Interim Report January – September 2017
July – September in summary
- Genovis signed a distribution agreement with the Chinese company Beijing Zhongyuan Ltd. for sales in the Chinese market. The agreement covers all Genovis products.
This agreement will enable Genovis, with its growing product portfolio, to establish a foothold in one of the world’s largest and most exciting markets. Over the last five years the Chinese market for biopharmaceuticals has grown by more than 40% annually. The market includes both large Chinese companies and a number of global pharma giants that have chosen to locate both their research and development and their manufacturing in China.
- Net sales rose by about 14 percent to SEK 5,286k (4,627k).
- Gross profit totaled SEK 4,882k (4,953k).
- Gross margin* was 90 (92) percent.
- Operating result totaled SEK -1,654k (-1,070k).
- Net loss for the period was SEK 1,641k (loss: 1,059k).
- Comprehensive income per share, basic and diluted, totaled SEK -0.03 (-0.02).
- Cash flow from operating activities was a loss of SEK1,474k (loss: 3,003k).
*Excl. other revenue and “Change in inventory, finished goods”
January – September in brief
- Net sales rose by about 22 percent to SEK 15,893k (13,030k).
- Gross profit totaled SEK 14,899k (17,755k).
- Gross margin* was 88 (92) percent.
- Operating loss improved to SEK 6,690k (loss: 12,472k).
- Comprehensive income for the period improved by SEK 5,778k to a loss of SEK 6,856k (loss: 12,634k).
- Comprehensive income per share, basic and diluted, improved by SEK -0.17 to SEK -0.12 (-0.29).
- Cash flow from operating activities was a loss of SEK6,919k (loss: 14,001k).
*Excl. other revenue and “Change in inventory, finished goods”
Events after the end of the period
Genovis has continued to expand in China and signed another distribution agreement with Shanghai Titan Scientific Ltd.
Comments from Fredrik Olsson, CEO
A quarter with intensive marketing efforts and new opportunities in China
Genovis continues its positive sales trend in the third quarter. Sales increased by 14 percent to SEK 5.3 million (4.6), bringing organic growth for the third quarter of the year to 22 percent with sales of SEK 15.9 million (13.0). Sales growth in the third quarter was relatively weak compared with the previous year due to temporary differences between the quarters, though this trend is expected to have limited impact on sales for the full year. We also see a certain negative impact from currency effects that mainly relate to the US market. I am pleased to report that sales have grown for an impressive 12 consecutive quarters and that the margins continue to remain at a high and satisfactory level.
We have launched an impressive five new products this year. Our product portfolio is now significantly broader and consists of a total of 15 product series. The third quarter was characterized by intensive marketing efforts to introduce the new products to customers. We have dedicated our efforts to the roll-out of our new technology for labeling antibodies, GlyCLICK™, and the products for glycan analysis. Genovis has participated in no fewer than five conferences during the quarter and carried out several customer visits. The conferences are well-established and excellent meeting places for us where we receive confirmation of the commercial and scientific strength and viability of our products. While these initiatives have raised our costs for the quarter, we believe they are essential to reach the market. I expect to see the effects of these initiatives already in the fourth quarter, but especially over the coming year as these products enter a more mature phase and volumes increase.
During the third quarter we signed an agreement distribution and sales of our product portfolio in China. Our objective during the year has been to acquire a partner or distributor on location in one of the growing Asian markets. The Chinese biopharmaceuticals market alone has grown by more than 40 percent annually over the past five years. Our Beijing-based partner Beijing Zhongyuan Ltd has resources, expertise, a strong product portfolio and the connections that we need. In addition, we entered into an additional distribution agreement in China after the end of the period. Our latest distributor, Titan Scientific, is based in Shanghai and works with well-known international brands in well-established channels. With this new agreement, another puzzle piece in our Asian venture is now in place. Building relationships with well-established partners is a cornerstone for Genovis to be able to achieve a good foothold and growth in Asia. These agreements also serve as an acknowledgment that our offering holds its own in relation to others and that our products strengthen the portfolios of our respective partners. We can conclude that our sales in Asia have doubled during the year, albeit from a very low level. With two new partners, we hope to accelerate sales further at a rapid pace.
As we now approach the end of 2017 I can see that Genovis is much stronger than last year. Our portfolio is broader and we have strengthened our position as an innovative knowledge partner on the global biologicals market. We will continue our goal-oriented work with customers and partners so that even more people see Genovis as its natural partner in the development of tomorrow’s medications.
For more information, please contact: Fredrik Olsson, CEO, Genovis AB Tel: 0046 (0)46 -101233 firstname.lastname@example.org
Genovis’ business concept is to apply its knowledge and imagination to design and provide innovative tools for the development of the drugs of the future. Today Genovis sells several enzyme products known as SmartEnzymes all over the world in innovative product formats that facilitate development and quality control of biological drugs.
The Group consists of Genovis AB and the wholly owned subsidiary Genovis Inc. (USA). Genovis shares are listed on Nasdaq First North Stockholm and Erik Penser Bank is the Company’s Certified Adviser. T: +46 (0)8-463 83 00.
This information is information that Genovis AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, by the contact person set out above, on November 27, 2017.
This press release is a translation of the Swedish original. In the event of any discrepancy between this translation and the Swedish original, the Swedish version shall prevail.