[October 30, 2014] |
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Novacyt Announces 2014 Half Year Results and Updates Strong Progress with Integration of Lab21
PARIS & CAMBRIDGE, England --(Business Wire)--
Novacyt (ALTERNEXT: ALNOV), an international specialist in cancer and
infectious disease diagnostics, today announces its half year results
for the six months ended 30th June 2014 approved by the Board
of Directors on 28th October 2014. Novacyt also provides an
update on the recent integration of Lab21.
FIRST-HALF HIGHLIGHTS
Transformational deal with Lab21 immediately improves financial and
growth outlook
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Transformational acquisition of UK personalized medicine
diagnostics specialist Lab21 will result in significantly increased
sales and improved financial performance of Novacyt.
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Increased commercial channels through the combined business will
support international expansion of NovaPrep® products to key markets
across Europe, Middle East and China. Two new market launches have
already occurred in Dubai and Kuwait.
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New molecular Lab21 products for infectious disease testing are
ready for launch in H2 2014.
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Significant tenders awarded for Lab21 products from across South
America, the Middle-East and Africa.
FINANCIAL HIGHLIGHTS
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Following the acquisition of Lab21 on 13th June 2014 the pro
forma sales of the Novacyt Group are €3.76m in the first half of
2014 compared to sales of €582k for Novacyt in the prior year.
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The Novacyt Group moved towards breakeven EBITDA on a pro forma
basis with a loss of €101k for the first half of 2014 compared to a
loss of €508k for Novacyt in the prior year.
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The Novacyt Group cash position at the end of June 2014 is €1.463m.
Half year results
€k
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Notes
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pro forma* H1 2014
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Novacyt H1 2014
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Novacyt H1 2013
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Revenue
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1,2
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3,760
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525
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582
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Other income
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(19)
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2
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47
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Total income
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3,741
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527
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629
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Operating charges
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(4,752)
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(1,133)
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(1,225)
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Operating result
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(1,011)
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(606)
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(596)
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Net result
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3
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(1,724)
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(566)
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(520)
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EBITDA
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4
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(101)
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(531)
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(508)
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Unaudited figures
* Pro forma : as if the Lab21 accounts have been consolidated
from 01/01/2014
1. The Novacyt Group has taken advantage of the provisions
under French GAAP to consolidate the results at 30th
June 2014. If the results had been consolidated at 13th
June 2014, the consolidated revenue would have been €827k, including
€302k of Lab21 revenue.
2. H1 2013 Novacyt revenues include €60k of revenues from the
acquisition of CCTI assets, a software company whose products were
discontinued by the end of 2013.
3. Net result includes €986k of goodwill amortisation.
4. Pro forma EBITDA (Earnings before interest, tax,
depreciation and amortisation) includes the one-off receipt of €836k
which relates to the payment of an earn-out to Lab21 on the sale of its
US operations in December 2012.
The Novacyt sales in the first half of 2014 were €525k compared to €582k
in the first half of 2013. The breakdown is as follows:
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Sales from NovaPrep® in France increase 15% to €299k (H1 2013: €259k)
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Sales from NovaPrep® internationally decrease by 14% to €226k (H1
2013: €263k)
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Sales from NovaPrep® consumables increase 19% to €425k (H1 2013:€357k)
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Sales from NovaPrep® instrument sales decrease to €100k (H1 2013:
€165k)
The operating loss of Novacyt, without the impact of Lab21 in the first
half, is similar to prior year at €606k, despite the slightly lower
revenues due to the management of lower operating costs.
The Novacyt Group net cash position of €1.463m at 30th June
2014 will provide sufficient financial resources to fund the initial
commercial plans of the Company and it plans to raise capital during the
next twelve months to fund the commercial expansion of the combined
business.
Strong progress in the integration of Novacyt with Lab21
A leader in cancer and infectious disease
diagnostics
The enlarged Novacyt Group is now a significant force in the cancer and
infectious disease diagnostic markets with a strong protected portfolio
of technologies. Novacyt benefits from a large global footprint with
more than 300 distributors in 120 countries. At the same time, the
expanded Novacyt business now boasts operating sites and employees in
five countries, making it a truly international operation.
Focused on commercialization
Novacyt has made significant progress in the integration of Novacyt with
Lab21 following the transaction on 13th June 2014. With a
strong focus on commercialization the business is being positioned for
sustainable and profitable growth through increased sales of NovaPrep®,
supported by robust profitable sales of Lab21 products as well as
bringing new molecular products to market.
The Company is focusing its efforts on global expansion to a number of
key markets which include large growing cancer screening markets such as
the Far East, with a particular focus on the opportunities offered in
China. At the same time, we are expanding existing markets including our
presence in France and following the transaction we have made our first
new country launches of NovaPrep® in Kuwait and Dubai.
The combination of Novacyt and Lab21 has resulted in a large portfolio
of products across infectious diseases and cancer diagnostics and we
continue to develop new products to expand this range. NovaPrep® and its
supporting products are under continual improvement and the company will
expand its infectious disease offering with new molecular products
planned for launch in the second half of this year.
Lab21 infectious disease products have also been awarded a number of new
tenders during 2014 with notable success across South America,
Middle-East and Africa. A single tender award will result in over €500k
of new sales during the second half of the year.
Novacyt has continued to strengthen its intellectual property position.
The company has secured four new patents related to the NovaPrep®
product bringing the total number of granted and pending NovaPrep®
patents in excess of 90. This patent protection coupled with strong
internal know-how positions the business to be highly competitive in the
countries in which it operates.
Graham Mullis, Group CEO of Novacyt, commented:
"Since the combination of Novacyt and Lab21, we have made significant
progress in integrating the two businesses with a focus on developing
our sales and marketing plans for the NovaPrep® product. We have been
able to draw on the expertise across the combined company to evaluate
and engage with new distribution partners and establish ourselves in new
markets. We have made particular progress in our planning to access
major new markets such as China and have continued to expand our
presence in more established markets such as the Middle East and Europe.
At the same time, we are expanding our product range with the launch of
new molecular products in the second half of this year. Additionally, we
continue to strengthen our intellectual property position through a
series of new patents and we are focused on developing the
organizational structure with the appointments of new key executive and
commercial personnel. I expect Novacyt to be well placed in 2015 to
increase the commercial expansion of its NovaPrep® product in the
significant growing sector of cancer diagnostics."
Appointments to support the new combined group
Novacyt continues to strengthen the management team most recently with
the appointment of Ian Wilde as Head of Quality Assurance and Regulatory
Compliance. He joins the Company from a successful career in blue-chip
medical device companies.
In addition, the Company is in the process of recruiting other executive
team members as well as strengthening the commercial team.
To support Novacyt as a growing publicly listed company, the Company has
also appointed a number of key advisers. These include Allegra Finance
as our new Listing Sponsor, Louis Capital Markets as our Liquidity
Advisor, Oriel Securities as our International Corporate Advisor and
Linklaters to assist with our global legal affairs.
Outlook: sustainable growth
The Lab21 product revenues will continue to be strong in the second half
of 2014 following the tender wins in South America, Middle-East and
Africa. These revenues will also be helped by the new molecular
infectious disease products which remain on target for launch in the
second half. The NovaPrep® revenues will continue at the first half rate
as the Company completes the integration of the business.
The Company will continue its commercial focus and invest in sales and
marketing particularly to increase NovaPrep® revenues through new market
launches which are planned in 2015. The anticipated synergies of the
merger between Novacyt and Lab21 are already showing early results.
Novacyt's excellent NovaPrep® platform technology, in combination with
Lab21's commercial infrastructure and network is expected to deliver
strong sustainable growth in the future.
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