REG - Inspiration Health - Trading update

Inspiration HealthcareAnnouncement

31/08/2023 07:00

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RNS Number : 8719K  Inspiration Healthcare Group PLC  31 August 2023

 

The information contained within this announcement is deemed by the Company to
constitute inside information stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as amended by the Market Abuse (Amendment) (EU Exit)
Regulations 2019. Upon the publication of this announcement via the Regulatory
Information Service, this inside information is now considered to be in the
public domain.

 

 

Inspiration Healthcare Group plc

("Inspiration Healthcare", the "Company" or the "Group")

 

Trading Update

 

Inspiration Healthcare Group plc (AIM: IHC), the global medical technology
company pioneering best-in class, specialist neonatal intensive care medical
devices, provides a trading update for the six months ended 31 July 2023.

 

Revenues for the period were £20.4 million, broadly in line with the £20.5
million reported for the same period last year. Within this, revenues for
Neonatal products including service grew by 4% to £16.1 million, driven by
sales of the Group's flagship product, the SLE6000 ventilator. This growth is
despite unexpected delays to regulatory approval for certain new distributed
products. These products were anticipated to replace products withdrawn from
the market that contributed £1.0m to revenue in the prior period. On a
like-for-like basis, Neonatal revenues grew by 11% in the period.

 

Growth was also hindered by the Infusion products where revenues declined by
14% to £4.3 million as a result of de-stocking by a leading customer.
Infusion revenues, excluding this customer, grew by 18% as underlying customer
demand remained strong.

 

Gross margin improved in the period and is expected to be over 48%,
representing a significant increase on the 44% delivered for the financial
year ended 31 January 2023. This improvement has been driven by a focus on
core growth neonatal products which yield higher margins.

 

Net debt (excluding IFRS16 lease liabilities) improved to £2.1 million as at
31 July, a £1.7 million reduction from the position at 31 January 2023. This
was achieved as a result of strong operating cash generation of £2.9 million
for the period.

 

As we continue to navigate our way through the transition to the new Medical
Device Regulations in Europe, we are seeing some changes in our product mix,
and we are using this opportunity to focus on the products with higher margins
and the best long-term growth opportunities.  Despite challenging market
conditions, we continue to expect to deliver revenue growth for the year as a
whole with gross margins at around the level achieved in the first half. This
is expected to result in EBITDA margins showing a significant year on year
improvement. Operating cash generation is also forecast to remain strong for
the second half.

 

Neil Campbell, CEO of Inspiration Healthcare, commented: "Whilst disappointed
in first half revenues, we are reporting margins returning towards our
expected levels and improved cash generation, which have combined to reduce
net debt and put the Group in a stronger financial position. We are focussed
on reshaping the business and are confident in returning to growth in the
second half."

 

The Group will be announcing interim results for the six months ended 31 July
2023 on Tuesday, 3 October 2023.

 

 

 Inspiration Healthcare Group plc                                                Tel: +44 (0)330
                                                 175 0000
 Neil Campbell, Chief Executive Officer

 Alan Olby, Chief Financial Officer

 Liberum (Nominated Adviser & Broker)                                            Tel: +44 (0)20
                                                 3100 2000
 Phil Walker

 Richard Lindley

 Walbrook PR Ltd (Media and Investor Relations)  Tel: +44 (0)20 7933 8780 or inspirationhealthcare@walbrookpr.com
 Anna Dunphy                                     Mob: +44 (0) 7876 741 001
 Stephanie Cuthbert                              Mob: +44 (0) 7796 794 663
 Louis Ashe-Jepson                               Mob: +44 (0) 7747 515 393

 

 

About Inspiration Healthcare

Inspiration Healthcare (AIM: IHC) is a global provider of medical technology
for use in neonatal intensive care & operating theatres. The Company
provides high quality innovative products to patients around the world which
help to improve patient outcomes and it actively invests in innovative product
opportunities and disruptive technologies.

 

The Company has key own brand products that can be used within the first days
of life to help premature and sick babies; helping resuscitation and
stabilisation in the first moments of life through to preventing brain damage
and both invasive and non-invasive respiratory support in terms of capital
equipment and disposable medical devices. Additionally, the Company has its
own range of products for maintaining normothermia pre, during and
post-surgery.

 

Since September 2019, the Company has acquired Vio Holdings a designer,
manufacturer and supplier of single use respiratory products and sterile
medical consumables and S.L.E., a leading designer, manufacturer and global
provider of neonatal ventilation products.  The Group generates approximately
58% of its revenues from export markets and more than half of its revenues
come from its own-branded products.

 

With product availability actively promoted to over 80 countries through a
distribution network, Inspiration Healthcare's success has been built on
continuous innovation, excellent customer service and an inherent commitment
to improving patient outcomes, working in close collaboration with key opinion
leaders across the globe.

 

In the UK and Ireland, the Group has direct sales teams selling Group Branded
and complementary products from third parties, with an additional range of
home healthcare products.  This is supported by Technical Support for planned
preventative maintenance and emergency assistance.

 

The Group operates from various sites in the UK for R&D, Marketing and
operations with manufacturing based in Croydon (south London) and Hailsham
(East Sussex).  The Group's Head Office is located in Crawley, a short
distance from London's Gatwick Airport.

 

Further information on Inspiration Healthcare can be found at
www.inspirationhealthcaregroup.com (http://www.inspirationhealthcaregroup.com)

 

 

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