BRAIN Biotech AG · XETR:BNN
BRAIN Biotech — Investor Presentation (August 2022)
61 slides from BRAIN Biotech's investor presentation, Aug 29, 2022
Slide 1: BRAIN Biotech AG Investor Relations Presentation 2022
BRAIN Biotech AG Creating a #BiobasedFuture Investor Relations Presentation 2022 Zwingenberg, August 2022 Since 2021 we have been committed to the UN Global Compact corporate responsibility initiative and its principles in the areas of human rights, labor, the environment and anti-corruption. Creati
Slide 2: Safe Harbor Statement
Safe Harbor Statement This document may contain forward-looking statements. These forward-looking statements are subject to risks and uncertainties, as they relate to future events and are based on current assumptions of the Company, which may not occur at all in the future or may not occur as assum
Slide 3: BRAIN at a Glance
Overview BRAIN at a Glance ~ €38m Creating Breakthrough Bioproducts & Solutions for Nutrition, Health and Environment ‘20/’21 Revenues > 28 Years of Experience Industrial Biotech Three (white) Product Platforms ~ 330 Employees Enzymes > 350 Specialty B2B Products Microorganisms > 150 Bioactive Natur
Slide 4: Mission & Vision
Overview Mission & Vision “Mission is what an organization is or does. Vision is what an organization desires to become” Mission Creating Breakthrough Bioproducts and Solutions for Nutrition, Health and the Environment Vision We will be the Industrial/White Biotech Specialists in finding and explori
Slide 5: When Should You #Think BRAIN?
Overview When Should You #Think BRAIN? in the center of mega-trends Health & Nutrition Creating a BiobasedFuture Vegan & Vegetarian Food: Alternative Protein Base Genome Engineering: (Precise Fermentation / Microbial Production Hosts) Novel Non-Cas9 Nucleases Healthy & Better Tasting Beverages: Biol
Slide 6: This is BRAIN
Overview This is BRAIN BRAIN Biotech AG Breakthroughs & Services Products BioScience BioIndustrial BioActive Compound Enzymes Microorganisms Bioactives Incubator Tailor Made Solutions Libraries Breakthrough Discoveries Discovery Proprietary Bio-Archive Nutrition, Healthcare, Environment, Cosmetics N
Slide 7: BRAIN Group – Solutions Provider
Overview BRAIN Group – Solutions Provider 1 Products Business • Focus on high-growth & high-margin niches Value Creation & Synergies • Re-shape from a purchase for resale to an own production model • Strong target markets with healthy sales and margin growth in F&B, healthcare and environment 1 TMS
Slide 8: Six Strong Reasons to Invest in BRAIN Biotech AG
Overview Six Strong Reasons to Invest in BRAIN Biotech AG 1. Mega-trends / UN-SDGs: our products address the big societal topics – nutrition, health & the environment. We address at least 5 SDGs directly 2. Incubator products: big upsides in our breakthrough inventions. BEC/BMC potential to be trans
Slide 9: Five Strategic Initiatives Centered Around our Core Values
Overview Five Strategic Initiatives Centered Around our Core Values Continuous Corp. Culture Development 1 Profitable Top Line Growth 5 1 5 • Can do and high ethics culture • Excel in specialty niches with high margins • Talent management • Selectively grow outside of Europe • Innovation is our pass
Slide 10: ESG+: Responsible Group Management
ESG/Sustainability ESG+: Responsible Group Management five key focal points for sustainable value creation Efficient Governance Economic Performance • German Corporate Governance Code (DCGK) compliance • Profitable top-line growth • German Sustainability Code (DNK) • Organic growth enhanced by value
Slide 11: Targets ESG+ Roadmap 2032 / 2050
ESG/Sustainability Targets ESG+ Roadmap 2032 / 2050 Minimizing the Environmental Livable & Satisfying Responsible Business BRAIN Impact from our Operations E Employment S Operations G Impact + Goals Goals Goals Goals • By 2032, reduce Scope 1-2 GHG • By 2032, share of women in • By 2032, Target zero
