TIDMNCYT
RNS Number : 2952N
Novacyt S.A.
29 January 2021
Novacyt S.A.
("Novacyt", the "Company" or the "Group")
Full Year 2020 Trading Update
Paris, France and Camberley, UK - 29 January 2021 - Novacyt (
EURONEXT GROWTH: ALNOV; AIM: NCYT ), an international specialist in
clinical diagnostics, announces an unaudited trading update for the
year ended 31 December 2020.
Highlights
-- Revenue for the full year of 2020 increased by over 20x to
EUR311.6 million (GBP277.0 million) compared to EUR13.1 million
(GBP11.5 million) for the full year of 2019
-- Revenue of EUR239.2 million (GBP213.7 million) delivered in
H2 2020 compared to EUR72.4 million (GBP63.3 million) in H1
2020
-- Gross margin for the full year above 80%
-- EBITDA profitability for the full year above EUR210 million
(GBP187 million), with H2 2020 EBITDA above EUR161 million (GBP143
million) compared to EUR49.4 million (GBP43 million) in H1 2020
-- T he Company's cash position at 31 December 2020 was EUR101
million (GBP91.8 million), compared to EUR1.8 million (GBP1.6
million) at 31 December 2019 and EUR19.7 million (GBP18.0 million)
at 30 June 2020
-- Investment in pipeline of next generation COVID-19 tests to address evolving clinical needs
-- Acquisition of IT-IS International, a profitable diagnostic
instrument development and manufacturing company, in line with
strategy
Overview
As a result of significant work, focus and innovation, the scale
and financial performance of the business continued to accelerate
during the second half of the year. This was driven by the
continued successful global commercialisation of the Company's
COVID-19 product portfolio, underpinned by one of the world's first
approved polymerase chain reaction (PCR) tests for the virus, and
has resulted in the rapid transformation of Novacyt into a leading
European integrated molecular diagnostic player.
The strong cash position at the year-end followed significant
investment in the Group's working capital, including inventory to
meet product demand and ensure uninterrupted supply to customers,
and the Group paying down all outstanding debt during the year,
making the Company debt free for the first time in its history. On
an ongoing basis, we expect conversion of EBITDA to free cash flow
before acquisitions to be close to 80%.
Novacyt has successfully integrated the acquisition of IT-IS
International Ltd (IT-IS), a profitable diagnostic instrument
development and manufacturing company, which was acquired in line
with the Company's stated growth strategy. The acquisition allowed
Novacyt to become a fully integrated instrument and consumables
player, with the ability to expand its product offering into
broader COVID-19 opportunities and beyond. As detailed at the time
of the acquisition, the Company is focused on delivering higher
manufacturing volumes at IT-IS to reduce its cost of goods and
therefore improve the gross margin of its instrument sales.
The Group has expanded its global presence, with the UK, Middle
East, Germany and US being its four largest revenue generating
markets. It has secured significant contracts with national
governments, including two with the Department for Health and
Social Care in the UK (DHSC), as well as with other national
non-government organisations, for the supply of its COVID-19
products.
Novacyt continues to leverage its proven capabilities in PCR
test R&D to expand the range of high quality and differentiated
products it offers to its customers. This has resulted in ten
further product launches during the year to address new needs in
the market, which has driven diversification of the Company's
revenue base. This includes a test panel to differentiate COVID-19
from common winter diseases and new reagents to aid PCR testing
workflow for users.
Novacyt also remains committed to its surveillance programme of
analysing the Company's selected gene targets for COVID-19 against
new mutations of the virus to demonstrate ongoing accuracy and
performance of its tests. To date, t he Company's PCR product
portfolio, based around a single and a two gene target for
COVID-19, remains able to detect all published strains of
SARS-CoV-2 with the same high level of accuracy.
To support growth, the Company continues to scale the business
internally. During 2020, Novacyt hired 124 people, with significant
increases across manufacturing, sales and R&D operations. Post
period end, Novacyt also expanded its executive team. James
McCarthy was appointed as Chief Financial Officer to support the
Company as it enters its next stage of growth. Anthony Dyer has
taken on a new role as Chief Corporate Development Officer to focus
on executing against the Company's ambitious organic growth and
innovation strategy, as well as its M&A strategy to supplement
growth initiatives. Novacyt has also appointed Guillermo Raimondo
to the newly formed, non-Board role of Chief Commercial Officer to
lead the Company's global commercial operations. Previously,
Guillermo had a successful career at Siemens Healthineers where his
last two roles were as Regional President and more recently
Executive Vice President Global Marketing & Sales, responsible
for $4 billion of global revenues.
