REG - Eden Research plc - Trading Update

Eden ResearchAnnouncement

22/08/2022 07:00

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RNS Number : 6920W  Eden Research plc  22 August 2022

22 August 2022

 

Eden Research

("Eden" or "the Company")

 

Trading Update

 

 

Eden Research plc (AIM: EDEN; OTCQB: EDNSF), the AIM-quoted company focused on
sustainable biopesticides and plastic-free formulation technology for use in
global crop protection, animal health and consumer products industries,
provides the following unaudited trading update for the half year to 30 June
2022.

 

Highlights

 

·      Revenue is expected to be c. £1.0m (H1 2021: £0.8m) an increase
of c. 33%; on track to meet full year guidance of £1.4m.

 

·      Product sales are expected to be c.£1.0m (H1 2021: £0.7m), an
increase of c. 54%.

 

·      Adjusted EBITDA (excluding Share Based Payments) is expected to
be a loss of approximately £0.8m (H1 2021: £0.8m loss), resulting in an
overall loss before tax of £1.3m (H1 2021: £1.8m loss).

 

·      Cash position as at 30 June balance date of £1.9m (HY 2021:
£5.8m), however, the Group had unaudited cash of £2.7m as of 15 August 2022
following a tax refund and receipts from half-year end trade debtors.

 

·      Development of Eden's seed treatment and insecticide products
continue to progress well with positive, early indications from 2022 field
trials received.

 

·      EPA authorisation expected before year-end for Eden's three
active ingredients, as well as Mevalone and Cedroz, allowing for meaningful
sales of both products in 2023.

 

Product sales growth

 

Sales of Eden's fungicide product, Mevalone, have been robust in the first
half of the year with the impact of Covid-19 diminishing and demand for Eden's
products returning to pre-Covid levels, despite challenging growing
conditions.

 

Furthermore, sales into new markets and use areas have increased as the
receipt of product authorisations translates into sales through our
distributors.  The ongoing diversification of Eden's product uses contributes
not only to sales growth but an increased level of resiliency in the business
as the Company expands from one crop and disease target, to many.

 

Corteva

 

In May 2021, Eden signed an exclusive Commercialisation, Supply and
Distribution Agreement with Corteva Agriscience ("Corteva"), the fourth
largest agriculture input company in the world. The agreement covers Eden's
first seed treatment product which uses Eden's proprietary, plastic-free
SustaineÒ encapsulation technology.

 

We have continued to work closely with Corteva and tests to date have shown
initial indications of successful trials in the current season. We are aiming
to apply for regulatory authorisation as soon as possible which, if
successful, will result in sales of the product by Eden to Corteva in time for
the 2024 growing season, although this time frame is currently an estimate and
remains subject to submission of an application for regulatory approval by the
relevant authorities.

 

We are focused on the EU and UK as initial markets for this product, which
have a current addressable market of €40m. In time, it is expected we will
be able to commercialise the product into other geographics, including the US,
where the addressable market is approximately €240 million. Eden estimates
peak product sales arising from the successful development and registration of
this seed treatment product for a specific application in all of these
territories may be at least €33m per year.

 

Insecticide

 

We have started to receive, collate and review results from our own
insecticide field trials from 2022.

 

In addition, samples have been sent out to a long list of third parties who
are undertaking their own field trials in the second half of this year.

 

At the end of the year, we shall then review the outcome of the trials and
look to enter into commercial arrangements with suitable, interested parties.

 

EPA authorisation

 

Eden awaits approval of its three active ingredients, as well as Cedroz and
Mevalone, in the US by the Environmental Protection Agency. The approvals are
expected to significantly increase the addressable markets for Eden's products
and pave the way for future product authorisations based upon the registration
of Eden's three active ingredients.

 

The US has one of the largest food markets in the world and its ongoing growth
presents a significant opportunity for biopesticide market participants. As
the only AIM-quoted company focused on biopesticides, we believe that Eden
offers a unique proposition for investors seeking to participate in the rapid
growth and promising future of sustainable agriculture. The EPA approval of
Eden's products, and subsequently, the company's insecticide offering in the
future, will open significant revenue opportunities for Eden, with total
market potential in the region of €500 million - approximately €94m for
Mevalone, €189m for Cedroz and €237m for insecticides.

 

 

Sean Smith, Chief Executive Officer of Eden Research plc, commented:

 

"The first half of the year has provided positive indications that we are on
track to meaningful product sales growth and we move into the second half of
the financial year with confidence and a well-managed cash position.

 

Growing conditions may play a significant role in determining the full year's
results, but we are encouraged by the strong first half and the underlying
demand for our products which these interim results represent.

 

We look forward to updating the market in due course on some of the exciting
projects we have in train and would like to thank shareholders for their
continued support."

 

 

For further information contact:

 

 Eden Research plc                                     www.edenresearch.com (http://www.edenresearch.com/)
 Sean Smith                                            01285 359 555

Alex Abrey

 Cenkos Securities plc (Nominated advisor and broker)
 Giles Balleny / Max Gould (corporate finance)         020 7397 8900

Michael Johnson (sales)

 Hawthorn Advisors (Financial PR)
 Victoria Ainsworth                                    eden@hawthornadvisors.com (mailto:eden@hawthornadvisors.com)

Stephen Atkinson

 

 

 

Notes to Editors:

 

 

Eden Research is the only UK-listed company focused on biopesticides for
sustainable agriculture. It develops and supplies innovative biopesticide
products and natural microencapsulation technologies to the global crop
protection, animal health and consumer products industries.

 

Eden's products are formulated with terpene active ingredients, based on
natural plant defence metabolites. To date, they have been primarily used on
high-value fruits and vegetables, improving crop yields and marketability,
with equal or better performance when compared with conventional pesticides.
Eden has two products currently on the market:

 

Based on plant-derived active ingredients, Mevalone® is a foliar
biofungicide which initially targets a key disease affecting grapes and other
high-value fruit and vegetable crops.  It is a useful tool in crop defence
programmes and is aligned with the requirements of integrated pest management
programmes. It is approved for sale in a number of key countries whilst Eden
and its partners pursue regulatory clearance in new territories thereby
growing Eden's addressable market globally.

 

Cedroz™( )is a bio-nematicide that targets free living nematodes which are
parasitic worms that affect a wide range of high-value fruit and vegetable
crops globally.  Cedroz is registered for sale on two continents and Eden's
commercial collaborator, Eastman Chemical, is pursuing registration and
commercialisation of this important new product in numerous countries
globally.

 

Eden's Sustaine(®)( )encapsulation technology is used to harness the
biocidal efficacy of naturally occurring chemicals produced by plants
(terpenes) and can also be used with both natural and synthetic compounds to
enhance their performance and ease-of-use. Sustaine microcapsules are
naturally-derived, plastic-free, biodegradable micro-spheres derived from
yeast. It is one of the only viable, proven and immediately registerable
solutions to the microplastics problem in formulations requiring
encapsulation.

 

Eden was admitted to trading on AIM on 11 May 2012 and trades under the
symbol EDEN. It was awarded the London Stock Exchange Green Economy
Mark in January 2021, which recognises London-listed companies that derive
over 50% of their total annual revenue from products and services that
contribute to the global green economy. Eden derives 100% of its total annual
revenues from sustainable products and services.

 

For more information about Eden, please visit:  www.edenresearch.com
(http://www.edenresearch.com/) .

 

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