REG - hVIVO PLC - Trading update

hVIVOAnnouncement

26/07/2023 07:00

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RNS Number : 1733H  hVIVO PLC  26 July 2023

 

hVIVO plc

("hVIVO" or the "Group")

 

Trading Update

Strong first half performance and record orderbook

On track to deliver full year guidance and long-term sustainable growth

 

hVIVO plc (AIM & Euronext: HVO), the world leader in testing infectious
and respiratory disease products using human challenge clinical trials,
announces a trading update for the six-month period ended 30 June 2023.

 

Highlights

 

·    First half revenue growth of 52% to £27.3 million* (H1 2022: £18.0
million)

·    EBITDA margin c.19% (H1 2022: 12.7%)

·    Net cash of £31.3 million as at 30 June 2023 (H1 2022: £15.9
million)

·    Weighted contracted orderbook of £78 million as at 30 June 2023 (30
June 2022: c.£70 million) underpins venue visibility

·    Full year revenue and EBITDA remains in line with expectations

 

* The Group will now report revenue excluding other income, such as R&D
tax credits. Other income in H1 2023 was £1.4 million (H1 2022: £0.9
million).

 

Strong revenue and robust cash generation

 

The Group expects to report half year revenues of £27.3 million excluding
other income (H1 2022: £18.0 million), a 52% increase year-on-year. This
growth has been driven through the delivery of a higher number of human
challenge trials with continued increases in total contract value. In addition
to the revenue generated, the Group also recognised other income relating to
R&D tax credits of £1.4 million (H1 2022: £0.9 million). The improved
EBITDA margin of c.19% is a result of enhanced operational efficiencies and
concurrent execution of multiple larger trials. The Group continues to be
strongly cash generative with a cash position of £31.3 million as at 30 June
2023 (H1 2022: £15.9 million) following the payment of a £3.0 million
special dividend on 9 June 2023.

 

Growing orderbook

 

As at 30 June 2023, the Group's weighted contracted orderbook increased to
£78 million (H1 2022: £70 million), an increase of 11%, underlining the
continued growth in demand for human challenge trials from the global
biopharma industry. Importantly, the orderbook is diversified across multiple
clients, challenge agents and geographies, which provides a strong foundation
for long term revenue growth.

 

Full year outlook

 

hVIVO is fully contracted to achieve its revenue guidance for 2023 and the
Group has a record orderbook giving visibility of revenue into the second half
of 2024, which will allow the management team to effectively optimise its
resources, improve strategic decision making and enhance its adaptability and
flexibility in managing its revenue pipeline. This coupled with its track
record of excellent operational delivery provides a strong foundation for
future trading.

 

While there have been industry wide delays in UK clinical trial approvals by
the Medicines and Healthcare products Regulatory Authority (MHRA), the Board
does not currently expect the MHRA delays to have a material impact on
revenue. This delay in approvals has had some impact on new trials but the
Company is successfully working closely with both its clients and the MHRA to
ensure the timely delivery of studies and has implemented a contingency plan
to mitigate any potential impact.

 

Based on the current guided timeline for approvals and hVIVO's contingency
plans, the Company reaffirms its guidance of £53 million in revenue for 2023
and EBITDA margins in the mid to high teens. Revenue excludes £2 million of
other income, such as R&D tax credits.

 

Yamin 'Mo' Khan, Chief Executive Officer of hVIVO, said: "I am pleased to
announce another period of excellent growth for hVIVO, delivering strong
revenues, healthy EBITDA and continued cash generation. Since the end of June
our weighted contracted orderbook has increased even further following the
recent announcement of our new Influenza B human challenge model. This record
visibility of revenue well into the second half of 2024 provides a strong
basis for future trading, as well as additional flexibility and adaptability
to efficiently manage our pipeline.

 

"I take pride in what the team has achieved and admire their determination to
continue our growth path. It has also been pleasing to see a number of our
clients receive positive outcomes as a result of conducting challenge trials
with us. Coupled with our current track record of operational delivery, the
Board is confident that the Group will achieve its full year revenue and
EBITDA expectations."

 

Investor presentation

 

Yamin 'Mo' Khan, Chief Executive Officer, and Stephen Pinkerton, Chief
Financial Officer, will provide a live presentation via the Investor Meet
Company platform on 26 July 2023 at 18:00 BST.

 

The presentation is open to all existing and potential shareholders. Investors
can sign up to Investor Meet Company for free and add to meet hVIVO here
(https://www.investormeetcompany.com/open-orphan-plc/register-investor) .

 

 

For further information please contact:

 

 hVIVO plc                                       +44 (0) 20 7756 1300
 Yamin 'Mo' Khan, Chief Executive Officer

 Stephen Pinkerton, Chief Financial Officer

 Liberum Capital (Nominated Adviser and Joint Broker)                       +44 (0) 20 3100 2000
 Ben Cryer, Edward Mansfield, Phil Walker, Will King

 finnCap plc (Joint Broker)                                                +44 (0) 20 7220 0500
 Geoff Nash, Charlie Beeson (Corporate Finance)

 Nigel Birks, Harriet Ward (ECM)

 Davy (Euronext Growth Adviser and Joint Broker)                           +353 (0) 1 679 6363
 Anthony Farrell, Niall Gilchrist

 Walbrook PR (Financial PR & IR)                 +44 (0) 20 7933 8780 or hvivo@walbrookpr.com

 Stephanie Cuthbert / Phillip Marriage /         +44 (0) 7796 794 663 / +44 (0) 7867 984 082 /

Louis Ashe-Jepson
+44 (0) 7747 515 393

 

Notes to Editors

 

hVIVO plc (ticker: HVO) (formerly Open Orphan plc) is a rapidly growing
specialist contract research organisation (CRO) and the world leader in
testing infectious and respiratory disease vaccines and therapeutics using
human challenge clinical trials. The Group provides end-to-end early clinical
development services to its large, established and growing repeat client base,
which includes four of the top 10 largest global biopharma companies.

 

The Group's fast-growing services business includes a unique portfolio of 11
human challenge models, with a number of new models under development, to test
a broad range of infectious and respiratory disease products. The Company has
world class challenge agent manufacturing, specialist drug development and
clinical consultancy services via its Venn Life Sciences brand, and a lab
offering via its hLAB brand, which includes virology, immunology biomarker and
molecular testing. The Group offers additional clinical field trial services
such as patient recruitment and clinical trial site services.

 

hVIVO runs challenge studies in London from its Whitechapel quarantine clinic,
its state-of-the-art QMB clinic with its highly specialised on-site virology
and immunology laboratory, and its clinic in Plumbers Row. To recruit
volunteers / patients for its studies, the Company leverages its unique
clinical trial recruitment capability via its FluCamp (http://www.flucamp.com)
volunteer screening facilities in London and Manchester.

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