REG - Oxford Biomedica PLC - Preliminary results for the year ended 31 Dec 2024
09/04/2025 07:00
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RNS Number : 2819E Oxford Biomedica PLC 09 April 2025
Preliminary results for the year ended 31 December 2024
~ Strong commercial momentum underpins transformative financial performance ~
● Strong 2024 financial performance in line with guidance
- Revenue growth of 44% to £128.8 million compared to 2023, organic revenue
growth of 81%(1)
- Operating EBITDA(2) loss of £(15.3) million for the full year in line
with expectations, Operating EBITDA profit of £5.0 million achieved in second
half of 2024
● Contracted value of client orders(3) signed during 2024 reached
approximately £186 million at 31 December 2024, an increase of c.35% compared
to £138 million in 2023(4), reflecting strong commercial momentum with client
base
● Increased demand in all vector segments including momentum in
AAV client work, demonstrating successful diversification across viral vector
platforms. Lentiviral vector development and manufacturing capabilities now
expanded beyond UK into US and France
● Financial guidance reaffirmed; Revenue CAGR of more than 35% for
2023-2026 and pivot to profitability in FY 2025
Oxford, UK - 9 April 2025: OXB (LSE: OXB), a global quality and
innovation-led cell and gene therapy CDMO, today announces preliminary results
for the year ended 31 December 2024.
Dr. Frank Mathias, Chief Executive Officer of OXB, commented:
"2024 was a year of strong commercial progress for OXB as we executed our
multi-vector, multi-site strategy as a pure-play CDMO. With revenue growth of
44%, organic revenue growth of 81% and an operating EBITDA profit in the
second half of 2024, we have demonstrated effective execution against our
objectives.
"The acquisition of ABL Europe (renamed OXB France) has expanded our EU
operations, adding specialised expertise and manufacturing capacity. With
lentiviral vector development and manufacturing capabilities now available
across all our sites, including the US and France, we have created a
comprehensive global platform.
"Our client portfolio continues to expand and diversify, now including over 45
programmes with a well-balanced mix across all geographies, development stages
and key viral vector platforms. The contracted value of client orders
represents an increase of 35% compared to 2023, reflecting growing demand for
our services across all key viral vector types.
"With our strong commercial momentum and the successful execution of our
strategy, we are on track to achieve significant revenue growth consistent
with our medium-term guidance and well above industry levels. Through
continued focus on efficiency and a disciplined approach to our cost base, we
also expect to achieve operating EBITDA profitability for FY 2025."
SUMMARY FINANCIAL PERFORMANCE
£'m 2024 2023 change
Revenue 128.8 89.5 44%
Manufacturing services 68.4 51.0 34%
Development services 47.3 31.8 49%
Procurement services 5.8 - n/a
Licences, milestones and royalties 7.3 6.7 9%
Cost of Sales (75.8) (49.8) 52%
Gross Margin 53.0 39.7 33%
Operating EBITDA(1) (15.3) (52.8) 71%
FINANCIAL HIGHLIGHTS
● Total revenues reached £128.8 million, representing a 44% increase
compared with 2023 (£89.5 million) and an 81% organic growth rate. Organic
growth excludes the impact of the acquisition of ABL Europe SAS (OXB France)
and the loss of revenues from Homology Medicines, Inc.
● Revenue growth driven by:
- Increase in lentiviral vector manufacturing of GMP batches for clinical
clients and for clients in preparation for commercial launch
- Clients moving further along their clinical development pathways including
an increase in development revenues from process characterisation and
validation work
- Procurement and Storage services to provide stability of supply of raw
materials.
● Significant improvement in Operating EBITDA loss to £(15.3) million
(2023: £(52.8) million), which narrowed by £37.5 million.
- Achieved £5.0 million operating EBITDA profit in the second half of 2024
at Group level.
● Operating loss of £(39.4) million also represented a significant
narrowing compared with 2023 (£(184.2) million) due to a combination of
increased revenues and a positive impact of the 2023 reorganisation lowering
the overall cost base and the non repeat of the 2023 impairment.
● Acquisition of ABL Europe SAS (OXB France) from Institut Mérieux for
a fair value consideration of €6.6 million (£5.7 million).
● Cash burn of £68.2 million in 2024 (2023: £39.1 million) arising
principally from operating loss and the increased activity in the second half
of 2024 resulting in a higher balance of Contract Assets and Trade Receivables
which are not yet due as at the year end, offset by the cash inflow of £17.5
million as a result of the investments by Institut Mérieux.
● Cash at 31 December 2024 was £60.7 million (31 December 2023:
£103.7 million); Net cash was £20.6 million (31 December 2023: £65.2
million).
● In 2024 OXB increased its ownership of OXB US LLC by 10%, from 80% to
90%. This followed the conversion of an existing working capital loan and a
capital injection into OXB US LLC, on 26 June 2024. On 1 March 2025, OXB US
Inc exercised the call option for the purchase of the remaining 10% of OXB US
LLC from Q32 Bio, Inc (which had merged with Homology Medicines, Inc). The
transfer of Q32's remaining 10% holding in OXB US LLC to OXB US Inc is in the
process of being finalised.
BOARD UPDATE
● After nine years of service as an Independent Non-Executive Director,
Audit Committee Chair and most recently as Vice Chair, Stuart Henderson has
informed the Board that he intends to retire from the Board. As such, Mr.
Henderson will not seek re-election at the 2025 Annual General Meeting. Mr.
Henderson's intention to retire is driven by the Corporate Governance Code
provision that service of nine years or more may impair independence of a
Director. The Board thanks Mr. Henderson for his impeccable service, loyalty
and defining contributions to OXB's strategic progress throughout his tenure.
- Colin Bond, who joined the Board as an Independent Non-Executive Director
in January 2025, will succeed Mr. Henderson as Audit Committee Chair. Mr. Bond
brings substantial financial expertise to this role from his career as Chief
Financial Officer of Sandoz and from senior finance positions at multiple
global pharmaceutical and life sciences companies. His extensive experience
chairing Audit Committees for public companies positions him well for this
role.
- To ensure a seamless transition and support continuity, Mr. Henderson will
remain available to assist Mr. Bond and the Audit
Committee.
OUTLOOK AND FINANCIAL GUIDANCE
● Medium-term guidance: Continue to target three-year revenue CAGR of
more than 35% for 2023-2026 and Operating EBITDA margins of approximately 20%
by the end of 2026.
● For 2025, revenues are expected to be between £160 million and
£170 million, consistent with medium-term revenue guidance. This is expected
to be second half-weighted, consistent with prior years.
● Operating EBITDA profitability is expected for 2025, with a low
single digit £ million Operating EBITDA profit.
● Guidance excludes the impact of FX fluctuations.
Analyst briefing
OXB's management team, led by Dr. Frank Mathias, CEO, Dr. Lucinda Crabtree,
CFO and Dr. Sebastien Ribault, CBO will be hosting a briefing and Q&A
session for analysts at 13:00 BST / 8:00 EST today, 9 April 2025, at RBC
Capital Markets, 100 Bishopsgate, London, EC2N 4AA, United Kingdom.
A live webcast of the presentation will be available via this link
(https://brrmedia.news/OXB_FY_24) . The presentation will be available on
OXB's website at www.oxb.com (http://www.oxb.com) .
If you would like to dial in to the call and ask a question during the live
Q&A, please email OXB@icrhealthcare.com
1 Organic growth excludes the impact of the acquisition of ABL Europe SAS
(OXB France) and the loss of revenues from Homology Medicines, Inc.
2 Operating EBITDA (Earnings Before Interest, Tax, Depreciation,
Amortisation, Impairment, revaluation of investments and assets at fair value
through profit and loss, and share based payments). A reconciliation to GAAP
measures is provided on page 16
3 Contracted value of client orders represent the value of customer orders
for which the customer has signed a financial commitment, whereby any changes
to agreed values will be subject to either change orders, cancellation fees or
the triggering of optional/contingent contractual clauses
4 Includes contributions from milestones, licensing and royalties
Notes
Unless otherwise defined, terms used in this announcement shall have the same
meaning as those used in the Annual report and accounts.
Enquiries:
OXB:
Sophia Bolhassan, Head of Investor Relations T: +44 (0) 1865 509 737 / E: ir@oxb.com
ICR Healthcare: T: +44 (0)20 3709 5700 / E: oxb@icrhealthcare.com
Mary-Jane Elliott
Angela Gray
Davide Salvi
RBC Capital Markets (Joint Corporate Broker) T: +44 (0)20 7653 4000
Rupert Walford
Kathryn Deegan
Jefferies (Joint Corporate Broker) T: +44 (0)20 7029 8000
Sam Barnett
Gil Bar Nauham
About OXB
OXB (LSE: OXB) is a global quality and innovation-led contract development and
manufacturing organisation (CDMO) in cell and gene therapy with a mission to
enable its clients to deliver life changing therapies to patients around the
world.
One of the original pioneers in cell and gene therapy, OXB has 30 years of
experience in viral vectors; the driving force behind the majority of cell and
gene therapies. OXB collaborates with some of the world's most innovative
pharmaceutical and biotechnology companies, providing viral vector development
and manufacturing expertise in lentivirus, adeno-associated virus (AAV),
adenovirus and other viral vector types. OXB's world-class capabilities range
from early-stage development to commercialisation. These capabilities are
supported by robust quality-assurance systems, analytical methods and depth of
regulatory expertise.
OXB offers a vast number of unique technologies for viral vector
manufacturing, including a 4th generation lentiviral vector system (the
TetraVecta™ system), a dual-plasmid system for AAV production, suspension
and perfusion process using process enhancers and stable producer and
packaging cell lines.
OXB, a FTSE4Good constituent, is headquartered in Oxford, UK. It has
development and manufacturing facilities across Oxfordshire, UK, Lyon and
Strasbourg, France and Bedford MA, US. Learn more at www.oxb.com, and follow
us on LinkedIn and YouTube.
Chair's Statement
A year of successful delivery following our transformation
2024 was an important year for OXB as we executed our multi-vector, multi-site
strategy as a pure-play CDMO which enabled us to deliver excellent financial,
commercial and operational progress. Following our successful reorganisation
and associated reduction in our cost base, OXB is transitioning towards long
term, sustainable profitability as a newly transformed business. With revenue
growth of 44% and the delivery of operating EBITDA profitability for the
second half of 2024, we have demonstrated effective execution against our
objectives. In the year, we have continued to work on strengthening our
position across our global network of sites. This included securing a growing
number of new clients in the US as well as enabling lentiviral vector
development and manufacturing capabilities in the US and France. Market demand
for OXB's specialised services and expertise accelerated in 2024, with an
increase of approximately 35% in contracted client orders, driven by a
well-balanced portfolio of client programmes spanning all stages of
development.
Opportunity to grow in an expanding market
Our successful execution comes at an optimal time, as the cell and gene
therapy sector is expected to grow at an average compound annual growth rate
(CAGR) of approximately 20% from 2025 through to the end of 2030 (GlobalData
and company estimates) and this market momentum shows no signs of slowing.
This is evidenced by a 32% increase in FDA-approved cell and gene therapy
products in 2024 vs. 2023 (www.fda.gov), sustained pipeline development across
multiple therapeutic areas and the number of viral vector based cell and gene
clinical trials having grown by 25% over the past two years (ARM and
GlobalData), with AAV a key growth driver.
A transformed pure-play CDMO in cell and gene therapy
We have made a number of important strategic decisions throughout the year,
guided by our vision to transform lives through cell and gene therapy. With
the acquisition of ABL Europe SAS, renamed Oxford Biomedica (France) SAS (OXB
France) in January 2024, we expanded OXB's operational footprint, further
strengthening our position as a global pure-play cell and gene therapy CDMO.
Alongside this, we continue to successfully implement our "One OXB" strategy,
creating a comprehensive multi-vector, multi-site network spanning the UK, the
US and the EU. Lentiviral vector development and manufacturing capabilities
have now been extended beyond the UK, to the US and France.
Our global integrated network provides our clients with access to our
best-in-class platform technologies and global capabilities across all three
geographies. To reflect this evolution, we rebranded as OXB, establishing a
stronger, more recognisable brand identity and building on our established
world leadership in lentiviral vectors. In addition, we have continued to
advance our cutting-edge vector platforms and technologies, with a focus on
client-centric innovation that ensures our developments directly address our
clients' needs while ultimately benefiting patients.
