Fermentalg reports on Q1 revenue as US expansion begins
20 Apr 2018 --- Fermentalg, a French supplier of microalgae for nutrition and health, has reported first-quarter revenue of €232k whereas no income was recorded in Q1 2017. As of 31 March 2018, Fermentalg held gross cash and cash equivalents of €19.5 million compared to €21.8 million at 31 December 2017. Cash burn amounted to a €2.5 million outflow, stable compared to the previous quarter (excluding financing activities) and down €0.5 million from Q1 2017. Q1 was marked by progress achieved in bringing to market its DHA ORIGINS range of algal oils naturally rich in omega 3, as well as a US distribution agreement with Stauber, a leading North American supplier of specialty ingredients, the company reports.
Q1 milestones
During the first quarter, Fermentalg obtained Generally Recognized As Safe (GRAS) classification awarded by a panel of US experts for DHA ORIGINS 350, an oil with a natural DHA concentration of 350mg/g, and DHA ORIGINS 550, the first algal oil with a minimum natural DHA concentration of 550mg/g. GRAS status allows DHA ORIGINS products to be sold in applications dedicated to human nutrition including baby food.
In addition to obtaining this administrative authorization, Fermentalg recently signed a US distribution agreement with Stauber, a leading North American supplier of specialty ingredients.
These achievements will reinforce the marketing framework already established in Europe via the Novel Food authorization obtained for DHA ORIGINS 350, the registration of DHA ORIGINS 550 on the EU list and the signing of a distribution agreement with IMCD Group, a leader in the sale, marketing and distribution of specialty chemicals and nutritional ingredients.
During the first quarter, several batches of DHA ORIGINS 350 and DHA ORIGINS 550 were manufactured and samples delivered to sales contacts in response to the interest expressed. As a result, the first invoices were issued to customers in France, in quantities that remain confidential.
Meanwhile, Fermentalg reports that is seeking to grow its production capacity by sourcing a second supplier of DHA. Discussions are underway to roll-out during the year.
DIC Corporation partnership
Fermentalg has also made progress with regard to its partnership with DIC Corporation, a major player in the global chemicals industry. Launched in October 2017, the partnership involves a three-year joint development programme concerning two products derived from Fermentalg technology.
During the first quarter, the partners finalized the choice of the second product which, alongside the innovative phycocyanin (natural blue pigment) previously announced, will be jointly developed for the health and nutrition market. For strategic reasons, the two partners have decided to keep their choice of this second product confidential for the time being.
In support of its various programmes, Fermentalg is pursuing a proactive review, expansion and selection policy regarding its patent portfolio to harmonize its intellectual property policy with its overall strategy.
Accordingly, in 2017 the Company acquired a portfolio of five patent families that consolidated its positioning in the omega 3 segment. As at 31 March 2018, Fermentalg's portfolio comprised 27 patent families, unchanged from 2017 year-end. 23 of these have already been published by the relevant patent offices.
