DGAP-News: Evotec AG reports H1 2013 results
(firmenpresse) - DGAP-News: Evotec AG / Key word(s): Half Year Results
Evotec AG reports H1 2013 results
08.08.2013 / 07:29
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Evotec AG reports H1 2013 results
- Innovation efficiency strategy on track
- Top-line growth in the second half of the year 2013 due to expected
milestones
- Guidance 2013 confirmed
Hamburg, Germany - 08 August 2013: Evotec AG (Frankfurt Stock Exchange:
EVT, TecDAX, ISIN: DE0005664809) today reported financial results and
corporate updates for the first half of 2013.
Revenues excluding milestones, upfronts and licences up 6% compared to
the first half of 2012
- H1 2013 revenues amounted to EUR 36.7 m (2012: EUR 42.0 m); revenues
excluding milestones, upfronts and licences were up 6% compared to H1 2012
revenues on a like-for-like basis
- Operating loss at EUR 4.4 m due to low milestone revenues in H1 2013
- Stable liquidity position at EUR 56.1 m
- High and stable equity ratio at 67.7%
Progress in EVT Execute business and new EVT Integrate/EVT Innovate
alliances support innovation efficiency strategy
- New collaboration with Dow AgroSciences on Cellular Target Profiling(R)
- Extension of alliance with Genentech
- Extension of Active Biotech collaboration (after period-end)
- Important strategic expansion of EVT Execute compound management
capability: New site in Branford, US
- Significant milestone achievement with Boehringer Ingelheim
- TargetPGB (Peptidoglycan Biosynthesis): New collaboration with Harvard
University to identify and develop a new class of antibacterials
- TargetKDM (Lysine Demethylases): New collaboration with Dana Farber's
Belfer Institute for Applied Cancer Science to explore epigenetic oncology
targets
- New hormone identified to treat diabetes as part of Evotec's CureBeta
initiative
- Significant clinical data points ahead in 2013/2014/2015
Indian operations to be discontinued at the end of September 2013
(after period-end)
Financial guidance for 2013 confirmed
- Revenues are expected to grow to a level between EUR 90-100 m
- Operating result before impairment and changes in contingent
consideration, if any, is expected to improve over 2012
- R&D expenditure is expected to be around EUR 10 m
- Strong liquidity position above EUR 60 m
Others
- Dr FlemmingØrnskov resigned as Chairman and member of the Supervisory
Board
- Dr Walter Wenninger appointed as new Chairman of the Supervisory Board
and Dr Claus Braestrup elected as a member of the Supervisory Board
- Strengthening of the management capacities with the following
appointments (after period-end):
Dr Adrian Howd, Executive Vice President, Head of Neurology&Corporate
Development; and
Dr Bastian Sauer-Odendahl, Global Head of Human Resources
- Strengthening of business development activities in Japan through the
appointment of Masahiko Ohtani as Vice President Business Development
(after period-end)
1. OPERATIONAL PERFORMANCE
Revenues excluding milestones, upfronts and licences up 6% compared to the
first half of 2012
Reported revenues for the first half of 2013 decreased by 13% to EUR 36.7 m
(2012: EUR 42.0 m). Revenues for the first half of 2013 included a
milestone from Boehringer Ingelheim of EUR 1.5 m. Revenues for the first
half of the previous year included milestone revenues earned in Evotec's
partnerships with Andromeda/Teva (EUR 3.9 m) and Boehringer Ingelheim (EUR
4.0 m). The total amount of revenues from milestones, upfronts and licences
recognised in Evotec's partnerships decreased in comparison to the same
period of the previous year (2013: EUR 3.4 m, 2012: EUR 10.7 m). Excluding
milestones, upfronts and licences, Evotec's revenues for the first half of
2013 would have increased by 6% over the same period of the previous year
on a like-for-like basis. Due to the comparatively low milestone revenues
in H1 2013, the operating loss for the first half of 2013 amounted to EUR
4.4 m. As stated before, Evotec's operating result may vary significantly
between quarters as a result of the timing of performance-based milestone
payments and partnering events. Liquidity including cash, cash equivalents
and investments at the end of June 2013 amounted to EUR 56.1 m.
Overall, the Company is expected to achieve increased full-year
profitability over 2012 (before impairment and changes in contingent
considerations, if any).
