TIDMVLG
RNS Number : 5251T
Venture Life Group PLC
25 July 2022
25 July 2022
VENTURE LIFE GROUP PLC
("Venture Life", "VLG" or the "Company")
Trading Update
Trading in line with management's expectations for the first
half and confidence in full year outlook
Venture Life (AIM: VLG), a leader in developing, manufacturing
and commercialising products for the international self-care
market, announces a trading update for the six months ended 30 June
2022. The Group expects to release interim results in
September.
Overview
The Company expects to report revenues for the six months ended
30 June 2022 of GBP18.9 million, a growth of 36% over the same
period previous year. This is reflective of the impact of the
recent acquisitions of BBI Healthcare Limited ("BBI") and Helsinn
Integrative Care Portfolio ("HICP") (together the "Acquisitions")
aswell as a difficult prior year comparable.
Key Highlights:
-- Group revenues of GBP18.9 million, a growth of 36% (35% on a
constant currency basis) over last year and reflecting the impact
of recent acquisitions;
-- The Acquisitions contributed revenues of GBP6.3 million (H1
2021 reported revenues GBP1.4 million);
-- Group gross margins and adjusted EBITDA margins improved by
4ppts and 3ppts respectively over the same period in the prior year
;
-- Cash inflow generated from operating activities of GBP1.5
million (H1 2021: GBP0.7 million outflow);
-- Net debt before finance leases reduced to GBP2.6 million (Dec: GBP3.2 million);
-- Net debt after finance leases reduced to GBP7.2 million (Dec: GBP7.5 million); and
-- Order book remains strong and is ahead of the same period
last year as customers place increased focus on ensuring security
of supply.
The Acquisitions delivered revenue growth of 10% and 6%
respectively on a like for like basis. Outside of the Acquisitions,
the revenue performance over the remainder of the business was 1%
ahead of the same period last year, driven by growth from customer
brands, which, given the second half weighting of international
revenues is in line with management's expectations. Whilst
COVID-related lockdowns in Shanghai impacted first half performance
from our new Chinese partner, the restrictions are now easing and
as such we continue to expect our new partner to begin to realise
the potential for our products in the Chinese market. Nonetheless
we remain mindful of the risk presented by China's stance on
Covid.
Including the Acquisitions, and on a proforma basis, the overall
revenue performance of the Group was 4% ahead of H1 2021 which, the
Board believes, highlights the resilience of Venture Life's
products through the cost of living crisis and the increasing
importance of selfcare to consumers.
Outlook
Although we remain mindful of the changing and challenging
economic backdrop, there are signs that the supply chain issues
have plateaued. The team are continuing to deliver the margin
protection strategy through robust cost management and by sharing
cost increases with customers wherever possible. The current order
book strength is enabling supplies to be purchased cost effectively
and in sufficient time to produce. The first half percentage gross
margin improvement demonstrates both the accretive impact of the
Acquisitions plus the progress made in mitigating some of the
adverse impacts faced from increased input costs. Pre-identified
cost synergies from the Acquisitions have been secured as expected
and support an overall improvement in adjusted EBITDA margin
percentage.
The order book remains strong and is ahead of the same time last
year, including the recently acquired businesses. As seen
historically in the Group, revenues are weighted towards the second
half of the year and these are well underpinned by the current
order book strength. Based on trading performance to date and
visibility over second half revenue, the Board is confident the
Group is on course to deliver full year financial performance in
line with market expectations.
Jerry Randall, CEO of Venture Life, commented: "The Group has
delivered revenue growth in the first half primarily through the
Acquisitions. The challenging retail environment continued in the
first half, but I am delighted to see that, notwithstanding this, a
number of our own brands, as well as some customer brands, have
demonstrated strong revenue growth in the period. The margin
improvement seen versus 2021 is particularly encouraging, and
customers have been very responsive to our request to order further
out than their normal lead times, enabling us to both ensure supply
of raw materials and packaging in time to produce, and manage
costs. The supply chain environment continues to remain
challenging, but the team has done a great job in managing this in
the first half and will continue to do so in the second half.
As is normal our revenues are weighted in the second half of the
year, and this will be the same for 2022, supplemented also by some
orders that moved into H2 as a result of supply chain timings. The
unlocking of Shanghai should allow our new partner to begin to
market our products there, but these are early days and we continue
to monitor the situation.
The progress to date and the order book in hand mean the Board
is confident the Group will deliver financial performance in 2022
in line with market expectations."
*Adjusted EBITDA is EBITDA before deduction of exceptional items
and share based payments
For further information, please contact:
Venture Life Group PLC +44 (0) 1344 578004
Jerry Randall, Chief Executive Officer
Daniel Wells, Chief Financial Officer
Cenkos Securities plc (Nomad and Joint Broker) +44 (0) 20 7397
8900
Stephen Keys / Camilla Hume (Corporate Finance)
Russell Kerr / Michael Johnson (Sales)
Singer Capital Markets (Joint Broker)
Shaun Dobson / Alaina Wong (Corporate Finance) +44 (0) 20
74963000
Jonathan Dighe (Sales)
About Venture Life ( www.venture-life.com )
Venture Life is an international consumer self-care company
focused on developing, manufacturing and commercialising products
for the global self-care market. With operations in the UK, Italy,
The Netherlands and Sweden, the Group's product portfolio includes
some key products such as the UltraDEX and Dentyl oral care product
ranges, the Balance Activ range in the area of women's intimate
healthcare, the Lift and Glucogel product ranges for hypoglycaemia,
Gelclair and Pomi-T for oncology support, products for fungal
infections and proctology, and dermo-cosmetics for addressing the
signs of ageing. Its products are sold in over 90 countries
worldwide.
The products, which are typically recommended by pharmacists or
healthcare practitioners, are available primarily through
pharmacies and grocery multiples. In the UK and The Netherlands
these are supplied direct by the company to retailers, elsewhere
they are supplied by the Group's international distribution
partners.
Through its two Development & Manufacturing operations in
Italy and Sweden, the Group also provides development and
manufacturing services to companies in the medical devices and
cosmetic sectors.
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