The
information contained within this announcement is deemed by the
Company to constitute inside information as stipulated under the
Market Abuse Regulation ("MAR") EU no.596/2014. Upon the
publication of this announcement via Regulatory Information Service
("RIS"), this inside information is now considered to be in the
public domain.
hVIVO plc
("hVIVO", the "Group", or the
"Company")
Trading
update
Record year across all
financial and operational metrics
Excellent forward visibility
with £80m weighted orderbook
hVIVO plc (AIM & Euronext:
HVO), the world leader in testing
infectious and respiratory disease products using human challenge
clinical trials, announces an unaudited trading update for the year
ended 31 December 2023.
Highlights
•
|
Full year revenue of
£56.0 million, an increase of
15.5% (2022: £48.5
million)
|
•
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EBITDA margins of
c.22% (2022: 18.7%)
|
•
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Cash of £37.0 million as at 31
December 2023 (31 December 2022: £28.4m)
|
•
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Weighted contracted orderbook of £80
million as at 31 December 2023 (31 December 2022: £76
million)
|
•
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90% of 2024 revenue guidance already
contracted and good visibility into 2025
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•
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Revenue guidance of £62 million for
2024
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•
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Move to new
state-of-the-art facility in Canary Wharf on schedule to complete
in H1 2024
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•
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Commencement of annual dividend payment in 2024
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•
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New
medium-term target of growing Group revenue to £100m by
2028
|
Double digit revenue growth
The Group expects to report full
year revenues of £56.0 million
(2022: £48.5 million), a 15.5%
increase year-on-year which, as announced previously, is slightly
ahead of previous market expectations. This has been driven by the
continued strong delivery of human challenge trials and consulting
services. The Group's growing operational team delivered its
highest number of inoculations to date, driving increased revenues
and improved margins. In addition to the revenue generated, the
Group also recognised Other Income relating to R&D tax credits
of £2.6 million (2022: £2.2 million).
Improved EBITDA margins and cash
The Group expects to report
increased EBITDA margins of c.22% (2022: 18.7%) which is a result of the increased facility and
staff utilisation as well as efficiencies gained through improved
volunteer recruitment and the concurrent running of multiple
clinical trials. The net impact of the client funded facilities
expansion has also contributed to an improvement in EBITDA,
that are expected to benefit margins in both 2023 and
2024.
hVIVO is a highly cash generative
business with cash of £37.0 million as at 31 December 2023 (31 December 2022: £28.4
million). This increase in cash generation is due to improved
margins and the upfront non-refundable quarantine booking fee from
new contracts.
Annual dividend
The Company paid a one-off special
dividend of £3.0m in 2023 and in light of the cash generative
qualities of the business and the substantial cash balances
available to the Company, the Board intends to commence payment of
an annual dividend. Payment is intended to take place following the
publication of the Group's annual results for the year ended 31
December 2023 which are expected to be announced in April
2024, and where further details of the
dividend policy will be provided.
Growing orderbook underpins 2024 guidance
In 2023, the Group has achieved
success in new sales bookings with the signing of multiple human
challenge trial contracts, including three large bespoke or
full-service human challenge trial contracts in Respiratory
Syncytial Virus (RSV), Influenza B and Human Metapneumovirus
(hMPV). hVIVO is the only provider of full-service human challenge
services which deliver a long-term revenue stream across challenge
agent manufacturing, characterisation and the main human challenge
trials.
With the range of services and
average size of challenge studies increasing, the average contract
value has continued to follow an upward trend, resulting in a
weighted contracted orderbook of £80 million as at 31 December
2023, including the £6.3 million contract announced on 2 January
2024.
Current year outlook
hVIVO enters the year in its
strongest ever position with 90% of 2024 revenue guidance already
contracted, and record revenue visibility into 2025. The Board is
confident that the Group's consistent year-on-year growth of
revenue, orderbook, sales pipeline, and contract values are a
strong indicator of the long-term health and growth potential of
the human challenge trial market, with hVIVO's business model being
further optimised to take advantage of this significant
opportunity.
The Company is on schedule to open
its new state-of-the-art facility in Canary Wharf in H1 2024,
enabling hVIVO to meet the growing demand for human challenge
trials. The move, which is largely funded by hVIVO clients, will
allow the Group to further scale and drive efficiencies across its
business.