2. EVOTEC ACTION PLAN 2016 - INNOVATION EFFICIENCY
Progress in EVT Execute business and new EVT Integrate/EVT Innovate
alliances support innovation efficiency strategy
Action Plan 2016 - Innovation Efficiency is the strategic framework that
was initiated in March 2012. EVT Execute aims to deliver cost-efficient and
industrialised services for drug discovery on a fee-for-service basis. EVT
Integrate is the systematic approach to progress targets through the
pre-clinic, on a research payments, milestone payments and royalties
success basis. EVT Innovate involves accelerating promising drug discovery
ideas and assets to partnerships with upfront payments, premium research
fees, milestone payments and royalties.
A. EVT Execute
New collaboration with Dow AgroSciences on Cellular Target Profiling(R)
In June 2013, Evotec and Dow AgroSciences ('Dow') entered into a research
collaboration with the objective of leveraging Evotec's advanced chemical
proteomics services to support compounds in development at Dow. To this
end, Evotec will perform quantitative chemical proteomics services
(Cellular Target Profiling() to de-convolute phenotypic screening results
obtained by Dow.
Extension of alliance with Genentech
In April 2013, Evotec extended its drug discovery alliance with Genentech,
a member of the Roche Group, for three additional years.
The collaboration was initiated in May 2010.
Extension of Active Biotech collaboration (after period-end)
In July 2013, the medicinal chemistry collaboration with Active Biotech has
been extended to further advance an existing programme, which has entered
late-stage lead optimisation. The programme aims to find novel small
molecule modulators of a priority biological target, selected by Active
Biotech, involved in immune disorders and cancer.
Important strategic expansion of EVT Execute compound management
capability: New site in Branford, US
Evotec (US), Inc. signed a multi-year lease on a facility located in
Branford, Connecticut that is specifically designed to expand the offering
of its compound management services on the US East Coast. The facility is
expected to be fully operational within Q3 2013 and will complement the
existing facility in South San Francisco, which will continue to serve
existing clients.
B. EVT Integrate
Significant milestone achievement with Boehringer Ingelheim
In June 2013, a further milestone was achieved in Evotec's discovery
collaboration with Boehringer Ingelheim. Evotec recognised milestone
revenues of EUR 1.5 m for the transition of a pain molecule into
pre-clinical development.
C. EVT Innovate
TargetPGB (Peptidoglycan Biosynthesis): New collaboration with Harvard
University to identify and develop a new class of antibacterials
Evotec and Harvard University entered into a further research collaboration
aimed at discovering and developing novel anti-bacterial agents based on a
highly validated target family involved in bacterial cell wall
biosynthesis.
Under the collaboration agreement announced in May 2013, researchers at
Harvard and Evotec will identify and optimise small molecule inhibitors of
bacterial cell wall synthesis based on enabling technologies and chemical
starting points licensed from Harvard. Using its comprehensive drug
discovery infrastructure and expertise in addressing anti-bacterial
targets, Evotec will specifically target peptidoglycan biosynthesis
(TargetPGB). The approach leverages promising chemical starting points, and
biological and structure-guided techniques in conjunction with extensive
medicinal chemistry expertise. The commercialisation of the resulting
assets will be Evotec's responsibility.
TargetKDM (Lysine Demethylases): New collaboration with Dana Farber's
Belfer Institute for Applied Cancer Science to explore epigenetic oncology
targets
A collaboration to discover new oncology therapies targeting epigenetic
mechanisms was signed with the Belfer Institute for Applied Cancer Science
at Dana-Farber Cancer Institute (DFCI) in April 2013. The goal of the
collaboration is to validate emerging epigenetic targets for oncology
indications and to demonstrate the drugability of the selected target
families. Evotec, DFCI and DFCI's Belfer Institute will invest in enabling
technologies, experimental target validation and the generation of chemical
matter by leveraging their existing expertise and drug discovery platforms.
These two new partnerships supplement the existing 'CureBeta' and
'CureNephron' initiatives with Harvard University.
New hormone identified to treat diabetes as part of Evotec's CureBeta
initiative
In April 2013, Evotec AG announced the publication of a scientific article
by Prof. Doug Melton - a key collaborator in CureBeta, a strategic alliance
between Harvard University, Evotec and Janssen in the field of beta cell
regeneration - and his post doc, Peng Yi, in the journal Cell. The paper
describes the discovery of betatrophin, a new hormone that controls beta
cell proliferation. All intellectual property associated with these
findings was licensed to Evotec in March 2011 and subsequently sublicensed
to Janssen within the CureBeta collaboration announced in July 2012.
Significant clinical data points ahead in 2013/2014/2015
The first Phase III clinical trial on DiaPep277(R) demonstrated the
achievement of both its primary and secondary endpoints. Moreover, results
from an extension study to its Phase III clinical trial in type 1 diabetes
patients demonstrating that DiaPep277(R) was well-tolerated and had a good
safety profile were announced by Andromeda in June 2013. Results of a
second pivotal trial are expected towards the end of 2014.
