In the press release where the half-year report was published on August 25, 2016, the minus signs for earnings per share disappeared, hence this correction. Correct result second quarter SEK -0.29 per share and result first half year SEK -0.51 per share:
Second quarter 2016 in brief
- Revenue 656 (1 097) TSEK
- Operating result -1 606 (-923) TSEK
- Result after tax -1 644 (-942) TSEK
- Earnings per share* -0.29 (-0.17) SEK
- Earnings per share after full dilution -0.22 (-0.12) SEK
First half of 2016 in brief
- Revenue SEK 1 249 (1 669) thousand
- Operating profit/loss -2 831 (-2 559) TSEK
- Profit after tax -2 886 (-2 598) TSEK
- Earnings per share* -0.51 (-0.46) SEK
- Earnings per share after full dilution* -0.38 (-0.34) SEK
* The number of shares is calculated at 5 683 374. The number of outstanding warrants is 1,894,458. These figures take into account the new share issue in May which was registered in July.
Significant events during the reporting period
- Bayn is becoming a sugar reduction specialist and a specialist resource for product development support across the food industry value chain.
- Proactive marketing activities and customer visits were carried out to get feedback on the new communication platform and business direction.
- Bayn's market contacts were focused on selling market needs rather than products. As part of this effort, Bayn has focused during the period on establishing itself as a knowledge consultant in sugar reduction rather than as a salesperson.
- Bayn participated in several major trade fairs and presented its new portfolio, which received positive feedback.
- Several test orders were received from Europe, an industrial order from South Africa and a major test order from China. Deliveries of these orders were made.
- New marketing staff was hired in the area of knowledge consultants/customer contacts.
- A new share issue was carried out May 9-24 and the issue was subscribed to 170%. The proceeds are used as planned to expand marketing and sales activities.
- The development of Bayn Studio, an innovation center for product design and training in sock making, was initiated. Bayn Studio, which will also include a café with its own sugar-reduced products for sale, will be available to both the public and companies and will open in Gävle in the fall of 2016.
- Work began on a digital community for sugar reduction, where sustainable sugar reduction projects will be implemented.
The CEO has the floor
An oversubscribed rights issue, test orders from South Africa and China, major sugar reduction commitments from multinational food companies, and intense media coverage on health risks and sugar taxes - this briefly summarizes the past six months. While we continue to work on market development, Bayn Studio, an innovation center for sugar reduction, is also taking shape.
Sugar and its health risks are increasingly discussed in the media and the debate on sugar taxes has flared up again in many European countries. In the article on the next page, I share my personal views on sugar taxes, based on my dual roles as an entrepreneur and a mother. In the public debate, we can see that many people are increasingly concerned about the negative effects of sugar and are asking for products with lower sugar content. At the same time, we humans have a sweet tooth, and we don't want to compromise on taste either. Therefore, one could say that sugar reduction is a mission in itself; making sure products taste good is another. Solving both challenges requires creativity. Bayn is working to reduce sugar and at the same time satisfy consumers' desire for sweet and savory taste. Our solutions are based on scientific research as well as on our personal and high-level expertise in sensory and food technology. Satisfied end consumers are what counts.
The fact that this spring's new share issue was oversubscribed is further proof that sugar-reduced products are highly interesting. Bayn's solutions have been well received by our customers, and the number of test orders is steadily increasing. We have also received test orders from outside Europe, from both South Africa and China.
Several multinational food companies, including Nestlé and Unilever, have introduced a sugar reduction commitment to reduce sugar in their own products. In the UK and the Benelux countries, some of the largest grocery stores have started to reduce sugar in their own products. These are important steps in the right direction, but we still find very few tasty, healthy products with less sugar in supermarkets. Changing the product range is a revenue risk for companies as there is uncertainty about whether the public is ready to accept the new products. At Bayn, we have approached grocery stores in Sweden with our fully developed chocolate and confectionery concepts, but have been told by purchasing departments that there are currently no plans to reduce sugar in our own products as profitability cannot be guaranteed.