Developments in 2024 include the launch of our inAAVate™ platform for
improved AAV production, the continued roll-out of U1 additive technologies in
GMP manufacturing that enhance viral vector yield and quality and the rollout
of automated testing systems that increase both precision and efficiency. We
maintain our focus on client-centric excellence with the goal of being the
global partner of choice for pharmaceutical and biotech clients.
Governance, sustainability and ethical leadership
We made several key appointments to our Board and Corporate Executive Team
(CET) during 2024, in line with our new strategy. Dr. Lucinda (Lucy) Crabtree
joined as Chief Financial Officer (CFO) and Board member in September,
bringing valuable biopharmaceutical and investment industry experience. This
was followed by Stuart Paynter's departure after seven years of dedicated
service and significant contribution to OXB's strategic progress as CFO. We
further strengthened our Board's CDMO expertise through the appointments of
Peter Soelkner, CEO of Vetter Pharma in March 2024, as well as Colin Bond,
former CFO of Sandoz, as a Board member in January 2025. We also strengthened
our shareholder representation with the appointment of
Laurence Espinasse representing Institut Mérieux, now our second largest
shareholder.
Having played a role in shaping OXB's strategy, Dr. Michael Hayden
and Catherine Moukheibir stepped down from the Board at the Annual General
Meeting (AGM) in June 2024. Leone Patterson also stepped down from the Board
on 31 December 2024 to focus on her new responsibilities as Chief Business and
Financial Officer of Zymeworks. After nine years of service as an Independent
Non-Executive Director, Audit Committee Chair and most recently as Vice Chair,
Stuart Henderson has informed the Board that he intends to retire from the
Board. As such, Mr. Henderson will not seek re-election at the 2025 AGM. We
thank Michael, Catherine, Leone and Stuart for their impeccable service and
defining contribution to the business.
Colin Bond will succeed Mr. Henderson as Audit Committee Chair. His extensive
experience chairing Audit Committees for public companies positions him well
for this role. To ensure a seamless transition and support continuity, Mr.
Henderson will remain available to assist Mr. Bond and the Audit Committee.
We have also implemented a new robust governance framework through our
Environment, Social, Governance and Risk (ESGR) Committee. The new structure
comprises an ESGR Committee at the Group level reporting to the CET and the
Board, alongside site-level ESGR Committees, ensuring strong governance is
integrated with the risk management framework and aligned with our corporate
sustainability goals. OXB remains dedicated to ethical and socially
responsible operations and as part of the Group's strategic reset as a
pure-play CDMO, we have also revised our sustainability reporting framework.
The new structure consolidates sustainability activities under Environment,
Social and Governance priorities, creating greater transparency and clarity.
Looking ahead
As we look ahead to 2025 and beyond, the Board and I are confident in our
position as a pure-play cell and gene therapy CDMO. At a time of significant
growth in the cell and gene therapy market, our capabilities and 30 years of
expertise perfectly position us to capture this opportunity. We are meeting
our stated financial and operational goals and will continue to focus on
increasing revenue opportunities in the US and France, including leveraging
our new ability to offer lentiviral development and manufacturing capabilities
from all our global sites.
The foundations we have cemented in 2024 - operational excellence, an
exceptional team, strategic client relationships and technological innovation
- provide a robust platform for continuing to scale our business and creating
long term value for all stakeholders. I extend my gratitude to our clients for
their ongoing trust, our shareholders for their support and our OXB colleagues
for their impressive delivery and ability to shape change as we continue to
lead the cell and gene therapy CDMO field as a trusted partner with unmatched
quality and innovation.
Dr. Roch Doliveux
Chair
Chief Executive Officer's statement
Building on three decades of innovation and expertise in viral vector
development, our "One OXB" strategy has established a clear trajectory towards
our revenue growth and profitability targets. The strong commercial momentum
achieved this year, including our growing order book and our deepening reach
and relevance to clients with the "One OXB" transformation, underpins our
confidence in delivering both attractive growth and sustainable profitability.
Enabling clients to deliver life-changing cell and gene therapies
OXB's client portfolio features a well-balanced mix of client programmes
spanning all stages of development, from early stage projects to late stage
commercial readiness and commercial manufacturing. Demand for OXB's
specialised services and expertise across all vector segments remained strong
in 2024, with new clients including several established biotech companies.
Looking ahead, the Group's pipeline of potential revenue opportunities has
also grown significantly, increasing by 30% from $438 million at the start of
the year to $570 million at the end of 2024. OXB tracks its revenue pipeline
through a structured internal process, providing clear visibility on future
opportunities. Clients transitioning from early stage manufacturing to late
stage and commercial activities have moved from a batch reservation model to a
binding forecast model, providing increased revenue visibility for late stage
client programmes.
The acquisition of ABL Europe SAS (OXB France) in January 2024 has enhanced
OXB's ability to meet growing demand across the EU by bringing additional GMP
manufacturing facilities and expertise in France to the Group. Since then, we
have successfully enabled lentiviral vector development and manufacturing
capabilities at our sites in France, complementing the offering of our
facilities in the UK and US. The alignment of operations across the UK, the US
and France is increasing efficiency and agility, allowing OXB to optimise its
capabilities and capacity.
Portfolio of client programmes diversified across region and vector type
In 2024, the Group maintained strong commercial momentum, as reflected in its
growing order book. The contracted value of client orders signed during 2024
reached approximately £186 million at 31 December 2024, an increase of
approximately 35% compared to £138 million in 2023. This included momentum
in AAV client work, with the number of contracts signed for AAV now almost as
high as lentiviral vectors. Lentiviral vector orders included commercial
orders, including engaging OXB to procure raw materials to de-risk supply as
well as securing GMP suite capacity. Orders also included additional batches
for late stage programmes with clients preparing for commercialisation of
their CAR-T products. Orders for other viral vectors (excluding lentiviral
vectors and AAV) have grown and now represent approximately one-third of the
number of new contracts. These orders validate OXB's strong commercial
positioning and provide increased revenue visibility.
Client programmes in the US and France now account for more than half of OXB's
client programmes (by number of programmes), validating our transition to a
global model. While lentiviral vectors remain the majority of clinical-stage
and commercial programmes in our portfolio, the number of projects for AAV and
other vector types is growing, with earlier stage projects providing the
foundation for future growth.
Client programmes by stage
April 2024(1) April 2025(2)
35 clients 40 clients
51 client programmes 48 client programmes
Pre-clinical through to early stage clinical 46 42
Late stage clinical 3 4
Commercial agreements 2 2
1 As per the FY 2023 results release
2 As of this results release (includes post-period events)
Innovation: advancing vector platforms and technologies
The Group focuses on client-centric innovation to address the complex
challenges of cell and gene therapy development and manufacturing.
At the start of 2024, the Group launched the inAAVate™ platform, which
offers a proprietary 'plug and play' Dual-Plasmid system for transient
transfection, alongside a standard triple transfection system for AAV-based
gene therapies. The inAAVate™ platform has demonstrated cell culture titre
exceeding 1E15 vg/L for multiple serotypes across multiple genomes and has
delivered a significant increase in AAV vector productivity and quality with
>50% full capsids in the bioreactor and >90% full capsids in the final
drug substance. The Dual-Plasmid system, combined with the Group's proprietary
transfection process has been successfully scaled up to 2,000L with multiple
GMP runs at 500L scale. This high-quality platform delivers industry-leading
productivity, supporting successful AAV product development.
The Group also developed an internal AAV production cell line. Initial
evaluations with multiple capsids indicate strong potential for high
productivity and optimised empty-to-full ratios. This cell line is now in
scale-up stage and will be available in 2025 for client evaluation. In
addition, OXB developed and optimised a robust enrichment process that
produces more than 90% full capsids across multiple serotypes and genes of
interest. This allows the Group to expedite its clients' products to the
clinic, including novel and engineered capsids, without the need for process
development.
OXB has developed multiple innovations that improve the productivity and
quality of lentiviral vectors. It has launched refined lentiviral vectors both
across its 3rd generation and TetraVecta(TM) platforms, which has led to a two
to three fold increase in titre. OXB's U1 enhancer is also available on these
genome plasmids as an option for clients, saving GMP costs for U1 plasmids.
The Group has made significant progress in improving impurity removal,
particularly DNA clearance, while enhancing process recoveries. These will be
scaled up in 2025 and made available to OXB's clients. As expected, GMP
production with the I3A additive which increases both lentiviral particle
yield and potency, will begin in the second half of 2025.
The Group believes that automation is key to further improving productivity
and has therefore developed and implemented automated assays for processes
such as PCR, tissue culture and plate-based assays. This approach enhances
both the efficiency and rigour of analytical workflows, allowing OXB to
release products to clients faster while maintaining robust quality and safety
standards.
In addition, new assays have been developed to rapidly identify optimal
production parameters including timing, plasmid concentrations, additives and
harvest times - to maximise the vector potency for target cell types.
Furthermore, the Group has introduced mass spectrometry to enable deep
proteomic profiling of cellular and vector products ultimately accelerating
the development and commercialisation of transformative therapies
Delivering "One OXB" and commitment to quality
2024 represented the first full year of our transformation. During the year,
the Group made significant progress executing its "One OXB" strategy which
provides a multi-vector, multi-site offering to its clients. The
transformation and integration workstreams that were planned to be completed
in 2024 were all successfully finalised and transferred to business functions
in 2024. The remaining initiatives are on track for completion by the end of
2025 as planned, providing a unified global operation focused on
client-centric excellence.
In 2024, the Group harmonised project management practices across the UK, US
and France, delivering consistent client experiences and enabling the seamless
execution of global projects. OXB also transitioned towards coordinated capex
prioritisation, enabling an integrated global approach in place of a
site-specific approach. Operationally, lentiviral vector capabilities were
expanded to the Bedford MA, US site and OXB's sites in France. An accelerated
product introduction process was implemented speeding up transition from
clinical stages to GMP manufacturing for clients. Following the successful
implementation in the UK and US, the Sales and Operations Planning process was
rolled out to our sites in France to optimise project allocation based on
delivery requirements and business impact.
In July 2024, the FDA carried out a routine GMP inspection at two out of our
four manufacturing sites in Oxford, UK, with zero written observations (i.e.:
no FDA 483 observations) and few verbal observations. This outcome is a
testament to our robust quality management systems (QMS), high-performing
delivery and quality teams and our overall commitment to manufacturing
products to the highest possible standards.
Building an organisation for success
The Group further strengthened its Corporate Executive Team (CET) during 2024
to support its continued growth as a global cell and gene therapy CDMO. Dr.
Lucinda (Lucy) Crabtree joined as Chief Financial Officer and Board member in
September 2024, bringing extensive experience in the biopharmaceutical and
investment sectors. In addition, Dr. Sabine Sydow was promoted to Chief of
Staff in April 2024, leveraging her deep industry expertise. The Group also
added experienced CDMO site leaders to support the CET in a move to reflect
its multi-vector, multi-site strategy: Mark Caswell as Site Head of UK
Operations, Stéphanie Colloud as Site Head and General Manager of France
Operations and John Maravich as Site Head of US Operations.
In January, OXB acquired ABL Europe SAS (OXB France) from Institut Mérieux
for a fair value consideration of €6.6 million (£5.7 million), adding
over 1,800m(2) of GMP manufacturing facilities in Lyon and Strasbourg. The
acquisition brought over 100 CDMO experts and expanded the Group's EU presence
and expertise in process and analytical development, GMP and early stage
manufacturing. This strategic move strengthens OXB's position as a leading
cell and gene therapy CDMO while enhancing its ability to serve EU clients and
meet growing demand for viral vector manufacturing services across Europe.
In September, the Group announced the launch of its new corporate brand
identity and rebranding to OXB, unveiling a more modern and recognisable
visual identity. In conjunction with the rebrand a revised set of corporate
values was also launched, aligned to OXB's mission and vision. Centred on
being responsible, responsive, resilient and respectful, these values support
OXB's mission to enable our clients to deliver life-changing therapies to
patients globally, while advancing our vision of transforming lives through
innovative cell and gene therapy solutions.