At the end of 2012, Roche started a substantial Phase IIb trial with EVT302
that aimed to recruit 495 patients in more than 140 centres worldwide to
assess the efficacy and safety of this compound in patients with
moderate-severity Alzheimer's disease (AD). This clinical trial is one of
the very few late-stage trials in this AD patient population. Results are
expected early 2015.
Evotec entered into a licence agreement with Janssen in December 2012 for
its NR2B subtype selective NMDA-antagonist portfolio for development
against diseases in the field of depression. The Company expects that
Janssen will initiate Phase II clinical trials for the treatment of
depression during the course of 2013/14.
In April 2013, Zhejiang JingXin Pharmaceutical Co., Ltd ('JingXin')
received approval from the Chinese Center of Drug Evaluation (CDE) to
commence clinical trials with EVT201, a novel potential treatment for
insomnia. Evotec had previously concluded two Phase II studies, providing
safety and efficacy results. Under the licence and collaboration agreement
entered in October 2010, JingXin receives exclusive rights to develop and
market the drug candidate in China.
3. RESTRUCTURING
Indian operations to be discontinued at the end of September 2013 (after
period-end)
In July 2013, Evotec announced that it will close its Chemistry Operations
in Thane, India. All chemistry efforts will now be performed at its
Abingdon (UK) facility, in response to increasing demands for Evotec to
operate closer to the principal R&D laboratories of its major customers.
All project work in Thane will be completed by the end of September 2013,
and Evotec (India) Private Ltd will then be wound down. As a consequence,
approximately 120 Thane-based employees will leave the Company and Evotec
will take a one-time impairment charge of up to EUR 4 m in Q3 2013.
4. ACQUISITION UPDATE
CCS integration - Strengthening Evotec's screening capabilities
Signed in December 2012 and effective 01 January 2013, Evotec acquired CCS
Cell Culture Service GmbH ('CCS'), a Hamburg-based company which supports
the cell culture needs of biotech and pharmaceutical companies on a
worldwide basis. With the move into the Manfred Eigen Campus, CCS'
large-scale processes for cell production, freezing and storage, including
the entire team of specialised cell culture scientists and technicians,
will be fully integrated into Evotec's Hamburg operations during Q3 2013 to
realise cost synergies and efficiency improvements.
The purchase price consisted of a cash consideration of EUR 1.15 m and an
earn out component which could reach up to EUR 1.4 m in cash. The earn out
component will become due one year after the acquisition and depends on the
achievement of certain revenue targets.
With respect to the impact of this transaction on Evotec's financial
statements, we refer to pages 19 to 20 of the half-year report.
5. GUIDANCE
Financial guidance for 2013 confirmed
All financial targets published on 26 March 2013 in Evotec's Annual Report
2012 (page 78) remain unchanged.
In 2013, total Group revenues are expected to grow to a level between EUR
90 m and EUR 100 m. This assumption is based on the current order book,
expected new contracts and contract extensions, as well as the achievement
of certain milestone payments. Milestones are difficult to predict, but
they remain a fundamental part of the business model of Evotec.
On this basis, gross margins in 2013 are expected to improve slightly on
those achieved in 2012. However, quarterly margins will continue to be
volatile, as they are dependent upon the timing of milestone payments.
Evotec expects research and development (R&D) expenses in 2013 to increase
above the levels of 2012. This is primarily due to additional investments
in the strategic Cure X franchise primarily in the fields of metabolic
diseases and regenerative medicine. In total, R&D expenditure is expected
to be around EUR 10 m in 2013.
Evotec's Group operating result before impairment and changes in contingent
consideration, if any, is expected to improve from its 2012 level for the
year 2013.
At constant year-end 2012 currencies, the Company expects to maintain its
liquidity position above EUR 60 m at the end of 2013, excluding any
potential cash outflow for M&A or similar transactions.
Webcast/Conference Call
The Company is going to hold a conference call to discuss the results as
well as to provide an update on its performance:
Conference call details
Date: Thursday, 08 August 2013
Time: 09.30 am CET (08.30 am GMT, 03.30 am EDT)
From Germany: +49 (0) 6103 485 3001
From UK: +44 207 153 2027
From USA: +1 480 629 9726
Access Code: 4629924
A simultaneous slide presentation for participants dialling in via phone is
available at www.equitystory.com, password: evotec0813.
Webcast details
To join the audio webcast and to access the presentation slides you will
find a link on our home page www.evotec.com shortly before the event.
