Evotec Third Quarter Financial Results: Growth of Business and
Restructuring Impact Lead the Path to
(Thomson Reuters ONE) - Corporate news announcement processed and transmitted by Hugin AS.The issuer is solely responsible for the content of this announcement. ------------------------------------------------------------------------------------ Hamburg, Germany - November 12, 2009: Evotec AG (Frankfurt StockExchange: EVT, TecDAX; NASDAQ: EVTC) today reported results andcorporate updates for the third quarter and nine months endedSeptember 30, 2009.Recent Highlights:o Strong operational performance; important milestones achieved- 9 months revenues +16%; 9 months operating result +6%o Closing of significant alliance with Boehringer Ingelheim(after period-end) and further new alliances and extensionso Execution of restructuring program "Evotec 2012 - Action Planto Focus and Grow" shows clear results- US facility closed as planned; acquisition of Indian RSIPLcompletedo Phase I study with EVT 103 started; start of Phase II with EVT101 in early 2010o TecDAX re-entry in Octobero Year-end guidance of > EUR 40m revenues and > EUR 65mliquidity comfortably confirmed; Strong liquidity of EUR 64m, cashflow positive Q4 expected1. Operational performance and Discovery Alliance Business updateStrong operational performance (9 months revenues +16%; 9 monthsoperating result +6%)Evotec's revenues for the first nine months of 2009 amounted to EUR29.1 million, an increase of 16% compared to the same period of theprevious year (2008: EUR 25.2 million). Gross margin was strong at38.3% (2008: 38.0%). Despite a Q1 impairment charge of EUR 6.6million and EUR 4.7 million of restructuring expenses, Evotec'soperating loss decreased by 6% to EUR 32.9 million (2008: EUR 35.2million), before these exceptional items by 38% to EUR 21.6 million(2008: EUR 35.1 million).In the third quarter of 2009 revenues were EUR 10.4 million (2008:EUR 10.7 million). The operating loss for the third quarter decreasedby 54% to EUR 3.8 million (2008: EUR 8.3 million). This significantdecrease in operating loss is a result of the Company's strongtop-line performance and its significant reductions in operatingexpenses following the implementation of "Evotec 2012 - Action Planto Focus and Grow".Closing of significant alliance with Boehringer IngelheimBased on the successful collaboration to date, Boehringer Ingelheimsigned a new, minimum four-year extension of its discoverycollaboration with Evotec on November 9, 2009 (after period-end).Jointly, both companies aim to identify novel therapeutics ininnovative disease-focused programs with an initial focus on oncologytargets. Evotec will receive increased research payments compared tothe original contract as well as payments for the achievement ofpre-clinical milestones. In addition, the contract providessubstantial long-term upside for Evotec through potential clinicalmilestone achievements and royalties.Further new alliances and extensions with strategic partnersIn October 2009 (after period-end), Evotec extended also anotherimportant collaboration with one of its strategic partners OnoPharmaceutical, initiating a new discovery program on an ion channeltarget. A new research agreement was signed in September with BiogenIdec. These important contracts clearly demonstrate the value Evotecbrings to its alliance partners in the area of drug discovery.Excellent execution on customer programs - important milestonesachievedThe Company continues to make excellent progress in its discoveryalliances. In July, Evotec announced the achievement of a researchmilestone in its drug discovery alliance with Boehringer Ingelheim. Asecond milestone was achieved in October (after period-end). Theachievement of both milestones will lead to total payments of EUR 4.0million to Evotec. Evotec also achieved a milestone with CardioxylPharmaceuticals.2. AcquisitionsAcquisition of Indian RSIPL completed, creating a global leader indrug discovery and development servicesOn August 6, 2009, Evotec announced the acquisition of a controllingmajority shareholding of the Indian company Research SupportInternational Private Limited (RSIPL) for EUR 2.4 million. Theacquisition was successfully completed as of August 31, 2009 and thecompany is in the process of being fully integrated as Evotec (India)Ltd.3. Update