The fiscal year 2015/16 was significantly influenced by the IPO in February 2016 with its related costs and one-off effects as well as partly difficult market developments in the bioethanol-related business. Investments into the future growth of the Group, such as the product development pipeline, were continued as planned. Through the implementation of the DOLCE programme for the development of novel biological sweeteners in August 2016, a solid foundation for the expected growth in the coming years was laid. The Management Board sees the DOLCE program as a blueprint also for other industries and fields. Overall, the Management Board is satisfied with the development in fiscal year 2015/16 and expects a clearly positive momentum for the current financial year 2016/17.
In the “BioScience” segment, the collaboration business with globally active partners especially from the specialty chemicals as well as the food and nutrition industries was further expanded over the fiscal year 2015/16. Supported by several achieved development milestones, the total operating performance increased slightly from € 12.3 million in the previous year to € 12.4 million, representing 47 percent of the Group’s total operating performance. Total operating performance is € 0.5 million lower, as - due to temporary delays during intermediate evaluations - grants were granted with a slight delay.
The total operating performance of the industrial product business, concentrated in the “BioIndustrial” segment, also improved slightly during FY 2015/16 to € 13.9 million from € 13.5 million in the previous year, representing a 53 percent share of the total operating performance of the BRAIN Group. A strong fourth quarter compensated for the decline in demand experienced during the prior three quarters in the field of bioethanol enzymes. Concurrent initiatives to expand the higher-margin special enzymes business, such as enzymes to process wine and fruit juice beverages, also showed positive effects.
The FY 2015/16 Group operating result (EBIT) was significantly influenced by one-off costs and other factors resulting from the IPO, and declined year-on-year from € -4.6 million to
€ -13.8 million. Adjusted for one-off IPO-costs of € 1.0 million, and personnel expenses with no impact on liquidity resulting from a share-based employee compensation programme at the subsidiary AnalytiCon of € 1.4 million, as well as a non-recurring compensation scheme in connection with the IPO accounting for € 3.9 million, equally having no impact on liquidity nor on equity („Post IPO Framework Agreement”), the adjusted Group EBIT amounted to € -7.6 million in FY 2015/16 compared to € -4.4 million the year before. The adjusted Group EBIT figure reflects, amongst others, € 4.7 million of costs relating to investments into own development projects, € 1.2 million of non-adjustable costs connected with the first year of being public, and € 1.2 million of additional personnel expenses to account for the new BRAIN AG employee bonus programme.
The Post IPO Framework Agreement, which was stated in the IPO prospectus, relates to an arrangement between the existing shareholders and certain members of the management concerning the one-off transfer of shares from the existing shareholders to recognize the managers’ contribution to the value enhancement of the company culminating in the IPO. The agreement was finalised in Q4 2015/16 and thus did not affect the previous interim financials. According to IFRS, this one-time reward from existing shareholders to employees is considered a share-based compensation and must be booked as such. This is offset by a corresponding increase in the capital reserve so that the transaction is neutral from both a liquidity and equity perspective.
Due to the additional accounting efforts in the first year as a listed company, the audit process takes longer than expected so that the full audited financial statements will not be published as originally planned on December 20, 2016, but only on January 16, 2017.
Key financials (preliminary, unaudited)
(in € million)1
||Total operating performance2
|Adjustments (consolidation effects)
||IPO one-off costs
|Share based employee compensation AnalytiCon
|Post IPO Framework Agreement
|Cash & cash equivalents (30.09.)
- The financial figures of the FY 2015/16 are comparable only to a limited extent to the values of the previous year, as for FY 2014/15 they include the financial figures of the WeissBioTech organisations only since November 2014 due to the acquisition
- Revenues + change in inventories + other income including R&D grants, only comparable to a limited extent