Outlook
The Group saw growing momentum through the year and successfully delivered
positive EBITDA profitability in the second half of the year. With the UK
business already profitable on an EBITDA level we will continue to work
towards sustainable profitability across all our sites. Building on our
operational excellence and strong market demand, growing revenue opportunities
across our global client portfolio is a key priority.
Our 2025 objectives sit across three pillars, namely: One OXB (increasing
employee engagement and increasing our Group-wide decarbonisation efforts),
Client-Centric Excellence (ensuring on-time and on-quality delivery) and
Financials (maintaining our projected revenue growth and achieving EBITDA
profitability.) With strong commercial momentum, growing client demand and the
successful implementation of the "One OXB" strategy, the Group is on track to
achieve significant revenue growth and operating EBITDA profitability in 2025.
Dr. Frank Mathias
Chief Executive Officer
Financial Review
In 2024, OXB successfully delivered strong topline growth, with revenues
increasing by 44%, as the Group executed its strategy as a pure-play cell and
gene therapy CDMO. This topline growth, combined with a streamlined cost base
enabled the Group to significantly improve its Operating EBITDA position
compared to 2023. OXB has entered 2025 in a position of strength and is
well-placed to deliver both attractive growth and sustainable profitability.
Selected highlights of the Group's financial results are as follows:
● Total revenues reached £128.8 million representing a 44% (45%
(1)CC) increase compared with 2023 (£89.5 million) and an 81%(2) organic
growth rate. Organic growth excludes the impact of the acquisition of ABL
Europe SAS (OXB France) and the loss of revenues from Homology Medicines, Inc.
● This strong revenue growth was driven by:
- Increase in lentiviral vector manufacturing of GMP batches for clinical
clients and for clients in preparation for commercial launch
- Clients moving further along their clinical development pathways including
an increase in development revenues from process characterisation and
validation work
- Procurement and Storage services to provide stability of supply of raw
materials
- Complemented by new contributions from OXB France (£11.5 million) on
an inorganic basis.
● Significant improvement in Operating EBITDA(3) loss to £(15.3) million
(2023: £(52.8) million), which narrowed by £37.5 million.
- Achieved £5.0 million operating EBITDA profit in the second half of 2024
at Group level.
● Operating loss of £(39.4) million (including operating loss from OXB
(France) (£11.8 million) also represented a significant narrowing compared
with 2023 (£(184.2) million) due to a combination of increased revenues and a
positive impact of the 2023 reorganisation lowering the overall cost base. The
2023 operating loss was also negatively impacted by an impairment of the US
business of £99.3 million.
● Acquisition of ABL Europe SAS (OXB France) from Institut Mérieux
for a fair value consideration of €6.6 million (£5.7 million) by means of a
share-for-share exchange increasing net assets of the Group by £7.4 million
and giving rise to a bargain purchase gain of £1.7 million.
● Cash burn(4) of £68.2 million in 2024 (2023: £39.1 million) arising
principally from operating loss and the increased activity in the second half
of 2024 resulting in a higher balance of Contract Assets and Trade Receivables
which are not yet due as at the year end, offset by the cash inflow of £17.5
million as a result of the investments by Institut Mérieux.
● Cash at 31 December 2024 was £60.7 million (2023: £103.7
million); net cash at 31 December 2024 was £20.6 million (2023: £65.2
million).
● Expansion of OXB's lentiviral development and manufacturing
capabilities to its US and France sites completed, establishing a fully
operational multi-site platform that will support geographic diversification
of revenue streams going forward. This strategic expansion is now generating
revenue momentum across all three key regions.
● In 2024 OXB increased its ownership of OXB US LLC by 10%, from 80% to
90%. This followed the conversion of an existing working capital loan and a
capital injection into OXB US LLC, on 26 June 2024. On 1 March 2025, OXB US
Inc exercised the call option for the purchase of the remaining 10% of OXB US
LLC from Q32 Bio, Inc. (Q32). At the date of this report, the transfer of
Q32's remaining 10% holding in OXB US to OXB US Inc is in the process of being
finalised.
1 CC refers to Constant Currency, which refers to the equivalent growth
based on the prior year exchange rates.
2 Comparative revenues adjusted for the non-recurrence of 2023 revenues
in the US from Homology in the US (£23.2 million) and the impact of the
acquisition of ABL Europe SAS (OXB France).
3 Operating EBITDA (Earnings Before Interest, Tax, Depreciation,
Amortisation, Impairment, revaluation of investments and assets at fair value
through profit and loss and share based payments) is a non-GAAP measure often
used as a surrogate for operational cash flow as it excludes from operating
profit or loss all non-cash items, including the charge for share based
payments. However, deferred bonus share option charges are not added back to
operating profits in the determination of Operating EBITDA as they may be paid
in cash upon the instruction of the Remuneration Committee. A reconciliation
to GAAP measures is provided on page 16.
4 Cash (burn)/accretion is net cash generated from operations plus net
interest paid plus capital expenditure. A reconciliation to GAAP measures is
provided on page 17.
( )
( )
Key Financial and Non-Financial Performance Indicators
The Group evaluates its performance inter alia by making use of alternative
performance measures as part of its Key Financial and Non-Financial
Performance Indicators as disclosed in the table below. The Group believes
that these Non-GAAP measures, together with the relevant GAAP measures,
provide a comprehensive, accurate reflection of the Group's performance over
time. The Board has taken the decision that the Key Financial Performance
Indicators against which the business will be assessed are Revenue, Operating
EBITDA and Operating profit/(loss). The figures presented in this section for
prior years are those reported in the Annual Reports for those years.
£'m 2024 2023 2022 2021 2020
Revenue 128.8 89.5 140.0 142.8 87.7
Operations
Operating EBITDA(1) (15.3) (52.8) 1.6 35.9 7.3
Operating (loss) / profit (39.4) (184.2) (30.2) 20.8 (5.7)
Cash Flow
Cash (used in) / generated from operations (50.7) (36.0) (13.2) 24.5 (3.9)
Capex(2) 7.5 9.8 16.3 9.5 13.4
Cash (burn) / accretion(3) (68.2) (39.1) (33.0) 16.0 (7.8)
Financing
Cash 60.7 103.7 141.3 108.9 46.7
Loan 40.1 38.5 39.8 - -
Non-Financial Key Indicators
Headcount
Year end 861 714 904 815 673
Average 845 854 929 759 609
1 Operating EBITDA (Earnings Before Interest, Tax, Depreciation,
Amortisation, Impairment, revaluation of investments and assets at fair value
through profit and loss and share based payments) is a non-GAAP measure often
used as a surrogate for operational cash flow as it excludes from operating
profit or loss all non-cash items, including the charge for share based
payments. However, deferred bonus share option charges are not added back to
operating profits in the determination of Operating EBITDA as they may be paid
in cash upon the instruction of the Remuneration Committee. A reconciliation
to GAAP measures is provided on page 16.
2 This is purchases of property, plant and equipment as per the cash
flow statement which excludes additions to right-of-use assets. A
reconciliation to GAAP measures is provided on page 25.
3 Cash (burn)/accretion is net cash generated from operations plus
net interest paid plus capital expenditure. A reconciliation to GAAP measures
is provided on page 17.
Revenue
Group revenue of £128.8 million was a 44% increase on 2023 (£89.5 million).
Comparative growth was 81%, once adjusted for the non-recurrence of 2023
revenues from Homology in the US (£23.2 million). This comparative growth is
driven by a 76% revenue growth in lentiviral vector projects in the UK and new
client work in the US. OXB France provided a contribution to overall revenue
of £11.5 million.
In order to provide the users of the accounts with a more detailed
understanding of the revenue streams the table below provides a breakdown of
the key streams individually.
Revenue generated from manufacturing increased by 34% to £68.4 million (2023:
£51.0 million) due to an increase in the number of batches manufactured for
clinical clients and for clients in preparation for commercial launch; and the
new contributions from OXB France (£5.5 million). Homology contributed £17.1
million of manufacturing revenue in 2023.
Revenue generated from development services increased by 49% to £47.3 million
(2023: £31.8 million) due to client products moving further along their
clinical development pathways including an increase in development revenues
from process characterisation and validation work; and the new contributions
from OXB France (£6.1 million). Homology contributed £6.1 million of
development services revenue in 2023.
Revenues from licence fees, milestones and royalties increased by 9% to £7.3
million (2023: £6.7 million). Milestones and licence fees increased to £4.1
million (2023: 2.7 million) due to the timing of milestones achieved from
existing clients. Royalties decreased to £3.2 million (2023: £4.0 million)
as the Kymriah product matures through its life cycle.
In 2024, Procurement and Storage services generated £5.8 million in revenue
(2023: £ nil). This revenue line, recognised as point in time, represents
additional procurement and storage services from clients undergoing commercial
preparation activities, representing our readiness to provide clients
stability of supply and the maturity of the Group in its capacity as a CDMO.
Gross Margin in 2024 was 41% (2023: 44%) due to product mix with the
transition to higher volume manufacturing contracts and the positive margin
impact of the contract closure for Homology in the prior year.
£'m 2024 2023 2022 2021 2020
Revenue
Manufacturing services 68.4 51.0 93.8 111.1 45.4
Development services 47.3 31.8 34.3 17.3 23.1
Procurement services 5.8 - - - -
Licences, milestones and royalties 7.3 6.7 11.9 14.4 19.2
Total revenue 128.8 89.5 140.0 142.8 87.7
Cost of Sales
Manufacturing services (42.2) (33.1) (52.3) (50.4) (29.0)
Development Services (29.0) (16.7) (18.6) (10.0) (12.4)
Procurement services (4.6)
Total Cost of Sales (75.8) (49.8) (70.9) (60.4) (41.4)
Gross Profit 53.0 39.7 69.1 82.4 46.3
Gross Margin 41% 44% 49% 58% 53%
Operating EBITDA
2024 Operating EBITDA loss of £(15.3) million, is £37.5 million lower than
2023 (£(52.8) million), as a result of revenues increasing by 44%, whilst the
Group's cost base including raw materials included in cost of sales increased
by 2% to £149.3 million. The costs included a decrease in operational spend
due to cost saving initiatives, the restructuring and the closure of the
Product division at the end of 2023. These cost savings were partly offset by
an increase in operational spend due to the consolidation of the results of
OXB France for 11 months, acquisition-related due diligence costs of
£0.2 million and inflationary increases.
In 2024, the Group benefited, in Other Income, from a £1.7 million one-off
gain as a result of the bargain purchase accounting relating to the
acquisition in France. In 2023, the Group benefited from a one-off profit on
sale of its Harrow House facility of £0.5 million in a sale and lease back
transaction. Other income also includes sub lease rental income £2.5 million
(£2023: £2.2 million) and grant income to further develop supply chain
capabilities of £1.1 million (2023: £0.6m).
£'m 2024 2023 2022 2021 2020
Revenue 128.8 89.5 140.0 142.8 87.7
Other income 5.3 2.8 2.3 0.9 0.8
Gain on sale of property (0.1) 1.0 21.4 - -
Total expenses(1) (149.3) (146.1) (162.0) (107.8) (81.1)
Operating EBITDA(2) (15.3) (52.8) 1.6 35.9 7.3
Impairment - (99.3) - - -
Non cash items(3) (24.1) (32.1) (31.8) (15.1) (13.0)
Operating (loss)/profit (39.4) (184.2) (30.2) 20.8 (5.7)
1 Total expenses are operational expenses including cost of goods
incurred by the Group. A reconciliation to GAAP measures is provided on page
15.
2 Operating EBITDA (Earnings Before Interest, Tax, Depreciation,
Amortisation, Impairment, revaluation of investments and assets at fair value
through profit and loss and share based payments) is a non-GAAP measure often
used as a surrogate for operational cash flow as it excludes from operating
profit or loss all non-cash items, including the charge for share based
payments. However, deferred bonus share option charges are not added back to
operating profits in the determination of Operating EBITDA as they may be paid
in cash upon the instruction of the Remuneration Committee. A reconciliation
to GAAP measures is provided on page 16.
