Evotec SE Q1 FY2026 earnings call

• Quarterly view not always helpful due to swings and milestone payment profile; stick to full-year guidance with first quarter evened out over next three quarters. - Strategic review not initiated in response to inbound interest, but is a logical timing as the company reset mid-last year, revised long-term view, and announced Horizon in March defining operating model to deliver business strategy.

• Stick to full-year guidance with first quarter evened out over next three quarters. - For second half, expect further negative impact from JEP licensing vs 2025, positive impact from JEP growth (double-digit excluding DOW), positive impact from underlying DPD growth (low single-digit in base business), and strategic partnerships will add on top, but FX effect will persist. Not breaking down further by quarter as quarterly volatility is not helpful.

Q: Thanks, Finn. So first of all, your first question, I think I just try to lay out a little bit that the quarterly view is not always helpful with the swings, also with the profile that we have in terms of milestone payments. I'm not sure I want to guide on individual quarters. We've never done that before. Important message is we stick to our guidance for the full year, which means that the first quarter will be evened out over the next three quarters. With regard to the strategic review, I can say that this was not initiated in response to any inbound interest. It's a very logical timing when you think about what we're doing. We're resetting the company mid-last year. We've revised our long-term view, vision for the company towards tech and scientific leadership or positioning the competencies that we need. In March, we've announced Horizon, which basically defines our operating model to deliver that business strategy. That's now the next logical step.

Q: Hello. Thank you for taking my follow-up. Now, I was listening to your previous answer where you said you weren't going to give quarterly guidance, but I'm going to ask perhaps again anyway. In particular, around Q4, so Q4, it's often a Q4-weighted year. just traditionally. Also, you've got your market improvements expected, you've got the strategic revenues coming through, and you've got the horizon savings. So could you perhaps give us some colour on how Q4 weighted the EBITDA could be? Looking back in the last couple of years, it was a loss for the first three quarters and a substantial profit in the fourth. um could that be the same or exacerbated even more um and perhaps just wondered if you'd like to provide any uh color around what we might expect in q2 whether there are any uh you know puts and takes in the comp that might uh that we might want to bear in mind for our modeling thank you A: Thanks charles and i think we iteratively uh approach uh actually move from from year to quarter and uh I won't do the quarter view, but I will actually help you with a half-year view. As you probably will remember, we've done that last time. It's really the dynamic difference here between H1 and H2 that Claire was explaining. When you look at the changes for the second half, we did mention that we expect a further negative impact from the JEP licensing versus 2025. However, a positive impact from JEP growth, actually in the range of double-digit growth excluding DOW, then there is a positive impact from underlying DPD growth where we set low single-digit growth in the base business, and then strategic partnerships will add on top. But we also said that the FX effect will persist. So that's our view. And we're not breaking it down further by quarter, knowing exactly why, because the quarterly volatility is not helpful.

Q: appreciate all the color on your end markets here. I wanted to first ask about the continuous softness you mentioned in preclinical speeding. Qualitatively, what do you think needs to happen for customers to really round the corner? We've continued to see pretty steady biotech funding recovery, some albeit early signs of AI efficiency gains across the sector. So I guess I'm wondering if there's just a time in consideration here or if A: We think it's a timing topic, as alluded to earlier. There's obviously two ways of looking at it. The funding situation seems to have stabilized in the last couple of actually months from a biotech perspective. That's the external view. The internal view. I alluded to cancellations have come down quite significantly. Now, some of the cancellations were more of scientific and strategic nature in the past, but some also where biotech companies have pulled off for other reasons. We've seen this decline also in the context of more confidence of biotech companies in funding. So that's the internal view. And as alluded to earlier, we do not see AI as a structural or disruptive challenge to our business model because we are applying AI in order to accelerate drug discovery. So we see this actually as a supporting tool in our toolbox.