EVOTEC SE FISCAL YEAR 2019 RESULTS: EXCELLENT 2019 PERFORMANCE; VERY GOOD OUTLOOK FOR CONTINUED GROWTH 2020
DGAP-News: Evotec SE
/ Key word(s): Annual Results
EVOTEC SE FISCAL YEAR 2019 RESULTS:
Hamburg, Germany, 26 March 2020: FINANCIALS REFLECT STRONG GROWTH
"ACTION PLAN 2022" ON TRACK, DESPITE MASSIVE GLOBAL INSECURITIES
FINANCIAL GUIDANCE 2020 - CONTINUED STRONG ORGANIC GROWTH
FINANCIALS REFLECT STRONG GROWTH Key figures of consolidated income statement & segment information Evotec SE & subsidiaries
1) Data including reclasses of recharges according to IFRS 15 In 2019, Evotec focused its unpartnered R&D expenses of € 37.5 m (2018: € 22.8 m) primarily on initiatives in the fields of metabolic diseases, oncology, and platform projects. Platform investments focused in particular on the continued expansion of Evotec's industry-leading iPSC platform as well as industrialisation and integration of "omics", artificial intelligence ("AI") and machine learning, as well as data analytics platforms. Its partnered R&D expenses of € 20.9 m (2018: € 12.7 m) related to its infectious disease portfolio were predominantly reported as R&D expenses while the costs fully reimbursed by its partner Sanofi were recognised under other operating income and thus do not negatively affect the operating result or adjusted EBITDA. This split into unpartnered and partnered R&D expenses has only been applied since July 2018 when the Lyon site was acquired from Sanofi. In 2019, the Group's selling, general and administrative ("SG&A") expenses increased by 17% to € 66.5 m (2018: € 57.0 m). This increase resulted primarily from first full year SG&A expenses of Evotec ID Lyon, first half year contribution of Just - Evotec Biologics, higher personnel expenses due to growth and temporary staff costs due to a strengthening of the support functions, higher consultancy fees as well as M&A and financing related expenses. In 2019, Evotec recorded impairments of intangible assets of € 11.9 m (2018: € 4.2 m) for the full impairment of SGM-1019 and related goodwill. This one-off impairment was mainly due to the termination of the SGM-1019 agreement by Evotec's partner Second Genome. Adjusted Group EBITDA for 2019 increased by 29% to € 123.1 m (2018: € 95.5 m), yielding an adjusted EBITDA margin of 27.6% (2018: 25.4%), mainly due to very strong performance in the base business, milestones and licence contributions, a positive EBITDA contribution by Just - Evotec Biologics and effects from the first-time application of the new accounting standard IFRS 16. Evotec's operating result amounted to € 62.6 m in 2019 (2018: € 77.5 m). A year-on-year comparison is not meaningful, as the 2018 result was significantly positively affected by a one-off impact from the bargain purchase ID Lyon (€ 15.4 m). The higher gross profit in 2019 was off-set by the significantly increased investments in R&D and the impairment of the intangible asset SGM-1019 and the related goodwill. The Company's net result for the year 2019 amounted to € 37.2 m (2018: € 84.1 m) and also cannot be compared like for like as it was affected by the one-off effect of the bargain purchase in 2018 and deferred tax income. Evotec ended the year 2019 with a liquidity of € 320.0 m (2018: € 149.4 m), which was composed of cash and cash equivalents (€ 277.0 m) and investments (€ 42.3 m). Cash and cash equivalents as well as current investments can be accessed within a period of less than three months. The increase in liquidity in 2019 resulted mainly from the issuance of the promissory note ("Schuldscheindarlehen") in the amount of € 249.1 m net and a positive operating cash flow of € 42.2 m (2018: € 156.2 m). MID-TERM STRATEGY ON TRACK TO ACHIEVE SERVICE INCOME, MILESTONES, AND ROYALTIES The EVT Execute segment continued to demonstrate strong progress in 2019 with new and extended alliances (e.g. Sanofi, Takeda). In 2019, Evotec was involved in 769 alliances and recorded a repeat business of 92%. Following the acquisition of Just Biotherapeutics, now Just - Evotec Biologics, in July 2019, Evotec was able to sign agreements with Teva, Biocon and, after period-end, with MSD and OncoResponse. The step into biologics is already showing significant scientific synergies and cross selling potential across the Evotec alliances. In EVT Innovate, 2019 was characterised by important progress and strong milestone income in its strategic partnerships (iPSC neurodegeneration alliance with Bristol-Myers Squibb/Celgene; iPSC diabetes alliance with Sanofi; kidney disease and endometriosis/chronic cough alliances with Bayer) as well as the signing of new partnerships, amongst others with Galapagos in fibrosis, with the Mark Foundation in immuno-oncology, with Indivumed in oncology as well as with Bayer and Celmatix in women's health. In July 2019, Evotec was able to report significant clinical progress within its multi-target alliance with Bayer by achieving phase II POC in chronic cough with the P2X3 antagonist BAY1817080. Evotec expects further clinical evaluation of this promising programme by Bayer in 2020. Other partnered clinical projects are progressing according to plan. Evotec and Vifor Pharma launched NephThera, a joint venture focused on the discovery and development of novel nephrology therapeutics. Both companies will hold a 50% share (transaction closed early 2020). Furthermore, Evotec and a venture capital consortium formed the Company's second spin-off, Breakpoint Therapeutics. The Company made further new investments in promising