Eden Research describes itself as a company that provides breakthrough biopesticides and natural microencapsulation technologies to the global agrochemicals, animal health and consumer products industries. The company has developed its first agrochemical product that was called 3AEY (now known as Mevalone) which is a fungicide which targets botrytis, a mould that causes diseases in grapes.

By the time Eden was floated on London’s AIM in 2012 the flagship Melavone started to gain recognition and interest amongst investors and by late 2015 the shares reached a price high of 25pence a share. As 2016 rolled on, however, the shares began a gradual decline because there were few signs that a meaningful revenue stream was emerging. This decline continued into the first half of 2017, so that at one point the share price dropped to 7.50p.

The company’s poor share price performance stemmed from the fact that, like the other young or start-up groups involved in technological innovation, Eden has been an early stage revenue group. Eden hemorrhaged funds establishing patents, overcoming regulatory hurdles and proving up its products’ commercial possibilities.

Eden has spent £13m developing and protecting its intellectual property and gaining regulatory authorisations since 2013, it claims; and in the second half of 2017 the company’s outlook began to change for the better due to the backstage efforts that were being made. By backstage efforts what is meant is that the company concentrated on gaining regulatory approvals, identifying suitable industrial partners and entering into commercial agreements.

Eden’s first commercial product Melavone combats grape disease

By Christmas 2017 Eden had gained approvals for Mevalone use from ten countries including Cyprus, Greece, Albania, Bulgaria, Malta, Kenya, Italy, France and Spain. These last three are the world’s top wine producing countries. All three achieved first commercial sales. But Eden is not a one-product company. It continued to develop a pipeline of products in the second half of 2017.

Importantly, the company’s net cash figure benefitted from an injection of £2.2m in June 2017, as a strategic investment, from SipcamSpA which gave the Italy-based multinational agrichemical group a 9.9 per cent interest in Eden. Sipcam acts as a distributor for Eden. As the company evolved from technology licensing to sales of products to distributors like Sipcam, it meant quicker payments and improved gross margins. In short, Eden became important in managing its own supply chain.

The Half Yearly Report for the six months ended 30 June 2018 was released on 24 September 2018. From a first glance at the financials you wouldn’t know that the progress made in the second half 2017 continued in 2018.

Revenue for the first half 2018 was £0.68m against £1.03m in the same period in 2017). The operating loss was £0.93m against a profit of £0.21m for the first half 2017. Closer scrutiny, however shows that the operating profit in 2017 was, in fact a loss of £0.37m after excluding exceptional payments. In terms of revenue the £1.03m stated for first half 2017 included one-off payments which totalled £0.6m.

Given these non-recurring items the company was able to say that product sales in first half 2018 increased by 58 per cent to the £0.68m figure compared to £0.43m in first half 2017.The new Eden Chair, Lykele van der Brook, the former COO of Bayer Crop Service, commented in the half yearly report: “Significant progress has been made in the areas of production, formulation, regulatory and packaging”.

In fact, there have been significant developments in the post-end period. On 10 October Eden announced that its associate company Terpene Tech had received regulatory approval to market its head lice product in the European Economic Area (EEA). Then, on 15 October the company unveiled an exclusive agreement with Sipcam to market Melavone under the name Novellus in Australia and New Zealand. Australia and New Zealand are major producers of grapes and wine, with Australia being in the top ten.

The company has not forecast any financials for these recent developments or for the company as a whole. Nevertheless, Eden is clearly on the mend. The share price of the £24.43m company last night was 11.80p against a 52-week high of 16.05p.