There is a lot going on in the field of sugar-reduced products, and slowly but surely the market is maturing. Based on our experience and the current situation, we will
Bayn Studio will serve as an innovation center for product design and education in sugar reduction where we will hold courses for the public and other stakeholders. These will include Do It Yourself Workshops where we teach sugar-reduced recipes for home use, tasting courses, as well as team building activities for different groups, with the aim of demonstrating the positive taste experience that can be combined with a healthy lifestyle. There will also be a café where we will sell healthy, sugar-reduced products to the end consumer. We are confident that Bayn Studio will serve as a solid platform from which we will be able to influence and create higher demand for sugar-reduced foods among end consumers, which will increase the need for our solutions within EUREBA. At the same time, Bayn Studio will generate new revenue in the short term.
Ultimately, it's all about consumer needs and demand, and creating concrete projects and products, from evidence to actual action around sugar reduction, to generate sustainable business revenue.
Lucy Dahlgren, CEO Bayn Europe
EUREBA - OUR TOOL TO BUILD A HEALTHIER WORLD
EUREBA® is a natural solution to reduce the sugar and calorie content of products without compromising on taste and flavor. Our range of EUREBA® products includes pure sweeteners, ready-to-use industrial formulations and base products, as well as advanced customized solutions developed on demand.
Bayn offers services to food manufacturers to help them reduce the amount of sugar in existing products or to develop new products according to customer specifications. Bayn's services include idea generation, market and consumer insights, product design, workshops and seminars, etc. Bayn acts as a catalyst for food manufacturers to launch new products with less sugar.
Our EUREBA® range includes the following categories:
Ingredient solutions: EUREBA® Basic is a range of natural high intensity sweeteners with zero calories (HIS).
Formulation solutions: EUREBA® Blend involves combining sweeteners and bulk ingredients to provide a 1:1 sugar replacement in processed food and beverages. Formulation solutions provide competitive advantages to food producers to eliminate new product development costs, uncertainties and risks. It guarantees the quality of production through better nutritional homogeneity and avoids the risk of overdosing, simplifying the production process, workflow and reducing costs. It also provides the right flavor profile, texture
and reduces the cost of new product development for customers.
Total solutions: EUREBA® Inclusion means that Bayn supplies finished products without added sugar to food manufacturers. The finished products can be used as private label by retailers. Bayn offers customized products that are often the result of a direct request from the customer. It is then a tailor-made solution that meets the customer's specific requirements and needs.
FINANCIAL REPORT
Revenues
Total revenue during the quarter amounted to SEK 656 (1097) thousand. Net sales amounted to 335 (596) TSEK.
Costs
Costs during the quarter amounted to SEK 2 262 (2 020) thousand. The cost increase is related to the completed new share issue.
Outcome
The operating result decreased to SEK -1 606 (-923) thousand.
Cash flow and financial position
Cash flow from operating activities amounted to SEK 3 387 (-1 984) thousand.
Cash and cash equivalents at the end of the period amounted to SEK 4 394 (2 541) thousand.
New issue
During the second quarter, new issues of SEK 6,593 (0) thousand were carried out.
Investments
Investments in fixed assets amounted to SEK 320 (501) thousand for the quarter, and consisted of capitalized development costs.
Other
Staff: The average number of employees during the period was 5.5 (6) and the number of employees at the end of the period was 5.5 (6).
Number of shares: The company had 5,683,374 shares and there were 1,894,458 warrants outstanding as of June 30, 2016.
Risks and uncertainties
Bayn Europe AB's results and financial position are affected by various risk factors that must be taken into account when assessing the company and its future potential. For other risks, please refer to the investment memorandum available on the company's website www.bayn.se.
Accounting principles
This report has been prepared in accordance with the Annual Accounts Act and the Swedish Accounting Standards Board's general advice, and the accounting principles are unchanged from the previous year.
Related party transactions
Loans from the company's largest shareholders were repaid during the quarter.
Future prospects
No forecast is provided for the third quarter.
Next reporting date
The interim report for the period July-September 2016 will be published on November 23, 2016.
Mangold Fondkommission AB (tel. +46 8 5030 1550) is the Company's Certified Adviser.
This report has not been examined by the company's auditors.
Stockholm, August 25, 2016 Bayn Europe AB (publ)
Lucy Dahlgren, CEO
Read the full report in the attached pdf, via this link or on the company website www.bayn.se
