the Annual Report for 2009, page 59.

Risk management

Vitrolife is constantly working to identify, evaluate and manage risks in different systems and processes. During 2009 a more comprehensive project was begun regarding Enterprise Risk Management (ERM), with the aim of ensuring that the risks are handled in a systematic way, that the right priorities are made and that the risks are managed as effectively as possible. The project will continue during under 2010. FSG AO

The principal risks and uncertainty factors that the Group faces at present are related to the company's market investments, product development investments, currency risks and legal risks. 250 225 200

For further information on the Group's operational and financial risks, risk exposure and risk management, please refer to Vitrolife's Annual Report for 2009. 175 100

Events after the end of the period

At Vitrolife's Annual General Meeting on April 26, a resolution was adopted that the proposed dividend of SEK 0.50 per share would be paid to the shareholders.

April 27, 2010

Magnus Nilsson CEO 175000

Financial reporting

Vitrolife'sinterim reports are published on the company's website, www.vitrolife.com, and are sent to shareholders who have registered that they would like to have this information.

Reports coming in 2010

Interim report January – June: Thursday July 15, 8.30 am Interim report January – September: Tuesday November 2, 8.30am

Queries should be addressed to

Magnus Nilsson, CEO, phone +46 31 721 80 61. Eva Nilsagård, CFO, phone +46 31 721 80 13

This report has not been reviewed by the company's auditors.

Vitrolife is required to publish the information in this press release in accordance with the Swedish Securities Market Act and/or the Financial Instruments Trading Act. The information was submitted for publication on Tuesday April 27, 2010 at 8.30 am.

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

Income after financial items

		January – March
SEK thousands	2010	2009	2009
Net sales	75 278	71 840	274 626
Cost of goods sold	-23 479	-22 640	-81 741
Gross income	51 799	49 200	192 885
Selling expenses	-19 740	-19 269	-80 275
Administrative expenses	-9 847	-10 254	-38 831
Research and development costs	-10 805	-8 359	-38 574
Other operating revenues and expenses	-1 404	-2 525	-4 797
Operating income	10 003	8 793	30 408
Financial income and expenses	232	-146	179
Income after financial items	10 235	8 647	30 587
Taxes	-459	-84	3 782
Net income	9 776	8 563	34 369
Attributable to
Parent Company's shareholders	9 623	8 576	34 114
Minority interest	153	-13	255
Earnings per share, SEK	0.50	0.43	1.75
Earnings per share, SEK*	0.50	0.43	1.75
Average number of outstanding shares	19 552 857	19 800 157	19 552 857
Average number of outstanding shares*	19 552 857	19 654 767	19 552 857
Number of shares at closing day	19 552 857	19 800 157	19 552 857
of which own shares	—	247 300	—
Number of shares at closing day*	19 552 857	19 800 157	19 552 857
of which own shares	—	247 300	—

Depreciation and amortization has reduced income for the period by SEK 4 033 thousand (3 839).

* After dilution. Vitrolife has one outstanding share warrant program, comprising 400 000 warrants. The net present values of the issue price in the

program higher than both the share price at closing day and the average share price for the last 12 months.

Statement of comprehensive income

		January – March
SEK thousands	2010	2009	2009
Net income	9 776	8 563	34 369
Other comprehensive income
Change in hedging reserve, net after tax	3 542	-2 752	638
Change in translation reserve, net after tax	254	5 997	-7 404
Total other comprehensive income	3 796	3 245	-6 766
Total income	13 572	11 808	27 603
Attributable to
Parent Company's shareholders	13 419	11 821	27 348
Minority interest	153	-13	255

Other key ratios

		January – March
	2010	2009	2009
Gross margin, %	68.8	68.5	70.2
Operating margin, %	13.3	12.2	11.1
Operating margin before R&D costs, %	27.6	23.8	25.1
Net margin, %	13.0	11.9	12.5
Equity/assets ratio, %	86.8	86.4	86.7
Shareholders'equity pershare, SEK	16.62	15.33	15.94
Shareholders'equity pershare, SEK*	16.62	15.33	15.94
Return on equity, %	11.5	10.7	11.3
Return on capital employed, %	11.3	11.0	11.9
EBITDA, %	18.6	17.6	16.8
*After dilution, see above

