Evotec OAI sees sustained growth

Despite difficult market conditions, German company Evotec OAI saw its total revenues rise by 11% to Euro 70.0 in 2002 from Euro 63.2m the previous year. The operating loss improved from Euro 152.5m to Euro 135.5m and r&d expenditure was maintained at Euro 23m.

While the growth rate for the first half of the year was in line with targets, a broad deterioration in market conditions affected many customers later in the year, the company said. Biotech companies delayed r&d spending decisions, and pharmaceutical companies also restricted spending. The weakness of the UK pound against the euro also affected performance, reducing reported revenues by Euro 1.6m.

Against this background Evotec OAI extended its multi-year partnerships with companies including Pfizer - for another three years - Roche, Amgen and Solvay Pharmaceuticals. It also signed an innovative three-year umbrella agreement with Oxford Bioscience Partners (OBP), a US venture capital firm, giving it a bridgehead into the US biotech market, and has already signed agreements with Elixir Pharmaceuticals, Psychiatric Genomics and Dynogen Pharmaceuticals.

As part of its strategy on drug discovery, Evotex OAI completed the spin out of its instrumentation and technology business into the majority-owned subsidiary, Evotec Technologies GmbH.

Looking ahead to 2003, Evotec OAI say it is fundamentally well positioned, having built the critical mass and capabilities that make it an attractive long-term partner

As of February, the order book for 2003 amounted to Euro 57 m, covering 73% of current analyst revenue expectations for 2003, which compares favourably with contracted 2002 revenues of Euro 37m at the same time last year.

Joern Aldag, president and ceo of Evotec OAI, commented: 'This was an excellent performance against a background of continuing tough market conditions, which have adversely affected many of our customers. Our range of products and services continued to make us the partner of choice for the pharmaceutical and biotech industry, underlined by important new or extended agreements. We have reacted swiftly to the changing business environment, and with our excellent market position and strong order book we are confident that we have put the Company on track for positive EBITDA earnings in 2003.'