REG - Deepverge PLC - Trading Update

DeepvergeAnnouncement

11/01/2022 07:05

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RNS Number : 9969X  Deepverge PLC  11 January 2022

11 January 2022

 

DeepVerge PLC

 

("DeepVerge" or "the Company")

 

Trading Update

 

DeepVerge unaudited 2021 revenue growth exceeds 108% to £9.33m

 

Skin Trust Club to launch video medical consultations and diagnostic service

 

DeepVerge (LSE:DVRG.L), the environmental and life science AI company, today
announces launch of Skin Trust Medical, an extension to the successful roll
out of Skin Trust Club, launched in Q2 2021, and a post-31 December 2021 year
end trading update and outlook for 2022.

 

·      Unaudited 2021 group revenues increased 108% to £9.33m (2020:
£4.48m - audited).

o  Orders exceeded £10m but supply chain delays and COVID infected staff
requiring isolation in Q4 pushed some shipments and backlog of reagent
supplies into Q1 2022.

o  In addition, installation of Government National Infrastructure trial
equipment with a value of £480,000 was installed before year end, but not
included in 2021 revenues. Project is ongoing and expected to complete late in
Q1 2022.

o  Strong unaudited H2 revenues of £6m (2020: £3.4m) delivered first
profitable EBITDA half year, excluding exceptional items.

o  Full year 2021 is expected to show an EBITDA loss of c£0.22m (2020:
£0.86m) and loss before tax c£3.50m (2020: £2.87m) respectively. While the
losses may exceed market expectations, it is primarily due to delayed
execution of 2021 orders.

o  June: Completed Placing of Ordinary Shares at 30 pence per share, raising
£10 million.

o  Order books continue to grow across all divisions.

 

Gerard Brandon, CEO of DeepVerge, comments:

"DeepVerge has delivered another year of triple digit percentage revenue
growth, with higher margins and an increase in recurring revenues despite
supply chain delays and reduced production staff due to COVID infection and
isolation in Q4. The injection of capital from the £10m placing in June
prepared the Group for an increase in staff, upgraded laboratories, and
expansion of our offering of innovative products and services across all
divisions. The Group has the strongest balance sheet in its history and a
solid foundation for continued strong growth through 2022."

 

·      Labskin - Skin Trust Club - Skin Trust Medical:

o  Skin Trust Medical offers an opt-in remote medical consultation and
diagnostic service as an additional revenue extension to the consumer based
Skin Trust Club, incorporating the Skin Trust Club Artificial Intelligence
Skincare App and Home Test Kit. This service is to be rolled out in Q2 2022.

§  Video consultants will include dermatologists, General Practitioners and
Clinical Nursing personnel

o  Skin Trust Club now has over 30,000 registered consumer users.

o  58% of the 30,000+ Skin Trust Club members have underlying skin
conditions.

o  Home Test processing capacity heading into 2022 is 20,000 per month in
each of the UK, Ireland and US laboratories.

o  Skin Trust Club members have begun to purchase skincare products,
recommended for their personalised daily skincare routines, through a new Skin
Trust Club marketplace service. This new in-app and web-based sales channel
promotes skin care manufacturers, Labskin partners and consumer test clients,
generating wholesale revenue for Labskin on products sold through this
platform.

 

 

·      Modern Water - Testing for COVID 19 and other pathogens in
communities:

o  Modern Water Mobile Services launching in Q1 2022 is a critical new
component in the armoury of national and provincial government response
protocol. It allows utilities to extend their reach into smaller sites for
more granular 'last mile' surveillance, enabling local authorities and private
companies to protect citizens and customers by monitoring for COVID and a
range of additional pathogens, including forever chemicals. Benefits include:

1.     Real-time detection of the virus in the community at source,

2.     Zero transport costs of non-virus confirmed samples, and

3.     Variant testing only on confirmed virus at the laboratory.

o  Microtox(®)PD equipment, with AI and pathogen detection systems being
deployed in multiple jurisdictions with data aggregated for real-time
detection in wastewater.

o  Microtox(®)BT equipment was re-designed to deliver a portable medical
device, mobile testing unit to process breath tests at point of care.
Regulatory approvals for human diagnostic equipment are evaluated on final
test equipment that will be used on humans. Therefore, roll out of the breath
test is subject to meeting the satisfactory requirements of EU Regulatory
approvals which will be carried out on the latest version of the Microtox® BT
units. Further information will be provided in a future update.

o  Collaboration with Microsaic Systems plc contributes portable real-time
sewage monitoring for "organics" such as drugs of abuse and active
pharmaceutical ingredients front line water analysis portfolio. Both companies
are engaged in a collaboration to deliver complete solutions, with a backbone
of analytics delivered to end users powered by AI techniques provided by the
Modern Water division.

