Full Press Release Details
For further information,
please contact: Volker Braun, SVP Head of Global Investor Relations & ESG,
volker.braun@evotec.com, M. +49(0)151.1940 5058, www.evotec.com
| 4 | CONTINUATION OF STRONG GROWTH IN DEMANDING MARKETS | |
| 4 | PARADIGM-SHIFTING OFFERINGS ARE STRONGEST GROWTH DRIVERS | |
| 4 | PIPELINE PROGRESS; E.G. WITH ADVANCED ASSET IN NEURODEGENERATION | |
| 4 | ALL ELEMENTS OF GUIDANCE CONFIRMED |
EVOTEC'S TOPLINE SUCCESS REFLECTS STRONG DEMAND
| 4 | Group revenues increased by 14% (19% excluding fx-effects) to 580.1 m (9M 2022: 510.8 m); excluding a lower contribution from milestones, upfronts and license payments, Base business at 575.3 m (9M 2022: 502.8 m) continued to show comparable growth of 14%. | |
| 4 | Costs of 43.9 m were incurred in 2023 as a direct result of the cyber-incident in early April, including additional external expenditures and internal recovery contributions. | |
| 4 | Total EVT Execute revenues (incl. intersegment revenues) up 3% to 543.4 m (9M 2022: 526.7 m), strongly affected by cyber-incident; EVT Innovate revenues up 64% to 199.9 m (9M 2022: 121.9 m). | |
| 4 | Adjusted Group EBITDA totalled 50.2 m (9M 2022: 44.6 m); continued work on key collaborations has partially compensated for underutilised capacities as a result of the cyber-attack. |
STRENGTHENING ACTIVITIES THROUGH INTEGRATED R&D AND PRECISION
Events after Period-End
Events after Period-End
BUSINESS OUTLOOK FOR FULL-YEAR 2023 AND MID-TERM GOALS 2025 CONFIRMED
Due to the criminal cyber-attack discovered on 6 April 2023, productivity was affected in the second and third quarters. In response
to the criminal cyber-attack, Evotec took immediate action to contain and remediate the attack by taking its external-facing systems
offline. This was deemed necessary to protect all the Company's partners and stakeholders and meant Evotec could ensure that the
integrity of scientific data remained unaffected.
FINANCIAL HIGHLIGHTS
The following table provides an overview of the financial performance
in the first nine months of 2023 compared to the same period in 2022. More detailed information can be found on page 6 of this interim
Key figures of consolidated income statement & segment
Evotec SE & subsidiaries - First nine months of
| In T | Evotec Group 9M 2023 | Evotec Group 9M 2022 | ||||||
| Revenues 1) | 580,113 | 510,759 | ||||||
| Costs of revenues | (442,729 | ) | (419,150 | ) | ||||
| Gross profit | 137,384 | 91,609 | ||||||
| Gross margin in % | 23.7 | % | 17.9 | % | ||||
| R&D expenses 2) | (48,366 | ) | (55,320 | ) | ||||
| SG&A expenses | (127,482 | ) | (109,858 | ) | ||||
| Other operating income (expenses), net 4) | 7,635 | 56,734 | ||||||
| Impairments of intangible assets | (5,131 | ) | - | |||||
| Net operating income (loss) | (35,960 | ) | (16,836 | ) | ||||
| Adjusted EBITDA 3) | 50,211 | 44,600 |
1) Group revenues would have amounted to
587.8 m at constant exchange rates
2) Includes unpartnered R&D expenses of
45.7 m in 9M 2023 (9M 2022: 50.7 m)
3) Net income (loss) adjusted for interest,
taxes, depreciation and amortization of intangibles, impairments on goodwill and other intangible and tangible assets, total non-operating
results, change in contingent consideration (earn-out) and items that in magnitude, nature or occurrence would distort the presentation
of the financial performance of the Group.
4) As of Q3, the external, one-off related
cyber expenses of 11.9 m ( 7.8 m as of Q2) are excluded from Adjusted Group EBITDA. Internal costs of recovery are included
in Adjusted Group EBITDA.
The following table details Evotec's segment revenues and operating
income (loss) for the nine months ended 30 September 2023:
| In T | EVT Execute | EVT Innovate | Intersegment Eliminations | Evotec Group 9M 2023 | ||||||||||||
| Revenues | 543,372 | 199,906 | (163,165 | ) | 580,113 | |||||||||||
| Operating result | (40,078 | ) | 4,118 | - | (35,960 | ) |
OPERATIONAL HIGHLIGHTS
Multiple new and extended integrated drug discovery and development
agreements all along the drug discovery & development value chain
In the first nine months of 2023, Evotec continued to further expand
its operational activities based on its fully integrated end-to-end shared R&D and precision medicine platforms. The Company entered
into several new partnerships and extended existing alliances across the various stages of drug discovery and development, as well as
across modalities and business areas e.g.:
Further value creation through academic partnerships (BRIDGEs)
In September, Evotec and Novo Nordisk announced "LAB eN²",
a translational drug discovery accelerator that aims to nurture early research from academic institutions into novel therapeutics. The
focus is on addressing unmet need in cardiometabolic diseases as well as rare blood and rare endocrine disorders. LAB eN² is
an engagement model that combines Evotec's multimodality drug discovery and pre-clinical development capabilities with Novo Nordisk's
therapeutic, clinical, and commercial expertise. LAB eN² has already signed on four academic institutions to participate: Harvard
University, Mass General Brigham, Yale University, and Beth Israel Deaconess Medical Center.