Consolidated income statements per quarter

SEK thousands	Jan–Mar 2010	Oct–Dec 2009	Jul–Sep 2009	Apr–Jun 2009	Jan–Mar 2009	Oct–Dec 2008
Net sales	75 278	67 360	65 247	70 179	71 840	59 042
Cost of goods sold	-23 479	-20 206	-18 752	-20 144	-22 640	-17 860
Gross income	51 799	47 154	46 495	50 035	49 200	41 182
Selling expenses	-19 740	-21 688	-19 149	-20 169	-19 269	-18 768
Administrative expenses	-9 847	-9 355	-9 211	-10 010	-10 254	-11 542
Research and development costs	-10 805	-9 761	-9 430	-11 024	-8 359	-7 813
Other operating revenues and expenses	-1 404	276	-1 510	-1 039	-2 525	2 403
Operating income	10 003	6 626	7 195	7 793	8 793	5 462
Financial income and expenses	232	540	9	-223	-146	223
Income after financial items	10 235	7 166	7 204	7 570	8 647	5 685
Taxes	-459	3 925	101	-160	-84	4 137
Net income	9 776	11 091	7 305	7 410	8 563	9 822
Attributable to
Parent Company's shareholders	9 623	11 067	7 260	7 237	8 576	10 035
Minority interest	153	24	45	173	-13	-213

Consolidated balance sheets

SEK thousands	Mar 31, 2010	Mar 31, 2009	Dec 31, 2009
ASSETS
Goodwill	97 301	89 294	97 301
Other intangible fixed assets	39 502	28 684	34 506
Tangible fixed assets	91 531	103 389	93 038
Financial fixed assets	29 463	28 343	30 652
Inventories	42 260	46 968	41 847
Accounts receivable	45 872	41 837	37 993
Other current receivables	7 721	10 868	7 125
Derivative instruments	4 788	—	866
Liquid funds	15 871	1 903	15 987
Total assets	374 309	351 286	359 315
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders'equity, attributable to the Parent Company's shareholders	325 007	303 882	311 588
Minority interest	603	314	481
Long-term non interest-bearing liabilities	2 369	—	2 489
Long-term interest-bearing liabilities	4 504	3 701	4 704
Short-term interest-bearing liabilities	2 981	2 217	2 981
Accounts payable	15 149	14 544	14 697
Derivative instruments	—	2 752	—
Other short-term interest-free liabilities	23 696	23 876	22 375
Total shareholders' equity and liabilities	374 309	351 286	359 315
Pledged assets for own liabilities
Contingent liabilities	20 000	20 000	20 000
	Inga	Inga	Inga

Consolidated changesin shareholders'equity

	Attributable to the Parent Company's shareholders				Minority	Total
	Share capital	Other capital	Reserves	Retained earnings	interest	shareholders´ equity
SEK thousands		contributed
Opening balance January 1, 2009	19 800	208 566	-11 475	75 170	327	292 388
Total comprehensive income			-6 766	34 114	255	27 603
Dividend				-7 821		-7 821
Increased in share capital via bonus issue	391		-391			—
Cancellation of own shares	-247		247			—
Other transactions with minority shareholders					-101	-101
Closing balance December 31, 2009	19 944	208 566	-18 385	101 463	481	312 069
Opening balance January 1, 2010	19 944	208 566	-18 385	101 463	481	312 069
Total comprehensive income Dividend			3 796	9 623	153	13 572
Other transactions with minority shareholders					-31	-31
Closing balance March 31, 2010	19 944	208 566	-14 589	111 086	603	325 610

Consolidated cash flow statements

		January – March	Whole year
SEK thousands	2010	2009	2009
Income after financial items	10 235	8 647	30 587
Adjustment for items not affecting cash flow	4 443	274	14 083
Change in inventories	-276	-746	3 098
Change in trade receivables	-8 910	-7 772	-1 575
Change in trade payables	1 854	-3 564	-4 715
Cash flow from operating activities	7 346	-3 161	41 478
Cash flow from investing activities	-7 173	-7 957	-32 965
Cash flow from financing activities	-225	-1 000	-6 384
Cash flow for the period	-52	-12 118	2 129
Liquid funds at beginning of period	15 987	14 009	14 009
Exchange rate difference in liquid funds	-64	12	-151
Liquid funds at end of period	15 871	1 903	15 987

