TIDMVLG
RNS Number : 6426H
Venture Life Group PLC
31 July 2023
31 July 2023
VENTURE LIFE GROUP PLC
("Venture Life", "VLG" or the "Group")
Trading Update
Trading on-course to deliver full year results in line with
market expectations.
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
2023 (the "Period"), ahead of the expected announcement of the
Group's interim results on 25 September 2023.
Headlines:
-- Group revenues for the Period of GBP23.5m, a growth of 24.4%
over last year, comprising growth from both the VLG Brands and
Customer Brands, including the recent acquisition of HL Healthcare
Limited ("HLH"). On a proforma(1) basis revenue performance was
10.4% ahead of H1 2022.
-- The newly acquired Earol product from HLH contributed
revenues of GBP2.3m (H1 2022: GBP2.2m), a growth of 6.1% over the
previous year on a like for like basis.
-- Cash generated from operating activities of GBP4.6m (H1 2022:
GBP1.8m), an increase of 158% over last year and improved operating
cashflow conversion of c.99% (H1 2022: 53%)
-- Group leverage(2) reduction to 1.4x at 30 June 2023 (31 December 2022: 1.6x)
-- Order book increase of c.30% since end of the previous year,
providing strong visibility over second half revenue and in line
with management expectations.
-- 17 new listings secured with major retailers for Balance
Activ, Lift and Earol, including existing and newly developed
products.
-- Further progress on digital transformation; online sales were
69% ahead of the previous year at GBP1.6m (H1 2022: GBP0.9m) and
accounted for 12.3% of VLG brands revenue (H1 2022: 9.7%).
(1) Proforma basis i.e. if the acquisition had been in place for
the whole of the prior period.
(2) Group leverage calculated as net debt (excl. finance leases)
and using proforma Adjusted EBITDA(3) on a trailing 12-month
basis.
(3) Adjusted EBITDA for Group leverage is EBITDA after deduction
of finance lease costs and before deduction of exceptional items
and share based payments.
Group revenues for the period grew by 24.4% to GBP23.5m and on a
proforma(1) basis revenue performance was 10.4% ahead of H1 2022,
comprising growth from both the VLG brands and Customer brands.
Excluding the newly acquired HLH, revenue performance elsewhere in
the Group was 11.4% ahead of the same period last year.
VLG Brands delivered revenues of GBP12.9m (H1 2022: GBP10.1m), a
growth of 27% over the previous year and accounted for 55% of first
half revenues (H1 2022: 53%). VLG Brands include the acquisition of
HLH on 30 November 2022 which delivered revenues of GBP2.4m during
the Period (H1 2022: GBP2.4m). HLH's main product is Earol which
contributes c.95% of the sales and achieved revenues of GBP2.3m in
the Period (H1 2022: GBP2.2m), a growth of 6.1% over the previous
year on a like for like basis.
On a proforma(1) basis, revenue from VLG Brands was 3.5% ahead
of the same period the previous year; within this portfolio the
Balance Activ and Lift brands have continued to perform strongly,
achieving revenue growth of 24% and 16% respectively during the
period, and revenues from Gelclair were 201% ahead of the same
period last year.
Customer Brands delivered revenues of GBP10.6m in the Period (H1
2022: GBP8.8m), a growth of 20.3% over the previous year, driven
largely by sales of newly developed products to existing customers.
These products are developed in house by the Group's R&D team
at Biokosmes and related revenues contributed to c.10% of the
overall Customer Brands revenue during the period.
Cash and debt
Cash generated from operating activities in the Period was
GBP4.6m (H1 2022: GBP1.8m), an increase of 158% over last year and
operating cashflow conversion improved to c.99% (H1 2022: 53%).
Free cash flow was GBP2.9m higher than the prior period at GBP3.4m
(H1 2022: GBP0.5m) and has been used to support a gross debt
reduction of GBP3.3m and net debt reduction of GBP1.2m during the
period. As a result, Group leverage(2) has reduced to 1.4x as at 30
June 2023 (31 December 2022: 1.6x).
Outlook
As seen historically, revenues are weighted towards the second
half of the year and these are expected to be weighted more towards
the higher margin VLG Brands than in the first half of this year,
as supported by the order book. The Group's trading performance to
date and the growth in its order book, provide a level of
visibility over second half revenue enabling the Board to remain
cautiously optimistic that trading for the full year financial
performance is on-course to be in line with market
expectations.
Jerry Randall, CEO of Venture Life, commented: "I am delighted
with performance of the business over this first half, with strong
growth contributions in particular from Balance Activ, Lift and
Gelclair, in the VLG Brands portfolio, and from the Customer
Brands. The acquisitions we made in 2021 & 2022 are now fully
integrated and delivering good organic growth, and we will be
launching some great newly developed products in the second half of
the year and increasing our distribution points in the UK, which
will both contribute to the expected stronger revenues in H2. We
have delivered excellent cash conversion and seen a meaningful
reduction in our debt position, having now paid the full contingent
consideration for the acquisition of HLH, and we expect this strong
cash generation to continue through the second half, further
reducing our net leverage. I send out a big thanks again to all our
hard working, dedicated and innovative team across the Group for
continuing to grow our business in challenging times."
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)
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, Earol for ear wax
removal, 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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END
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