Libourne - April 3, 2024 - Fermentalg, the French leader in microalgae listed on Euronext (FALG), today unveils its 2023 annual results[1] .

Pierre Josselin, Chief Executive Officer of Fermentalg, comments: "In 2023, we were hit by soaring energy and raw materials prices and rising interest rates, but also by short-term commercial difficulties linked to the reduction in purchases by two major customers.

We are approaching 2024 with much greater confidence. The new strategic plan deployed since the end of 2023 is beginning to bear fruit, as demonstrated by our quarterly sales figures published today, which are well ahead of schedule.

This confirms that our technology, our products and our organization are now perfectly aligned to take advantage of the major underlying trends in favor of solutions for healthy, sustainable food, the protection of marine resources and the fight against climate change."

Income statement analysis

As already announced, sales for 2023, at €4.1 million, were down 47% on the previous year. In addition to the economic slowdown affecting consumption, particularly in the nutraceuticals segment, Fermentalg was penalized by two major customers who significantly reduced or completely cancelled their purchases.

This context explains the increase in inventories during the year, which led the Company to write down part of them, with an accounting impact of -2.0 M€ for the year. The net inventory of €6.8 million is due to be sold in 2024, with the resumption of commercial activity.

At the same time, the gradual increase in industrial productivity during the year offset the continued high level of energy and glucose prices. Total R&D costs fell by 28% to €5.6 million in 2023, reflecting the completion of industrialization of the acid-stable blue pigment of natural origin. After taking into account capitalized costs and amortization, the net expense amounted to €4.4 million, or 8% less than in 2022.

Operating income for the year, before share-based payments and non-recurring items, came to -10.9 M€, compared with -8.7 M€ a year earlier. After non-recurring items (transfer of industrial production to new partner HuveNutra and depreciation of obsolete equipment), operating income came to -11.8 M€, and to -9.8 M€ excluding inventory write-downs, compared with -9.0 M€ for FY 2022.

Financial expenses were heavily impacted by the calculation of the fair value under IFRS of the convertible bonds issued in 2023 (accounting impact of -1.2 M€ with no cash impact), against a backdrop of volatile share prices. After taking into account the Group's share in the earnings of CarbonWorks, a subsidiary dedicated to the development of CO₂ circular economy solutions, whose operational ramp-up is weighing on results in the short term (€ -0.9 million versus € -0.5 million a year earlier), net income came to € -14.1 million (versus € -9.9 million in 2022).

Analysis of financial structure

As of December 31, 2023, Fermentalg had gross cash of €11.2 million (€15.9 million at end 2022) and shareholders' equity of €30.8 million.

The €6.3 million bond issue in March 2023 covered a large part of the company's needs in terms of operations (-€8.7 million) and capital expenditure (-€1.8 million), mainly in R&D.

Financial debt, amounting to €15.4m gross at year-end compared with €11.0m a year earlier, consists of repayable advances (€6.4m), the convertible bond held by the Givaudan group (€3.6m) and, for the balance, the portion of the above-mentioned bonds not yet converted into shares (€4.6m).

At present, the Company estimates that it has a liquidity horizon until the middle of the 2^nd quarter 2025.

Outlook

After managing this transitional 2023 financial year, and buoyed by a good start to 2024, Fermentalg is approaching the coming months with confidence, confirming its sales ambitions of €10 million in 2024 and over €25 million in sales by 2026.

Next publication: 1^st half-year sales 2024,
July 4, 2024 (after market close)

About Fermentalg

An expert in the research and bioindustrial exploitation of microalgae, Fermentalg aims to offer sustainable solutions and innovative products that contribute to the development of healthy, natural and high-performance products. Our business: the development, production and marketing of sustainable solutions and active ingredients derived from microalgae, for nutrition, health and the environment. Nutritional lipids, alternative proteins, natural food colorings and innovative environmental solutions make up our company's current and future offering. Fermentalg shares are listed on Euronext Paris (FR0011271600 - FALG), and are eligible for PEA-PME and long-only SRD. It has received an Exemplary rating (90/100) from EthiFinance ESG Ratings, a rating agency specializing in the ESG performance of SMEs listed on European markets, in favor of Socially Responsible Investment (SRI). 

For further information: www.fermentalg.com

Appendices

Consolidated income statement

Consolidated statement of financial position

Consolidated cash flow statement

[1] The Board of Directors of Fermentalg, chaired by Philippe Lavielle, has approved the IFRS annual financial statements, and the audit procedures have been completed. The certification report will be issued after completion of the procedures required for publication of the Universal Registration Document by April 30, 2024 at the latest.