YGEN.L Regulatory News (YGEN)

Yourgene Health plc

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

First half trading update

Manchester, UK - 03 November 2022: Yourgene (AIM: YGEN), a leading international molecular diagnostics group, provides the following unaudited trading update for the six months ended 30 September 2022 ("H1 FY23").

Highlights

Core revenues for H1 FY23, i.e. excluding COVID-related activities, were £8.0m (H1 FY22: £7.0m), an increase of 14%. Total revenues on a statutory basis were £9.6m (H1 FY22: £17.5m) reflecting the transition away from COVID services post-pandemic, and in total representing over 40% of consensus market expectations for the full year which is consistent with the historical H1 / H2 pattern.

The revenue breakdown across the Group's portfolio of technologies and services, in each case excluding those derived from COVID-related activities, is as follows:

· Recurring revenues, i.e. excluding one-off hardware sales, were up 20% to £5.5m (H1 FY22: £4.7m)

· Genomic Technologies revenues increased by 10% to £6.1m (H1 FY22: £5.5m)

- NIPT category up 18% year-on-year demonstrating a continuing recovery post pandemic

- Ranger® Technology revenue run rate now over USD $2.0m per annum

- Growth pipeline being converted, including three new NIPT accounts won in H1 and being installed early in H2

· Genomic Services revenues up 26% to £1.9m (H1 FY22: £1.5m)

- NIPT services up 50% to £1.3m on the back of Asia reopening post COVID

- Steady progress in building a broader research and oncology service portfolio

The year-to-date performance and healthy commercial pipeline supports unchanged management revenue expectations for the year as a whole. In line with other businesses in the UK facing inflationary and economic pressures and currency fluctuations, the Company is experiencing some erosion to margins which will only partially be offset by existing measures to mitigate these effects. The Company has prioritised expanding market share in its core markets above near-term margin protection and therefore expects margins to remain below the 60% level previously forecast for the remainder of the financial year.

In line with previous announcements, the Company remains on track to reduce its operating costs by £5m, approximately one-third, in the current financial year when compared to FY22, excluding restructuring expenses. To mitigate the margin pressures, the Board continues to assess its cost base in the context of its pipeline of commercial partnerships and discretionary investment options. The Board is confident that it can further reduce operating costs to achieve positive adjusted EBITDA in the next financial year, and can exercise control over discretionary spending and working capital to manage the Group's financial position. The necessary decisions will be taken as commercial progress in the second half of the financial year becomes clearer.

Lyn Rees, Chief Executive Officer of Yourgene, commented: "This continues to be a year of transition for Yourgene, with encouraging delivery of top line performance in the first half creating a solid base for expected future growth. It is particularly pleasing that the core business has shown improved momentum in such difficult macroeconomic conditions. Whilst margins have been impacted by the current external environment, we are continuing to reshape the business and are evaluating the best ways to manage costs without constraining future growth where possible. The year-to-date performance informs the Board's confidence in the business remaining on track to deliver full-year revenues in line with expectations and to prioritise market penetration over near-term EBITDA delivery. Yourgene remains well placed to exploit the opportunities available to its growing portfolio of genomic products and services and, with additional partnerships in place and being added, is expanding its market access to create significant strategic value."

This announcement contains inside information for the purposes of the UK Market Abuse Regulation.

The Directors of the Company take responsibility for this announcement.

About Yourgene Health

Yourgene Health is an international molecular diagnostics group which develops integrated genomic technologies and services enabling precision medicine. The group works in partnership with global leaders in DNA technology to advance diagnostic science. 

Yourgene primarily develops, manufactures, and commercialises simple and accurate molecular diagnostic solutions, for reproductive health, precision medicine and now infectious diseases. The Group's flagship products include non-invasive prenatal tests (NIPT) for Down's Syndrome and other genetic disorders, Cystic Fibrosis screening tests, invasive rapid aneuploidy tests, and a recent extension into the oncology space with DPYD genotyping.

The launch of Yourgene Genomic Services has enabled Yourgene to offer a global laboratory service network equipped to be a full life-cycle partner for clinical, research and pharmaceutical organisations to support partners at the preclinical, clinical, and post-market stages to develop, manufacture, obtain regulatory approval and commercialise new products and services. In addition, Yourgene Genomic Services offers an NIPT and high throughput COVID-19 testing service.

In August 2020, Yourgene acquired Coastal Genomics, Inc., a sample preparation technology company based in Vancouver, Canada, enabling the Company to extend its offering and IP portfolio in the DNA sample preparation sector. The acquisition increased Yourgene's geographical penetration into the US and Canada, supplementing existing coverage in the UK, Europe, MEA and Asia.

Yourgene Health is headquartered in Manchester, UK with offices in Taipei, Singapore, the US and Canada, and is listed on the London Stock Exchange's AIM market under the ticker "YGEN". For more information visit www.yourgene-health.com and follow us on twitter @Yourgene_Health.

Forward-Looking Statements

Certain statements made in this announcement are forward-looking statements. These forward-looking statements are not historical facts but rather are based on the Company's current expectations, estimates, and projections about its industry; its beliefs; and assumptions. Words such as 'anticipates,' 'expects,' 'intends,' 'plans,' 'believes,' 'seeks,' 'estimates,' and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties, and other factors, some of which are beyond the Company's control, are difficult to predict, and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. The Company cautions security holders and prospective security holders not to place undue reliance on these forward-looking statements, which reflect the view of the Company only as of the date of this announcement. The forward-looking statements made in this announcement relate only to events as of the date on which the statements are made. The Company will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances, or unanticipated events occurring after the date of this announcement except as required by law or by any appropriate regulatory authority.