Evolva reports accelerated revenue growth in H1 boosted by Health Ingredients

26 Aug 2021 --- Evolva has reported accelerated revenue growth in its half-year 2021 results, bolstered by “ongoing strong momentum” in Health Ingredients. On a reported basis, total revenue increased to CHF 6.4 million (US$6.9 million) from CHF 4 million (US$4.3 million), an increase of 60 percent. Product-related revenue increased to CHF 6.0 million from CHF 3.8 million (US$4.1 million), up by 58 percent in line with plans.

Notably, continued progress has been made in optimizing supply by enlarging the supplier base for Health Ingredients. 

Oliver Walker, CEO of Evolva, says: “Despite all the challenges thrown at us by the pandemic, we progressed our strategy, accelerated product revenue and are on track to deliver positive gross profit across products from Q4, 2021.”

“With the growing customer demand for our innovative product solutions and the strengthened manufacturing base, Evolva is well-positioned to achieve cash break-even by 2023.”

Recovering from COVID-19 
The Swiss biotech company’s purpose-led response to the pandemic was focused on ensuring the safety of its staff and customers.

In the first half of the year, Evolva launched a new ingredient, L-arabinose. The company also supported its growing customer base in developing new consumer products, implementing solid and more efficient manufacturing processes, and broadening its contract manufacturers’ network to prepare for the increased customer demand.With the trend toward more natural ingredients, Evolva is experiencing a significant increase in interest from end-users.

Despite turbulent times, the pandemic accelerated trends for healthier food, beverages and products sourced through affordable and reliable supplies of natural resources, the company states. 

“We are assuming the pandemic will not have further negative impact in the second half-year on Evolva’s target markets.”

Commercial operations
Ongoing strong demand for functional ingredients and dietary supplements across market segments was heightened by COVID-19, with consumers choosing products that can support healthy living like Veri-te resveratrol. 

Growth was also fueled by a significant spike in pet adoptions and families spending more time at home during the pandemic. The company saw an opportunity to expand the animal health business further and launched Veri-te Pets resveratrol with initial emphasis on the significant demand in the US.

The most significant contributions came from core US and EU markets, where the company continued market penetration: moving forward with NPD incubating partnerships with key accounts on strategic projects and leveraging the efficiency of the strong distribution partners in these regions. 

Veri-te resveratrol continued to grow in Asia, where there is a strong interest in the Veri-te brand. Veri-te resveratrol is now used in a wide range of market segments, including dietary supplements, functional beverages, cosmetics and Active Pharmaceutical Ingredients (API) for human and animal health.

With the trend toward more natural ingredients, Evolva is experiencing a significant increase in interest from end-users. This also led to product sampling with large Fast-Moving Consumer Goods (FMCG) companies.

The joint activities with IFF to further develop and expand commercialization of vanillin make good progress with scale-up of manufacturing progression as planned and vanillin product samples receiving a very positive response.

A positive outlook?
As the pandemic continues, industry is experiencing a slower return to normal conditions than anticipated. Evolva expects growing demand for Health Ingredients, but only slow recovering demand for its Flavor and Fragrance products.

The more robust supply chain is expected to support the accelerated growth path in the second half of the year.

The manufacturing start-up cost and the extraordinary expenses are projected to amount to around CHF 6.5 million (US$7 million) for the full year 2021, and EBITDA is expected to be somewhat below the previous year’s figure, the company says. 

Edited by Elizabeth Green