As a result of the current strong
outlook and performance of the business, the Company expects to
achieve revenues of £62 million in 2024.
Medium-term target
The Company also announces a
medium-term target of growing Group Revenue to £100m by 2028. The
majority of this is expected to be achieved through sustained
organic growth complemented by small, strategic bolt on
acquisitions. With a growing cash position of
£37.0 million as at 31
December 2023, and no debt, hVIVO is well placed to pursue both
organic and inorganic growth. The Company is actively assessing
synergistic opportunities that align with its growth strategy and
market positioning.
Investor presentation
Yamin 'Mo' Khan, Chief Executive
Officer, and Stephen Pinkerton, Chief Financial Officer, will
provide a live presentation via the Investor Meet Company platform
on 30 January 2024 at 18:00 GMT.
The presentation is open to all
existing and potential shareholders. Investors can sign up to
Investor Meet Company for free and add to meet hVIVO
here.
Dr
Yamin 'Mo' Khan, Chief Executive Officer of hVIVO,
said: "In 2023, hVIVO demonstrated strong financial and operational
performance, delivering record-breaking results across all key
parameters. The sustained success of the Group, coupled with a
growing orderbook, reinforces the resilience of our business model
and reaffirms the stability of the market. The infectious disease
market has witnessed increased interest from both commercial and
non-profit entities, as well as a notable uptick in M&A
activity. A significant highlight of the year was the market
authorisation of the first-ever vaccine incorporating human
challenge trial data as part of its submission
package.
"I
am excited about 2024 as we look forward to our move to a larger
facility and the further diversification of our services including
the addition of new challenge agents. The new facility will
substantially boost our revenue potential and should lead to
improved operational efficiencies and enhanced margins. We are
pleased to share a new target of growing the Group's revenue to
£100m by 2028. This growth will be primarily achieved through
strong organic growth complemented by small strategic bolt-on
acquisitions that adhere to our disciplined criteria, ensuring our
long-term success."
For further information please
contact:
hVIVO plc
|
+44 (0) 20
7756 1300
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Yamin 'Mo'
Khan, Chief Executive Officer
Stephen Pinkerton, Chief Financial
Officer
|
|
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Cavendish
Capital Markets Limited (Nominated Adviser and Joint
Broker)
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+44 (0) 20
7220 0500
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Geoff Nash,
Charlie Beeson, Nigel Birks, Harriet Ward
|
|
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Peel Hunt LLP (Joint Broker)
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+44 (0)20
7418 8900
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James Steel, Dr Christopher Golden
|
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Davy (Euronext Growth Adviser and
Joint Broker)
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+353 (0) 1
679 6363
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Anthony Farrell, Niall
Gilchrist
|
|
|
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Walbrook PR (Financial PR &
IR)
Stephanie
Cuthbert / Phillip Marriage /
Louis Ashe-Jepson
|
+44 (0) 20
7933 8780 or hvivo@walbrookpr.com
+44 (0)
7796 794 663 / +44 (0) 7867 984 082 /
+44 (0) 7747 515 393
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Notes to
Editors
About
hVIVO
hVIVO plc (ticker: HVO) (formerly Open Orphan
plc) is a rapidly growing specialist contract research organisation
(CRO) and the world leader in testing infectious and respiratory
disease vaccines and therapeutics using human challenge clinical
trials. The Group provides end-to-end early clinical development
services to its large, established and growing repeat client base,
which includes four of the top 10 largest global biopharma
companies.
The Group's fast-growing services business
includes a unique portfolio of 11 human challenge models, with a
number of new models under development, to test a broad range of
infectious and respiratory disease products. The Company has world
class challenge agent manufacturing, specialist drug development
and clinical consultancy services via its Venn Life Sciences brand,
and a lab offering via its hLAB brand, which includes virology,
immunology biomarker and molecular testing. The Group offers
additional clinical field trial services such as patient
recruitment and clinical trial site services.
hVIVO runs challenge studies
in London from its Whitechapel quarantine clinic, its
state-of-the-art QMB clinic with its highly specialised on-site
virology and immunology laboratory, and its clinic in Plumbers Row.
To recruit volunteers / patients for its studies, the Company
leverages its unique clinical trial recruitment capability via
its FluCamp volunteer
screening facilities
in London and Manchester.