Evolva to reduce staff numbers as part of “major restructuring”
01 Sep 2017 --- Specialty natural ingredients company Evolva has given details of the next phase of its corporate evolution, which includes moneysaving measures, considerable growth of revenues, commercial collaborations as well as a reduction of its staff numbers from 178 to approximately 100.
Evolva, whose flagship ingredients are stevia, nootkatone and resveratrol, announced in its half-year results further details of its future intended strategic direction to aggressively grow product revenues and accelerate the path to a cash flow break-even position. In order to exploit the full potential of its own products in various applications and geographies, the company has announced that it will enter commercial collaborations with market-leading companies in addition to selected direct sales.
It will also maintain a capital-light manufacturing strategy and continue to strengthen its unique and highly differentiated technological capabilities. Together, the company believes these elements will generate significant shareholder value.
Evolva CEO Simon Waddington says: “Evolva is undertaking the next logical step in its own evolution. Both our leadership and operations will be significantly optimized to ensure that our products achieve their full potential and our innovation engine remains strong. The choices we make today will strengthen our ability to deliver commercial success, realize future innovation breakthroughs and produce shareholder value.”
Operational structure changes
Evolva announced that it will undertake a major site consolidation over the coming months, centralizing research and development activities predominantly at its Reinach headquarters in Switzerland. According to the company, this will also allow it to gain maximum synergies across all its products and pipeline programs, to simplify and reduce back office processes and to reduce facility costs.
As a consequence, the company is changing its management structure. The first phase of this transformation has already been announced with the appointment of a new CEO, Simon Waddington, and a new Chief Commercial Officer, Scott Fabro. On Wednesday, it announced the second phase with the departure of three members of the Group Management Team (GMT).
Evolva Chief Business Officer Pascal Longchamp, Chief Scientific Officer Jørgen Hansen and Managing Director & CEO of Evolva India Panchapagesa Murali will step down from the company’s GMT by or before the end of the year while providing support to the transition process, the company’s press release states. The CEO is set to lead R&D on an interim basis during the search for a Chief Technology Officer, a process that has already begun. Panchapagesa Murali will aim to spin off Evolva’s Chennai branch into an independent R&D services group in the course of Q4 of this year.
Headcount reduced
Evolva says it will “reduce its overall headcount” from 178 fulltime employees at present to approximately 100. It anticipates that the company’s annual operating expenses run rate will decrease by approximately 30 percent, or roughly CHF11 million (US$11.45 million), developing full effect in Q2 of 2018. Evolva “will take a one-time charge in 2017 against its Profit and Loss Statement of around CHF5 million and estimates capital expenditures for the centralization of its laboratories and small-scale fermentation equipment to equal around CHF1 million with the majority being spent in Q4 2017.” Guidance on product revenues, which Evolva estimates will more than triple in 2017 over 2016, will not be affected by the restructuring, the company has announced.
“I would also like to personally thank all employees as well as our departing management team members, Pascal Longchamp, Jørgen Hansen and Panchapagesa Murali, for their invaluable contributions to Evolva over many years,” Waddington adds.
Evolva has stated that it will provide a further update on commercial strategy and mid-term targets later in Q3 of this year.
Speaking about the news, Paul Verbraeken, Investor Relations Officer at Evolva, tells NutritionInsight that “the restructuring should reduce complexity and […] is the logical next phase in our transition into a more commercially focused next-generation specialty ingredient company.”
“We see a big potential for our specialty ingredients, which get around supply chain issues of traditional production routes and unlock their true potential,” Verbraeken says. “Our yeast fermentation innovation engine is only just getting started. Many more ingredients may one day be produced in this way.”
“We have launched or will launch three products that fit [the demands of the health and wellness] trend perfectly. Veri-te resveratrol is applied in food supplements and cosmetics to assist healthy aging. Nootkatone has the potential to protect you, your kids and pets against ticks and mosquitos. And EverSweet stevia should help you reduce your calorie intake, while enjoying a great, sweet taste,” he concludes.