on Evotec 2012 Action Plan and cost reductionsExecution of restructuring program shows clear initial resultsBased on the "Evotec 2012 - Action Plan to Focus and Grow", Evotecimplemented strict restructuring measures from March 2009 (see pressreleases of March 27 and May 5, 2009). These measures are clearlyreflected in the results of the third quarter. R&D expenses were down66% and SG&A expenses were down 13% compared to the same period ofthe prior year, leading to a 54% improvement of the operatingresult.US facility of Renovis, Inc. closed as planned; delisting of EvotecADSs from NASDAQ initiated; TecDAX re-entry in OctoberIn order to leverage more efficiently its research and developmentinfrastructure, Evotec decided in May 2009 to concentrate itsoperations in Europe. Consequently, the Company has now completed theclosure of the former facility of Renovis, Inc. in South SanFrancisco.In November, Evotec decided to delist from the NASDAQ Global Marketand to prepare for a de-registration with the Securities and ExchangeCommission (SEC) in the future. In parallel, Evotec reentered intothe German technology index TecDAX. These steps are intended tofurther streamline Evotec's activities, to reduce unnecessarycomplexity in its capital market presence and to focus the liquidityof Evotec stock on one trading platform.4. Status of clinical programs and partnering of assetsRoche collaboration: Phase I study with EVT 103 started; start ofPhase II with EVT 101 in early 2010In September, Evotec started, as planned, the first Phase I study forEVT 103. Data from this study are expected to be reported in early2010. EVT 103 is the next generation molecule following EVT 101. Bothmembers of the EVT 100 compound family are planned to be developedfor treatment-resistant depression (TRD) in collaboration with Roche.Preparations of the Phase II TRD study for EVT 101 are ongoing,however, Evotec now expects the study to start in early 2010 ratherthan 2009, based on the latest feedback of the FDA on toxicology andsafety monitoring and due to a more complex and bigger study design.5. GuidanceStrong liquidity of EUR 64m, cash flow positive Q4 expected, year-endguidance of > EUR 40m revenues and > 65m liquidity comfortablyconfirmedThe Company confirms all financial targets for the fiscal year 2009published on March 27 and updated on August 7, 2009. In the contextof its second quarter report, Evotec increased its 2009 revenueguidance to above EUR 40 million (previously above EUR 35 million).R&D and SG&A expenses are expected to significantly decreaseyear-on-year. On this basis, Evotec's Group operating result beforeimpairment for 2009 is expected to improve significantly over 2008.Liquidity including cash and cash equivalents, short-term investmentsand auction rate securities at the end of September 2009 is at EUR64.0 million. With strong revenue contributions, including a EUR 2.5million milestone payment from Boehringer Ingelheim, Evotec expectsto report a cash flow positive fourth quarter 2009. On this basis,Evotec remains confident to deliver on its liquidity guidance ofabove EUR 65 million at constant year-end 2008 currencies by the endof 2009, a strong basis to comfortably develop the Company tosustainability.Conference CallThe Company is going to hold a conference call to discuss the resultsand to give an update on its business strategy:Conference call details:Date: Thursday, November 12, 2009Time: 09.30 a.m. CST 08.30 a.m. GMT 03.30 a.m. US time (East Coast)From Europe: +49.(0)69.2222 9550 (Germany) +44.(0)20.7784 1036 (UK)From the US: +1.718.354 1152Access Code: 9023741A simultaneous slide presentation for participants dialing in viaphone is available at www.equitystory.com, password: evotec121109.Webcast detailsTo join the audio webcast and to access the presentation slides youwill find a link on our home page www.evotec.com shortly before theevent.A replay of the conference call will be available for 24 hours andcan be accessed in Europe by dialing +49.(0)69.2222 2236 (Germany) or+44.