TIDMEKF
RNS Number : 9351O
EKF Diagnostics Holdings PLC
06 February 2023
This announcement contains inside information
for the purposes of UK Market Abuse Regulation.
EKF Diagnostics Holdings plc
("EKF", the "Company" or the "Group")
Trading update
EKF Diagnostics Holdings plc (AIM: EKF), the AIM-listed global
diagnostics business , provides the following unaudited trading
update for the year ended 31 December 2022 ("FY 2022"), reflecting
strong growth in the core established business. The Company also
gives a progress update on the expansion of the Life Sciences
enzyme fermentation business and on the transition of Contract
Manufacturing & Laboratory Testing into non-COVID revenues.
Summary expected results for FY 2022
The positive first half performance of the core established
business, comprising Point-of-Care & Central Laboratory,
continued into the second half, and the Life Sciences division also
delivered significant year-on-year growth. Overall performance has
shown considerable growth compared to pre-pandemic levels and, as a
result, the Company will report revenues for FY 2022 that are in
line with market expectations.
The transition to non-COVID revenues in both Contract
Manufacturing and Laboratory Testing is progressing, but is taking
longer than originally anticipated. As a result of the
underperformance in these businesses, adjusted EBITDA(1) is now
anticipated to be slightly below market expectations. Laboratory
Testing has, however, moved closer to a return to profitability in
recent months, driven by non-COVID services introduced.
Group cash, net of borrowings, as at 31 December 2022 was
GBP11.4m (31 December 2021: GBP19.6m), reflecting planned
investments made during the year, including the significant capital
expenditure to increase the Company's enzyme fermentation capacity
in the US.
Divisional Commentary
1. Point-of-Care ("POC") & Central Laboratory - Continued
growth in key established business units
The established POC & Central Laboratory businesses
continues to deliver double-digit growth, and the Company expects
continued growth in 2023. The temporary supply delays that
marginally impacted H1 sales of <BETA>-HB
(Beta-Hydroxybutyrate) have been resolved and a strong H2 sales
performance has ensured significant growth for the full year. This
momentum is expected to continue into 2023.
2. Life Sciences - Focus on completing increase in enzyme fermentation capacity
Completion of the capacity expansion at the enzyme fermentation
facility in South Bend, Indiana, remains the main short-term
priority for the Group. Once completed this will lead to further
growth in 2024, the business having already delivered significant
organic growth of 60% using existing capacity in FY 2022. The
customer onboarding processes (internal audit, validation and tech
transfer) have progressed well, however the supply and delivery of
the largest 14,500 litre fermenter has been delayed and is now
expected to be installed and validated in July 2023. Delays have
also arisen in the delivery of key components and costs have
increased, partly due to enhanced customer requirements and partly
due to inflationary pressures. Although these increases mean that
the total capital cost of the development is now estimated to be
around $14.2m, the Board remains confident in the commercial
potential and payback of this growth opportunity.
The full additional capacity is now expected to become
operational during Q3 2023. Whilst this has an impact on growth
expectations for this division for 2023, these delays have not
affected relationships with key customers. Accordingly the full
positive impact of this increased capacity is still expected to be
seen in 2024.
3. Contract Manufacturing - Reducing cost base as operations
shift into non-COVID-revenues
In the US, the Company's non-COVID Contract Manufacturing
services continues to develop, focused on working with innovative
companies in the areas of genomics and forensics to support their
growth ambitions. In 2023 this division's focus will be on
expanding this service line utilising the Company's asset base in
the US and Germany.
During the global pandemic, EKF went through significant
structural changes to deliver COVID-related testing products and
services to a number of international customers, expanding
facilities in Germany, as well as opening a number of new
facilities in the US and UK to meet demand. In addition, there was
a requirement to employ further resource to meet this demand. EKF
is focussing on taking out significant costs from the business,
using pre-pandemic levels as a benchmark and extending its
re-organisation programme and efficiency drives previously notified
in the Company's interim results in September 2022.
By reducing the cost base in the first half of this year, the
Company anticipates growth in adjusted EBITDA and gross margin in
the second half of 2023, with an improved cash position over the
same period.
4. Laboratory Testing - Diversifying portfolio of non-COVID
tests and targeting a return to profitable growth
The transition of the Laboratory Testing business into non-COVID
revenues remains a challenge, following the rapid drop in demand
for COVID testing seen worldwide in Q1 2022. Whilst ADL was loss
making for the last three quarters of 2022, a focus on developing
and validating a diversified portfolio of high value tests has
slowly seen the green shoots of recovery within the business, with
losses narrowing in Q4 2022.
