Half-Yearly Report January – June 2017

April–June in brief

• Genovis added five new products to the product portfolio:

FabALACTICA™: a unique enzyme for antibody analysis. The enzyme is of particular interest to pharmaceutical companies that develop biological drugs in the growing immunotherapy segment.

Three unique enzymes for glycan analysis: OpeRATOR™: a completely unique protease that cleaves proteins at the exact site of a certain type of glycan. OglyZOR™ and SialEXO™: both products have improved performance compared with other similar enzymes on the market and together with OpeRATOR offer a unique and cutting edge option in the field of glycan analysis.

GlyCLICK™: a product for specific labeling of antibodies for purposes such as development of biopharmaceuticals.

• Genovis carried out a directed share issue that raised SEK 11.5 million for the company.

• Net sales rose by about 26 percent to SEK 5,812k (4,595k).

• Gross profit totaled SEK 5,887k (4,036k).

• Gross margin was 86 (92) percent.

• Operating loss improved to SEK 1,978k (loss: 7,953k).

• Comprehensive income for the period improved by SEK 5,976k to a loss of SEK 2,145k (loss: 8,121k).

• Comprehensive income per share, basic and diluted, improved by SEK 0.17 to SEK -0.04 (-0.21).

• Cash flow from operating activities was a loss of SEK 3,662k (loss: 8,499k).

Half year in brief

• Net sales rose by about 26 percent to SEK 10,607k (8,403k).

• Gross profit totaled SEK 10,017k (12,802k).

• Gross margin was 87 (91) percent.

• Operating loss improved to SEK 5,037k (loss: 11,402k).

• Comprehensive income for the period improved by SEK 6,359k to a loss of SEK 5,215k (loss: 11,574k).

• Comprehensive income per share, basic and diluted, improved by SEK 0.22 to SEK -0.09 (-0.31).

• Cash flow from operating activities was a loss of SEK 5,445k (loss: 10,997k).

Comments from Fredrik Olsson, Chief Executive Officer  

Five product launches in H1

Genovis has continued to have strong organic sales growth in 2017. Sales in the second quarter increased by 26 percent to SEK 5.8 million, while sales for the first half of the year totaled SEK 10.6 million, corresponding to a 26 percent increase. This means that sales have surged for an impressive 11 consecutive quarters and the margins continue to remain at a high and satisfactory level.  

The quarter was primarily characterized by intensive product development and an extremely high rate of new product launches. We launched no fewer than five unique products in the second quarter and have exceeded our goal of launching three new products annually by a wide margin. In April we launched FabALACTICA™, a new addition to our enzyme family with a focus on antibody analysis. We also launched GlyCLICK™, a new antibody labeling technology that was developed in collaboration with Life Technologies. In addition, we developed a new enzyme family with three products aimed at glycan analysis, especially for pharmaceutical companies and researchers who develop biologicals within the growing field of glycomics.

Sales of these new products have developed very positive over the short-term, confirming both that there is a need on the market and that Genovis is able to meet that need. This excellent start to the year bodes well and I expect the contribution from the new products to be another important puzzle piece for our continued growth moving forward.

The new products definitely contribute to strengthening our brand and position in the market. The positive feedback we have received from our customers underscores our capacity, knowledge and ability to produce the right products. For example, this autumn one industrial customer will publish a scientific article based on FabALACTICA™. In addition, GlyCLICK™ is a finalist for the “2017 Innovation of the Year” award at the World Molecular Imaging Congress (WMIC), the largest imaging conference in the world. It is particularly empowering when a world-leading scientific organization like the World Molecular Imaging Society (WMIS) confirms that GlyCLICK is an important addition to the market. The new enzymes for the field of glycomics have also generated extremely positive feedback from customers who have already purchased and tested the products in an initial evaluation step.

The launches in the second quarter have affected our costs during the quarter, primarily due to increased costs for new patents, marketing and production – a natural consequence of a high launch rate. We are convinced that these costs are wise investments for the future. 

Efforts to identify partners or distributors in the key Asian markets remain a priority and are progressing according to plan. We continue to aim to have a partner in place before the end of the year. 

As I look forward, I see that the contribution from our new products will be an important cornerstone along with our already established products for continued strong sales growth. Our success is largely due to our organization in combination with our close customer relationships. With five new products in our product portfolio, I am convinced that we have further strengthened our position as an innovative knowledge partner in the global biologicals market.  

For more information, please contact: Fredrik Olsson, CEO, Genovis AB Tel: 0046 (0)46 -101233 fredrik.olsson@genovis.com

ABOUT GENOVIS

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 August 28, 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.