BRIDGEs after period-end
In October, Evotec announced that the Company has entered into a new
BRIDGE partnership with Lightstone Ventures, ClavystBio, Leaps by Bayer, Polaris Partners, and the Polaris Innovation Fund. "65LAB",
Evotec's first academic BRIDGE in Asia, aims to advance drug discovery and the creation of new therapeutics companies in Singapore.
In the same month, Evotec announced a translational BRIDGE partnership with Pre-Amp, a new venture studio created by Amplitude Ventures.
Co-owned pipeline progress
In August, a clinical Phase I study for EVT401, a P2X7 receptor antagonist
for the treatment of inflammatory conditions originally developed by Evotec, then licensed to Zhejiang CONBA Pharmaceutical Co., was initiated.
In September, BMS presented positive Phase I data for BMS-986419 /
EVT 8683 and announced plans to initiate a Phase II trial in ALS in 2024.
Pipeline progress after period-end
In October, Kazia Therapeutics ("Kazia") presented biomarkers
data on EVT801 at ESMO Congress 2023. Evotec first announced a partnership with Kazia for clinical development of EVT801 in April 2021
and in November of the same year, Kazia announced that EVT801 entered clinical development with the first patient enrolled in a first-in-human
Opening of new state-of-the-art biology facility on Dorothy Crowfoot
In September, Evotec celebrated the Grand Opening of a new facility,
Building 95 ("B95"), on the Company's Dorothy Crowfoot Hodgkin Campus at Milton Park. Evotec has developed B95 to accommodate
new state-of-the-art biology laboratories, a range of collaborative workspaces and meeting rooms as well as a restaurant for employees.
The B95 facility was designed with a particular focus on sustainability, and incorporates air source heat pumps, a demand-based laboratory
ventilation system, as well as low energy lighting and appliances. These measures will support Evotec in achieving the Company's
carbon net-zero targets.
Evotec receives approval
for its near-term targets by SBTi
In October after Period-End,
the Science Based Targets initiative ("SBTi") informed Evotec that the Company's greenhouse gas emissions reduction
targets have been validated and approved. The science-based near-term targets are compliant with SBTi criteria and recommendations and
consistent with levels required to meet the goals of the Paris Agreement. The SBTi has classified Evotec's scope 1 and 2 target
ambition and has determined that it is in line with a 1.5 C trajectory.
REPORT ON THE FINANCIAL SITUATION AND RESULTS
1. Results of operations
During the nine months ended 30 September 2023 Group revenues
increased by 14% to 580.1 m compared with the same period of the previous year (9M 2022: 510.8 m). The increase compared with
prior-year period is based on the diversified underlying business mix in a challenging environment, supported by two effects: BMS/Celgene
programs and delivery of work packages as part of the new Technology-Partnership with Sandoz. Excluding the recognition of negative fx
-effects, Group revenues grew by 15% from 510.8 m to 587.8 m. Growth of the base business was 14% from 502.8 m
in 9M 2022 to 575.3 m in the first nine months of 2023. Evotec received milestone, upfront and license payments of 4.8 m
(9M 2022: 8.1 m). Just - Evotec Biologics contributed 74.1 m during the nine months ended 30 September 2023
versus 27.9 m in the comparable prior year period, nearly tripling its revenues.
The Costs of revenue for the nine months ended 30 September 2023
amounted to 442.7 m (9M 2022: 419.2 m) yielding a gross margin of 23.7% (9M 2022: 17.9%). The increase of margin was supported
from signing of cooperations and partnerships with BMS and Sandoz. Excluding effects related to the capacity build-up at Just -
Evotec Biologics, total gross margin amounted to 26,7% versus 27,3% during the same period last year.
R&D expenses were 48.4 m, compared to 55.3 m
in the nine months ended 30 September 2022 (-13%), reflecting the impacted business activity due to the cyber-incident in the second
quarter leading to a temporary reduction of R&D costs. Unpartnered R&D expenses decreased by 10% ( 45.7 m vs.
9M 2022: 50.7 m) and partnered R&D expenses were 42% lower than in the comparable reporting period in the previous
year (9M 2023: 2.7 m versus 9M 2022: 4.6 m).
SG&A expenses for the nine months ended 30 September 2023
amounted to 127.5 m and were thus 17.6 m or 16% higher compared to last year (9M 2022: 109.9 m). Expanding Evotec's
number of people to facilitate further growth as well as strengthening the end-to-end global processes and systems were the main drivers.
For the nine months ended 30 September 2023, other operating
income amounted to 52.3 m, compared to 58.2 m for the comparable prior year period. R&D tax credits increased to 32.6 m