401-405, 4th Floor, • TICEL Road, TICEL Biopark Ltd, • Taramani Road, • 600113 • Chennai, Tamil Nadu • India
Evolva has provided an update on strategy and mid-term objectives, and announces plans to raise approximately CHF 80 million gross proceeds in two separate equity transactions.
Evolva has provided an update on strategy and mid-term objectives, and announces plans to raise approximately CHF 80 million gross proceeds in two separate equity transactions.The company says its mission is unchanged: to bring sustainably-sourced, next-generation health, wellness, and nutrition ingredients to the world. Elements of its core strategy also remain unchanged, namely:+ Identifying alternatives for existing commercially available ingredients that are currently hard-to-source from nature and hence limit their use in health, wellness and nutrition applications+ Investing in Evolva’s distinct capability to discover and develop low cost bio-production routes for these ingredients in order to offer better economics, improved supply chains or enhanced product functionalities+ Maintaining a capital-light manufacturing strategy through Contract Manufacturing Organizations, investing in production infrastructure only when volumes/margins reach certain thresholdsThe strategic focus, however, has been sharpened. Evolva says it will:+Focus near term on three key products: stevia, resveratrol and nootkatone, each of which has large potential in lucrative market segments+ Ramp product sales and gradually reduce annual net cash burn to target breakeven in 4-6 years through a combination of direct sales and business-to-business partnering with market leaders+ Enter partnerships on new or existing products only if this complements its core strategy outlined aboveEvolva says it believes products derived from fermentation may offer a number of competitive advantages versus alternative natural sources, including:+ Where the ability to harvest ingredients from nature is not desirable. For example, the source of an ingredient (e.g. in a plant or animal) may be too rare, too hard to grow or produces the ingredient in very low quantities. This may lead to the ingredient being unavailable at the right quality or at the right price or being produced in an unsustainable way+ The ability to create simple, stable and sustainable supply chains for products that provide independence from weather, seasonality or the availability of agricultural land+ The ability to significantly lower the cost of production of many ingredients allowing for their usage in market segments and/or product applications for which they were previously too expensive+ The ability to make clean and safe products with more control and traceability+ The ability to provide consistent product qualities by standardized manufacturing+ The potential to provide better ingredients (e.g. more soluble, bioavailable, less bitter) or novel ingredients with new benefitsBased on the potential within their addressable markets, the products’ differentiation as well as objectives around market penetration, Evolva targets total revenue generation of around CHF 40 – 60 million by 2021 from nootkatone and resveratrol. This amount, which excludes the expected contribution from Cargill’s EverSweetT business, is expected to bring thecompany close to profitability.Evolva generated CHF 0.9 million in product revenues during the first half of 2017. The in-depth review of the company’s strategy has resulted in an immediate adjustment to the Company’s sales strategy, including the wind down of milestone-based research and development partnerships and a sharpened geographical and customer segment focus. As a result of this, Evolva expects full-year product revenues to reach between CHF 2.0 – 2.5 million and R&D revenues in the second half of the year to be below the level of the first half.
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