Income statements for the Parent Company

		January – March
SEK thousands	2010	2009	Whole year 2009
Administrative expenses	-1 014	-907	-3 631
Research and development costs	-4	-4	-16
Other operating revenues and expenses	—	-2 999	-3 014
Operating income	-1 018	-3 910	-6 661
Financial income and expenses	477	1 292	-967
Income after financial items	-541	-2 618	-7 628
Taxes	—	—	—
Net income	-541	-2 618	-7 628

Depreciation and amortization has reduced income for the period by SEK 18 thousand (18).

Balance sheets for the Parent Company

SEK thousands	Mar 31, 2010	Mar 31, 2009	Dec 31, 2009
ASSETS
Patents	19	34	22
Tangible fixed assets	28	82	42
Participation in affiliated companies	334 214	324 746	334 214
Deferred tax assets	12 897	13 970	12 897
Receivables from affiliated companies	35 239	48 468	36 407
Other current receivables	635	1 500	770
Liquid funds	697	92	46
Total assets	383 729	388 892	384 398
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders'equity	371 412	380 708	371 954
Long-term non interest-bearing liabilities	2 369	—	2 489
Long-term interest-bearing liabilities	4 504	3 701	4 704
Short-term interest-bearing liabilities	2 981	2 217	2 981
Accounts payable	171	722	318
Other short-term interest-free liabilities	2 292	1 544	1 952
Total shareholders' equity and liabilities	383 729	388 892	384 398
Pledged assets for own liabilities	3 100	3 100	3 100
Contingent liabilities	20 000	20 000	20 000

Note 1. Accounting Principles

This interim report has been drawn up for the Group in accordance with the Annual Accounts Act and IAS 34, Interim Financial Reporting, and for the Parent Company in accordance with the Annual Accounts Act and recommendation RFR 2.2 of the Swedish Financial Reporting Board, Accounting for Legal Entities. Unless otherwise stated below, the accounting principles applied to the Group and the Parent Company are consistent with the accounting principles used in the presentation of the most recent Annual Report.

Note 2. Financial data per segment, Group

	January – March	Whole year
SEK thousands	2010	2009	2009
Fertility and Stem Cell Cultivation
Net sales	65 768	62 090	234 725
Operating income	6 069	5 732	17 739
Total Assets	342 906	338 452	332 867

Transplantation
Net sales	9 510	9 750	39 901
Operating income	3 934	3 061	12 669
Total Assets	31 403	13 416	26 448

www.vitrolife.com

Vitrolife AB (publ) Vitrolife Sweden AB Vitrolife Sweden Instruments AB Box 9080, SE-400 92 Göteborg Sverige Tel +46 31 721 80 00 Fax +46 31 721 80 90

Vitrolife, Inc.

3601 South Inca Street Englewood CO 80110 USA Tel +1 303 762 1933 Fax +1 303 781 5615

Vitrolife Ltd

1 Church Street CV34 4 AB Warwick Storbritannien Tel +44 800 (0)32 0013 Fax +44 800 (0)32 0014

A.T.S. Srl

Via Pistrucci, 26 20137 Milano Italien Tel +39 (0) 2 541 22100 Fax +39 (0) 2 541 22100

Vitrolife Pty Ltd

Suite 115, 55 Flemington Road, North Melbourne VICTORIA 3051 Australien Tel +61 (0) 3 9329 1212 Fax +61 (0) 3 9329 1213

Vitrolife K.K.

Embassy of Sweden Compound 1-10-3-901 Roppongi Minato-ku, Tokyo 106-0032 Japan Tel +81 (0) 33560 3874 Fax +81 (0) 33560 3875

Vitrolife Sweden AB

Beijing Representative Office Rm 2905-Fl 29-CITC-C 6A Jianguomenwai Avenue, Chaoyang District Beijing CN-100022,Kina Tel + 86 10 6593 9890 Fax +86 10 6563 9833

XVIVO Perfusion AB

Box 9080 SE-400 92 Göteborg Sverige Tel +46 31 721 80 00 Fax +46 31 721 80 99