Evotec (EVT) Q2 2024 earnings summary

Executive summary

• H1 2024 revenue increased 2% year-over-year to €390.8 million, driven by 50% growth in Just-Evotec Biologics, offsetting a 7% decline in Shared R&D.

• Adjusted EBITDA dropped to €(0.5)m from €33.9m in H1 2023, reflecting high fixed costs, ramp-up expenses, and capacity overhang.

• Major restructuring underway, including site closures, headcount reduction (~400 roles), and portfolio optimization to restore profitability.

• Net loss widened to €(115.6)m from €(28.8)m, mainly due to increased costs of revenue and €68.5m in reorganization costs.

• New CEO Dr. Christian Wojczewski appointed effective July 2024.

Financial highlights

• Group revenues: €390.8m (+2% year-over-year); Just-Evotec Biologics: €88.5m (+50%); Shared R&D: €302.4m (–7%).

• Adjusted EBITDA: €(0.5)m (H1 2024); core operations generated €3.6m; gross margin dropped to 12.9% (6M 2023: 25.9%).

• Net cash used in operating activities: €(98.6)m; cash and cash equivalents: €221.9m (Dec 2023: €510.9m).

• Total assets: €1,998.9m (Dec 2023: €2,252.5m); equity ratio stable at ~50%.

• Share price declined 58% YTD, underperforming indices.

Outlook and guidance

• FY 2024 revenue expected at €790–820m; adjusted EBITDA €15–35m; R&D expenditures €50–60m.

• Full impact of cost savings and capacity adjustments expected in 2025, with recovery anticipated in H2 2024.

• Priority Reset program targets recurring annual savings >€40m, with one-off expenses of €68m.