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Evotec Posts Increased Revenues in Q4; Maintains Technology Unit No Longer Core to Company


Evotec OAI last week reported increased revenues amidst soaring losses for the fourth quarter of 2004. Despite increased revenues over the whole of 2004 for its Evotec Technologies subsidiary, which employs approximately 90 people, is “[as] we have said before ... no longer core to Evotec OAI,” CEO Joern Aldag said in a conference call to investors.

Although Evotec did not indicate whether a possible divestiture of Evotec Technologies was in its future, the company has been moving to increase its focus on drug discovery, including the recent €49 million ($63.1 million) buy-back of drug-discovery spin-off Evotec Neurosciences (see Inside Bioassays, 3/8/2005).

The company did not break down the quarterly revenues of Evotec Technologies and Evotec Neurosciences, but it said that Evotec Technologies’ revenues excluding non-internal sales grew by 3 percent for the entire year, to €17.7 million, while revenues for the overall company declined for the year to €72.7, from €77.2 in 2003. “This is a very strong performance considering that revenues recorded in 2003 had an extraordinarily large percentage of revenues with Pfizer,” one of its EVOscreen consortium partners, the company said in a statement.

Aldag also mentioned during the call that Evotec Technologies had acquired the ultra-high-throughput screening business from Carl Zeiss — a deal that the com-pany had not previously disclosed. As a result, Aldag said, the company had roughly doubled its market share from 20 percent to close to 40 percent in this area, adding, amongst others, Roche, J&J, Bayer, and Boehringer Ingelheim to its customer base. Evotec said that it currently has installed about 20 ultra-high-throughput screening systems.

A company official told Inside Bioassays that Evotec Technologies acquired Zeiss’ PlateExplorer ultra high-throughput screening platform and PlateVision plate reader, both used for biochemical assays, earlier this year.

Aldag also mentioned that Evotec Technologies’ fourth-quarter product revenues grew significantly in the academic market to €4.5 million in 2004, from €1 million in the prior year. This increase resulted mostly from the sale of an EVOscreen system and two Opera imaging systems to the Institut Pasteur in Korea in December, Evotec said.

“We see very strong growth in the academic market for the type of equipment [that] we have, including the Opera system and the cell-handling equipment, Cytocon, and others,” Aldag said during the call in response to an analyst’s question about instrumentation growth in the academic market.

Aldag also specifically mentioned a “significant increase of Opera and Cytocon sales … which have to do with cell imaging and cell handling. This clearly is a growth area in which we have benefited very nicely.”

The Opera is Evotec Technologies’ confocal-based high-content imaging system.

The company as a whole had €25.3 million in total revenues for the quarter, up from €20.5 million during the fourth quarter of 2003.

Research and development costs stayed flat at roughly €3.8 million.

Evotec’s net loss for the quarter amounted to €66.5 million, or €1.75 per share, up from €4.3 million, or €.12 per share during the year-ago quarter.

Evotec said that the huge increase in net loss was mainly due to an expected €69.5 million non-cash impairment, including goodwill and underutilized capacities, in the company’s second pilot plant and the new laboratory building in Abingdon, UK.

— JK


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