15 Jan 2015 07:00
15 January, 2015
Bioquell PLC
Pre-close statement
Bioquell PLC ("Bioquell") (LSE symbol: BQE) - provider of specialist microbiological control technologies to the international Healthcare, Life Sciences & Defence markets; and specialist testing services in the UK via its TRaC division, today announces an update on its trading performance, and details of certain exceptional non-cash impairment charges, prior to entering the closed period ahead of the preliminary results for the year to 31 December 2014.
Trading remained broadly consistent with that disclosed in the Interim Management Statement on 19 November, 2014.
We estimate that revenues for the year ended 31 December, 2014 will be approximately £45.3 million (2013: £44.6 million), an increase in the year of some 1.5%. This estimate comprises £27.3m for the Bio division (2013: £27.9m) and £18.0m for the TRaC division (2014: £16.8m). Pre-exceptional earnings before interest and tax are expected to be in line with market expectations.
The Company had net cash of £1.1m at the year end.
The Board has carried out a review of BioxyQuell, the Group's wound-care technology which is currently in early stage trials. While these trials continue, the speed of adoption of the technology has been slower than expected to date and accordingly the Board has determined that the capitalised value of the BioxyQuell technology of £1.9m should be impaired.
At the same time, the Board has reviewed all other capitalised product development costs in the Bio division in light of the ongoing updating of the Division's product range, which will see the discontinuance of certain products and their replacement by new and improved ones later this year. This review has identified capitalised development costs of £0.8m which relate to products which are to be discontinued, and therefore this amount will be recognised as an exceptional impairment charge in the 2014 accounts.
As noted at the time of our interim results, the Board has also conducted a review of the Bio division's capitalised patent costs. This review has now concluded and it has been decided to focus on maintenance of a narrower group of core patents associated with the Division's core technology, which will result in ongoing cost savings, and to abandon certain other patents. In consequence, an impairment charge of £1.2m will be taken against the value of capitalised patents in the 2014 accounts.
The aggregate pre-tax exceptional non-cash impairment charge of £3.9m will be offset by a deferred tax credit of £0.8m, resulting in a net after tax charge of approximately £3.1m.
The preliminary results for the year ended 31 December, 2014 will be announced on 18 March, 2015.
- Ends -
Enquiries
Nigel Keen (Chairman) Bioquell PLC 01264 835 900
Nick Adams (Chief Executive)
Michael Roller (Finance Director)
Notes to Editors
§ Bioquell is a UK-headquartered, international technology company with two divisions:
o Bio (www.bioquell.com) which sells specialist biological contamination control products and services into the Healthcare, Life Sciences and Defence sectors, with most of its revenues generated from overseas customers; and
o TRaC (www.tracglobal.com) which provides specialist Testing, Regulatory and Compliance services - including EMC (electromagnetic compatibility), environmental, safety, ATEX (explosive atmospheres) radio and telecoms testing - principally to UK corporates.
§ Bioquell's bio-contamination control technology is principally based around hydrogen peroxide vapour (HPV) - which is highly efficacious at eradicating micro-organisms such as bacteria and viruses at room temperature - and is subsequently broken down using specialist catalysts to water vapour and oxygen (hence an extremely 'green' technology) at the end of the bio-decontamination process.
§ For the last three years Bioquell has invested substantial sums in developing new products - comprising rental, service and consumables - which have been designed to increase the proportion of the Group's recurring revenues (cf. capital equipment sales).
§ Bioquell's bio-contamination control technology:
o is used by bio-pharmaceutical, biotechnology and research institutions to provide sterile equipment and/or sterile facilities;
o is used to eradicate "superbugs" from hospitals including Clostridium difficile and carbapenemase producing Enterobacteriaceae (CPE) - sometimes referred to as carbapenem-resistant Enterobacteriaceae (CRE). Independent scientific research from a team at Johns Hopkins, one of America's top hospitals, has demonstrated that 'bioquelling' hospital equipment and facilities resulted in a 64% reduction in the rate of hospital acquired infection;
o is used to provide single rooms to hospitals (via its ICE-pod rental service) which currently only have open, multi-bed "Nightingale" ward structures
o has been incorporated in a wound-care product - BioxyQuell - which has received regulatory approval for use on chronic wounds in the European Union; and
§ Bioquell currently has overseas operations in the USA, France, Ireland, Singapore and China.
TRaC sells its specialist services to the product development departments of a broad range of companies, principally based in the UK, with a particular focus on organisations operating in the aerospace, defence and telecoms sectors. TRaC also has a small team of technical experts located in China.