REG - Eco Animal Health Gp - Pre-close Trading Update

ECO Animal HealthAnnouncement

15/03/2022 07:00

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RNS Number : 7474E  Eco Animal Health Group PLC  15 March 2022

 

ECO Animal Health Group plc

(''ECO" or "the ECO Group") (AIM: EAH)

 

Pre-close Trading update

 

ECO Animal Health Group plc, a leader in the development, registration and
marketing of pharmaceutical products for global animal health markets provides
an unaudited trading update for the financial year ending 31 March 2022.

 

ECO commented in early January 2022 that China pork prices were volatile, and
producers remained cautious. Although these trading conditions have persisted
throughout the first quarter of 2022, ECO has continued to trade in line with
revised revenue and margin expectations.

 

Further encouraging progress has been made within the R&D portfolio and
investment was maintained at the budgeted rate, resulting in R&D cash
expenditure, including capitalisation, of about 13% of revenue in the full
year and a charge to the income statement of £8.7million.  This charge to
the income statement reflects some exciting early-stage technologies. This,
together with further investment in critical support functions, is expected to
result in EBITDA (for the year ending 31 March 2022) 15% to 20% below
consensus expectations.

 

Exposure to Russia and Ukraine

 

The ECO Group has no business in Ukraine. The annual revenue derived from
Russia has been less than £0.5m in each of the last three financial years.
The current receivables due from the ECO distributor in Russia are
approximately €430,000 and the Board continues to explore a number of
mechanisms to recover this debt.

 

Marc Loomes, CEO said:

"The pork commodity price in China continues to be volatile but we are pleased
with recent trading and our expectation of meeting revenue consensus is an
important indicator of a return to more stable trading conditions. We have
kept investment on critical organisation development and strategic R&D at
our planned levels despite the reduced revenues from China. This decision is
beginning to bear fruit and we look forward with excitement to the
announcement of new regulatory approvals."

 

"We hope for a speedy resolution to the conflict in Ukraine and stay ready to
support our business partners in Eastern Europe in any way we can."

 

The information contained within this announcement is deemed by the Group to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ("MAR") as it forms part of United Kingdom domestic law by
virtue of the European Union (Withdrawal) Act 2018. Upon the publication of
this announcement via a Regulatory Information Service ("RIS"), this inside
information is now considered to be in the public domain.

 

Contacts:

                                                                020 8447 8899

 ECO Animal Health Group plc

 Marc Loomes (CEO)

 Chris Wilks (FD)

 IFC Advisory                                                   020 3934 6630

 Graham Herring

 Zach Cohen

 Singer Capital Markets (Nominated Adviser & Joint Broker)      020 7496 3000

 Mark Taylor

 George Tzimas

 Investec (Joint Broker)                                        020 7597 5970

 Gary Clarence

 Alex Penney

 Carlo Spingardi

                                                                020 7418 8900

 Peel Hunt LLP (Joint Broker)

 Dr Christopher Golden

 James Steel

 

 Equity Developments  020 7065 2692

 Hannah Crowe

 Matt Evans

 

 

About ECO Animal Health

ECO Animal Health Group plc ("ECO" or "the "GROUP") researches, develops and
commercialises products for livestock. Our business strategy is to generate
shareholder value by achieving the maximum sales potential from the existing
product portfolio whilst investing in Research and Development ("R&D") for
new products, particularly vaccines, and seeking to in-license new products.

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