3 Non-cash items include depreciation, amortisation, revaluation of
investments, fair value adjustments of available-for-sale assets and the share
based payment charge. A reconciliation to GAAP measures is provided on page
15.
Total Expenses
In 2024, the Group has pivoted to a pure-play CDMO and as a result, the
classification of the expenditure types has been reviewed and represented in a
more meaningful way. Note 22 provides a reconciliation of the Re-presentation.
· The costs previously disclosed as Bioprocessing and the element of
Research and Development which related to Development services are now
included as operating costs.
· Innovation costs relate to the internal development work
undertaken on OXB platforms.
· Commercial costs relate to the teams engaged in business
development activities.
· Administration expenses are those departments who support the
operational teams across the Group.
In order to provide the users of the accounts with a more detailed explanation
of the reasons for the year on year movements of the Group's operational
expenses included within Operating EBITDA, the Group has removed depreciation,
amortisation and the share option charge as these are non-cash items which do
not form part of the Operating EBITDA alternative performance measure. As
Operating (loss)/profit is assessed separately as a key financial performance
measure, the year on year movement in these non-cash items is then
individually analysed and explained specifically in the Operating and Net
(loss)/profit section. Expense items included within Total Expenses are then
categorised according to their relevant nature with the year on year movement
explained in the second table on the next page.
£'m 2024 2023 2022 2021 2020
Operating costs(1) 57.3 86.2 60.9 40.2 29.7
Innovation costs 4.5 11.5 33.9 7.2 10.7
Commercial costs 6.4 3.9 - - -
Administrative expenses 29.4 26.9 28.2 15.1 11.3
Impairment - 99.3 - - -
Operating expenses 97.6 227.8 123.0 62.5 51.7
Depreciation (20.1) (21.5) (20.3) (12.4) (9.8)
Amortisation (2.3) (7.2) (6.1) - -
Impairment - (99.3)(2) - - -
Share option charge (1.7) (3.5) (5.4) (2.5) (2.4)
Adjusted Operating expenses(3) 73.5 96.3 91.2 47.6 39.5
Cost of sales 75.8 49.8 70.8 60.2 41.7
Total Expenses(4) 149.3 146.1 162.0 107.8 81.2
1 Includes benefit of the RDEC tax credit.
2 Impairment on the US LLC business following the decision of Homology
to cease clinical activities.
3 Research, development, manufacturing and administrative expenses
excluding depreciation, amortisation, impairment and the share option charge.
4 Cost of sales plus research, development, manufacturing and
administrative expenses excluding depreciation, amortisation, impairment and
the share option charge.
£'m 2024 2023 2022 2021 2020
Raw materials, consumables and other external manufacturing services costs 47.0 32.4 45.6 34.2 22.0
Manpower-related 76.9 83.2 84.4 55.0 45.3
External R&D expenditure 0.7 2.5 3.6 2.5 1.4
Acquisition costs 0.2 1.4 5.1 1.2 -
Other costs 31.9 32.8 27.8 20.0 17.1
RDEC Credit (7.4) (6.3) (4.5) (5.1) (4.6)
Total Expenses(1) 149.3 146.1 162.0 107.8 81.2
1 Total expenses are operational expenses including cost of goods
incurred by the Group. A reconciliation to GAAP measures is provided above.
· Raw materials, consumables and other external manufacturing costs
have increased by 45% as a direct result of the increase in the number of
lentivector batches produced and development activities. 85% of these costs
are classified as cost of sales and increase with revenue.
· Manpower-related costs are lower than 2023 driven by the
restructuring completed at the end of 2023, which included redundancy costs
incurred (£5.6 million) with the loss of approximately 200 roles across the
UK and the US business, as well as the fact that no bonuses accrued with
regards to 2023 performance. The lower costs were partly offset by inclusion
of 11-month impact of the 151 roles in OXB France and a bonus has been accrued
on 2024 performance as the Group achieved its targets.
· External R&D expenditure decreased as a result of the closure
of the Product division during 2024.
· Due diligence costs incurred in 2024 and in 2023 were as a result
of the acquisition of ABL Europe SAS (OXB France). Due diligence costs
incurred in 2022 related to the establishment of OXB US.
· Other costs were in line with 2023 despite the 11-month impact of
the inclusion of the administrative expenditure of OXB France and inflationary
increases.
· The RDEC credit has increased to £7.4 million (2023:
£6.3 million) due to an increase in activity which qualifies for supporting
the resolution of scientific uncertainty.
Operating and Net profit/(loss)
£'m 2024 2023 2022 2021 2020
Operating EBITDA(1) (15.3) (52.8) 1.6 35.9 7.3
Depreciation, Amortisation and share option charge (24.1) (32.2) (31.8) (14.9) (12.2)
Impairment - (99.3) - - -
Revaluation of investments/Change in fair value of available for sale assets - 0.1 - (0.2) (0.8)
Operating (loss)/profit (39.4) (184.2) (30.2) 20.8 (5.7)
Interest (7.2) (6.3) (7.8) (0.9) (0.8)
Foreign exchange (0.7) 1.9 (8.0) - -
Taxation (1.3) 4.4 0.8 (0.9) 0.3
Net(loss)/profit (48.6) (184.2) (45.2) 19.0 (6.2)
1 Operating EBITDA (Earnings Before Interest, Tax, Depreciation,
Amortisation, Impairment, revaluation of investments and assets at fair value
through profit and loss and share based payments) is a non-GAAP measure often
used as a surrogate for operational cash flow as it excludes from operating
profit or loss all non-cash items, including the charge for share based
payments. However, deferred bonus share option charges are not added back to
operating profits in the determination of Operating EBITDA as they may be paid
in cash upon the instruction of the Remuneration Committee.
In arriving at Operating (loss)/profit it is necessary to deduct from
Operating EBITDA the non-cash items referred to above. The depreciation
(£20.1 million) and amortisation (£2.3 million) charge are lower than
prior year due to the OXB US impairment at the end of 2023 offset by the
11-month impact of the acquisition of the fixed assets of OXB France. The
share option charge £1.7 million (2023: £3.5 million) decreased due to the
impacts of staff turnover and lower share price.
The impact of these charges increased the operating EBITDA loss and resulted
in an operating loss of £39.4 million in 2024. This compared to an operating
loss of £(184.2) million in the prior year primarily driven by the
impairment of £99.3 million.
The net interest charge increased by £0.9 million as a result of a decrease
in bank interest received of £1.7 million to £3.2 million due to a lower
cash balance and a reduction in the interest on finance leases as the lease
balances decrease. Foreign exchange losses of £0.7 million were recognised
in 2024 on the loan from Oaktree Capital Management, L.P. (Oaktree loan or
Oaktree loan facility), as opposed to foreign exchange gains of £1.9 million
in 2023. The corporation tax charge is impacted by an increase in the notional
tax charge due to an increase in the RDEC tax credit expected for 2024 offset
by the release of the deferred tax liability on the US intangibles.
Other Comprehensive Income
The Group recognised a loss within other comprehensive income in 2024 of
£0.7 million (2023: £5.3 million) in relation to movements on the foreign
currency translation reserve. The translation reserve comprises all foreign
currency differences arising from the translation of the financial statements
of foreign operations, including gains arising from monetary items that in
substance form part of the net investment in foreign operations.
Cash flow
£'m 2024 2023 2022 2021 2020
Operating (loss)/profit (39.4) (184.2) (30.2) 20.8 (5.7)
Non-cash items included in operating loss(1) 24.1 131.4 31.8 15.1 13.0
Operating EBITDA(2) (15.3) (52.8) 1.6 35.9 7.3
Working capital movement(3) (35.4) 16.8 (14.8) (11.4) (11.2)
Cash (used in)/ generated from operations (50.7) (36.0) (13.2) 24.5 (3.9)
R&D tax credit received - 7.5 0.6 1.0 7.0
Net Cash (used in)/ generated from operations (50.7) (28.5) (12.6) 25.5 3.1
Interest paid, less received - 0.1 (4.1) - -
Sale of Investment Asset - - - - 2.5
Lease payments (10.1) (9.2) - - -
Capex(4) (7.5) (1.4) (16.3) (9.5) (13.4)
Net cash (burn) / accretion(5) (68.2) (39.1) (33.0) 16.0 (7.8)
Acquisition of subsidiary 9.0 - (99.2) - -
Sale of building - - 60.0 - -
Net proceeds from financing(6) 17.1 0.6 104.6 46.2 38.3
Movement in year (42.1) (38.4) 32.4 62.2 30.5
1 Depreciation, Amortisation, Impairment, revaluation of investments and
assets at fair value through profit and loss, and share based payments.
2 Operating EBITDA (Earnings Before Interest, Tax, Depreciation,
Amortisation, Impairment, revaluation of investments and assets at fair value
through profit and loss and share based payments) is a non-GAAP measure often
used as a surrogate for operational cash flow as it excludes from operating
profit or loss all non-cash items, including the charge for share based
payments. However, deferred bonus share option charges are not added back to
operating profits in the determination of Operating EBITDA as they may be paid
in cash upon the instruction of the Remuneration Committee. A reconciliation
to GAAP measures is provided on page 16.
3 This is Changes in working capital and reversal of the Gain on sale of
building as outlined in note 17: Cash flow from operating activities on page
40.
4 This is Purchases of property, plant and equipment as per the cash flow
statement which excludes additions to Right-of-use assets. A reconciliation to
GAAP measures is provided on page 25.
5 Cash (burn)/accretion is net cash generated from operations plus net
interest paid plus capital expenditure.
6 This is net cash generated from financing activities as per the Cash flow
statement on page 40 excluding interest paid and lease liability payments.
The Group held £60.7 million of cash at 31 December 2024 (2023: £103.7
million). Significant movements across the year, further to the EBITDA
movements, are explained below:
● The operating EBITDA loss of £(15.3) million
● A negative working capital movement of £(35.4) million
principally driven by:
· An increase in Trade and other receivables of £34.3 million to
£59.0 million (2023: £24.7 million), of which £3.2 million relates to
OXB France. This significant increase on 2023 is directly related to increased
activity in the second half of 2024, which resulted in £23.3 million of
Trade receivables at the end of 2024 for invoices not yet due (2023:
£8.1 million) and £18.0 million of contract assets (2023: £5.2 million)
from inflight manufacturing batches and in progress development projects all
of which will be invoiced in 2025
· An increase in Trade and other payables of £8.4 million to
£26.2 million (2023: £17.8 million), of which £5.9 million relates to
OXB France. The accruals in 2024 include a corporate bonus accrual which was
nil in 2023.
· A decrease in Contract Liabilities and Deferred Income of
£2.1 million to £25.3 million (2023: £27.4 million) of which
£3.0 million relates to OXB France. This reduction is driven by the
utilisation of opening contract liabilities relating to batch deposits by
£6.2 million for batches which have been manufactured during 2024.
· The 2023 UK RDEC refund from HMRC was received in March 2025,
therefore is outstanding at the year end, but in the comparable period both
the 2021 and 2022 RDEC tax credits were received in 2023.
· Purchases of property, plant and equipment increased to £7.5
million from £9.8 million, as the Group invested in the expansion of
lentiviral development and manufacturing to the sites in the US and France as
part of the execution of its "One OXB" strategy.
· Lease payments of £10.1 million (2023: £9.2 million) for all
facilities which have increased due to the inclusion of leases related to OXB
France and the full year impact of the sale and leaseback of the Group's UK
Harrow House facilities.
· The acquisition of the ABL Europe SAS (OXB France) in January
2024 resulted in an inflow of £9.0 million.
· The net proceeds from financing (excluding finance leases and
interest) during 2024 was £17.1 million, consisting of proceeds from the
share subscription associated with the OXB France acquisition £17.5 million
offset by repayment of short term OXB France loans £0.4 million.
The result of the above movements is a net decrease of £42.1 million which,
together with a negative movement in foreign currency balances of £0.9
million, leads to a decrease in cash from £103.7 million to £60.7 million.
Subsequent events
On 1 March 2025, OXB US Inc exercised the call option for the purchase of the
remaining 10% of OXB US LLC from Q32. At the date of this report, the transfer
of Q32's remaining 10% holding in OXB US to OXB US Inc is in the process of
being finalised.