·      Modern Water - equipment production and assembly:

o  The €2.7m project, with a €750,000 grant provided by Enterprise
Ireland is part of the assembly line for 200 miniaturised Microtox(®)PD units
per month, based in Ireland, with first assembly production units expected in
Q2 2022.

§  Multiplex chips are produced in Ireland,

§  Pathogen binding agents produced in the UK, and

§  Off the shelf electronic components supplied from Asia suppliers.

 

·      Bioluminescent Microtox(®) reagent has seen additional demand
with production increased to meet order backlog following investment for
laboratory equipment upgrade and additional staff in the Newcastle, Delaware,
US facilities.

 

·      Microtox(®) CTM, LX, FX, Microtrace equipment continues to be in
demand following recent CTM and FX installations in Beijing China, ahead of
the Winter Olympics, making this nine out of the last 10 Olympic Games
monitored for drinking water contamination by Modern Water's Microtox Toxicity
testing.

 

·      China Resources Environmental Technology negotiations continue.
Orders in China are increasing for Modern Water's multiple award-winning
equipment and reagent consumables with provincial and municipal governments.
Further information will be provided in a future update.

 

 

For further information please contact:

 

 DeepVerge plc                                   Gerard Brandon, CEO         +44 (0) 7340 055 648

 SPARK Advisory Partners Limited                 Neil Baldwin/Andrew Emmott  +44 (0) 113 370 8974

 (Nominated Adviser)

 Turner Pope Investments (TPI) Limited (Broker)  Andy Thacker/James Pope     +44 (0) 20 3657 0050

 

Market Abuse Regulation (MAR) Disclosure

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER
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ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED.  ON
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About DeepVerge plc (www.deepverge.com)

DeepVerge is an environmental and life science group of companies that
develops and applies AI and IoT technology to analytical instruments for the
analysis and identification of bacteria, virus and toxins. Utilising
artificial intelligent data analytics to scientifically prove the impact of
skincare product claims on skin microbiome for most of the top 20 global
cosmetic company clients and remotely detect and identify in real-time,
dangerous pathogens in wastewater treatment plants, drinking water, rivers,
lakes and reservoirs.

 

Labskin (Life Science Division)

Labskin is a 3D human skin equivalent test platform that scientifically proves
the impact of skincare product claims in healthcare, life sciences, skin
microbiome clinical trials, pharmaceutical and cosmetics industries. Labskin
have been pioneering the development of a laboratory grown human skin platform
for 15 years and is the only commercially available lab-grown full thickness
human skin model that naturally mimic the skins' microbiome. Labskin's virtual
clinical trials with remote collection of human volunteers' skin microbiome
provides a solution for the collection of volunteer microbiomes to allow for
lab-controlled trials of advanced skin models and human microbiomes. As the
data bank of remote volunteers grow, the higher the accuracy and increased
reliability of virtual product testing that can be provided to clients,
eliminating early human trial and error testing and resulting in a faster time
to market. The Labskin test platform and protocols help clients maintain an
optimum real-world environment, when testing their new ingredients and
existing products, that shows the positive or negative impact on skin's
natural microflora.

 

Skin Trust Club

Skin Trust Club incorporates an artificial intelligence Skincare App and Home
Test Kit that provide simple, at-home skin microbiome testing for personalised
skincare and skin health tracking. The self-administered skin swab is a remote
trial and allows the participant to conduct each stage of the trial without
interaction. Skin Trust Club's DNA Test generates a report that consumers can
use to manage their custom skincare regime. Analysis of skin attributes
provides information to create hundreds of different product combinations to
suit a person's unique skin microbiome.

 

Modern Water (Environmental Health Division)

Modern Water is a pioneering and innovative technology subsidiary, and over a
30 year period, with installations in more than 60 countries, this division
has built core expertise in the development of analytical instruments and
technology for monitoring toxicity in water, soil, food and industry. The core
systems use bioluminescent bacteria to perform biosensor testing that detects
the presence of toxic substances. New systems incorporate multiple pathogen
detection including SARS-CoV-2 in wastewater.

 

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