TIDMEKF
RNS Number : 3387U
EKF Diagnostics Holdings PLC
01 August 2022
This announcement contains inside information for the purposes
of UK Market Abuse Regulation.
EKF Diagnostics Holdings plc
("EKF", the "Company" or the "Group")
Trading Update
H1 2022 performance in-line with management expectations
Strong double-digit growth in underlying (non-COVID) revenue
EKF Diagnostics Holdings plc (AIM: EKF), the AIM-listed global
diagnostics business , provides the following unaudited trading
update for the six months ended 30 June 2022 ("H1 2022"), a period
of strong underlying (non-COVID) revenue growth, underpinning
confidence in meeting full year expectations.
Trading Update
As announced in the 18 May 2022 AGM statement, trading in the
first quarter of 2022 was strong. This has continued into the
second quarter, where the focus remains on our strategy to position
the business for long-term sustainable growth. Unaudited revenues
for H1 2022 were GBP37.5m (H1 2021: GBP38.6m), including c.GBP3.5m
of revenue arising from cash received for US inventory as reported
on 13 June 2022. On an underlying basis, which excludes largely
COVID-related revenue from Contract Manufacturing and Laboratory
Services, the Group delivered double-digit growth compared to H1
2021.
The Company expects to report adjusted EBITDA(1) for the first
half which is in line with management expectations. More recently
established activities are expected to see improvements in adjusted
EBITDA margin as they start to build scale from the second half and
into 2023. The Company remains on track to deliver an adjusted
EBITDA(1) result in line with its expectations for the full
year.
Group cash, net of borrowings, as at 30 June 2022 was GBP18.9m.
Continuing positive cash flows from operations in H1 2022 mean
that, after recent corporation tax payments, movements in working
capital, the completed share buyback and investment activities, the
30 June 2022 balance compares well against the 31 December 2021
figure of GBP19.6m.
The Board remains confident that the Company will continue to
deliver on its growth strategy across all areas of the business.
First half progress most notably includes:
(1) The established Point-of-Care & Central Laboratory
businesses have delivered growth compared to pre-pandemic levels
and have made further progress on new product and new market
initiatives.
(2) Life Sciences had a strong H1 2022 performance from its
existing fermentation capacity and the expansion plans into larger
volume production remain on schedule for completion by the end of
the year, with encouraging early meetings with large industrial
partners who are looking to utilise this additional capacity.
Revenue from this area of investment is expected to build
materially in 2023 and to be a source of significant growth through
to 2024.
(3) The transition to non-COVID revenues in both Contract
Manufacturing and Laboratory Services continues. The Company is
bringing on new partners in the genomics and forensic space and
successfully taking them through validation and pilot scale batches
for products expected to be launched later in 2022 and into 2023.
In addition, the Laboratory Services team recently launched a new
clinical toxicology method geared toward medication adherence,
developed an analysis of cannabis potency and has made major
advances in establishing our capability in Non-Invasive Prenatal
Testing ("NIPT"). The expansion of testing capabilities to create a
broader suite of healthcare applications is proceeding well against
the Company's roadmap, and it is reassuring to see early interest
and new opportunities emerging as the team start to promote the new
testing services.
EKF expects to announce its unaudited results for H1 2022 on 20
September 2022.
Mike Salter, CEO of EKF, commented: "It has been an encouraging
start to the year and our adjusted EBITDA (1) expectations for the
full year remain in line with expectations. We are excited by the
growth potential from our expansion plans which will support growth
through to 2024 and beyond, funded by internally generated cash
resources. EKF remains on track to deliver planned expansions in
capability and capacity in Life Sciences, as well as the further
broadening of our Laboratory Services offering beyond COVID. The
Point-of-Care and Central Laboratory businesses continue to recover
well and provide steady, cash generative growth. We look forward to
reporting our interim results more fully in September, as we enter
the next chapter of EKF's growth with increasing confidence."
(1) Earnings before interest, tax, depreciation and
amortisation, excluding exceptional items and share based
payments.
(2) Comparative data relates to the comparable period to 30 June
2021 ("H1 2021")
The persons responsible for arranging the release of this
Announcement
on behalf of the Company are Mike Salter, CEO, and Marc Davies,
CFO.
EKF Diagnostics Holdings plc www.ekfdiagnostics.com
Mike Salter, CEO / Marc Davies, CFO Tel: +44 (0)29 2071 0570
Singer Capital Markets (Nominated Adviser Tel: +44 (0)20 7496 3000
& Joint Broker)
Aubrey Powell / George Tzimas
Investec Bank plc (Joint Broker) Tel: +44 (0)20 7597 4000
Gary Clarence / Daniel Adams / Ben Farrow
Walbrook PR Limited Tel: +44 (0)20 7933 8780 or ekf@walbrookpr.com
Paul McManus / Lianne Applegarth Mob: +44 (0)7980 541 893 / +44
(0)7584 391 303
About EKF Diagnostics Holdings plc ( www.ekfdiagnostics.com
)
EKF is a leading global diagnostics business with custom
manufacturing facilities across sites in the US, UK and Europe for
a variety of life science products. EKF is focussed on the
following areas:
Point-of-Care Providing a portfolio of Point-of-Care analysers and
consumables, particularly for use in the area of Hematology
and Diabetes, for use in hospital and research laboratories,
doctor's offices, blood banks and for in-field anaemia
screening programmes. EKF has an estimated 80,000
hemoglobin, hematocrit, HbA1c, glucose and lactate
analysers in regular use across more than 100 countries.
Central Laboratory Clinical chemistry, Small lab analysers, Centrifuges
Beta-Hydroxybutyrate (<BETA>-HB) LiquiColor , Glycated
Albumin, Glycated Serum Protein, Nitro-tab, Procalcitonin
Life Sciences Enzyme fermentation, Custom products and Bulk fermentation
Contract Manufacturing Bulk formulation, Sample collection kits, Private
labelling, Molecular and forensic kits
Laboratory Services In September 2021, EKF completed the acquisition of
Advanced Diagnostic Laboratory LLC ("ADL Health"),
a Texas based testing laboratory certified under the
Clinical Laboratory Improvement Amendments ("CLIA")
for high complexity testing. The laboratory provides
testing for a variety of clinical, forensic and microbiological
sample types using a range of analytical techniques.
This acquisition positions EKF as a leading 'one stop'
provider of diagnostic products and services from
sample collection to results.
EKF's growth strategy to 2024 and beyond can be summarised
as:
-- continuing innovation in products and services in Point-of-Care,
Central Laboratory and Life Sciences leveraging new and existing
routes to market and relationships;
-- investment in expanded production and kitting capabilities to offer
a suite of diagnostic Contract Manufacturing solutions to third
party businesses;
-- expansion of CLIA Laboratories Testing offering, building on the
acquired capabilities in ADL Health; and
-- concluding complementary earnings-enhancing acquisitions with key
strategic value.
EKF will also continue to generate enhanced shareholder value
through:
-- a progressive dividend policy; and
-- its agreement with Mount Sinai Innovation Partners ("MSIP"), which
allows us advanced access to innovative commercial opportunities
such as those already seen with Renalytix plc, Verici Dx plc and
Trellus Health plc.
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END
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