Horizon Discovery Group plc – Half-year Report

Horizon Discovery Group plc – Half-year Report

Cambridge, UK, 16 September 2019: Horizon Discovery Group plc (LSE: HZD) (“Horizon”, “the Group” or “the Company”), a global leader in the application of gene editing and gene modulation technologies, today announces its results for the six months ended 30 June 2019.

 

Group Financial highlights

·     Reported revenue of £28.6m an increase of 13.9% on the prior year (HY18: £25.1m) or growth of 8.8% on a constant currency basis1

·     Gross margin increased by 5.3 percentage points to 68.5% (HY18: 63.2%)

·     Adjusted EBITDA1 loss of £0.9m2 (HY18: £2.2m loss), including a positive impact of £1.3m from the implementation of IFRS 16 Leases

·     Loss after taxation2 of £5.3m for the half year (HY18: £7.6m)

·     Cash position at 30 June 2019 of £24.8m (HY18: £24.9m)

Business Unit performance*

·     Research Reagents: Reported revenue of £16.5m up 11.5% on the prior half year period (HY18: £14.8m) or growth of 6.8% on a constant currency basis1

·     Screening: Reported revenue of £4.3m up 38.7% on the prior half year period (HY18: £3.1m) or growth of 32.3% on a constant currency basis1

·     Bioproduction: Reported revenue of £2.8m up 154.5% on the prior half year period (HY18: £1.1m) or growth of 145.5% on a constant currency basis1

·     Diagnostics: Reported revenue of £2.5m down 28.6% on the prior half year period (HY18: £3.5m) or a decline of 31.4% on a constant currency basis1

·     In Vivo: Reported revenue of £2.5m down 3.8% on the prior half year period (HY18: £2.6m) or a decline of 11.5% on a constant currency basis1 

 

Other

·     Post period end, licensing partner Celyad received FDA acceptance of an IND filing for CYAD-02 its CAR-T cell therapy based on Horizon’s optimized SMARTvector™ shRNA technology, triggering the first milestone payment to the Group

·     Product revenue increased 14.6% to £22.8m (HY18: £19.9m); Service revenue increased 11.5% to £5.8m (HY18: £5.2m)

 

Financial Outlook

·     Strong start to trading in H2 2019

·     Revenues for FY19 are expected to be second half weighted (consistent with previous years) and in line with current market expectations

·    The Group is trading in line with expectations for FY 2019

 

 

1                      Refer to the financial review for the definition and reconciliation of alternate performance measures

2                      The HY19 results incorporate the impact of adopting IFRS16 Leases. Refer to the financial review for the reconciliation

*New market aligned business unit structure introduced in January 2019.  Prior year equivalents provided for comparison.  A detailed explanation of the performance of each Business Unit is provided in the CEO Review.

Terry Pizzie, Chief Executive Officer of Horizon Discovery, commented: 

“Horizon has enjoyed a solid performance in the first half of the year with the business as a whole performing in line with expectations.”

“I am pleased to report Group revenues of £28.6m, an increase of 13.9% on the prior year (HY18: £25.1m) or a growth of 8.8% on a constant currency basis. This growth has largely been driven by strong performance in the Group’s Bioproduction and Screening business units, which increased revenues by 154.5% and 38.7% respectively. The Group’s Research Reagent business unit, which encompasses more than half of Group revenues, also had a good start to the year and we expect strong growth in the second half as this Business Unit benefits from the increased capacity in Cell Line engineering that we have implemented in the first half. We have experienced some organisational challenges with our Diagnostics business unit, but the corrective action that we have put in place should lead to an improved performance in the second half.”

“I am pleased to report that the business is on track to complete the delivery of the productivity and eCommerce initiatives that we are implementing as part of our Investing for Growth strategy. We expect these investments to generate significant payback in the short and long-term, by reducing costs, increasing capacity and operating leverage, whilst also opening up new avenues of growth.”

“With our traditional second-half weighting and strong order book for the remainder of 2019, we are well positioned to deliver on our strategy, as we continue to transform Horizon from a scientifically-led business, into a fully commercial tools and services company with industrialised processes and customer-directed R&D.”

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