Interim Results
28 Septiembre 2001 - 8:00AM
UK Regulatory
RNS Number:8268K
Huntingdon Life Sciences Group PLC
28 September 2001
HUNTINGDON ANNOUNCES HALF YEAR RESULTS
Huntingdon, England, September 28, 2001 - Huntingdon Life Sciences Group plc
("Huntingdon" or the "Company") announced today that net revenues for the half
year ended June 30, 2001 were #32.4 million ($46.8 million) an increase of
3.3% on revenues for the equivalent period last year of #31.4 million ($49.3
million). Under UK GAAP the Company reported an operating loss of #2.4 million
($3.5 million), up from #0.5 million ($0.7 million) last year. Net loss after
interest and taxation was #6.3 million ($9.1 million) compared to #3.9 million
($6.1 million) for the equivalent period last year. These losses included
non-cash exchange losses on the conversion of dollar denominated assets and
liabilities into sterling of #2.1 million compared to exchange losses in the
same period last year of #2.0 million. Net loss per ordinary share was 2.2
pence compared to 1.3 pence last year. Net loss per ADR was 77.4 cents
compared to 52.8 cents last year.
Under US GAAP the Company reported an operating loss for the half year ended
June 30, 2001 of #2.0 million ($2.8 million) compared to an operating profit
of #0.2 million ($0.3 million) for the equivalent period last year. Net loss
after taxation for the half year was #4.3 million ($6.2 million) compared to #
3.2 million ($5.0 million) last year including non-cash exchange losses-
on the conversion of dollar denominated assets and liabilities into sterling
of #2.2 million compared to exchange losses in the same period last year of #
2.3 million. Net loss per ordinary share was 1.5 pence compared to 1.1 pence
last year. Net loss per ADR was 52.5 cents compared to 43.4 cents last year.
The principal differences between the UK and US reported results are non-cash
charges associated with pension accounting, deferred taxation and foreign
currency translation.
Andrew Baker, Huntingdon's Executive Chairman said:
"These results are in line with our expectations of earlier this year and
reflect our steady recovery from the issues of Q4 and Q1. At that time we
faced refinancing difficulties as a result of the ferocity of the animal
rights movement's campaign against both us and the financial community; our
results were impacted accordingly. However, our long term (5 year)
refinancing was completed in January and the animal rights campaign is now
recognised as being much broader and of concern to all those involved in the
vital endeavour of animal research. The backing we have seen from clients and
from the Government including the changes to the law they have introduced,
reflects that new understanding, and provides benefits for our whole
industry."
Brian Cass, Huntingdon's Managing Director added:
"Earlier in the year we noted a recovery in orders following the refinancing
in January. We are pleased to report that this was maintained during Q2 and
the first half of 2001 saw a significant increase in the value of new studies
awarded. Orders were 12% up on the preceding 6 months and, encouragingly,
much of the growth was driven by the UK laboratories which were 23% ahead.
With the dip in orders in Q4 last year revenues in Q1 2001 were only #15.5
million. However, the growth in orders since then has started to feed through
into revenues in Q2 which at #16.9 million were 9% ahead of Q1 and 6% up on Q2
2000; in fact Q2 revenues were the highest in 4 years.
Costs, whilst up on the first half of last year, were down on the run rate for
Q4 2000. The reasons are largely the same as noted at the time of the release
of our 2000 results. We've continued to invest in our workforce with focused
salary actions to ensure that we remain competitive. We have also incurred
increased professional and public relations costs this year as we continue to
successfully counter the so called "animal rights" campaign and with the
continuing strength of the dollar the sterling translation of our US costs has
increased."
Huntingdon Life Sciences Group plc is one of the world's leading Contract
Research Organisations providing product development services to the
pharmaceutical, agrochemical and biotechnology industries. Huntingdon brings
leading technology and capability to support its clients in non-clinical
safety testing of new compounds in early stage development and assessment.
Huntingdon operates research facilities in the United Kingdom (Huntingdon and
Eye, England) and the United States (The Princeton Research Centre, New
Jersey).
This announcement contains statements that may be forward-looking as defined
by the USA's Private Litigation Reform Act of 1995. These statements are
based largely on Huntingdon's expectations and are subject to a number of
risks and uncertainties, certain of which are beyond Huntingdon's control, as
more fully described in Huntingdon's Form 10-K for the year ended December 31,
2000, as filed with the US Securities and Exchange Commission.