A replay of the conference call will be available for 24 hours and can be
accessed in Europe by dialling +49 69 58 99 90 568 (Germany) or +44 207 154
2833 (UK) and in the US by dialling +1 303 590 3030. The access code is
4629924#. The on-demand version of the webcast will be available on our
website:
http://www.evotec.com/article/en/Investors/Finance/Financial-Reports-2011-
2013/188/6/26.
ABOUT EVOTEC AG
Evotec is a drug discovery alliance and development partnership company
focused on rapidly progressing innovative product approaches with leading
pharmaceutical and biotechnology companies. We operate worldwide providing
the highest quality stand-alone and integrated drug discovery solutions,
covering all activities from target-to-clinic. The Company has established
a unique position by assembling top-class scientific experts and
integrating state-of-the-art technologies as well as substantial experience
and expertise in key therapeutic areas including neuroscience, pain,
metabolic diseases as well as oncology and inflammation. Evotec has
long-term discovery alliances with partners including Bayer, Boehringer
Ingelheim, CHDI, Genentech, Janssen Pharmaceuticals, MedImmune/AstraZeneca
and Ono Pharmaceutical. In addition, the Company has existing development
partnerships and product candidates both in clinical and pre-clinical
development. These include partnerships with Boehringer Ingelheim,
MedImmune and Andromeda (Teva) in the field of diabetes, with Janssen
Pharmaceuticals in the field of depression and with Roche in the field of
Alzheimer's disease. For additional information please go to
www.evotec.com.
FORWARD LOOKING STATEMENTS - Information set forth in this press release
contains forward-looking statements, which involve a number of risks and
uncertainties. The forward-looking statements contained herein represent
the judgement of Evotec as of the date of this report. Such forward-looking
statements are neither promises nor guarantees, but are subject to a
variety of risks and uncertainties, many of which are beyond our control,
and which could cause actual results to differ materially from those
contemplated in these forward-looking statements. We expressly disclaim any
obligation or undertaking to release publicly any updates or revisions to
any such statements to reflect any change in our expectations or any change
in events, conditions or circumstances on which any such statement is
based.
First half year 2013 results
Key figures of consolidated interim income statement
Evotec AG and subsidiaries
In TEUR except share data and per share data
January June April June
to to
2013 2012 Change 2013 2012 Change
in % in %
Revenues 36,690 42,046 (12.7) 19,626 21,936 (10.5)
Gross margin in % 28.8 35.2 31.1 37.7
Research and development
expenses (4,819) (3,924) 22.8 (2,491) (2,012) 23.8
Selling, general and
administrative expenses (8,176) (8,026) 1.9 (4,251) (3,594) 18.3
Amortisation of intangible
assets (1,716) (1,217) 41.0 (816) (691) 18.1
Other operating income 416 1,572 (73.5) 306 1,338 (77.1)
Other operating expenses (660) (1,860) (64.5) (534) (677) (21.1)
Operating income (loss) (4,403) 1,333 (430.3) (1,687) 2,622 (164.3)
Operating income (loss)* (4,136) 648 (738.3) (1,420) 1,622 (187.5)
Net income (loss) (4,583) 1,679 (373.0) (1,732) 3,674 (147.1)
Weighted average shares
outstanding 117,800,410 117,024,530 117,834,364 117,061,462
Net income (loss) per share
(basic and diluted) (0.04) 0.01 (0.01) 0.03
* Excluding impairments and reversal of impairments and changes in
contingent considerations
Key figures of consolidated interim statement of financial position
Evotec AG and subsidiaries
In TEUR
30 June 31 Dec Change
2013 2012 in %
Cash, cash equivalents and investments 56,055 64,159 (12.6)
Working capital 4,982 3,287 51.6
Current and non-current loan liabilities and
finance lease obligations 17,331 17,402 (0.4)
Stockholders' equity 146,698 152,547 (3.8)
Total assets 216,579 225,427 (3.9)
Contact Evotec AG:
Gabriele Hansen, Head of Corporate Communications, Phone:
+49.(0)40.56081-255, gabriele.hansen(at)evotec.com
End of Corporate News
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Language: English
Company: Evotec AG
Manfred Eigen Campus / Essener Bogen 7
22419 Hamburg
Germany
Phone: +49 (0)40 560 81-0
Fax: +49 (0)40 560 81-222
E-mail: info(at)evotec.com
Internet: www.evotec.com
ISIN: DE0005664809
WKN: 566480
Indices: TecDAX
Listed: Regulierter Markt in Frankfurt (Prime Standard);
Freiverkehr in Berlin, Düsseldorf, Hamburg, Hannover,
München, Stuttgart
End of News DGAP News-Service
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