Last close As at 05/08/2026
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Research: Consumer
Evolva has undergone a transformation from an R&D-driven enterprise to a commercial company with a product-based revenue model. Its H121 results demonstrated that Evolva is progressing towards its goal of being cash break-even by FY23. H1 revenue was up 60% y-o-y to CHF6.4m, and all segments witnessed an increase in sales. The contract manufacturer network continues to expand and manufacturing scale-up and optimisation is yielding successful results. Evolva now expects to see positive gross profits from Q421.
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Evolva |
Progressing towards cash break-even
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Consumer |
Deutsches Eigenkapitalforum 2021
28 October 2021 |
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Evolva is a research client of Edison Investment Research Limited |
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Evolva has undergone a transformation from an R&D-driven enterprise to a commercial company with a product-based revenue model. Its H121 results demonstrated that Evolva is progressing towards its goal of being cash break-even by FY23. H1 revenue was up 60% y-o-y to CHF6.4m, and all segments witnessed an increase in sales. The contract manufacturer network continues to expand and manufacturing scale-up and optimisation is yielding successful results. Evolva now expects to see positive gross profits from Q421.
Optimising costs
As Evolva nears profit and cash break-even it has focused on optimising its manufacturing capabilities and ensuring they are both stable and scalable. This should ensure that gross profits are positive by Q421, with a view to reaching cash break-even by FY23, and should stand the business in good stead for future growth.
Accelerating growth
Evolva witnessed growth across all segments during H121: Flavors & Fragrances products gained momentum during Q2, following some quieter quarters as a result of the pandemic; Health Ingredients saw ongoing strong demand across its segments; and Health Protection is focusing on end-user applications for the use of nootkatone in pest control. Resveratrol’s growth has accelerated as it has benefited from a pandemic-related spike in pet adoptions. Commercial interest has also been boosted by clinical studies initiated by Evolva demonstrating the product’s efficacy.
Valuation: Fair value of CHF0.30/share
We continue to value Evolva on a discounted cash flow basis with a 25-year model, assuming cash break-even in FY23, in line with management guidance. As a reminder, nootkatone contributes c 50% of our fair value for Evolva, with most of this coming from its use in pest control. We expect overall net debt of CHF5.1m at end FY21, including the balance of convertible loan notes issued since FY21. As a reminder, in June and December 2020 and May 2021, Evolva entered into an agreement with Nice & Green for the issue and subscription of up to CHF44m of convertible loan notes. As of the end of H121, Evolva has drawn tranches totalling CHF21.5m. Our current forecasts do not imply any further issuances of shares to redeem the convertible loan notes, though we note the capital increase in September 21 whereby Evolva issued 40m shares.
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Edison estimates
Source: Edison Investment Research |
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Research: Consumer
Whitbread continues to show that the strong get stronger with Premier Inn, much the largest UK hotel chain, materially outperforming the market throughout H1 to August and to date (by 14% in the seven weeks to 14 October). Notwithstanding seasonality, accentuated by the staycation boon, management expects leisure demand to remain buoyant, with tradespeople business resilient and office-based custom recovering, thereby a potential return of UK like-for-like RevPAR to pre-pandemic levels ‘at some point in 2022’. Robust, asset-backed finances (£2.1bn liquidity) give ample scope to capitalise on structural opportunities, enhanced by COVID-19 fallout, in the highest growth segment of the hotel market, both domestically and in Germany, where management is confident of replicating its UK success.