TIDMHZD
RNS Number : 1727Q
Horizon Discovery Group plc
08 September 2017
Trading Update
-- On track to meet revenue guidance for the enlarged Group of
GBP37-GBP41 million for FY2017, with strong H2 order book
-- Delivery on scalability and path-to-profit strategy now
accelerated through the transformational acquisition of GE
Healthcare Dharmacon, Inc.
-- Consolidation of cell line manufacturing capability from
Vienna, Austria to Centre of Excellence in Cambridge, UK
Cambridge, UK, 8 September 2017: Horizon Discovery Group plc
(LSE: HZD) ("Horizon" or "the Group"), a global leader in gene
editing and gene modulation technologies, today announces a trading
update ahead of its interim results for the six months ended 30
June 2017. The Group will announce its interim results on Tuesday
26 September 2017.
Strong financial performance
The Group expects to report six month revenues of GBP12.1
million, in line with previous guidance, representing growth of at
least 20%. Reported Group gross margins are expected to expand
substantially to at least 60% (HY16: 48%), enhanced by significant
improvement in service margins as the impact of actions to drive
operational efficiencies are realised. As anticipated, the Group
expects to report negative EBITDA in H1 2017 in line with its
historical H1:H2 phasing of revenue of c. 40%:60% and the fixed
cost base of the business.
Based on the historical revenue profile, combined with a strong
H2 order book, the Group is on track to achieve FY2017 revenue in
the GBP30 million - GBP33 million range on an organic basis, GBP37
million - GBP41 million inclusive of the impact of GE Healthcare
Dharmacon, Inc. ("Dharmacon"), whose P&L will be consolidated
with effect from 1 September 2017. Full year EBITDA for the
enlarged group is expected to be approximately break-even prior to
exceptional items relating to the acquisition, integration and
restructuring costs and discontinued operations.
Dharmacon acquisition complete
On 31 August 2017 Horizon announced completion of the $85
million acquisition of Dharmacon, a global leader in gene
modulation products with a fast-growing gene-editing product
portfolio that is highly complementary to Horizon's Products
business. The deal has approximately doubled the annual revenue of
the Group, is significantly accretive to earnings, and provides
further opportunities to accelerate revenue growth and margin
expansion via commercial synergies and cost efficiencies across the
enlarged business. The initial transition to the enlarged
organisation has been delivered successfully and ongoing
integration planning continues to progress well.
Over-subscribed GBP80 million Placing
On 23 August 2017, Horizon completed an over-subscribed placing
of shares, raising gross proceeds of GBP80 million. Following the
investment in the Dharmacon acquisition and settlement of the debt
facility, the Group will be in a robust cash position. The cash
proceeds of the placing will be used to support accelerated growth,
drive sustainable revenue growth and margin expansion, exploit
synergies to drive profitability and strengthen the balance
sheet.
Continued delivery of Path to Profit
The Group is now benefiting from the investments and actions
taken in prior years to optimise organisational design and
operating efficiency. In line with the strategy to transition to
sustainable profitability, this process is continuing and today
Horizon announces the intention to close the Group's site in
Vienna, Austria, by the end of 2017, consolidating its cell line
manufacturing capabilities into Horizon's UK-based in vitro Centre
of Excellence. This closure, combined with further reductions in
personnel across the Group, would result in an overall reduction of
staffing costs of c. 5% (prior to the acquisition of Dharmacon) by
year end.
Dr. Darrin M. Disley, Chief Executive Officer of Horizon
Discovery Group, commented: "Horizon is a leader in the rapidly
growing gene editing and gene modulation markets that are having a
major impact on the crucial drivers of healthcare, including
personalised medicine, immuno-oncology, and gene and cell therapy.
With our continued growth and delivery of the business strategy, we
look forward to a strong performance in the second half of the
year.
"The acquisition of Dharmacon has created immediate value for
our customers and for the Group, and we look forward to benefiting
from the substantial commercial potential of the enlarged business.
The transaction has also allowed Horizon to significantly grow its
shareholder base, and we are grateful for the continued support of
our existing investors, and to welcome GE Healthcare and many
specialist life science investors from the US to our shareholder
register.
"With the acquisition of Dharmacon now complete, and a strong
balance sheet following the GBP80 million placing, we are well
positioned to unlock the potential of this highly complementary
acquisition, building an innovation-driven and customer-focused
business that delivers sustained growth and profitability."
ENDS
Interim Results notification
The Group will announce its interim results for the six months
ended 30 June 2017 on Tuesday 26 September 2017. Dr Darrin Disley,
Chief Executive Officer, and Richard Vellacott, Chief Financial
Officer, will host a presentation and live conference call for
analysts at 9:30am on the morning of the results at the offices of
Numis Securities Ltd., 10 Paternoster Square, London, EC4M 7LT. A
recording of the call will be made available on the Company website
later in the day.
For further information from Horizon Discovery Group plc, please
contact:
Horizon Discovery Group plc
Darrin Disley, Chief Executive Officer
Richard Vellacott, Chief Financial Officer
Chris Claxton, VP Investor Relations
Tel: +44 (0) 1223 655 580
Numis Securities Limited (Broker and NOMAD)
Michael Meade / Freddie Barnfield / Tom Ballard
Tel: +44 (0) 207 260 1000
Consilium Strategic Communications (Financial Media and Investor
Relations)
Mary-Jane Elliott / Matthew Neal / Philippa Gardner / Melissa
Gardiner
Tel: +44 (0) 20 3709 5701
Email: horizon@consilium-comms.com
About Horizon Discovery Group plc -- see
www.horizondiscovery.com
Horizon Discovery Group plc (LSE: HZD) ("Horizon") is a world
leader in gene editing and gene modulation technologies. Horizon
designs and engineers cells using its translational genomics
platform, a highly precise and flexible suite of DNA editing tools
(rAAV, ZFN, CRISPR and Transposon) and, following the acquisition
of Dharmacon, Inc., its functional genomics platform comprising
gene knockdown (RNAi) and gene expression (cDNA, ORF) tools, for
research and clinical applications that advance human health.
Horizon's platforms and capabilities enable researchers to alter
almost any gene or modulate its function in human or mammalian
cell-lines.
Horizon offers an extensive range of catalogue products and
related research services to support a greater understanding of the
function of genes across all species and the genetic drivers of
human disease and the development of personalised molecular, cell
and gene therapies. These have been adopted by over 10,000
academic, drug discovery, drug manufacturing and clinical
diagnostics customers around the globe, as well as in the Company's
own R&D pipeline.
Horizon is headquartered in Cambridge, UK, and is listed on the
London Stock Exchange's AIM market under the ticker "HZD"
This information is provided by RNS
The company news service from the London Stock Exchange
END
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