Financial outlook
Near-term outlook
Financial metric 2025 guidance (CC(1))
Revenue £160 million - £170 million
Operating EBITDA profit Low single-digit million
1 CC refers to Constant Currency, which refers to the equivalent growth based
on the prior year exchange rates.
The Group expects 2025 revenues to be between £160 million and £170 million,
with contracted client orders providing a high degree of visibility. Revenues
for 2025 are expected to be second half-weighted, in line with prior years,
due to holiday shutdown and annual routine maintenance that occurs at the
start of each year.
The Group's revenue backlog stood(1) at approximately £150 million as at 31
December 2024 compared to £94 million as at 31 December 2023. This is the
amount of future revenue available to earn from current orders. The contracted
value of client orders signed in 2024 was approximately £186 million, an
increase of approximately 35% compared to £138 million in 2023, which instils
confidence in the Group's ability to deliver further revenue growth in 2025
and 2026. This includes £141 million to be recognised in 2025, subject to
revenue performance obligations. This compares to £82 million at the same
time last year (equivalent to 64% of FY 2024 Revenues of £128.8 million).
With our strong business development pipeline and sufficient manufacturing and
development capacity, we have strong visibility of the remaining 2025 revenue
guidance.
Capital expenditure for 2025 is expected to be low double-digit £ million,
limited to maintenance capex required as well as disciplined spend on certain
key capital expenditure projects.
Operating EBITDA profitability is expected in 2025, with a low single digit £
million Operating EBITDA profit for the full year. This is expected to be
second half weighted, in line with revenues and with the benefits of the
streamlined cost base to increase through the course of the year.
The business is sensitive to FX fluctuations due to the revenues being
receivable in Sterling, Euro and US Dollars with certain expenditures payable
in Euro and US Dollars, including the loan payments due to the Oaktree loan
facility being denominated in dollars. Financial guidance excludes the impact
of FX fluctuations.
Medium term financial guidance and long term ambition
Building on its track record and competitive advantage as a viral vector
specialist, the Group aims to ultimately have a market leading position in the
viral vector supply market across all key vector types. The Group continues to
target a three-year revenue CAGR of more than 35% for 2023-2026.
The Group's expectations for 2026 include an increase in manufacture of GMP
batches compared with 2025, primarily driven by commercial and late-stage
client activity in the UK. Early stage GMP manufacturing is expected to
increase as programmes from new and existing clients advance into the clinic
across UK, US and France sites.
To support the high growth in GMP manufacturing demands, driven by late stage
and commercialisation activities, OXB expects to make investments in headcount
in 2026 to increase manned GMP suite capacity. With ongoing focus on
efficiency and a disciplined approach to our cost base; and planned targeted
investment, the Group continues to target Operating EBITDA margins of
approximately 20% by the end of 2026.
Beyond 2026, the Group is targeting revenue growth in excess of the broader
viral vector market. Manufacturing revenues as a proportion of total revenues
are expected to increase, from approx. 50% in 2024 to c.70% in 2029. OXB is
targeting continued margin expansion following the pivot to positive operating
EBITDA in 2025, as the Group continues to grow top line and benefits from
operating leverage.
Financial metric Medium-term guidance
Revenue CAGR (2023-2026) >35%
Operating EBITDA margins ~20% by end of 2026
1 Revenue backlog represents the ordered gross value of CDMO revenues
available to earn. The value of customer orders included in revenue backlog
only includes the value of work for which the customer has signed a financial
commitment for OXB to undertake, whereby any changes to agreed values will be
subject to change orders, cancellation fees or the triggering of
optional/contingent contractual clauses.
Viability Statement
The Directors have assessed the prospects of the Group over the three years to
December 2027. They believe three years to be appropriate due to the inherent
significant uncertainties of forecasting within and beyond this time horizon
given the nature of the business sector in which the Group operates. The
assessment has been performed by developing and updating the Long Range Plan
that covers the viability assessment period which the Board has scrutinised in
depth together with its financial advisers prior to the publication of this
statement. The Group's strategy is to exploit its platform technologies in
lentiviral vector ( LentiVector®), AAV and others to support the development
of other companies' cell and gene therapy products. The Group is generating
growing cell and gene therapy revenues from providing process development and
manufacturing services to other companies and fees for licensing its platform
technology, generating upfront receipts and royalties. Over the three years to
December 2027 the Directors believe that revenues from providing process
development and manufacturing services to its clients and from licensing its
technology to third parties will be sufficient to support a sustainable Group.
The following factors are considered both in the formulation of the Group's
strategy and in the assessment of the Group's prospects over the three-year
period:
· The principal risks and uncertainties faced by the Group,
including emerging risks as they are identified (such as climate change) and
the Group's response to these.
· The prevailing economic climate and global economy, competitor
activity, market dynamics and changing client behaviours.
· How the Group can best position itself to take advantage of the
current opportunities within the cell and gene therapy and adenovirus markets.
· Opportunities for further technology investment and innovation.
· The resilience afforded by the Group's enviable technology
platform and innovation capabilities.
· The financial viability of the Group, taking into account its
current financial position and ability to secure future financing either to
repay or refinance the existing Oaktree loan when it falls due in 2026.
Going concern
The financial position of the Group and the Company, their cash flows and
liquidity position are described in the Financial Statements and notes to the
financial statements section of the Annual report and accounts.
The Group and the Company made a loss after tax for the year ended 31 December
2024 of £(48.6) million and £(12.8) million respectively and consumed net
cash flows from operating activities for the year of £50.7 million and
£2.0 million.
The Group also:
· Closed the acquisition of ABL Europe SAS (OXB France) in January
2024 for a consideration of €15 million, (including €10million of
pre-completion cash funding from Institut Mérieux).
· Ended the period with cash and cash equivalents of £60.7
million.
In considering the basis of preparation of the FY24 Annual report and
accounts, the Directors have prepared cash flow forecasts for a period of at
least 12 months from the date of approval of these financial statements, based
in the first instance on the Group's 2025 latest forecast and forecasts for
2026. The Directors have undertaken a rigorous assessment of the forecasts in
a base case scenario and assessed identified downside risks and mitigating
actions. These cash flow forecasts also take into consideration severe but
plausible downside scenarios including:
· Commercial challenges leading to a substantial manufacturing and
development revenue downside affecting both the LentiVector® platform and AAV
businesses.
· Considerable reduction in revenues from new clients.
· Removal of any future licence revenues.
· The potential impacts of a downturn in the biotechnology sector
on the Group and its clients including expected revenues from existing clients
under long term arrangements.
Under both the base case and mitigated downside scenario, the Group and the
Company have sufficient cash resources to continue in operation for a period
of at least 12 months from the date of approval of these financial statements.
In the event of all the downside scenarios above crystallising, the Group and
Company would continue to comply with its existing loan covenants until the
maturity of the Oaktree loan without taking any mitigating actions, but the
Board has mitigating actions in place that are largely within its control that
would enable the Group to reduce its spend within a reasonably short
time-frame to increase the Group and the Company's cash covenant headroom as
required by the Oaktree loan facility. Specifically, the Group will continue
to monitor its performance against the base case scenario and if base case
cash-flows do not crystallise, start taking mitigating action by the end of Q4
2025 which may include rationalisation of facilities and rightsizing the
workforce.
In addition, the Board has confidence in the Group and the Company's ability
to continue as a going concern for the following reasons:
· As noted above, the Group has cash balances of £60.7 million at
the end of December 2024.
· £141 million of 2025 forecasted revenues are covered by
contracted client orders which give confidence in the level of revenues
forecast over the next 12 months.
· The Group intends to delay the construction element of its Oxbox
manufacturing facility expansion to take place during 2028 and 2029.
· The Group's ability to continue to be successful in winning new
clients and building its brand as demonstrated by successfully entering into
new client agreements including with multiple new clients over the last 6
months.
· The Group has the ability to control capital expenditure costs and
lower other operational spend, as necessary.
Taking account of the matters described above, the Directors are confident
that the Group and the Company will have sufficient funds to continue to meet
their liabilities as they fall due for at least 12 months from the date of
approval of the financial statements and therefore have prepared the financial
statements on a going concern basis.
Dr. Lucinda Crabtree
Chief Financial Officer
Consolidated statement of comprehensive income
Dec-24 Dec-23
Re-presented(1)
Notes £'000 £'000
Continuing operations
Revenue 128,797 89,539
Cost of sales (75,776) (49,812)
Gross profit 53,021 39,727
Operating costs (57,261) (86,163)
Innovation costs (4,544) (11,471)
Commercial costs (6,356) (3,911)
Administration expenses (29,420) (26,893)
Impairment of assets - (99,284)
Other operating income 5,254 2,803
(Loss)/ gain on sale and leaseback (69) 1,018
Operating (loss) (39,375) (184,174)
Finance income 3,236 4,910
Finance costs 5 (11,126) (9,263)
(Loss) before tax (47,265) (188,527)
Taxation (expense)/credit (1,344) 4,365
(Loss) for the period (48,609) (184,162)
Other comprehensive (expense)
Foreign currency translation differences (737) (5,307)
Other comprehensive (expense) (737) (5,307)
Total comprehensive (expense) (49,346) (189,469)
(Loss) attributable to:
Owners of the Company (43,190) (157,490)
Non-controlling interest 18 (5,419) (26,672)
(48,609) (184,162)
Total comprehensive expense attributable to:
Owners of the Company (43,878) (161,359)
Non-controlling interest 18 (5,468) (28,110)
(49,346) (189,469)
Basic and Diluted (loss) per ordinary share (41.75) (163.11)
1 The prior year has been re-presented - please refer to Note 22
Statement of financial position
Group
Dec-24 Dec-23
Notes £'000 £'000
Assets
Non-current assets
Intangible assets & goodwill 6 29,219 30,981
Property, plant and equipment 7 64,296 75,692
Trade and other receivables 4,934 4,340
98,449 111,013
Current assets
Inventories 8 13,573 12,872
Trade and other receivables 9 58,971 24,741
Cash and cash equivalents 60,650 103,716
133,194 141,329
Current liabilities
Trade and other payables 10 26,169 17,802
Provisions 12 1,152 747
Contract liabilities 11 23,630 21,598
Deferred income 11 562 514
Loans 13 281 -
Lease liabilities 4,139 3,654
Put/ call option liability 14 2,388 -
58,321 44,315
Net current assets / (liabilities) 74,873 97,014
Non-current liabilities
Provisions 12 7,424 7,710
Contract liabilities 11 50 4,494
Deferred income 11 1,020 837
Loans 13 39,790 38,534
Lease liabilities 64,551 69,270
Put/ call option liability 14 - 9,348
112,835 130,193
Net assets 60,487 77,834
Equity attributable to owners of the parent
Ordinary shares 52,981 48,403
Share premium account 394,856 380,333
Other reserves 8,709 (1,812)
Accumulated losses (399,500) (352,918)
Equity attributable to owners of the Company 57,046 74,006
Non-controlling interest 18 3,441 3,828
Total equity 60,487 77,834
Statement of cash flows
Group
2024 2023
Notes £'000 £'000
Cash flows from operating activities
Cash (consumed in) operations 17 (50,666) (36,027)
Tax credit received - 7,510
Net cash used in operating activities (50,666) (28,517)
Cash flows from investing activities
Acquisition of subsidiary, net of cash acquired 9,004 -
Purchases of property, plant and equipment (7,496) (9,832)
Proceeds on disposal of property, plant and equipment - 8,390
Interest received 4,124 4,248
Net cash generated from/(used) in investing activities 5,632 2,806
Cash flows from financing activities
Proceeds from issue of ordinary share capital 17,526 651
Interest paid (4,086) (4,136)
Loans repaid (466) -
Payment of lease liabilities (4,723) (3,117)
Payment of lease liabilities interest (5,343) (6,101)
Net cash generated from/(used in) financing activities 2,908 (12,703)
Net decrease in cash and cash equivalents (42,126) (38,414)
Cash and cash equivalents at 1 January 103,716 141,285
Movement in foreign currency balances (940) 845
Cash and cash equivalents at 31 December 60,650 103,716
Statement of changes in equity attributable to owners of the parent company
Reserves
Ordinary shares Share premium account Merger Other Equity Translation Accumulated losses Total Non-controlling interest Total equity
Group Notes £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
At 1 January 2023 48,132 379,953 2,291 (35,003) 7,825 (198,545) 204,653 31,539 236,192
Loss for period - - - - - (157,490) (157,490) (26,672) (184,162)
Foreign currency translation differences - - - - (3,869) - (3,869) (1,438) (5,307)
Other comprehensive expense - - - - (3,869) - (3,869) (1,438) (5,307)
Total comprehensive expense for the period - - - - (3,869) (157,490) (161,359) (28,110) (189,469)
Transactions with owners:
Share options
Proceeds from shares issued 271 380 - - - - 651 - 651
Value of employee services - - - - - 3,117 3,117 399 3,516
Total contributions 271 380 - - - 3,117 3,768 399 4,167
Changes in ownership interests: -
Put/ call option revaluation - - - 26,944 - - 26,944 - 26,944
At 31 December 2023 48,403 380,333 2,291 (8,059) 3,956 (352,918) 74,006 3,828 77,834
At 31 December 2023 48,403 380,333 2,291 (8,059) 3,956 (352,918) 74,006 3,828 77,834
Loss for period - - - - - (43,190) (43,190) (5,419) (48,609)
Foreign currency translation differences - - - - (688) - (688) (49) (737)
Other comprehensive income - - - - (688) - (688) (49) (737)
Total comprehensive expense for the period - - - - (688) (43,190) (43,878) (5,468) (49,346)
Transactions with owners:
Shares
Proceeds from shares issued 4,578 14,523 4,126 - - (394) 22,833 - 22,833
Value of employee services - - - - - 2,079 2,079 4 2,083
Total contributions 4,578 14,523 4,126 - - 1,685 24,912 4 24,916
Changes in ownership interests: -
NCI recapitalisation - - - - - (5,077) (5,077) 5,077 -
Put/ call option revaluation - - - 7,083 - - 7,083 - 7,083
At 31 December 2024 52,981 394,856 6,417 (976) 3,268 (399,500) 57,046 3,441 60,487
NOTES TO THE PRELIMINARY FINANCIAL INFORMATION
1. Basis of preparation
This preliminary announcement was approved by the Board of Directors on 9
April 2025.
