hVIVO plc (HVO), the world leader in testing infectious and respiratory disease products using human challenge clinical trials, has released its Trading Update for the 12 months to the 31st of December 2023.
FY23 Highlights
- FY23 revenue up 15% to £56m
- EBITDA margin expansion to c.22%
- Cash, as at 31 December, of £37.0m (FY22; £28.4m / 1H23: £31.3m)
Outlook
- Move to new state-of-the-art facility in 1H24
- FY24e Revenue guidance of £62m
- Weighted forward orderbook of £80m (FY22: £76m)
- Commencement of annual dividend payment in 2024
- New medium-term target of growing Group revenue to £100m by 2028
Market Intelligence
- hVIVO has once again beaten broker estimates on both the top and EBITDA lines
- FY24 guidance of £62m Vs Broker estimate of c. £60m
- Strong risk-adjusted order book covers 90% of estimated FY24 revenue
- The Company’s medium-term revenue target of £100m by 2028 indicates double digit 5-year CAGR
- FY23a, FY24e and beyond market upgrades expected to follow
hVIVO plc, the world leader in testing infectious and respiratory disease products using human challenge clinical trials, has released its Trading Update for the 12 months to the 31st of December 2023.
These record results across all operating metrics include :
Full year 2023 revenue is now expected to be up 15% to £56m, slightly ahead of previous market expectations.
The Group also expects to report expanding earnings before interest tax and depreciation margin to c.22% as a result of the increased facility and staff utilisation as well as efficiencies gained through improved volunteer recruitment and the concurrent running of multiple clinical trials.
hVIVO remains a highly cash generative business with cash of £37.0 million as at 31 December 2023 ) following the one-off special dividend of £3.0 million in 2023 versus the improved operating margins and the upfront non-refundable quarantine booking fee from new contracts.
The outlook for full year 2023 and beyond also looks strong with Company issuing FY24 guidance of 62 million based on a Weighted forward orderbook of £80m.
Importantly for investors, and given the strong cash generation and balance sheet, the Company will now commence and annual dividend payment in 2024. Payment is intended to take place following the publication of the Group's annual results for the year ended 31 December 2023 which are expected to be announced in April 2024, where further details of the dividend policy will be provided.
A new material medium-term revenue target of £100m by 2028 is clearly positive and indicates an expected 5-year CAGR of 12%.
hVIVO has once again beaten broker estimates on both the top and EBITDA lines with FY24 guidance of £62m improving on current Broker estimates of circa £60m underpinned by Strong risk-adjusted order book of 80- million that covers 90% of estimated Full year 2024 revenue estimate.
The Company’s medium-term revenue target of £100m by 2028 indicates double digit 5-year CAGR.
House broker, Cavendish, notes that at 26p the stock trades on an undemanding 2024 EV/EBITDA multiple 10.3 times and increase our target price modestly to 38p from 35p.
hVIVO (HVO)