The performance of ADL recently has been much improved, driven
by non-COVID services. Management will be monitoring this business
closely in H1 2023 to ensure it continues on its path to profitable
growth and will update shareholders on progress during the
year.
Russia Update
During 2022 EKF continued to supply essential medical products
to its 60%-owned Russian subsidiary, in compliance with current
international sanctions guidance and following regular management
review. International sanctions mean that the Company remains
unable to distribute cash dividends from this subsidiary and this
situation is not expected to change in 2023. As at 31 December
2022, cash in Russia totalled GBP2.4m (31 December 2021:
GBP1.3m).
Outlook
The performance of the core established business has been very
encouraging and the outlook for 2023 remains positive. Despite the
delay with South Bend the Company remains positive of the
significant benefit to 2024 and beyond. The swift end of the
pandemic has posed challenges as the Group adjusts its operating
focus to execute its growth plans in other areas.
It is expected that 2023 performance will benefit from further
cost reduction, restructuring and operational efficiency measures
being implemented, alongside further growth in the core established
business. Following the completion of the capacity improvements at
the South Bend facility later this year, there is further
opportunity for significant, longer-term growth from the Life
Sciences division.
The Company will recognise large exceptional costs in 2022, but
this will lead to stronger and clearer foundations for 2023.
Further guidance on the outlook for 2023 and beyond will be
provided at the time of release of full year results for FY 2022,
expected to be reported in late March 2023.
Board Changes
The Board recognises the critical success factor in the delivery
of growth in Life Sciences and improved performances for Contract
Manufacturing and Lab Testing. Mike Salter, Chief Executive
Officer, will focus on these critical operational tasks and to do
so will stand down from his role as CEO with immediate effect, but
remain as key part of the Management Team reporting directly to the
Board.
Christopher Mills, currently Non-executive Chair will remain a
Non-executive Director, and Julian Baines, will assume the role of
Executive Chair on a short-term basis, using his skills and
experience to best support the Management Team to deliver the
required results for the Company. All of the planned EKF Board
changes are effective immediately.
Julian has agreed to step back from a number of his other
non-executive roles to focus on EKF alongside Mike Salter and Marc
Davies, CFO. The Board will also begin the process of recruiting a
new Chief Executive Officer, and Mike will support Julian and Marc
closely during this period to ensure continuity and an orderly
transition.
(1) Earnings before interest, tax, depreciation and
amortisation, excluding exceptional items and share based
payments.
EKF Diagnostics Holdings plc www.ekfdiagnostics.com
Julian Baines, Executive Chair / Marc Tel: +44 (0)29 2071 0570
Davies, CFO
Singer Capital Markets (Nominated Adviser Tel: +44 (0)20 7496 3000
& Broker)
Aubrey Powell / George Tzimas / Oliver
Platts
Walbrook PR Limited Tel: +44 (0)20 7933 8780 or ekf@walbrookpr.com
Paul McManus / Lianne Applegarth Mob: +44 (0)7980 541 893 / +44
(0)7584 391 303
The persons responsible for arranging the release of this
announcement
on behalf of the Company are Julian Baines, Executive Chair, and
Marc Davies, CFO.
About EKF Diagnostics Holdings plc ( www.ekfdiagnostics.com
)
EKF is a leading global diagnostics business with custom
manufacturing facilities across sites in the US, UK and Europe for
a variety of life science products. EKF is focussed on the
following areas:
Point-of-Care Providing a portfolio of Point-of-Care analysers and
consumables, particularly for use in the area of Hematology
and Diabetes, for use in hospital and research laboratories,
doctor's offices, blood banks and for in-field anaemia
screening programmes. EKF has an estimated 80,000
hemoglobin, hematocrit, HbA1c, glucose and lactate
analysers in regular use across more than 100 countries.
Central Laboratory Clinical chemistry, Small lab analysers, Centrifuges
Beta-Hydroxybutyrate (<BETA>-HB) LiquiColor , Glycated
Albumin, Glycated Serum Protein, Nitro-tab, Procalcitonin
Life Sciences Enzyme fermentation, Custom products and Bulk fermentation
Contract Manufacturing Bulk formulation, Sample collection kits, Private
labelling, Molecular and forensic kits
Laboratory Testing Laboratory testing services certified under the Clinical
Laboratory Improvement Amendments ("CLIA") for high
complexity testing.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
TSTFLFITFIIVIIV
(END) Dow Jones Newswires
February 06, 2023 02:00 ET (07:00 GMT)
EKF Diagnostics (AQSE:EKF.GB)
과거 데이터 주식 차트
부터 11월(11) 2024 으로 12월(12) 2024
EKF Diagnostics (AQSE:EKF.GB)
과거 데이터 주식 차트
부터 12월(12) 2023 으로 12월(12) 2024
