10 January 2017 – Evolva (SIX: EVE) provides an update to shareholders on its collaboration with Cargill on the next-generation stevia sweetener, EverSweet™, and its preliminary, unaudited, 2016 top-line financials.
Evolva currently expects EverSweet™ to launch in 2018.
During 2016 Evolva and Cargill made solid progress on EverSweetTM. The FDA issued a GRAS No Objection Letter for EverSweetTM and Evolva received pivotal patent notifications and grants in both Europe and the US. Current developments suggest that a launch-ready strain will be achieved during 2017.
Under the 2018 launch plan, EverSweetTM will be produced initially at Cargill’s advanced, low cost, manufacturing campus in Blair, Nebraska through retrofitting existing Cargill facilities. Evolva and Cargill are additionally examining an accelerated move to a new facility that may also act as a production hub for other Evolva products, including nootkatone and resveratrol, and those of certain Evolva partners. As a result of the accelerated move, the initial retrofit will be more limited in scale than previously estimated, with significantly lower costs.
This plan is subject to the successful completion by Spring 2017 of ongoing negotiations between Evolva and Cargill. It is expected that third party financing of some activities, notably production capex, will be involved.
Evolva CEO Neil Goldsmith noted: “An EverSweetTM launch in 2018 would maintain our first mover advantage in the next generation stevia market. In addition, any multi-use facility has the potential to provide Evolva with a long-term, low-cost production solution for our other key products.”
If the above negotiations do not translate to an agreement that Evolva believes is value creating for its shareholders then Evolva will focus on maximising value from its launched, and commercially promising, nootkatone and resveratrol products.
Based on preliminary, unaudited numbers, 2016 revenues are now expected to come in at between CHF 9-10 million, around a third lower than expected in August. This reduction is a function of two things:
- A technical milestone in the stevia program, which was expected towards the end of 2016, was not achieved.
- Evolva product sales increased almost fourfold in 2016 over 2015, a lower rate than projected. The primary reason was that customer conversion takes longer than expected. Despite this the sales trajectory is clearly positive and the customer pipeline continues to improve.
The preliminary 2016 end cash position is estimated to be on target at around CHF 47 million.
Evolva believes it has a good financial position going into 2017 and expects an uptick in both product and partnership revenues. Future cash-flow will depend on the outcome of the above mentioned negotiations.
We will provide fuller guidance on 2017 expectations when we publish the final 2016 results on 30 March 2017.
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