The financial information set out above does not constitute the Company's
statutory accounts for the years ended 31 December 2023 or 2024 but is derived
from those accounts. The preparation of the financial statements in
conformity with IFRS requires the use of certain critical accounting
estimates.
Statutory accounts for 2023 have been delivered to the registrar of companies,
and those for 2024 will be delivered in due course.
The numbers presented in this released have been audited. The auditor has
reported on the 2024 accounts; their report was (i) unqualified, (ii) did not
include a reference to any matters to which the auditor drew attention by way
of emphasis without qualifying their report; and (iii) did not contain a
statement under Section 498 (2) or (3) of the Companies Act 2006.
The consolidated statement of comprehensive income for 2023 has been
re-presented to present the accounts in a more meaningful way as detailed in
note 22.
Going concern
The financial position of the Group and the Company, their cash flows and the
liquidity position are described in the Financial Statements and notes to the
financial statements section of the Annual report and accounts.
The Group and the Company made a loss after tax for the year ended 31 December
2024 of £(48.6) million and £(12.8) million respectively and consumed net
cash flows from operating activities for the year of £50.7 million and
£2.0 million.
The Group also:
● Closed the acquisition of ABL Europe SAS (OXB France) in January
2024 for a consideration of €15 million, (including €10million of
pre-completion cash funding from Institut Mérieux).
● Ended the period with cash and cash equivalents of £60.7
million.
In considering the basis of preparation of the FY24 Report and full-year
accounts, the Directors have prepared cash flow forecasts for a period of at
least 12 months from the date of approval of these financial statements, based
in the first instance on the Group's 2025 latest forecast and forecasts for
2026. The Directors have undertaken a rigorous assessment of the forecasts in
a base case scenario and assessed identified downside risks and mitigating
actions. These cash flow forecasts also take into consideration severe but
plausible downside scenarios including:
● Commercial challenges leading to a substantial manufacturing and
development revenue downside affecting both the LentiVector® platform and AAV
businesses.
● Considerable reduction in revenues from new clients.
● Removal of any future licence revenues.
● The potential impacts of a downturn in the biotechnology sector on
the Group and its clients including expected revenues from existing
clients under long term arrangements.
Under both the base case and mitigated downside scenario, the Group and the
Company have sufficient cash resources to continue in operation for a period
of at least 12 months from the date of approval of these financial statements.
In the event of all the downside scenarios above crystallising, the Group and
the Company would continue to comply with its existing loan covenants until
the maturity of the Oaktree loan without taking any mitigating actions, but
the Board has mitigating actions in place that are largely within its control
that would enable the Group to reduce its spend within a reasonably short
time-frame to increase the Group and the Company's cash covenant headroom as
required by the Oaktree loan facility. Specifically, the Group will continue
to monitor its performance against the base case scenario and if base case
cash-flows do not crystallise, start taking mitigating action by the end of Q4
2025 which may include rationalisation of facilities and rightsizing the
workforce.
In addition, the Board has confidence in the Group and the Company's ability
to continue as a going concern for the following reasons:
As noted above, the Group has cash balances of £60.7 million at the end of
December 2024.
● £141 million of 2025 forecasted revenues are covered by
contracted client orders which give confidence in the level of revenues
forecast over the next 12 months.
● The Group intends to delay the construction element of its Oxbox
manufacturing facility expansion to now take place during 2028 and 2029.
● The Group's ability to continue to be successful in winning new clients
and building its brand as demonstrated by successfully entering into new
client agreements including with multiple new clients over the last six
months.
● The Group has the ability to control capital expenditure costs and
lower other operational spend, as necessary.
Taking account of the matters described above, the Directors are confident
that the Group and the Company will have sufficient funds to continue to meet
their liabilities as they fall due for at least 12 months from the date of
approval of the financial statements and therefore have prepared the financial
statements on a going concern basis.
2. Critical accounting judgements and estimates
In applying the Group's accounting policies, management is required to make
judgements and assumptions concerning the future in a number of areas. Actual
results may be different from those estimated using these judgements and
assumptions. The key sources of estimation uncertainty and the critical
accounting judgements that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within the next
financial year are discussed below.
Key accounting matters
Judgements
Acquisition date of OXB France
The acquisition date of ABL Europe SAS (OXB France) has been deemed to be 29
January 2024 and is the date that control passed to OXB. This is due to
multiple substantive conditions which existed in the Sale and Purchase
Agreement, which were not all fully completed until this date.
Contract revenues: Identification of performance obligations, allocation of
revenue and timing of revenue recognition
The Group has identified three key areas of judgement within the collaboration
agreements entered into during the period. Firstly, in relation to the number
of distinct performance obligations contained within each collaboration
agreement; secondly the fair value allocation of revenue to each performance
obligation based on its relative stand alone selling price; and thirdly the
timing of revenue recognition based on the achievement of the relevant
performance obligation. The sales royalties contained within the collaboration
agreements qualify for the royalty exemption available under IFRS 15 and will
only be recognised as the underlying sales are made even though the
performance obligation, in terms of the technology licence, has already been
met.
The judgements with regards to the number of distinct performance obligations
and the fair value allocation of revenue to each performance obligation, based
on relative stand alone selling price, takes place on a contract-by-contract
basis across numerous contracts entered into by the Group.
Procurement and storage services: revenue recognition
The Group has identified requirements within certain agreements that
necessitate the procurement and storage of key materials. In these cases, the
Group has determined that there are 2 distinct performance obligations; the
procurement of the materials and their storage. These are contractual
obligations which are reportable to the Clients.
On completion of the procurement activities, control is passed over to the
client as the materials are quality checked then segregated within Group
premises and solely for the use of the specified client under the contractual
terms. The determination of the passing of control is a key judgement, which
dictates the timing of the revenue recognition, as at this point, revenue is
recognised.
Once control passes to the client, the storage services commence and revenue
is recognised over time in accordance with IFRS 15.
The Group has made a judgement that it considers itself to be the principal in
such cases since:
● The Group is solely responsible for order, acceptance and testing
inventories of the quantum required to meet the customer confirmed orders.
● The Group bears risk before the control of the materials are passed
over to clients which includes the completion of quality testing and
compliance with regulatory requirements. These tasks are not deemed to be
solely trivial or administrative in nature and therefore the principal
judgement is appropriate.
● Further, the Group negotiates the purchase price with suppliers of
the materials and bears pricing risk as the selling price is agreed and can
only be renegotiated annually subject to breaching certain thresholds.
Estimations
The key assumptions concerning the future and other key sources of estimation
uncertainty at the reporting date, that have a significant risk of causing a
material adjustment to the carrying amounts of assets and liabilities within
the next financial year, are discussed below. The nature of estimation means
that actual outcomes could differ from those estimates.
Revenue recognition: Percentage of completion of manufacturing batch revenues
Manufacturing of clinical/commercial product for clients is recognised on a
percentage of completion basis over time as the processes are carried out.
Progress is determined based on the achievement of verifiable stages of the
manufacturing process. Revenues are recognised on a percentage of completion
basis and as such require estimation in terms of the assessment of the correct
stage of completion including the expected costs of completion for that
specific manufacturing batch. The value of the revenue recognised with regards
to the manufacturing batches which remain in progress at period end is
£40.4 million. If the assessed percentage of completion was 10 percentage
points higher or lower, revenue recognised in the period would have been
£4.2 million higher or £5.0 million lower.
Revenue recognition: Percentage of completion of fixed price process
development revenues
As it satisfies its performance obligations, the Group recognises revenue and
the related contract asset with regards to fixed price process development
work packages. Revenues are recognised on a percentage of completion basis and
as such require estimation in terms of the assessment of the correct
percentage of completion for that specific process development work package.
The value of the revenue recognised with regards to the work packages which
remain in progress at year end is £18.9 million. If the assessed percentage
of completion was 10 percentage points higher or lower, revenue recognised in
the period would have been £2.7 million higher or £2.9 million lower.
Revenue recognition: Provision for out of specification manufacturing batches
Manufacturing of clinical/commercial product for clients is recognised on a
percentage of completion basis over time as the processes are carried out.
Progress is determined based on the achievement of verifiable stages of the
process.
As the Group has now been manufacturing product across a number of years and
also in a commercial capacity, the Group has assessed the need to include an
estimate of bioprocessed product for which revenue has previously been
recognised and which may be reversed should the product go out of
specification during the remaining period over which the product is
bioprocessed. In calculating this estimate the Group has looked at historical
rates of out of specification batches across the last three years and has
applied the percentage of out of specification batches to total batches
produced across the assessed period to the revenue recognised on batches which
have not yet completed the manufacturing process at period end. The Group
makes specific provisions for product batches where it is considered that the
average overall historical failure rate does not adequately cover the
perceived risk of revenue recognised on those specific batches having to be
subsequently reversed.
This estimate, based on the historical average percentage as well as certain
specific provisions, may be significantly higher or lower depending on the
number of manufacturing batches actually going out of specification in future.
The estimate will increase or decrease based on the number of manufacturing
batches undertaken, the percentage of completion of those manufacturing
batches and the number of batches which go out of specification over the
assessment period. If three additional batches failed during the year, this
would lead to a material variance on the estimate.
Consequently, manufacturing revenue of £1.3 million (31 December 2023:
£1.1 million) has not been recognised during the year ended 31 December 2024
with the corresponding credit to contract liabilities. This revenue will be
recognised as the batches complete manufacturing.
Fair value assumptions on acquisition of OXB France
The estimations for the fair value of the Plant, Property and Equipment has
been made using a Depreciated Replacement Cost. This cost has then been
adjusted for economic obsolescence to determine the fair value adjustments to
the opening acquisition balance sheet,.
Impairment assessment of OXB US Cash Generating Unit (CGU)
OXB US has been identified as a CGU (cash generating unit) of the business.
Since the last impairment assessment performed, an impairment trigger was
identified in the CGU as it did not fully deliver its annual budget and
accordingly, a full impairment assessment has been performed as at 31 December
2024.
