Comment on Eevia Health’s Q3-22 Report

On the November 25th, Eevia Health (“Eevia” or “The company”) released its quarterly report for Q3-22.

Statement of Operations

During Q3-22, the net sales amounted to EUR 1.1m (1.3), corresponding to a decrease of 11% YoY which was in line with our expectations. Adjusted for raw material trading revenues of EUR 0.7m, net sales increased from EUR 0.6m to EUR 1.1m, corresponding to an increase of 105%.

Gross profit in Q3-22 amounted to EUR 0.7m, compared to EUR 0.1m in Q3-21, and EUR 0.7m in Q2-22. However, the gross margin was up from 25% in Q3-21, and from 35% in Q2-22, to 63% in Q3-22. This is a substantial improvement, since Eevia’s gross margin has been depressed due to temporary issues with equipment from Q2-21 and onwards. The total improvement in the gross margin stem from multiple factors however, such as higher production yields from changes in production protocols, efficiency gains from new equipment, high-margin product mix, and improved pricing in terms of both purchase and sales price.

The EBITDA during Q3-22 amounted to EUR 56k, compared to EUR -749k in Q3-21, which was above our expectations, resulting in an EBITDA-margin of 5%. The increase in EBITDA was attributed to the same factors that improved the gross profit, i.e., improving yields, better pricing etc., but also due to lower personnel and other operating expenses. Worth to note is that this is the first time Eevia shows a positive EBITDA, which is a major financial milestone for the company in our view.

The net income of Q3-22 amounted to EUR -0.4m, an improvement of EUR 0.5m compared to Q3-21 EUR -0.9m. However, the net income in Q3-22 was impacted by a non-cash foreign exchange loss of EUR 0.2m.

In summary, seeing a near break-even and positive EBITDA two quarters in a row is something that, according to Analyst Group, indicates improving operational performance. Furthermore, we see that Eevia is continuing the company’s path to high growth balanced with improving margins going forward.

Cash Position and Burn Rate

At the end of Q3-22, Eevia’s cash balance was EUR 0.1m, compared to EUR 0.6m at the end of Q2-22, corresponding to a net change in cash of EUR 0.5m. The decrease in cash was mainly due to a build-up in inventory and minor investments in assets. However, in November, Eevia announced that the company received approximately SEK 18.6m in net proceeds from a recent rights issue, which corresponds to roughly EUR 1.7m, given the current exchange rate of EUR/SEK. Moreover, Eevia managed to secure a short-term bridge loan of NOK 2.0m from the company’s largest shareholder Betulum AS in November, which will be repaid at latest in December with the proceeds from the rights issue. The bridge loan was used to strategically procure sufficient volumes of high-quality berries in a timely and cost-efficient manner for contracted bilberry sales orders, since the proceeds from the rights issue had not been received yet.

Eevia’s burn rate per month amounted to EUR -0.2m, compared to EUR -0.1m in the previous quarter. Given the cash position at the end of September amounting to EUR 0.1m, the net proceeds from the rights issue of EUR 1.7m, the repayment of the bridge loan of NOK 2m, and an estimated burn rate of EUR -0.1m going forward, Eevia is estimated to be financed until the beginning of Q3-23, all else equal. However, depending on how the net sales contributes to strengthening Eevia’s liquidity position and profitability, as well how effectively the working capital is managed, the company could be financed longer than estimated.


Going forward, we see the following triggers:

  • Continued sales growth by booking new orders from customers
  • Improving profitability by shifting to higher margin products as well as increased efficiency
  • Launch of new proprietary products, i.e., Retinari against the eye disease AMD

In conclusion, Eevia is progressing well operatively, where achieving a positive EBITDA-margin for the first time is a solid achievement. With the net proceeds from the fully subscribed rights issue, Eevia’s financial position is substantially stronger, where Analyst Group expect that Eevia will continue to deliver on the strong customer demand in order to reach a positive EBITDA in 2023.

We will return with an updated analysis of Eevia Health.