(0)20.7111 1244 (UK) and in the US by +1.347.366 9565. The accesscode is 9023741#. The on-demand version of the webcast will beavailable on our website: www.evotec.com - Investors - Finance -Financial Reports 2008 - 2009.Forward-looking statementsInformation set forth in this report contains forward-lookingstatements, which involve a number of risks and uncertainties. Suchforward-looking statements include, but are not limited to,statements about our ability to achieve a cash flow positive fourthquarter in 2009 and to deliver on our liquidity guidance, ourexpectation that our funds will be sufficient to finance our plannedactivities through to sustainability, our expectation that ourreentry into the German technology index TecDAX will increaseliquidity for our shareholders and that our voluntary delisting fromNASDAQ and de-registration with the SEC will streamline ouractivities and focus the liquidity of Evotec's stock on one tradingplatform, our expectations and assumptions concerning regulatory,clinical and business strategies, the progress of our clinicaldevelopment programs and timing of the commencement and results ofour clinical trials, strategic collaborations and management's plans,objectives and strategies. These statements are neither promises norguarantees, but are subject to a variety of risks and uncertainties,many of which are beyond our control, and which could cause actualresults to differ materially from those contemplated in theseforward-looking statements. In particular, the risks anduncertainties include, among other things: risks that the Company maybe unable to reduce its cash burn through recent restructuring andcost containment measures and may not recognize the results of suchmeasures within the expected timeframe; risks that product candidatesmay fail in the clinic or may not be successfully marketed ormanufactured; the risk that we will not achieve the anticipatedbenefits of our collaborations, partnerships and acquisitions in thetimeframes expected, or at all; the risk that we will not achieve theanticipated benefits of our voluntary delisting from NASDAQ andde-registration with the SEC; risks relating to our ability toadvance the development of product candidates currently in thepipeline or in clinical trials; our inability to further identify,develop and achieve commercial success for new products andtechnologies; the risk that competing products may be moresuccessful; our inability to interest potential partners in ourtechnologies and products; our inability to achieve commercialsuccess for our products and technologies; our inability to protectour intellectual property and the cost of enforcing or defending ourintellectual property rights; our failure to comply with regulationsrelating to our products and product candidates, including FDArequirements; the risk that the FDA may interpret the results of ourstudies differently than we have; the risk that clinical trials maynot result in marketable products; the risk that we may be unable tosuccessfully secure regulatory approval of and market our drugcandidates; and risks of new, changing and competitive technologiesand regulations in the U.S. and internationally.The list of risks above is not exhaustive. Our most recent AnnualReport on Form 20-F, filed with the Securities and ExchangeCommission, and other documents filed with, or furnished to theSecurities and Exchange Commission, contain additional factors thatcould impact our businesses and financial performance. We expresslydisclaim any obligation or undertaking to release publicly anyupdates or revisions to any such statements to reflect any change inour expectations or any change in events, conditions or circumstanceson which any such statement is based.Contact: Dr Werner Lanthaler, Chief Executive Officer,Evotec AG, Tel.: +49.(0)40.56081-242, werner.lanthaler(at)evotec.comKey Figures of Consolidated Interim Statements of OperationsEvotec AG and SubsidiariesEuro in thousands except share data and per share data+-----------------------------------------------------------------------------------------+| | Nine months ended |Change| Three months ended |Change|| | September 30, | in % | September 30, | in % ||----------------------------+----------------------+------+-----------------------+------|| | 2009 | 2008 | | 2009 | 2008 | ||----------------------------+-----------+----------+------+-----------+-----------+------|| | | | | | | ||----------------------------+-----------+----------+------+-----------+-----------+------||Revenue | 29,135| 25,173| 15.7| 10,396| 