The recoverable amount of the CGU is deemed to be the higher of its fair value
less cost of disposal, or value in use. The Group has determined that the
recoverable amount of the CGU is the fair value less costs of disposal
(FVLCOD) of the OXB US CGU as it expects this value to be higher than the
value in use. The valuation is considered to be level 3 in the fair value
hierarchy due to unobservable inputs used in the valuation.
Management's approach and the key assumptions used to determine the CGU's
FVLCOD were as follows:
The Group assessed the FVLCOD of the OXB US CGU through a discounted cash flow
calculation to approximate the fair value a buyer would be willing to pay for
the CGU. The discounted cash flow calculation calculates the present value of
the CGU taking into consideration the forecasted cash flows based on the Board
approved long term forecast, as well as the calculation of the terminal value
at the end of the cash flow period. Management has prepared the FVLCOD
calculation based on an approved forecast of 10 years. Management have
assessed this to be 10 years followed by the calculation of the terminal
value.
Sensitivity calculation:
Key estimation uncertainty inputs which directly impact the FVLCOD of the CGU
are assessed to be:
· Revenue growth rates including the ability of the CGU to acquire
new clients and increase revenues from existing clients. Average growth
rates of 24% over the period as assessed to be the expected growth rates for a
start-up CDMO entity over the initial growth period after which growth rates
are brought down to more inflationary levels. Revenues include revenues with
respect to the LentiVector® platform for which the know how transfer was
completed in 2024.
· Discount rate - the discount rate may be impacted by economic and
market factors, as well as changes to the risk free rate of return which
impacts debt borrowing rates. Should the discount rate calculated by
management be adjusted, this may impact the FVLCOD of the CGU. The discount
rate used of 12.3% has been calculated based on the current risk free rate,
the NASDAQ biotechnology Index's expected rate of return and the Group's cost
of debt.
· Operational expenditure and capital expenditure - the cash flows of
OXB US are based on the management approved forecasts.
· These forecasts may change in future or the actual results vary.
· Long term inflation rates in the United States which are used to
approximate the long term growth rate into perpetuity for the terminal value.
· Expected volatility of cash flows - should the expected volatility
of OXB US cash flows vary, this may impact the FVLCOD of the CGU.
Sensitivities to the FVLCOD model outcome
31-Dec-24 Higher/ Longer Lower/Shorter
£'ms £'ms
Forecast revenues 10% higher or lower 43.2 (43.5)
Operational expenditure 10% higher or lower (19.8) 19.8
Capital expenditure 10% higher or lower (1.5) 1.5
Long term inflation rates 2% higher or lower 20.6 (13.1)
Discount rate 3% higher or lower (17.5) 33.3
Long Term Growth Rate 2% higher or lower 19.4 (12.6)
Based on the valuation of the CGU through a discounted cash flow calculation,
the Group has assessed that no further impairment of OXB US is required in
2024 (2023: £99.3 million ($126.4 million)).
Amortisation of intangibles assets (developed technology)
The estimated useful life of developed technology acquired by the Group is 15
years as the Group expects the technology to generate cash flows for a total
of 15 years. The estimate of 15 years is based on management's experience of
the time period over which the technology acquired as part of the acquisition
of OXB US will become fully obsolete. Over time as the platform technology is
improved, parts of the technology will become obsolete as they are superseded
by new technology until after 15 years the original technology is expected to
have been fully replaced by newer/improved technology.
The effective date of the impairment of OXB US was 31 December 2023, therefore
the amortisation charge in 2023 is pre impairment. If the estimated useful
life of the assets had been 10 years, the estimated amortisation for the year
ended 31 December 2024 would be £0.7 million higher (2023: £3.6 million);
whilst, if the estimated useful life of the assets had been 20 years, the
estimated amortisation for the year ended 31 December 2024 would be
£0.8 million lower (2023: £1.8 million lower).
3. Taxation
The Group claims research and development tax credits under the UK
Government's Research and Development Expenditure Credit (RDEC) Scheme for
large companies.
2024 2023
Current tax £'000 £'000
Corporation tax (1,809) (1,487)
Total (1,809) (1,487)
Adjustments in respect of prior periods:
France corporation tax research and development credit 219 -
United Kingdom corporation tax research and development credit 246 (58)
Current tax (1,344) (1,545)
Deferred tax
Deferred tax relating to the origination of timing differences - 5,910
Deferred tax - 5,910
Taxation (charge)/ credit (1,344) 4,365
UK income tax
The amount of £1.8 million (2023: £1.5 million) included as part of the
taxation (charge)/credit within the Statement of Comprehensive income for the
year ended 31 December 2024 comprises the corporation tax payable on the
amount claimed as a Large Company Tax Credit (RDEC) within research and
development expenses in the Statement of Comprehensive Income.
The United Kingdom corporation tax research and development (RDEC) credit
which is included in research and development expenses, is paid in arrears
once tax returns have been filed and agreed. The tax credit recognised in the
financial statements but not yet received is included in trade and other
receivables in the Statement of Financial Position.
The adjustment of current tax in respect of the prior year is £246,000. The
adjustment in 2023 was £58,000 which related to the corporation tax credit on
a lower than anticipated RDEC tax receipt.
During 2024, the Group recognised £nil (2023: £nil) of current tax relating
to tax relief obtained on exercise of share options directly within equity. At
31 December 2024, the Group had UK tax losses, with no expiry date, to be
carried forward of approximately £118.3 million (2023: £127.6 million).
4. Basic and diluted profit/(loss) per ordinary share
The basic loss per share of (41.75)p (2023: (163.11)p) has been calculated by
dividing the loss for the period by the weighted average number of shares in
issue during the year ended 31 December 2024 being 103,458,254 (2023:
96,555,347).
As the Group incurred a loss in both the current and prior year, there is no
difference between the basic loss per ordinary share and the diluted loss per
ordinary share for the reporting period, as the impact of potential dilutive
instruments is anti-dilutive.
5. Finance Costs
Finance costs of £11.1 million (2023: £9.3 million) consists of loan
interest (£4.5 million), foreign exchange gains relating to loans (£0.6
million) and lease liability interest recognised in accordance with IFRS 16
(Leases) (£5.3 million) offset by interest received on bank balances of £3.2
million.
6. Intangibles
Goodwill Developed technology Patents Total
£'000 £'000 £'000 £'000
Cost
At 1 January 2024 628 105,889 1,811 108,328
Additions - 28 9 37
Effects of movements in exchange rates 8 1,567 - 1,575
At 31 December 2024 636 107,484 1,820 109,940
Amortisation and impairment
At 1 January 2024 628 74,914 1,805 77,347
Charge for the period - 2,341 2 2,343
Effects of movements in exchange rates 8 1,023 - 1,031
At 31 December 2024 636 78,278 1,807 80,721
Net book amount at 31 December 2024 - 29,206 13 29,219
Intangible assets comprise Developed technology and Patents for intellectual
property rights. The Developed Technology is being amortised over the period
to February 2037. The Group has not capitalised any internally generated
intangible assets.
In 2024, an impairment indicator relating to the manufacturing and process
development operation of the OXB US Cash generating unit (CGU) located at the
Bedford, MA, US site was identified. The CGU was tested for impairment at 31
December 2024 which concluded no further impairment was required (2023: £62.6
million).
Due to a tax deduction not being available on a portion of the developed
technology intangible asset, there is a deferred tax liability of
£2.1 million at 31 December 2024. £7.3 million was recognised at the
acquisition date, reduced to £2.2 million after the December 2023
impairment, with the liability expected to unwind in line with the 15 year
useful life of the developed technology intangible asset.
7. Property, plant and equipment
Freehold property Leasehold improvements Office equipment and computers Bio processing and laboratory equipment Right-of-use assets Total
£'000 £'000 £'000 £'000 £'000 £'000
Cost
At 1 January 2024 - 61,063 10,371 54,960 50,766 177,160
Additions at cost 1,333 194 1,224 4,707 260 7,718
Additions through business combinations 1,456 - 205 644 1,545 3,850
Reallocation between asset classes - (354) 12 342 - -
Disposals - (11) (759) (996) (1,063) (2,829)
Change of Estimate - - - - (1,226) (1,226)
Effects of movements in exchange rates (53) 393 (4) 91 210 637
At 31 December 2024 2,736 61,285 11,049 59,748 50,492 185,310
Depreciation & Impairment
At 1 January 2024 - 33,901 8,182 34,982 24,403 101,468
Charge for the period 364 7,201 869 8,483 3,167 20,084
Reallocation between asset classes - (958) 782 176 - -
Impairment of assets - (8) - - 178 170
Effects of movements in exchange rates (7) 349 15 185 227 769
Disposals - (11) (739) (727) - (1,477)
At 31 December 2024 357 40,474 9,109 43,099 27,975 121,014
Net book value at 31 December 2024 2,379 20,811 1,940 16,649 22,517 64,296
Leasehold improvements are capital improvements to buildings which the Group
leases. Manufacturing and laboratory equipment is equipment purchased for the
Group's laboratory and manufacturing processes and are generally movable from
one facility to another.
In 2024, an impairment indicator relating to the manufacturing and process
development operation of the OXB US Cash generating unit (CGU) located at the
Bedford, MA, US site was identified. The CGU was tested for impairment at 31
December 2024 which concluded no further impairment was required (2023:
£36.7 million).
8. Inventories
2024 2023
£'000 £'000
Raw materials 13,573 12,872
Total Inventory 13,573 12,872
Inventory constitutes raw materials held for commercial development and
manufacturing purposes, all of which are expected to be recovered within the
next 12 months.
During the year, the Group wrote down £4.7 million (2023: £2.1 million) of
inventory which is not expected to be used in production or sold onwards.
9. Trade and other receivables
2024 2023
Current £'000 £'000
Trade receivables 23,281 8,114
Contract assets 18,048 5,228
Other receivables 784 2,081
Other tax receivable 12,914 4,962
Prepayments 3,944 4,356
58,971 24,741
Non-current trade and other receivables constitute other receivables of £4.9
million (2023: £4.3 million) which are deposits held in escrow as part of the
Oxbox lease arrangements as well as security deposits held on the Group's
Bedford, MA site lease.
The fair value of trade and other receivables are the current book values. The
Group has performed an impairment assessment under IFRS 9 and has concluded
that the application of the expected credit loss model has had an immaterial
impact on the level of impairment of receivables.
Included in the Group's trade receivable balance are debtors with a carrying
amount of £5.3 million (2023: £3.5 million) which were past due at the
reporting date and of which £4.9 million (2023: £3.5 million) has been
received after the reporting date.
Contract assets
The Group performed an impairment assessment under IFRS 9 and has concluded
that the application of the expected credit loss model has had an immaterial
impact on the level of impairment on contract assets. The Group has noted
there has been no change in the time frame for a right to consideration to
become unconditional and the performance obligation to be satisfied.
10. Trade and other payables
2024 2023
£'000 £'000
Trade payables 9,612 6,052
Other taxation and social security 1,513 1,478
Accruals 15,044 10,272
Total Trade and other payables 26,169 17,802
11. Contract liabilities and deferred income
Contract liabilities and deferred income arise when the Group has received
payment for services in excess of the stage of completion which are expected
to be released as the related performance obligations are satisfied over the
period as described below:
Years Current Non-Current Total
At 31 December 2024 £'000 £'000 £'000
Manufacturing services income 14,335 6 14,341
Process development income 6,158 - 6,158
Procurement and storage services 3,121 - 3,121
Licence fees and incentives 16 44 60
Contract Liabilities 23,630 - 23,680
Grant 562 1,020 1,582
Deferred Income 562 1,020 1,582
Contract liabilities and deferred income of £27.4 million are included in
the statement of financial position at the end of 2023, £23.9 million has
been recognised as revenue during the 2024 financial year.
Included within manufacturing services contract liabilities is revenue of
£1.3 million which has not been recognised during 2024 (2023:
£1.1 million) relating to the estimate of out of specification batches. In
2024 all of the £1.1 million held in contract liabilities as an out of
specification provision at 31 December 2023 was recognised as revenue.
Deferred income relates to grant funding received from the UK Government for
capital equipment purchased as part of the Oxbox manufacturing facility
expansion. The income will be recognised over the period over which the
purchased assets are depreciated.