Slide 12: Sustainability: Manifold Business Opportunities for BRAIN
ESG/Sustainability Sustainability: Manifold Business Opportunities for BRAIN enabling technologies & solutions Discovery / Enabling Biological Production/ BRAIN Group Bio-based Biomimicry Biological Manufacturing Fermentation Products Cell-factories Upscaling Biological catalysts: Natural and nature
Slide 13: BRAIN Incubator
Recent Events BRAIN Incubator building a prosperous future rNPV Market Profit Model Current R&D Time-to-Market Potential Options Platform Project Pipeline Partners R&D Market *1 *2 *3 Status 3–5 years out 1–3 years out In pre-launch Prod, Fee, Unsuccessful Natural fermented beverages 1 Small M/O MSP
Slide 14: Management & Employee Incentives
Incentives Management & Employee Incentives since the IPO BRAIN Biotech AG’s board as well as management compensation has been closely linked and aligned with shareholder interests Executive Board • fixed salary • variable component based on individual quantitative & qualitative targets • stock comp
Slide 15: Financial Highlights 9M FY 2021/22 at a Glance
Financials Financial Highlights 9M FY 2021/22 at a Glance fourth consecutive strong quarter of sales growth Organic Organic 9M 9M Growth Growth Q3 Q3 Growth Growth Comment (in € thousand) 2021/22 2020/21 2021/22 2020/21 Revenues 35,974 27,845 29.2% 14.9% 12,707 9,844 29.1% 6.2% Milestones 183K 9M 21
Slide 16: Cash & Cash Flow
Financials Cash & Cash Flow strong OCF 9M, cash position remains solid despite Breatec purchase & Capex spend 9M 9M Q3 Q3 Growth Growth (in € thousand) 2021/22 2020/21 2021/22 2020/21 Comment Gross Cash Flow -3,695 -4,061 9.0% -1,494 -924 -61.7% Operating Cash Flow -1,032 -3,000 65.6% 30 1,157 -97.4
Slide 17: Long-Term Revenue Growth Trajectory
Financials Long-Term Revenue Growth Trajectory strong organic growth in both divisions, Breatec inclusion for 5 months **** * ** *** As stated: we will go back on the growth track in FY 21/22 – confirmed now by three quarters Breatec added to growth since Q2, consolidation for 8 months in this f
Slide 18: Adjusted EBITDA
Financials Adjusted EBITDA BioScience: positive operating leverage, BioIndustrial: strong Biocatalysts fermentation Adjusted EBITDA 9M 21/22 5.000 € • Group adj. EBITDA strongly improving due 4.000 € 3.686 to dynamic sales growth and positive 3.000 € 2.379 operating leverage; good cost control 2.000
Slide 19: Rising Supply Chain Risks & Cost Inflation
Guidance Rising Supply Chain Risks & Cost Inflation persisting supply chain constraints, rising input and labor costs Covid Summary: Secure: Supply chain constraints persist and hinder even more dynamic growth in • Health aspects BioIndustrial. Inflationary pressures keep building. • Supply chain •
Slide 20: Our Targets
Guidance Our Targets Guidance and Mid-Term Targets FY 21/22 Guidance (updated incl. Mid-Term Targets, Unchanged Breatec**) (issued 09/‘20, 4-5 year targets) (excluding CRISPR) Group sales: around EUR 50 million BS: growth 15-25% (higher end) Double group revenue from base ‘18/19 BI: organic grow
Slide 21: Our Share Ownership
Shares Our Share Ownership* DAH Beteiligungs GmbH Lloyd Fonds 5.6% 4.1% Founders/ Management 6.7% Free Float (in definition German Stock • Number of shares: 21,847,495 Exchange ~52%) 44.8% • Free float of ~ 45% • Strong long-term investor base • 8,600 shareholders • WKN 520394 / ISIN DE0005203947
Slide 22: Financial Calendar
Financials Financial Calendar QUARTERLY STATEMENT Publication of the quarterly statement as of June 30th, 2022 (9M) August 29th, 2022 ANNUAL REPORT Publication of the annual report as of September 30th, 2022 (12M) January 16th, 2023 QUARTERLY STATEMENT Publication of the quarterly statement as of De
Slide 23: Thank you for your attention.
