To BRAIN Annual Report 2018/19
BRAIN Annual Report 2018/19 with the title ”Pioneering Bioproducts”
Dr. Jürgen Eck has been co-founder and CEO* of BRAIN AG since July 2015. Ludger Roedder took over the newly created position of Chief Business Officer (CBO) on 1 January 2019. Manfred Bender has been Chief Financial Officer (CFO) since 1 January 2019.
Our scalable product business already accounts for two thirds of the total operating performance we generate in a year.
With our product range, we operate in specialty markets where we can achieve above-average growth compared with basic chemical markets. This growth is driven by the general desire to replace chemical-synthetic processes with biological ones. As a consequence, manufacturers of everyday goods face new requirements. We offer you the entire spectrum from research and development to biobased product manufacturing.
For us, product scalability also means that we do not limit ourselves to supporting the general trend as a research partner, but that we participate in volume growth. We also receive more information as well as more direct information about consumer wishes. We exploit such knowledge for our own research projects.
BRAIN has unique research and development capacities. Our many years of expertise in industrial biotechnology area and the effective collaboration between our highly qualified interdisciplinary teams lead recurrently to genuine pioneering achievements, all the way up to springboard innovations. It is especially important that consumers can taste, smell, and feel the results of our work. We enable manufacturers of consumer goods to differentiate their product offerings with biobased components and biotechnology processes, thereby securing our long-term growth prospects and participating in the bioeconomy’s potential.
“With our volume-scalable offering, we participate more directly in the above-average growth of biobased innovations and are better able to respond to end customers’ wishes.”
BRAIN is excellently positioned internationally with its range of bioactive natural substances, tailor-made enzymes and high-performance microorganisms. Although the ingredients business is centered on Europe, it is a global growth topic. I myself have worked in the United States for a long time and can say that demand trends there at the consumer level are hardly any different from those in Europe. The requirements made of everyday consumer goods are being directed towards more naturalness and greater sustainability. Our customers include global leaders in the chemical and food industries. With the expansion of our international business, we can meet their high demands locally and are closer to what is going on.
All parts of the BRAIN group of companies contribute to our overall success with their special competencies. Exclusive access to extensive natural product libraries and the application of state-of-the-art biotechnology analysis methods lay the foundation for product and process innovations. Together with our subsidiaries’ special expertise, we make innovations from our own research ready for market launch and commercialize existing products. The BRAIN Group’s overall performance primarily reflects good networking with our customers. This provides us with direct information about new market developments and trends, which we in turn incorporate into our work.
“Our customers include global leaders in the chemical and food industries. The successful way in which we network creates a business advantage, which we aim to leverage in all areas. For this reason, it makes sense to tap markets internationally.”
The BRAIN Group achieved double-digit organic growth, despite the German chemical industry reporting declines in many areas. As a provider of biobased products and processes for industrial business partners with a strategic focus on promising markets for Nutrition & Health, Skin Care, and Industrial BioSolutions, we do not operate in complete isolation from economic trends. On the other hand, we do benefit from our specialization. A positive contribution to our growth came from the prioritization of our product scalable business, which now accounts for 65% of our total annual revenue. In the past financial year, BRAIN also generated good growth from R&D partnerships.
If you look closely, the operating segments for the product business and contract research are already operating profitably. However, the extraordinarily high quality of our own research also necessitates a high level of investment, a fact that is still dominating our overall results at present. These investments are of great importance for our company’s sustainable orientation. By investing in our own research, we are laying the foundation for long-term growth in our product business. We can make a product from our own research ready for market launch in just a few years and offer it directly to our B2B customers thanks to the integration of all of BRAIN’s operating segments. In other words, our three business units are closely linked and generate synergies for the overall business. We will soon see the positive effect in our overall results as well.
“Our three business units are closely interlinked and enable synergies to be leveraged for our overall business. We will soon see the positive effect in our overall results as well.”
Absolutely not – market growth and sustainability are two factors that belong together in the long term. Climate change and a growing world population are two megatrends that are leading worldwide to shortages in relation to the basis of our existence. Economic prosperity cycles increasingly depend on the intelligent utilization of dwindling raw material resources.
The bioeconomy can create the conditions for a new growth cycle by shaping the cycle of production and consumption in a sustainable way, with new value creation paths and disruptive product ideas. Industrial biotechnology is the trailblazer and innovation engine of this change. BRAIN plays a leading role in this context and, with its combination of strong research and efficient product development, is well positioned for the future.