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Trading Update

15 Aug 2023 07:00

RNS Number : 2886J
Instem plc
15 August 2023
 

 15 August 2023

Instem plc

 ("Instem", or the "Company")

 

Half Year Trading Update

 

Instem plc (AIM: INS), a leading provider of IT solutions to the global life sciences market, announces a trading update for the six months to 30 June 2023 ("H1 2023").

 

Financial Highlights

Revenue for H1 2023 is expected to be in the region of £29.7m (H1 2022: £27.0m), an increase of approximately 10.2%, with recurring software revenue growing by 27%. This excludes Samarind Limited, which was sold on 1 April 2023 and will be classified as a discontinued operation in the H1 2023 results statement. Annual Recurring Revenue ("ARR") at 1 July 2023 was c.£41m (1 July 2022: £32m). Overall performance was broadly in line with management expectations.

 

Closing cash at 30 June 2023 was £8.4m (30 June 2022: £10.3m), after £5.8m of deferred consideration paid in H1 2023 in relation to certain of the Company's previous acquisitions. The Group's balance sheet remains strong, retaining the flexibility to execute on acquisition opportunities as they arise. The Board is currently appraising a healthy pipeline of opportunities progressed to various stages.

 

Operational Highlights

The Company commenced the next phase of its development, positioning itself at the forefront of the growing Artificial Intelligence ("AI") opportunity with an increased focus on in silico solutions as part of a blended growth strategy, building on the relationships and fundamentals of the established business.

 

The transfer of the ToxHub Platform (the "Platform") and launch of Centrus® announced in May 2023 enables existing and new clients to utilise a single repository from which to unlock new knowledge through the application and deployment of cutting-edge algorithms.

 

The Company also renewed its long-standing agreement with the National Toxicology Program ("NTP"), run by the US National Institute of Environmental Health Sciences ("NIEHS") during the period - providing further potential for Instem to broaden its in silico presence. The size and scale of this extension underpins increased revenue visibility.

 

Post period end, the Company grew its Provantis footprint further, with Altasciences signing a three-year subscription order worth $3.1m. This follows the acquisitions of Calvert Labs and Sinclair Research by Altasciences and the subsequent decision to standardise on Provantis and to transition from on-premises deployment to Instem's cloud-based solutions, increasing its Provantis user licences from 250 to more than 600.

 

Outlook

The Company remains optimistic about the growth potential having positioned itself to provide solutions across the entire drug discovery and development life cycle. The in silico growth opportunity, in particular, is expected to increase as the Company addresses the pressing market need to reduce the cost and time of life sciences research and development, leveraging the integration of "Toxhub" data and technology into its existing Centrus suite.

 

As in 2022, it is expected that revenue growth will be second half weighted benefitting from increased software recurring revenue, predominantly from new business already secured and the reliable renewal of contracts with current clients.

 

With an increasing number of customer touch points and cross selling opportunities management is confident that Instem's performance will be broadly in line with the Board's expectations for the full year.

 

Phil Reason, Instem CEO, commented: "We are delighted with the continued momentum we are seeing, advocating our acquisition strategy and highlighting our standing across the drug research and development lifecycle. We believe there is significant potential to continue driving value and look forward to building on the Company's growing market reach."

 

 

For further information, please contact:

 

Instem plc

Via Walbrook

Phil Reason, CEO

Nigel Goldsmith, CFO

Singer Capital Markets (Nominated Adviser & Broker)

+44 (0) 20 7496 3000

Peter SteelAlex Bond

Stifel Nicolaus Europe Limited (Joint Broker)

+44 (0) 20 7710 7600

Ben Maddison

 

Richard Short

 

 

 

Walbrook Financial PR

+44 (0) 20 7933 8780

Tom Cooper

instem@walbrookpr.com

Nick Rome

Joe Walker

About Instem

Instem is a leading IT solutions & services provider to the life sciences market, radically reducing the cost and time taken for drugs to come to market across the discovery and development lifecycle. Its workflow software and data science solutions are targeted at increasing life science R&D efficiency, and are currently used by over 700 customers worldwide, including the largest 25 pharmaceutical companies.

 

Instem provides a compelling set of solutions - with more than 50% of global preclinical drug safety data collected over the past 20 years using its software. The Company is focused on increasing touchpoints across the drug development lifecycle - from discovery and non-clinical testing through clinical trials and up product launch. It is positioning itself at the forefront of broader market trends - with the aim of monetising growing demand for data insight that leverages artificial intelligence ("AI") and in silico-based solutions.

