18 Jan 2016 07:00
Trading Update
Revenue and EBITDA expected to be ahead of consensus driven by at least 120% growth in product sales
Cambridge, UK - 18th January 2016: Horizon Discovery Group plc (LSE: HZD) ("Horizon" or the "Group"), the international life science tools business today announces a trading update ahead of its full year results for the twelve months ended 31 December 2015. The Group intends to announce its preliminary full year 2015 results on 26 April 2016.
The Group reports a second consecutive year of on-target performance since its IPO, with full year 2015 revenues expected to be at least 2% ahead of the £19.8 million market consensus, representing growth of at least 69% (year ended 31 December 2014: £11.9 million). In addition, the Group is eligible to receive future R&D milestones of up to £208 million plus future product royalties, an increase of 32% over the prior year (year ended 31 December 2014: £158m).
Revenue growth is reflective of strong product and service sales to large pharmaceutical and diagnostic development companies as well as an increasing number of academic customers purchasing from a product inventory that increased from 2,750 to 23,000 in the year.
Growth in the Products business has been particularly strong, with organic revenue growth of at least 120% expected to be reported (year ended 31 December 2014: £3.5 million), driven by strong demand for genetically-defined cell lines and derived molecular diagnostic reagents.
Growth in the Services business of at least 65% (year ended 31 December 2014: £7.2 million) has been driven by a strong demand for custom gene-editing, genetic screening and drug combination screening projects.
The Leveraged business continues to generate a portfolio of up-front, milestone and product royalty upside as exemplified by the deals announced with two new collaborations signed in 2015 with Redx and Servier. Further, commitments were made to invest up to £10 million across the following two years in two cutting-edge areas of cancer biology: synthetic lethality and immuno-oncology, which have the potential to deliver significant upside.
The Group also expects to report a full year EBITDA loss that is a positive improvement to the £7.7 million market consensus as investment continues in the long term growth of the business consistent with our previously reported strategy.
Year-end cash is expected to be reported at £25.1 million (year ended 31 December 2014: £18.5 million).
Dr. Darrin M. Disley, Chief Executive Officer of Horizon Discovery Group, commented:
"2015 has been another strong year for Horizon, with growth underpinned by organic and inorganic revenue, new product launches, and the establishment of new channels to market. Horizon's reputation as a leader in gene-editing, translational genomics and personalised medicine is exemplified by the range of partnerships we have announced in the areas of product development (e.g. Axol Bioscience, CareDx, Definigen), market access (e.g. ThermoFisher, Abcam), and leveraged research (e.g. Servier, Redx).
"Horizon continues to deliver on its strategy of: sustainable core revenue growth; increasing the value of what we provide customers; scientific leadership via academic partnerships and grant funded research; and accelerated growth through product in-licensing and M&A activities. Our rAAV, ZFN and CRISPR gene editing platform continues to prove that it is fundamental to the elucidation of the genetic basis of disease and the evolving personalised and genomic-medicine value chain, and we are confident and excited about the prospects for the year ahead."
ENDS
For further information from Horizon Discovery Group plc, please contact:
Horizon Discovery Group plc
Dr. Darrin Disley CEO / Richard Vellacott CFO
Tel: +44 (0) 1223 655580
Consilium Strategic Communications (Financial Media and Investor Relations)
Amber Fennell / Jessica Hodgson / Matthew Neal / Laura Thornton
Tel: +44 (0) 20 3709 5701
Email: horizon@consilium-comms.com
Zyme Communications (Trade and Regional Media)
Katie Odgaard
Tel: +44 (0)7787 502 947
Email: katie.odgaard@zymecommunications.com
Panmure Gordon & Co. (NOMAD)
Corporate Finance: Freddy Crossley / Fabien Holler / Duncan Monteith
Corporate Broking: Tom Salvesen
Tel: +44 20 7886 2500
Notes for Editors
· Horizon is an international life science group supplying products, services and leveraged research programs built upon drug targets, drug biomarkers and drug candidates to customers engaged in genomics research and the development of personalised medicines.
· Performance continues to be driven by an increased global demand for Horizon's integrated commercial offering.
· The integration of SAGE Labs Inc. and CombinatoRx Inc., and the acquisition and integration of Haplogen Genomics GmbH, has proceeded according to expectations. Horizon is now a fully-integrated life science company capable of supporting our customers' research and development activities from 'sequence to treatment'.
· Horizon has expanded its existing catalogue of products from 2,750 at the end of FY14 to over 23,000 genetically-defined cell line and in vivo models, and molecular diagnostic reagents at the end of 2015. This expansion has been primarily driven by incorporation of the cell line inventory and deployment of the high throughput, low-cost cell line generation platform from the acquisition of Haplogen Genomics GmbH in January 2015.
· Horizon launched an advanced eCommerce platform complete with an integrated webshop capable of supporting the online sale of complete product catalogue. Horizon is encouraged by the increase in website traffic since launch and expects it to have a significant impact on the business.
· Horizon has continued to deploy its technology platform, products, services and expertise to drive the early stage drug discovery research programmes of our partners, or to deliver novel drug targets, drug biomarkers and drug candidates for partnership.
· Horizon has continued to take steps to ensure our leadership in high value areas of science that promise to be important drivers of growth in future years. We are expanding our cell line expertise into the area of induced pluripotent stem cells (iPSCs), deploying CRISPR gene editing broadly across product development and genetic screening services, and are deepening the Company's expertise and infrastructure in synthetic lethality and immuno-oncology, two of the most important areas of the emerging drug discovery paradigm.
About Horizon Discovery Group plc www.horizondiscovery.com/
Horizon is a revenue-generating life science group supplying research tools to organizations engaged in translational genomics research and the development of personalised medicines. Horizon has a diverse and international customer base of over 1,400 organizations across more than 50 countries, including major pharmaceutical, biotechnology and diagnostic companies as well as leading academic research centers. The Group supplies its products and services into multiple markets, estimated to total in excess of £29 billion by 2015.
Horizon's core capabilities are built around its proprietary translational genomics platform, a high-precision and flexible suite of gene editing tools able to alter almost any endogenous gene sequence of human or mammalian cell-lines. Horizon offers over 23,000 catalogue products, almost all of which are based on the application of gene editing to generate cell lines that accurately model the disease-causing mutations found in genetically based diseases. These 'patients-in-a-test-tube' are being used by customers to identify the effect of individual or compound genetic mutations on drug activity, patient responsiveness, and resistance, which may lead to the successful prediction of which patient sub-groups will respond to currently available and future drug treatments.
In addition, Horizon provides custom cell line and in vivo model generation services for research and bioproduction applications, quantitative molecular reference standards, in vivo disease models, and contract research and custom screening services both on a fee for service basis and as leveraged partnerships.
Horizon is headquartered in Cambridge, UK, and is listed on the London Stock Exchange's AIM market under the ticker "HZD". For further information please visit: www.horizondiscovery.com.