Strong first half financial performance – revenues up 21% and gross profit up 26% £19 million new contracts signed resulting in a backlog of £60 million Acquisitions of O+P and GASD strengthens service business Acquisition of Haemostatix expands product pipeline potential significantly Completion of £9.2 million fund raising Guildford, UK – 26 September 2016: Ergomed […]
Strong first half financial performance – revenues up 21% and gross profit up 26%
£19 million new contracts signed resulting in a backlog of £60 million
Acquisitions of O+P and GASD strengthens service business
Acquisition of Haemostatix expands product pipeline potential significantly
Completion of £9.2 million fund raising
Guildford, UK – 26 September 2016: Ergomed plc, (‘Ergomed’, ‘the Company’, AIM: ERGO) a profitable UK-based company dedicated to the provision of specialised services to the pharmaceutical industry and the development of new drugs, today announces its interim results for the six months ended 30 June 2016.
Commenting on the results, Miroslav Reljanovic M.D., Chief Executive Officer of Ergomed plc, said:
“Ergomed has delivered another set of excellent results for the first half of 2016. We made significant progress against our strategic goals through the continued strong trading performance of our profitable, growing service businesses where overall top-line growth of 21% was driven by revenue growth of 53% in our subsidiary company PrimeVigilance and through the completion of two targeted acquisitions.
The acquisitions of O+P and GASD augment the continuing growth of our services businesses, adding immediate significant, tangible value including an in-house Electronic Data Capture system, “OPVERDI” and biostatistics and data management capabilities. We have already won our first service contract together for a clinical study with a European biotech company underlining the benefits of the acquisition.
We continue to believe we can create significant value by investing in-kind through carefully selected co-development partnerships and we are expecting important clinical data readouts from Ferrer and Aeterna Zentaris around the end of 2016 and early 2017 respectively. The Haemostatix acquisition is an exciting evolution of the co-development model and has the potential to be transformational for Ergomed through the rapid development of its novel treatment for surgical bleeding.
Overall, we continue to believe that our hybrid model of a growing, profitable services business combined with managed risk drug development has the potential to deliver significant shareholder value over the next few years with some exciting newsflow in the next 12 months.”
Financial highlights (unaudited)
- Revenues up 21% to £17.6 million from £14.5 million in H1 2015
- Including revenue growth of 53% to £5.5 million from £3.6 million in H1 2015 from PrimeVigilance
- Gross profit up 26% to £5.3 million from £4.2 million in H1 2015
- Adjusted EBITDA up 12% to £1.9 million from £1.7 million in H1 2015 excludes costs of £0.4 million relating to M&A activities and £0.1 million of R&D costs (note 11)
- EBITDA before adjustments for share-based payment charge, M&A costs, exceptional items and R&D of £1.2 million compared with £1.4 million in H1 2015 (note 11)
- Placing of 6.63 million new ordinary shares raised £9.2 million before expenses
- Cash and cash equivalents of £9.9 million as of 30 June 2016 (30 June 2015: £4.9 million; 31 December 2015: £4.0 million)
- Contribution in kind to co-development projects increased to £2.1 million in H1 2016 from £1.9 million in H1 2015
- Service contracts with a value of £19 million signed in H1 2016 (£15 million signed in H1 2015)
- Strong backlog of awarded contracts of approximately £60 million at the end of July 2016
- O+P and GASD, a contract research organisation with a proprietary electronic data capture system, OPVERDI, and a biostatistics and data management company respectively, were acquired on 13 June 2016 (note 8)
- Opening of a new office in Boston, MA to support growth of PrimeVigilance in the US in June 2016
- Five ongoing clinical studies with co-development partnerships proceeding to plan
- Haemostatix, a UK company developing a proprietary platform to control surgical bleeding with two lead products, one of which is Phase IIb ready, was acquired on 24 May 2016 (note 7)
For further information, please contact
Miroslav Reljanovic (Chief Executive Officer)
Stephen Stamp (Chief Financial Officer)
|Tel: +44 (0) 1483 503205|
|Numis Securities Limited
Michael Meade / Freddie Barnfield (Nominated Adviser)
James Black (Joint Broker)
|Tel: +44 (0) 20 7260 1000|
|Stifel Nicolaus Europe Limited
Jonathan Senior (Joint Broker)
|Tel: +44 (0) 20 7710 7600|
|FTI Consulting – for UK enquiries
Simon Conway / Mo Noonan / Natalie Garland-Collins
|Tel: +44 (0) 20 3727 1000|
|MC Services – for Continental European enquiries
|Tel: +49 211 529252 22|
Ergomed plc is a profitable UK-based business providing drug development services to the pharmaceutical industry and has a growing portfolio of co-development partnerships. It operates in over 50 countries.
Ergomed successfully manages clinical development from Phase I through to late phase programmes, providing clinical development, trial management and pharmacovigilance services to over 100 clients ranging from top 10 pharmaceutical companies to small and mid-sized drug development companies. Ergomed has a wide therapeutic focus, with a particular expertise in oncology, neurology and immunology and the development of orphan drugs. Ergomed believes its approach to clinical trials is differentiated from that of other providers by its innovative Study Site Management model and the use of Study Physician Teams, resulting in a close relationship between Ergomed and the physicians involved in clinical trials.
Ergomed’s subsidiary, PrimeVigilance, is a leading independent pharmacovigilance and medical information business in Europe. PrimeVigilance offers a range of post-approval drug safety surveillance and ancillary services to the pharmaceutical industry. With a compound growth rate of 38% since 2011, PrimeVigilance won the Queens Award for Enterprise in 2014.
As well as providing high quality clinical development services, Ergomed is building a portfolio of co-development partnerships with pharma and biotech companies which share the risks and rewards of drug development. Ergomed leverages its expertise and services in return for carried interest in the drugs under development. Lastly, Ergomed recently acquired Haemostatix, including a pipeline of proprietary development products for haemostasis in surgical settings. For further information, visit: https://ergomedplc.com.
Forward Looking Statements
Certain statements contained within the announcement are forward looking statements and are based on current expectations, estimates and projections about the potential returns of Ergomed plc (“Ergomed”) and industry and markets in which Ergomed operates, the Directors’ beliefs and assumptions made by the Directors. Words such as “expects”, “anticipates”, “should”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “projects”, “pipeline” and variations of such words and similar expressions are intended to identify such forward looking statements and expectations. These statements are not guarantees of future performance or the ability to identify and consummate investments and involve certain risks, uncertainties, outcomes of negotiations and due diligence and assumptions that are difficult to predict, qualify or quantify. Therefore, actual outcomes and results may differ materially from what is expressed in such forward looking statements or expectations. Among the factors that could cause actual results to differ materially are: the general economic climate, competition, interest rate levels, loss of key personnel, the result of legal and commercial due diligence, the availability of financing on acceptable terms and changes in the legal or regulatory environment.
These forward-looking statements speak only as of the date of this announcement. Ergomed expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in Ergomed’s expectations with regard thereto, any new information or any change in events, conditions or circumstances on which any such statements are based, unless required to do so by law or any appropriate regulatory authority.