10,658| (2.5)||----------------------------+-----------+----------+------+-----------+-----------+------||Gross margin in % | 38.3| 38.0| | 39.4| 55.6| ||----------------------------+-----------+----------+------+-----------+-----------+------|| | | | | | | ||----------------------------+-----------+----------+------+-----------+-----------+------||Research and development | 19,501| 31,446|(38.0)| 3,208| 9,499|(66.2)||expenses | | | | | | ||----------------------------+-----------+----------+------+-----------+-----------+------||Selling, general and | | | | | | ||administrative expenses | 13,136| 12,830| 2.4| 4,123| 4,765|(13.5)||----------------------------+-----------+----------+------+-----------+-----------+------||Amortization of intangible | | | | | | ||assets and impairment | 6,924| 476| -| 113| 79| 43.0||----------------------------+-----------+----------+------+-----------+-----------+------||Restructuring expenses | 4,654| 132| -| 518| 2| -||----------------------------+-----------+----------+------+-----------+-----------+------||Other operating income | 3,485| 1,868| 86.6| 2,757| 791| 248.5||----------------------------+-----------+----------+------+-----------+-----------+------||Other operating expenses | 3,352| 1,751| 91.4| 2,705| 677| 299.6||----------------------------+-----------+----------+------+-----------+-----------+------|| | | | | | | ||----------------------------+-----------+----------+------+-----------+-----------+------||Operating result | (32,932)| (35,190)| 6.4| (3,815)| (8,305)| 54.1||----------------------------+-----------+----------+------+-----------+-----------+------||Operating result* | (21,648)| (35,058)| 38.3| (3,297)| (8,303)| 60.3||----------------------------+-----------+----------+------+-----------+-----------+------|| | | | | | | ||----------------------------+-----------+----------+------+-----------+-----------+------||Net result | (34,071)| (28,958)|(17.7)| (3,655)| (3,106)|(17.7)||----------------------------+-----------+----------+------+-----------+-----------+------|| | | | | | | ||----------------------------+-----------+----------+------+-----------+-----------+------||Weighted average shares |106,775,495|91,118,012| |106,935,167|105,818,799| ||outstanding | | | | | | ||----------------------------+-----------+----------+------+-----------+-----------+------||Net loss per share (basic | (0.32)| (0.32)| | (0.03)| (0.03)| ||and diluted) | | | | | | |+-----------------------------------------------------------------------------------------+*Before impairment and restructuring expenses.Key Figures of Consolidated Interim Balance SheetsEvotec AG and SubsidiariesEuro in thousands+-------------------------------------------------------------------+| | Sep 30, 2009 | Dec 31, 2008 | Change || | | | in % ||----------------------------+--------------+--------------+--------|| | | | ||----------------------------+--------------+--------------+--------|| Liquidity* | 63,976 | 92,401 | (30.8) ||----------------------------+--------------+--------------+--------|| Working capital | (7,797) | (9,911) | 21.3 ||----------------------------+--------------+--------------+--------|| Current and non-current | | | || portion of loans and | 9,485 | 11,328 | (16.3) || finance lease obligations | | | ||----------------------------+--------------+--------------+--------|| Stockholders' equity | 121,377 | 149,859 | (19.0) ||----------------------------+--------------+--------------+--------|| | | | ||----------------------------+--------------+--------------+--------|| Total assets | 154,675 | 182,900 | (15.4) |+-------------------------------------------------------------------+*Including auction rate securities.http://hugin.info/131215/R/1354459/328441.pdfhttp://hugin.info/131215/R/1354459/328442.pdf --- End of Message ---Evotec AGSchnackenburgallee 114 Hamburg GermanyWKN: 566480; ISIN: DE0005664809 ; Index: Prime All Share, CDAX, HDAX, MIDCAP, TECH All Share;Listed: Prime Standard in Frankfurter Wertpapierbörse, Freiverkehr in Börse Berlin, Freiverkehr in Bayerische Börse München, Freiverkehr in Börse Düsseldorf, Freiverkehr in Börse Stuttgart, Freiverkehr in Hanseatische Wertpapierbörse zu Hamburg, Freiverkehr in Niedersächsische Börse zu Hannover, Regulierter Markt in Frankfurter Wertpapierbörse;
Datum: 12.11.2009 - 07:58 Uhr
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