Year-end Report January - December 2020

Report for the fourth quarter of 2020          

October – December in brief

• Net sales totaled SEK 19,850 (12,830) thousand. Organic growth, adjusted for acquired sales, rose by 33% to SEK 17,102 thousand.
• Gross profit totaled SEK 19,761 (12,065) thousand.
• Operating profit before depreciation and amortization (EBITDA) totaled SEK 6,196 (492) thousand.
• Operating profit was SEK 4,604 (loss: -522) thousand.
• Comprehensive income was SEK 6,347 (loss: -895) thousand.
• Earnings per share, basic and diluted, totaled SEK 0.13 (-0.01).
• Cash flow from operating activities was SEK -672 (2,824) thousand.
• Cash and cash equivalents at the end of the period totaled SEK 44,118 (14,992) thousand.
• Genovis AB and Glykos Finland Oy have entered into a licensing and supply agreement for unique toxin and linker technologies to be combined with the site-specific marking technology for antibodies from Genovis.
   

January – December in brief

• Net sales totaled SEK 61,030 (60,549) thousand. Organic growth, adjusted for bioprocess and acquired sales, rose by 20% to SEK 53,329 thousand.
• Gross profit totaled SEK 59,370 (56,187) thousand.
• Operating profit before depreciation and amortization (EBITDA) totaled SEK 8,573 (13,563) thousand and was negatively impacted by non-recurring expenses for acquisitions and restructuring of SEK 2.6 million.
• Operating profit totaled SEK 3,140 (10,066) thousand.
• Comprehensive income was SEK 1,973 (9,549) thousand.
• Cash flow from operating activities was SEK 3,755 (2,824) thousand.
• Earnings per share, basic and diluted, totaled SEK 0.10 (0.15).
• During the year Genovis acquired all shares of QED Bioscience Inc. The total cost of the acquisition, including transaction costs, is SEK 20 million.
• In the first quarter Genovis raised SEK 50 million for the Company before issue expenses in a rights issue.

Comments from Fredrik Olsson, Chief Executive Officer

We ended a challenging year on a strong note. In the fourth quarter, growth in the core business for enzymes within Analytics was 23 percent and currency-adjusted growth was 33 percent. Growth in the fourth quarter was driven by a general increase in activity in our markets, along with several large individual orders.

We saw a recovery in customer activity in both North America and Europe at the beginning of the quarter. In Asia sales growth continued and some markets showed a return to a more normal level of market activity.

The antibody business in our subsidiary showed growth in the quarter compared with the corresponding period the previous year, driven in part by orders that were postponed from Q3 because of the pandemic. Parts of the antibody business continue to be impacted by the general reduction in diagnostics as a result of COVID-19.

We have completed our investments in our electronic sales and marketing system since we do not expect to be able to carry out physical marketing activities such as conferences and customer meetings until the second half of 2021 at the earliest. Our initiatives have resulted in the continued inflow of new customers, which is extremely encouraging.

We have periodically experienced challenges in various geographic markets as a result of local restrictions imposed by the authorities to limit the spread of infection. In many markets, operational work in our customers’ laboratories continued to be limited by COVID-19-related restrictions, which in turn negatively impacts our business. Postponements caused by challenges related to conducting clinical trials have entailed delays in some of our customers’ projects. My assessment is that access to vaccine and implementation of a hopefully successful vaccination program will determine the pace of recovery to a more normal market situation in 2021. Despite these challenges, revenue in our core business grew and the inflow of new customers resulted in continued growth in our customer base compared with the previous year.

Through our collaboration with Glykos at the end of the year we launched yet another product in our antibody labeling segment. GlyCLICK® ADC facilitates quick and simplified generation of antibody drug conjugates (ADC) in which Genovis’ labeling platform is combined with the latest generation of linker technology from Glykos. We are actively working to establish more industrial partnerships to further strengthen our product portfolio and broaden our customer offering to the biopharma industry. We will continue to focus on product development and we plan to launch several new enzyme products within analysis and antibody labeling during the first half of 2021.

At the end of the year, the second wave of the pandemic hit several of our key markets. Over the short term, once again there is growing uncertainty about what impact the reinstated restrictions will have on Genovis’ activities, especially in Europe and the US.

Despite the uncertainty about short-term market trends because of the pandemic, Genovis’ growth potential for the future remains intact. Because of the strong underlying driving forces for growth within several areas related to biological drugs and protein analysis, my fundamental outlook remains positive regarding our potential for continued strong growth over time.

I would like to close by thanking the Board of Directors and shareholders for their support and commitment over the past year. I would also like to warmly thank my colleagues at Genovis who have successfully handled a challenging year with great dedication, which has allowed us to enter 2021 with renewed vigor.

For more information, please contact: Fredrik Olsson, CEO, Genovis AB Tel: +46 (0)46 101233, email: 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 Growth Market and Erik Penser Bank is the Company’s Certified Adviser, certifiedadviser@penser.se, T: +46 (0)8 463 83 00.

Published reports can be downloaded from the Genovis website:
https://investor.genovis.com/en/financial-reports/

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 February 11, 2021.

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.