 

Its AI solutions include predictive data analytics, simulation and modelling, with a current total addressable market of over £600m, a serviceable addressable market of c.£150m and multiple opportunities to grow. The Group's broader portfolio helps clients collect, analyse, report and submit data to regulatory agencies with confidence and to reveal new insights from public and proprietary data with a total addressable market worth close to £2.0bn.

 

It has an established client base and is well positioned to grow revenues from existing and new clients. Its blended growth strategy will build on strong relationships and fundamentals with growing levels of high margin SaaS revenues underpinning continued profitable growth.

 

To learn more about Instem solutions and its mission, please visit www.instem.com

 

 

 

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TSTFLFVATFISLIV
Date   Source Headline
25th Feb 201610:17 amRNSHolding(s) in Company
23rd Feb 20161:32 pmRNSResult of General Meeting and Director Dealings
12th Feb 20167:00 amRNSInvestor Presentation
5th Feb 20164:47 pmRNSIssue of Equity and Total Voting Rights
4th Feb 20167:00 amRNSDirector/PDMR Shareholding
3rd Feb 20167:00 amRNSPlacing, Posting of Circular and Notice of GM
25th Jan 20167:00 amRNSInnovators & Investors Forum
13th Jan 20167:00 amRNSTrading Update
23rd Dec 20151:15 pmRNSDirector Shareholding and Other Holdings
8th Dec 20153:53 pmRNSIssue of Equity and Total Voting Rights
1st Dec 20157:00 amRNSLogos Earn Out, Issue of Equity and TVR
30th Nov 20155:59 pmRNSHolding(s) in Company
29th Sep 20157:00 amRNSHalf Yearly Report
6th Aug 201511:55 amRNSAdmission of Ordinary Shares
3rd Aug 20157:00 amRNSLogos Third Earn Out Payment & Total Voting Rights
30th Jul 20157:00 amRNSTrading Update and Notice of Interim Results
29th Jul 20157:01 amRNSGrants Under the Long Term Incentive Plan
23rd Jun 20157:00 amRNSInvestor Teach-in
21st May 20154:39 pmRNSHolding(s) in Company
19th May 20151:16 pmRNSResult of AGM
14th May 20157:00 amRNSInstem ALPHADAS Contract Wins
27th Apr 20159:16 amRNSPosting of Annual Report and Notice of AGM
30th Mar 20157:00 amRNSFinal Results
16th Mar 20157:00 amRNSNotice of Results
13th Feb 20157:00 amRNSPerceptive Instruments Earn Out Payment
27th Jan 20157:01 amRNSInnovators & Investors Forum (London)
12th Jan 20157:00 amRNSTrading Update and Notice of Results
23rd Dec 201411:52 amRNSHolding(s) in Company
18th Dec 20147:00 amRNSWIL Research Contract Extension
10th Nov 20147:00 amRNSCentrus-submit Contract Wins
24th Sep 20147:00 amRNSUnaudited Interim Results
5th Sep 20147:00 amRNSNotice of Results
13th Aug 201410:27 amRNSHolding(s) in Company
1st Aug 20147:00 amRNSLogos Second Earn Out Payment
16th Jul 20147:00 amRNSTwo contract wins in Asia-Pacific
21st May 201411:45 amRNSResult of AGM
1st May 20147:00 amRNSContract win
25th Apr 20147:00 amRNSPosting of Annual Report and Notice of AGM
26th Mar 20147:01 amRNSUS Government Contract Extension
26th Mar 20147:00 amRNSFinal Results
6th Mar 20147:00 amRNSNotice of Results
20th Feb 20147:00 amRNSThree-Year SaaS Contract with Leading Pharma
7th Feb 20141:05 pmRNSHolding(s) in Company
3rd Feb 20147:00 amRNSLogos Initial Earn Out Payment
8th Jan 20147:00 amRNSTrading Update and Notice of Results
22nd Nov 20137:00 amRNSAcquisition and Trading Update
9th Oct 20137:00 amRNSAppointment of VP Global Sales
25th Sep 20137:00 amRNSHalf Yearly Report
15th Aug 20137:00 amRNSNotice of Results
2nd Jul 20137:00 amRNSFirst Contract Win for Instem Clinical

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