Biotech companies as Aeovian Pharmaceuticals, Celmatix and Immunitas Therapeutics and continued to financially support already existing holdings. Additionally, Evotec made significant progress with its leading iPSC platform as well as the industrialisation and integration of "omics", AI and machine learning, and as data analytics platforms. In the field of anti-infectives, Evotec closed additional collaborations, e.g. kicking off "GNA Now", a new initiative for the development of novel antibacterial agents. The increasing recognition of antibiotic resistance as a growing threat to public healthcare systems enabled Evotec to receive grants for projects to further accelerate drug discovery efforts in this area of high medical need. Evotec initiated multiple partnerships with the Bill and Melinda Gates Foundation (especially in Tuberculosis). In 2019, Evotec's academic BRIDGE model continued to attract significant interest from academia and industry partners, leading to the building of LAB10x and LAB555. FINANCIAL GUIDANCE 2020 - CONTINUED STRONG GROWTH Given current global insecurities surrounding the COVID-19 pandemic, and possible future disruption of business within Evotec and our partners, guidance for 2020 has been critically assessed. However, due to the drastic and very dynamic developments in the overall economic environment since the end of February 2020 and the unforeseeable special situation triggered by the COVID-19 pandemic and its associated unknown time lines, it is not possible to precisely predict or quantify the potential impact on revenue and financial performance at this early stage. This uncertainty also explains the broader than usual ranges. Evotec will continue to very closely monitor the further development of this exceptional situation and update on guidance in case the situation changes materially. Revenues, research and development expenses, and adjusted EBITDA remain the financial key performance indicators of the Evotec Group. For the financial year 2020, the Management Board expects Evotec's total Group revenues in a range of € 440 - 480 m. This anticipated revenue growth is based on visibility of the current order book, expected new contracts, contract extensions and milestone opportunities. Projections are based on constant 2019 exchange rates. Evotec's adjusted Group EBITDA is expected to be in the range of € 100 - 120 m despite increased R&D investments, expected loss of the Sanofi subsidy for the Toulouse site after Q1 2020 and significantly ramping up the Just - Evotec Biologics business by investing in and building highly innovative J.POD(R) capacities in the USA. Evotec will continue to significantly invest in its own "unpartnered" research and development (R&D) to create a long-term pipeline of first-in class assets and platforms. Evotec expects these expenses to be at approx. € 40 m. These expenses are independent of the "partnered" R&D spending in infectious diseases, which is fully covered under the Sanofi partnership.
1) EBITDA is defined as earnings before interest, taxes, depreciation, and amortisation of intangibles. Adjusted EBITDA excludes contingent considerations, income from bargain purchase and impairments on goodwill, other intangible and tangible assets as well as the total non-operating result 2) Despite the loss of € 20 m subsidy payments from Sanofi and significantly ramping up J.POD(R) capacities
Conference call details From Germany: +49 69 201 744 220 A simultaneous slide presentation for participants dialling in via phone is available at https://webcasts.eqs.com/evotec20200326/no-audio. Webcast details A replay of the conference call will be available for 24 hours and can be accessed in Europe by dialling +49 69 201744221 (Germany) or +44 20 3364 5150 (UK) and in the USA by dialling +1 (844) 307-9362. The access code is 315578854#. The on-demand version of the webcast will be available on our website: www.evotec.com/financial-reports
EVOTEC SE FORWARD LOOKING STATEMENTS
Key figures of consolidated income statement In T€ except share data and per share data
1) Before contingent considerations, income from bargain purchase and excluding impairments on goodwill, other intangible and tangible assets as well as the total non-operating result
2019
1) Revenues in the segments consist of revenues from contracts with customers without revenues from recharges, as those are not of importance for the management to assess the economic situation of the segments. 2) Adjusted for changes in contingent considerations and impairments on goodwill, other intangible and tangible assets as well as the total non-operating result 2018
1) Before contingent considerations, income from bargain purchase and excluding impairments on goodwill, other intangible and tangible assets as well as the total non-operating result Key figures of consolidated statement of financial position In T€
Contact Evotec SE: Gabriele Hansen, SVP Corporate Communications, Marketing & Investor Relations,
26.03.2020 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. |
Language: | English |
Company: | Evotec SE |
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@evotec.com |
Internet: | www.evotec.com |
ISIN: | DE0005664809 |
WKN: | 566480 |
Indices: | MDAX, TecDAX |
Listed: | Regulated Market in Berlin, Frankfurt (Prime Standard); Regulated Unofficial Market in Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange |
EQS News ID: | 1007261 |
End of News | DGAP News Service |
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