Outlook
Novacyt has had a strong start to 2021 across the business, with
demand for the COVID-19 product portfolio remaining strong. At this
early stage in the year, it is difficult to provide a clear
forecast on the financial performance for full year 2021. However,
the Directors believe demand for the Company's COVID-19 product
portfolio will remain strong throughout most of 2021, with
continued conversion of new opportunities, including a number of
planned product launches, and the expansion of the Company's
VersaLab(TM) service to support private sector testing of
infectious diseases, initially focused on COVID-19 .
In addition, the Company continues to support the DHSC and the
NHS following the deployment of its rapid PCR testing system, for
the contract with the DHSC, announced on 29 September 2020, and the
Company is in active discussions with the DHSC to extend this phase
of the contract. Novacyt's PROmate(TM), a new product to improve
the workflow efficiency when used with the Company's q16/q32
instruments successfully completed an in-service validation
conducted by Test and Trace's Technology Validation Group (TVG),
with the TVG concluding the performance of the PROmate(TM) aligns
with the acceptable standard for point-of-care (rapid testing).
With the strengthened cash position of the Company, the business
is able to continue to invest in innovation, organic expansion and
external business development, in line with its growth strategy, to
leverage its strong momentum as a leading European molecular
diagnostic player in infectious diseases. Organically, Novacyt will
continue to invest in its commercial infrastructure to deliver new
products, as the Company continues to redefine its R&D pipeline
and establish a direct sales force in key markets in the US and
across Europe. The Company also continues to evaluate M&A
opportunities and will consider additional bolt-on acquisitions to
add strategic assets and functionality to the expanding Group.
The Company expects to announce its full year results in April
2021.
Graham Mullis, Group CEO of Novacyt, commented:
"2020 has been transformational for Novacyt. We have cemented
our early mover advantage of developing one of the first tests for
COVID-19 into an established position within COVID-19 testing and
the broader diagnostics market. We have signed significant
contracts with national governments, supplied our products to over
130 countries globally and continue d to develop innovative testing
capabilities to support laboratories and clinicians during these
challenging times .
"I would like to thank all employees who have helped Novacyt to
achieve an outstanding year of growth and prepare the Company for
an exciting future. O ur strong financial position has enabled us
to settle all outstanding debt, make a strategically important
acquisition and conclude the year with significant levels of cash
to reinvest in the business. These foundations ensure we are well
positioned to continue to grow the business in line with our
strategy of delivering long-term value to our shareholders."
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
- End -
Contacts
Novacyt SA
Graham Mullis, Chief Executive Officer
James McCarthy, Chief Financial Officer
+44 (0)1276 600081
SP Angel Corporate Finance LLP (Nominated Adviser and
Broker)
Matthew Johnson / Charlie Bouverat (Corporate Finance)
Vadim Alexandre / Rob Rees (Corporate Broking)
+44 (0)20 3470 0470
Numis Securities Limited (Joint Broker)
Freddie Barnfield / James Black
+44 (0)20 7260 1000
Allegra Finance (French Listing Sponsor)
Rémi Durgetto / Yannick Petit
+33 (1) 42 22 10 10
r.durgetto@allegrafinance.com ; y.petit@allegrafinance.com
FTI Consulting (International)
Victoria Foster Mitchell / Alex Shaw / Mary Whittow
+44 (0)20 3727 1000
victoria.fostermitchell@fticonsulting.com /
alex.shaw@fticonsulting.com / mary.whittow@fticonsulting.com
FTI Consulting (France)
Arnaud de Cheffontaines
+33 (0)147 03 69 48
arnaud.decheffontaines@fticonsulting.com
About Novacyt Group
The Novacyt Group is an international diagnostics business
generating an increasing portfolio of in vitro and molecular
diagnostic tests. Its core strengths lie in diagnostics product
development, commercialisation, contract design and manufacturing.
The Company's lead business units comprise of Primerdesign and
Lab21 Products, supplying an extensive range of high-quality assays
and reagents worldwide. The Group directly serves microbiology,
haematology and serology markets as do its global partners, which
include major corporates.
For more information please refer to the website:
www.novacyt.com
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