European life science company Evotec SE ( EVO )  announced a priority reset to optimize its business to meet evolving market demand and focus on profitable growth in 2024 and beyond.

The company is focusing on and rightsizing organizations to overcome the challenging market environment and return to sustainable and profitable growth.

Shared R&D and Just–Evotec Biologics will replace EVT Execute & EVT Innovate segments in a streamlined reporting structure as of Q1 2024.

The priority reset is anticipated to result in an expected annualized EBITDA improvement of greater than 40 million euros.

2023 revenues increased 4% Y/Y to 781.4 million euros (+6% at constant FX rates).

Revenues from Just – -Evotec Biologics are up 111% to 108.4 million euros.

Base business excluding Just–Evotec Biologics is down 4%, including approx. (10)% impact as a result of the severe cyber-attack.

The company reported adjusted EBITDA at 66.4 million euros versus 101.7 million a year ago, adjusted for one-off effects related to the recovery from the severe cyber-attack of 15.9 million euros.

The company appointed Christian Wojczewski as the company's new CEO, effective 01 July.

Mario Polywka, who has led Evotec as Interim CEO since 03 January 2024, will retire at the end of June.

"Evotec's business displayed great resilience in a challenging market environment. Our central focus for 2024 is to protect our strong balance sheet and refocus the company on profitable growth. Through the planned priority reset and measures to rightsize our operational and corporate structure, we are taking the necessary steps to ensure that we continue to work with our partners to shape the medicines that matter for many years to come, "said Mario Polywka, Interim CEO of Evotec

Guidance: Evotec forecasts 2024 revenue to grow by a double-digit percentage versus 2023.

The company expects a mid-single to low double-digit percentage reduction of unpartnered research and development expenses.

Evotec expects 2024 adjusted EBITDA expected to grow by a mid-double-digit percentage.

The company said that the new management team will review the mid-term outlook due to changing industry dynamics, associated pressure on margins, and the implementation of the priority reset. 

Evotec plans to update the market on its mid-term forecast with the release of its H1 2024 results in August 2024.

Price Action: EVO shares are down 31.90% at $5.21 at the last check Wednesday.