Thank you for your attention. BRAIN Biotech AG Darmstädter Straße 34−36 64673 Zwingenberg, Germany +49 (0) 6251-9331-0 www.brain-biotech.com Your contacts: Michael Schneiders, Head of IR & Sustainability Martina Schuster, IR +49 (0) 6251-9331-86 +49 (0) 6251-9331-69 [email protected] MS@brain-bi
Slide 24: Appendix
Appendix Appendix Page High barriers to entry 25 NBD deep dive 26 Service business deep dive 38 Partnerships ”BRAIN Inside” 39 Enzyme production, expression hosts 41 Enzyme value chain 43 BioArchive 44 HR: People -- our core capital 45 Detailed management & employee incentives 46 Peers by business a
Slide 25: High Barriers to entry
Entry Barriers High Barriers to entry Our novel products & solutions are based on: • Proprietary BioArchive with >450 person years to reproduce • Extensive patent portfolio, around 175 patents granted and around 40 patent families • Trade secrets • Broad and deep technology know-how in enzymes, micr
Slide 26: NBD Deep Dive, The Pipeline
Deep Dive NBD Deep Dive, The Pipeline Large Market Potential Natural Beverage 2 • Partners: Japanese Beverage Company • Scope: undisclosed, confidentially agreement • Exclusive to partner • Technology Platform: microorganism • Research Business Model: milestone payments • Commercial Model: starter c
Slide 27: NBD Deep Dive, The Pipeline
Deep Dive NBD Deep Dive, The Pipeline Large Market Potential BRAIN CRISPR Non-Cas9 Associated Nucleases (BEC/BMC) • Genome Editing: directed and precise change or use of a chromosomal target in a given organism; “the power to program cells” • CRISPR = clustered regularly interspaced short palindromi
Slide 28: BEC/BMC: What is Genome Editing and How Does it Work?
Deep Dive BEC/BMC: What is Genome Editing and How Does it Work? the power to program cells The power to program cells disable, correct or change genes DNA: biological four letter code of living organisms Genes: biological templates making the proteins & enzymes to build & maintain tissue Editing
Slide 29: BEC: Discovery Steps
Deep Dive BEC: Discovery Steps Creating a proprietary tool #1 #2 #3 Let's start with nature Metagenomics meets Bioinformatics Shaping the heroes Metagenomics samples were selected The isolated DNA was sequenced using The selected metagenomics sequences using rational bioprospecting and the state of
Slide 30: BRAIN Genome Editing: Platform Business
Deep Dive BRAIN Genome Editing: Platform Business adding value across the group Agriculture Life Science Application Marine Application Producer Strains Non-Disclosed Int. Exclusive License Non-Exclusive License Research License Cooperation R&D Partner E IP Consulting IP Creation Industrial Biotech
Slide 31: BEC/BMC Has Transformational Characteristics for BRAIN
Deep Dive BEC/BMC Has Transformational Characteristics for BRAIN freedom to operate, fees, creating licence & royalty opportunities Top-Level IP Holder R&D Licensing to Healthcare & Industry Tech Access, License & Royalties Agriculture Exclusive Partnership Readiness Level Milestones, X-License High
Slide 32: BEC/BMC Budget
Deep Dive BEC/BMC Budget a first indication €10-20 mio investment* Top-Level • Create IP families IP Holder • Mode of action studies • Multiplexing R&D • Additional R&D Genome Editing Technology GE Service Providers Adjacent Service Providers Required Budget CRISPR-Enabled Product Development • Depe
Slide 33: SolasCure Ltd.