SUMMARY OF UNAUDITED CONSOLIDATED PROFIT & LOSS ACCOUNTS
6 Months ended June 30 2001 2000
#000's #000's
Revenues 32,443 31,413
Cost of sales (29,183) (27,229)
Gross profit 3,260 4,184
Selling and administrative expenses (5,685) (4,661)
Loss on ordinary activities before interest (2,425) (477)
Interest receivable and similar income 473 792
Interest payable and similar charges (4,353) (4,232)
Loss on ordinary activities before taxation (6,305) (3,917)
Taxation - -
Loss after taxation (6,305) (3,917)
Loss per share (pence) - basic (2.2) (1.3)
- diluted (2.9) (1.4)
Loss per ADR (cents) - basic (77.4) (52.8)
- diluted (103.9) (56.2)
There are no other recognised gains and losses, other than those shown in the
Profit and Loss Account.
SUMMARY OF UNAUDITED CONSOLIDATED BALANCE SHEETS
As at June 30 2001 2000
#000's #000's
Fixed Assets 63,355 67,552
Stock 1,085 658
Debtors 19,372 19,415
Cash at bank and in hand 2,188 1,223
Current assets 22,645 21,296
Bank and other loans (1,747) (22,586)
Creditors and taxation (24,007) (17,636)
Current liabilities (25,754) (40,222)
Net current liabilities (3,109) (18,926)
Total assets less current liabilities 60,246 48,626
Creditors: amounts falling due after one year
Convertible capital bonds (35,022) (32,389)
Long term loans (22,688) -
(57,710) (32,389)
Provisions for liabilities and charges (2,031) (2,550)
Shareholder funds - all equity 505 13,687
SUMMARY OF UNAUDITED CONSOLIDATED CASH FLOWS
6 Months ended June 30 2001 2000
(see also Note 8 in the press release) #000's #000's
Net cash inflow/(outflow) from operating activities 2,680 (913)
Returns on investment and servicing of finance
Interest received and similar income 52 86
Interest paid and similar charges (2,068) (2,112)
(2,016) (2,026)
Taxation
UK Corporation tax received - -
Capital expenditure and financial investment
Purchase of tangible fixed assets (1,421) (1,096)
Net cash outflow before use of liquid resources and financing (757) (4,035)
Management of liquid resources
Movement in short term investments - 2,200
Financing:
Issue of ordinary share capital 90 -
Loans received (net) 656 -
746 -
(Decrease) in cash and cash equivalents (11) (1,835)
Notes:
(1) Bank loans totaling #22,586,000 were refinanced on January 20, 2001 by
means of a loan from HLSF LLC, a subsidiary company of the Stephens Group
Inc., a related party, and two other banks who were part of the original
syndicate. The loans are repayable on June 30, 2006.
As part of the refinancing additional working capital was made available to
the Group to meet its immediate
trading requirements. This together with other financing options still
available to the Group, are expected to provide adequate finance for the
foreseeable future.
In the light of the above the directors have formed a judgement that it is
appropriate to adopt the going concern basis in preparing the accounts.
(2) These results have been prepared in accordance with UK GAAP, but do not
constitute Statutory Accounts as defined by the UK Companies Act 1985 and have
not been audited.
(3) Loss per share is based on an average of 293,165,479 (2000, 291,010,294)
Ordinary Shares outstanding during the six month period ended June 30, 2001.
(4) Diluted loss per share is based on an average 218,785,035 (2000,
273,738,353) Ordinary Shares outstanding during the six month period ended
June 30, 2001.
(5) Loss per ADR is calculated using an exchange rate of $1.44 = #1.00 (2000,
$1.57 = #1.00). On July 10, 2000 the Company changed its ADR ratio to one ADR
representing twenty-five Ordinary Shares and the loss per ADR for each period
has been calculated using this ratio; previously each ADR represented five
Ordinary Shares. The ratio change was implemented to assure compliance with
the New York Stock Exchange's listing requirement that ADR's trade at a
minimum price of $1.00 per share.
(6) The Directors do not recommend payment of an interim dividend.
(7) For the purposes of consolidation an average exchange rate of $1.44 = #
1.00 has been used in the six month period ended June 30, 2001 (2000, $1.57 =
#1.00).
(8) Reconciliation of operating loss and net cash inflow/(outflow) from
operating activities
6 months ended June 30
2001 2000
#'000 #'000
Operating loss (2,425) (477)
Depreciation 2,893 2,976
(Increase)/decrease in stock (178) 145
(Increase) in debtors (1,036) (2,899)
Increase/(decrease) in creditors 3,653 (452)
Movement in provisions (227) (206)
2,680 (913)
(9) A printed copy of this half year report is being posted to
shareholders and is available on request from the Registered Office at Woolley
Road, Alconbury, Huntingdon, Cambs PE28 4HS.
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