SBI.L Regulatory News (SBI)

SourceBio International plc

("SourceBio", the "Company" or the "Group")

Trading Update

Full year results in-line with expectations

Almost fivefold increase in adjusted EBITDA and strong balance sheet position

SourceBio International plc (AIM: SBI), the international provider of integrated state of the art laboratory services and products, provides the following trading update for the year ended 31 December 2020.

The Company confirms that full year results will be in line with market expectations, recording considerable growth in both revenues and EBITDA year-on-year. The Company expects to report, subject to audit, revenues of approximately £50.7 million, compared to revenues of £21.2 million recorded in 2019. Adjusted EBITDA1 for the year ended 31 December 2020, subject to audit, was approximately £14.0 million, an almost fivefold increase on 2019 (2019: £3.0 million). Following careful working capital management, the Company's cash position was well ahead of market expectations with cash at 31 December 2020 of £8.4 million (31 December 2019: £1.2 million). At the year end the Company had also eliminated all outstanding bank and shareholder borrowings, compared to borrowings on 31 December 2019 of £95.9 million.

In addition, trading has started strongly in 2021. Whilst the Company still awaits a potential formal award under Public Health England's National Microbiology Framework in relation to further COVID-19 testing services, the Company is pleased to announce that it has signed a surge capacity agreement with the Department of Health and Social Care ("DHSC") for the supply of COVID-19 antigen RT-PCR testing services using the Company's laboratory facility in Nottingham (the "Agreement"). Under the Agreement, SourceBio has been supplying testing services since mid-December, and could potentially process up to a maximum of 4,000 RT-PCR tests for SARS-CoV-2 Virus a day. This surge capacity agreement, which has a maximum value of £7.6 million, expires on 13 February 2021 and may be extended for a further three months. SourceBio has already processed over 400,000 COVID-19 antigen RT-PCR tests for the DHSC and the NHS.

As the country has entered a third national lockdown and the severity of the COVID-19 landscape continues to cause delays in elective surgeries, the Company is anticipating reduced demand for its Cellular Pathology testing services into the new year and until the COVID-19 pandemic is under more control. Following recent announcements, the Company continues to explore further COVID-19 testing service capabilities and expand technology platforms and expects the strength of COVID-19 related revenues to counteract any impact on the Cellular Pathology business. Therefore, the Board's expectation for continued significant earnings growth for 2021 across the Group as a whole remains unchanged.

Full details of the Group's financial performance for 2020 together with a fuller outlook for 2021 will be provided in the Company's preliminary results which it expects to announce in April 2021, with the precise date to be confirmed in a subsequent announcement.

Jay LeCoque, Executive Chairman, commented: "I am pleased to report to shareholders significant revenue growth with dramatically increased profitability in an extremely busy year for SourceBio, that included a successful AIM listing in October. The results have been dominated by robust COVID-19 testing services and, given the impact of the COVID-19 pandemic, the Board remains pleased with performance across all areas of the business. The Company remains strongly capitalised with a loan free balance sheet which positions us well to deliver further aggressive growth in 2021. The Board is appreciative of the strong support from both long standing and new shareholders and we look forward to updating shareholders in more detail in due course."

1 Adjusted EBITDA comprises earnings before interest, tax, depreciation and amortisation, and excluding exceptional costs, which for 2020 comprised IPO related expenses

Contacts: 

About SourceBio International plc www.sourcebiointernational.com

SourceBio is a leading international provider of integrated state-of-the-art laboratory services and products clients in the healthcare, clinical, life science research and biopharma industries, with a focus on improving patient diagnosis, management and care. Group revenues are derived from four core businesses areas:

· Healthcare Diagnostics - histopathology and clinical diagnostic services for the NHS and private healthcare across the UK and Ireland.

· Genomics - DNA sequencing services for pharmaceutical and biotechnology companies, academia, contract research organisations (CROs) and other research groups in the UK, Europe and North America.

· Stability Storage - shelf-life testing services and equipment for pharmaceutical and biotechnology companies, contract manufacturers and analytical testing companies from around the world but primarily in the UK, Ireland and the USA; and

· Infectious Disease Testing - since May 2020, the Group has provided COVID-19 Antigen RT-PCR testing services. These services passed all of the auditing requirements of the NHS and the Department of Health and Social Care (DHSC) in April 2020. It is intended that this offering will potentially provide a broad range of infectious disease testing across the NHS, private healthcare and commercial sectors in the future.

More details on Group operations can be found here: www.sourcebioscience.com

SourceBio International plc (SBI.L) is listed on the AIM market of the London Stock Exchange.