SolasCure SolasCure Ltd. Revolutionizing Chronic Wound Care through Biomimicry For BRAIN: Latest Funding, Q1 ‘22 • Discovering a unique technology and spinning it out in 2017 as a separate company • GBP 3.7 Mio Series B1 in total • 41% shareholding of BRAIN Biotech AG, at equity consolidated • BRAIN
Slide 34: NBD Deep Dive, The Pipeline
NBD Deep Dive, The Pipeline Medium Market Potential Perillic Active • Partners: US distribution partner contracted (non-disclosed); toll manufacturing • Scope: nature based anti-microbial for food, feed, drinks and cosmetic applications, generated from industrial side streams; fermented orange oil •
Slide 35: PHA121 / Pharvaris
Deep Dive PHA121 / Pharvaris Value Creation The Market* • Large global HAE (hereditary angioedema) market of ~USD 2 Billion size with robust growth ~9% CAGR • Rare but potentially life-threatening genetic condition: painfully, hospitalization • At least 6,600 patients in the US, at least 8,900 patie
Slide 36: NBD Deep Dive, The Pipeline
Deep Dive NBD Deep Dive, The Pipeline Small Market Potential Natural Beverage 1 • Partners: Suntory • Scope: nature based low calorie drink innovation through fermentation • Exclusive to Suntory, in a certain field • Technology Platform: microorganism/starter cultures • Research Business Model: mile
Slide 37: NBD Deep Dive, The End-Markets
Deep Dive NBD Deep Dive, The End-Markets 2026 10.27 bn US$ Sugar Substitutes Market1 6.3% CAGR 2018 6.35 bn US$ 2026 20.03 bn US$ Advanced Wound Care Market 2 5.4% CAGR 2019 12.84 bn US$ 2027 46.85 bn US$ Mining Chemicals Market 3 6.5% CAGR 2019 28.13 bn US$ 2025 1.54 bn US$ Salt Substitutes Market
Slide 38: Service Business Deep Dive
Deep Dive Service Business Deep Dive Programs with industry partners • BRAIN Biotech AG has a long track record with dedicated contract R&D programs • Monetization: tech-access, fees and milestone payments, royalties or entity formation/profit participation • Non-cyclical service contract business w
Slide 39: Partnerships „BRAIN Inside“
BRAIN Inside Partnerships „BRAIN Inside“ More than 100 exclusive partner collaborations successfully completed Speciality High-performance Bioactive Natural Enzymes Microorganisms Compounds Industrial Partner* *confidential partnerships not disclosed Creating a #BiobasedFuture © BRAIN Biotech AG Zwi
Slide 40: Partnerships „BRAIN Inside“
BRAIN Inside Partnerships „BRAIN Inside“ Novel Solutions with high value added for our partners Speciality High-performance Bioactive Enzymes Microorganisms Compounds Product range Beiersdorf BRAIN inside Low temperature Flavorpro™ 786P Optimisation Skin anti-irritant detergent Flavor creation of mi
Slide 41: Enzyme Production, Expression Hosts
Enzymes Enzyme Production, Expression Hosts For expression hosts, a wide variety of protein expression systems are available Enzymes can be expressed in cell cultures of bacteria or yeasts. Factors for choosing an expression system • Protein quality • Functionality • Regulatory • Production speed an
Slide 42: Enzyme Production, Expression Hosts
Enzymes Enzyme Production, Expression Hosts Strain Development: Setting the Scene Creating a #BiobasedFuture © BRAIN Biotech AG Zwingenberg Germany www.brain-biotech.com +49 (0) 6251-9331-0 42
Slide 43: We Cover the Entire Enzymes Value Chain
Enzymes We Cover the Entire Enzymes Value Chain All steps are underpinned by strong customer application knowledge Discovery Protein and Enzyme Expression/Secretion: Large Scale Formulation Marketing and Engineering Bioprocesses & scale-up Fermentation And Blending Sales BRAIN Zwingenberg Biocatalys
Slide 44: BRAIN BioArchive – Nature's Toolbox
BRAIN BioArchive BRAIN BioArchive – Nature‘s Toolbox ~ 53,000 ~ 13,000 54 Characterized Plant fractions Metagenome Microorganisms available for isolation libraries campaigns 450 ~ 13,000 231 Habitat collections Plant fractions available Giga-bp DNA ready and environmental for isolation campaings to
Slide 45: HR: People – Our Core Capital
HR HR: People – Our Core Capital* BRAIN is a Knowledge Driven Enterprise Innovation is our Passion & Teamwork our Basis • Strong corporate culture • Global scientific and university network • Technology campus • BRAIN alumni platform ~39 9 years average age years average tenure 54% 8 55% female empl
Slide 46: Detailed Management & Employee Incentives
HR Detailed Management & Employee Incentives ✔ Since the IPO BRAIN Biotech AG’s board as well as management compensation has been linked and aligned with shareholder interests Executive Board variable component based on individual quantitative & qualitative targets (Fix + performance based bonus) st
Slide 47: Peers by Business Activity