12. Provisions
2024 2023
£'000 £'000
At 1 January 8,457 8,424
New provision 563 772
Unwinding of discount 661 528
Change in estimate (1,105) (552)
Derecognition - (715)
At 31 December 8,576 8,457
Provisions are exclusively in respect of dilapidations. The dilapidations
provisions relate to properties in Oxford and Wallingford, UK. They relate to
anticipated costs of restoring the leasehold properties at the Corporate
Office, Oxbox, Wallingford Warehouse, Windrush Court, Yarnton and Harrow House
to their original condition at the end of the lease terms in 2025, 2033, 2037,
2037, 2024 and 2033 respectively.
The future anticipated costs of restoring the properties is calculated by
inflating the current expected restoration costs using the three year historic
UK Consumer Price Inflation rate, up to the end of the lease term. The
discount rate utilised for the purpose of determining the present value of the
provision is 9.20% (2023: 7.69%) based on the risk free rate adjusted for
inflation. The present value of the future anticipated costs of restoration is
calculated by discounting the future expected value using the nominal rate of
9.20% (2023: 7.69%). The unwinding of this discount over time is included
within finance costs.
13. Loans
On 10 March 2022, the Group drew down an $85 million loan facility with
Oaktree Capital Management, L.P. (Oaktree) to finance the acquisition of OXB
US under a 1 year facility agreement maturing in 2023. Over the course of the
loan term interest was payable quarterly with a nominal interest rate on the
loan of 8.5%.
On 7 October 2022, the loan facility was refinanced with Oaktree. Under the
terms of such refinancing, the Company has partially repaid the outstanding
amounts and amended the facility into a new senior secured four year term loan
facility provided by Oaktree in a principal amount of $50 million. The term
loan carries a variable interest rate, which is capped at 10.25% per annum and
payable quarterly in cash, with up to 50% of the interest for the first twelve
months payable in kind as additional loan principal, at the option of the
Company. The interest rate is subject to downward adjustment following the
satisfaction of certain commercial conditions.
The Company has also secured the option, subject to the same commercial
conditions as the amended facility and available for a three-year period, to
draw down a further $25 million from Oaktree loan facility to fund certain
permitted acquisitions. If the option were to be exercised, it would be
assessed against meeting the substantial modification requirements under IFRS
9.
The terms include financial covenants including holding a minimum of
$20 million cash at all times, restrictions on the level of indebtedness the
Group may enter into or distributions made by the Group. The Oaktree loan
facility was secured by a pledge over substantially all of the Group's assets.
2024 2023
£'000 £'000
At 1 January 38,534 39,780
Acquisitions through business combinations 756 -
Interest accrued 4,515 4,570
Interest paid (4,086) (4,136)
Foreign exchange movement 502 (2,003)
Amortised fees 316 323
Loan repayment (466) -
At 31 December 40,071 38,534
14. Put/ call option liability
2024 2023
£'000 £'000
At 1 January 9,348 38,182
Revaluation (6,960) (28,834)
At 31 December 2,388 9,348
On 10 March 2022, the Group recognised a put/ call option liability to acquire
the remaining 20% of OXB US that it doesn't already own from Q32. The fair
value of the put/ call option at the date of acquisition was assessed to be
£39.0 million. In June 2024, the Group increased its ownership in OXB US by
a further 10% to 90%.
At 31 December 2024, the fair value of the put/ call option liability was
£2.4 million (Dec 2023: £9.3m). The lower liability valuation was due to a
decrease in the value at which the option is expected to be exercised as a
result of lower forecasted revenues over the option period and due to the
ownership change.
15. Leases
Property Laboratory Equipment IT Equipment Motor Vehicles Total
£'000 £'000 £'000 £'000 £'000
Balance at 1 January 2024 26,363 - - - 26,363
Acquisitions 1,431 - 54 60 1,545
Reclassifications (55) 55 - - -
Additions 217 - - 43 260
Disposals (1,057) - (4) (2) (1,063)
Impairment of assets (178) - - - (178)
Change in estimate (1,226) - - - (1,226)
Depreciation charge for the period (3,093) (27) (14) (33) (3,167)
Effects of movements in exchange rates (10) (3) (2) (2) (17)
Balance at 31 December 2024 22,392 25 34 66 22,517
16. Share capital and Share premium
At 31 December 2024 and 31 December 2023 Oxford Biomedica had an issued share
capital of 105,961,199 and 96,804,353 ordinary 50 pence shares respectively.
806,365 shares were created as a result of the exercise of options by
employees during the period.
17. Cash flows from operating activities
2024 2023
£'000 £'000
Continuing operations
Loss before tax (47,265) (188,527)
Adjustment for:
Depreciation 20,084 21,504
Amortisation of intangible assets 2,343 7,206
Impairment charge 179 99,285
Loss on disposal of property, plant and equipment 289 197
Loss/ (Gain) on sale and leaseback - (1,018)
Net finance costs 7,890 4,353
Charge in relation to employee share schemes 1,690 3,516
Non-cash loss/(gains) (1,493) -
Changes in working capital:(1)
(Increase)/Decrease in contract assets and trade and other receivables (33,338) 28,793
Increase/(Decrease) in trade and other payables 2,893 (18,125)
(Decrease)/Increase in contract liabilities (6,048) 7,034
(Decrease)/Increase in provisions (83) 2
Decrease/(Increase) in inventory 2,193 (247)
Net cash used in operations (50,666) (36,027)
1 The movements in working capital attributable to subsidiary acquisition,
are considered non-cash. Therefore, these movements have been excluded from
the calculation of changes in working capital.
18. Non-controlling interest ("NCI")
The accounting policy selected and applied by the Group to calculate
Non-controlling interest (NCI) was the holders' proportionate interest in the
recognised amount of the identifiable net assets of the acquiree. The
proportion of the identifiable net assets of the Non-controlling interest in
OXB US on acquisition was determined to be £34.6 million. Goodwill of
£0.6 million and acquisition of NCI without a change in control of
£0.4 million was recognised.
In June 2024, the Group acquired a further 10% of the equity of OXB US,
bringing the residual NCI percentage to 10%.
The following table summarises the information relating to the Group's
subsidiary that has material NCI:
2024 2023
£'000 £'000
NCI percentage 10% 20%
Non-current assets 60,113 50,282
Current assets 10,451 11,813
Non-current liabilities (20,594) (22,479)
Current liabilities (15,560) (20,477)
Net assets 34,410 19,139
Net assets attributable to NCI 3,441 3,828
Revenue 3,290 26,813
Loss (34,624) (133,361)
Other comprehensive expense (384) (7,190)
Total comprehensive expense (35,008) (140,551)
Loss allocated to NCI (5,419) (26,672)
Other comprehensive expense allocated to NCI (49) (1,438)
Cash flows from operating activities (24,516) (15,105)
Cash flows from investment activities (19,397) 3,077
Cash flow from financing activities (dividends to NCI: nil) 45,469 (3,717)
Net increase in cash and cash equivalents 1,556 (15,745)
19. Contingent liabilities and capital commitments
The Group has a letter of credit for £1.4 million (2023: £1.4 million)
related to the deposit on the Patriots Park lease which is disclosed within
Trade and other receivables in non-current assets. The Group had commitments
of £1.1 million for capital expenditure for leasehold improvements and plant
and equipment not provided for in the financial statements at 31 December 2024
(2023: £3.5 million).
20. Related party transactions
Transactions Balance outstanding
2024 2023 2024 2023
£'000 £'000 £'000 £'000
Sales of goods and services
Q32 (formerly Homology Medicines, Inc) 145 23,664 - 2,429
Purchase of services
Q32 (formerly Homology Medicines, Inc)- rental income - 387 - 17
Other
Other: Q32 (formerly Homology Medicines, Inc)- rental income 1,743 1,074 - 258
21 Acquisition of subsidiary
On 29 January 2024, the Group acquired 100% of the shares and voting interests
in ABL Europe SAS (OXB France).
As a result, the Group's equity interest granted it control of OXB France.
Included in the identifiable assets and liabilities acquired at the date of
acquisition are inputs, production processes and an organised workforce. The
Group has determined that together the acquired inputs and processes
contribute to the ability to create revenue. The Group has concluded that the
acquired inputs and processes constitute a business.
a) Consideration transferred: On acquisition date the fair value of the
shares in Oxford Biomedica plc was 180.6p, this represents the fair value of
the consideration under IFRS 3. 3.149 million shares were issued giving a
consideration of £5.7 million
Consideration transferred: 31 December 2024
£'000
Fair value of shares in OXB issued to Institut Mérieux 5,700
Total consideration transferred 5,700
b) Acquisition related expenses: The Group incurred acquisition related
legal and due diligence expenses of £1.5 million which is included in
Administrative expenses.
c) Identifiable assets acquired and liabilities assumed:
Identifiable assets acquired and liabilities assumed: Acquired net assets Fair value adj Fair value of net assets
£'000 £'000 £'000
Property plant and equipment 8,018 (4,168) 3,850
Intangible assets 832 (832) -
Long term receivables 191 - 191
Inventory 2,894 - 2,894
Cash and cash equivalents 9,004 - 9,004
Prepayments and accrued income 2,145 - 2,145
Trade and other receivables 1,384 - 1,384
Lease liabilities (1,548) - (1,548)
Payroll and other taxes (2,568) - (2,568)
Other liabilities (7,931) - (7,931)
Total identifiable net assets acquired: 12,421 (5,000) 7,421
d) Goodwill: The acquisition of OXB France increases access to EU-based
clients and broadens the Group's international development, manufacturing and
testing presence, whilst increasing its capacity in process and analytical
development and early stage manufacturing. Conversely, the vendors have been
able to dispose of a business that was not profitable for them. As a result of
the mutual benefits of the transaction, the fair value of the net assets
acquired is in excess of the fair value of the shares transferred as
consideration which has created a negative goodwill.
Negative goodwill arising from the acquisition has been recognised through the
profit and loss in other operating income as follows
Goodwill Acquired net assets
£'000
Consideration transferred 5,700
Fair value of identifiable assets 7,421
Negative goodwill (1,721)
e) Impact of acquisition: During the year ended 31 December 2024, the
acquisition has contributed £11.5 million revenue and pre-tax loss of £11.7
million. Had the acquisition taken place on 1 Jan 2024, then the revenue
contributed in the period would have been £0.7 million more and a further
£0.9 million loss.
f) Acquired receivables: The fair value of trade and other receivables is
£1.4 million and includes trade receivables with a fair value of £1.4
million. The gross contractual amount for trade receivables due is equal to
the fair value.
22 Re-presentation
In 2024, the Group has pivoted to a pure-play CDMO and as a result, the
classification of the expenditure types has been reviewed and represented in a
more meaningful way.
● The costs previously disclosed as Bioprocessing and the element of
Research and Development which related to Development services are now
included as operating costs.
● Innovation costs relate to the internal development work
undertaken on OXB platforms.
● Commercial costs relate to the teams engaged in business
development activities.
● Administration expenses are those departments who support the
operational teams across the Group.
The table below shows the impact on 2023 of the changes made in the year.
2023 Re-presented Re-presentation Impact 2023 as previously reported
£'000 £'000 £'000
Revenue 89,539 - 89,539
Cost of sales (49,812) - (49,812)
Gross Profit 39,727 - 39,727
Operating costs (86,163) 86,163 -
Bioprocessing costs - (43,746) (43,746)
Research and Development costs - (59,353) (59,353)
Innovation costs (11,471) 11,471 -
Commercial costs (3,911) 3,911 -
Administration expenses (26,893) 1,480 (25,413)
Impairment of assets (99,284) - (99,284)
Other operating income 2,803 - 2,803
Gain/loss on sale and leaseback 1,018 - 1,018
Change in fair value of available for sale assets - 74 74
Operating loss (184,174) - (184,174)
Finance income 4,910 - 4,910
Finance costs (9,263) - (9,263)
Loss before tax (188,527) - (188,527)
Taxation 4,365 - 4,365
Loss for the period (184,162) - (184,162)
Other comprehensive income
Foreign currency translation differences (5,307) - (5,307)
Other comprehensive income (5,307) - (5,307)
Total comprehensive expense (189,469) - (189,469)
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