Peer Group Peers by Business Activity BRAIN Biotech AG BioScience BioIndustrials Solutions&Services Customized Products Advanced Wound Care Incubator/NBD 21st BIO Brightseed Amyris Smith&Nephew* C-Lecta (now Kerry Group) Christian Hansen (Santyl) Codexis Corbion Dyadic Ingredion/Pure Circle Evotec*
Slide 48: Detailed Financials – Organic vs. Reported
Financials Detailed Financials – Organic vs. Reported Long-term reported revenues per segment Long-term organic revenues per segment 45.000 € 45.000 € 0% 0% 40.000 € 40.000 € 35.000 € 43% 26.411 28.236 35.000 € 26.411 28.236 88% 30.000 € 12% 30.000 € 6% -15% 25.000 € 6% in T. € 25.000 € in T. € 8% 1
Slide 49: Detailed Financials – Expenses Development
Financials Detailed Financials – Expenses Development Creating a #BiobasedFuture © BRAIN Biotech AG Zwingenberg Germany www.brain-biotech.com +49 (0) 6251-9331-0 49
Slide 50: Detailed Financials – Adjusted vs. Reported
Financials Detailed Financials – Adjusted vs. Reported For a like-for-like comparison BRAIN Biotech AG adjusts its EBITDA for its employee stock ownership program, performance based numeration in daughter companies, acquisition & integration costs (in € thousand) 12M 20/21 12M 19/20 EBITDA -2,533 -3
Slide 51: Detailed Financials – Financial Debt vs. Financial Liabilities
Financials Detailed Financials – Financial Debt vs. Financial Liabilities For or a detailed analysis of our EV calculation, our financial liabilities include: €thousands Sept 30th, 2021 Comment Liabilities from put option rights 4,401 Biocatalysts Ltd. Call/Put options '23/'24, earlier exercise poss
Slide 52: Detailed Financials – Balance Sheet
Financials Detailed Financials – Balance Sheet Creating a #BiobasedFuture © BRAIN Biotech AG Zwingenberg Germany www.brain-biotech.com +49 (0) 6251-9331-0 52
Slide 53: M&A Criteria & History
M&A M&A Criteria & History Qualitative mid-term M&A criteria Quantitative mid-term M&A criteria • B2B only • Bolt-on character • Clearly focused on the product business • Profitable or at least break-even • Niche applications and producers • Value accretive within 1-2 years post synergies • Europe f
Slide 54: Management CV Executive Board
Management Management CV Executive Board Adriaan Moelker (CEO) Lukas Linnig (CFO) • Master of Business Administration • B.S. in Economics, CFA • Year of birth 1964 • Year of birth: 1993 • Joined BRAIN in 2020 • Joined BRAIN in 2015 • 20+ y of professional experience in • 7+ y leadership experience
Slide 55: Analyst Coverage
Analysts Analyst Coverage Bank Analyst Target Price Recommendation Markus Mayer 20.50 € Buy Falko Friedrichs/Jan Koch 13.00 € Buy Dr. Mohamad Vaseghi 14.00 € Buy Fabien Le Disert 14.00 € Buy Dr. Christian Ehmann 21.00 € Buy Creating a #BiobasedFuture © BRAIN Biotech AG Zwingenberg Germany www.brain-
Slide 56: Glossary I
Glossary Glossary I Aurase® Enzymatic agent as part of an innovative gel-based medical device for the biotherapeutic treatment of chronic wounds Bioactive natural compounds Used to develop products for the food, beverages, skin care, cosmetics and chemical industries Bio-based Bio-based products are
Slide 57: Glossary II
Glossary Glossary II Biotechnology Application-oriented sub-sector of biology; includes insights and methods from microbiology, genetics, biochemistry, technical chemistry and process engineering; utilizes biological processes e.g. for industrial applications BEC BRAIN Engineered Cas: BRAIN‘s first
Slide 58: Glossary III
Glossary Glossary III Circular bio-economy Term derived from the fusion of the two concepts of the “bio-economy” and the “circular economy”; circular bio-economy focuses on the sustainable, resource-efficient utilization of biomass in integrated production chains (e.g. biorefineries) while BRAIN dem
Slide 59: Glossary IV
Glossary Glossary IV Enzymes Proteins that accelerate biochemical reactions in their function as biocatalysts; play an important role in the development of biobased products; BRAIN identifies and develops optimized enzymes and biocatalysts for complex process and application requirements FRESCO BRAI
Slide 60: Glossary V
Glossary Glossary V Microorganism Microscopically small unicellular or multicellular organisms, e.g. bacteria, algae, fungi or viruses New Business Systematic further development of existing and development of new business opportunities Development (NBD) including e.g. R&D and marketing activities N
Slide 61: Glossary VI
Glossary Glossary VI Tailor-Made-Solutions Dedicated contract R&D programs for the development of tailor-made solutions for industry TMS Urban mining Sustainable extraction of valuable substances from secondary raw materials and waste flows in order to retain them in value chains in the long term Wh