Full Year 2020 Trading Update
Paris, France and Camberley, UK - 29 January 2021 - Novacyt (EURONEXT GROWTH: ALNOV; AIM: NCYT), an international specialist in clinical diagnostics, announces an unaudited trading update for the year ended 31 December 2020.
Highlights
· Revenue for the full year of 2020 increased by over 20x to €311.6 million (£277.0 million) compared to €13.1 million (£11.5 million) for the full year of 2019
· Revenue of €239.2 million (£213.7 million) delivered in H2 2020 compared to €72.4 million (£63.3 million) in H1 2020
· Gross margin for the full year above 80%
· EBITDA profitability for the full year above €210 million (£187 million), with H2 2020 EBITDA above €161 million (£143 million) compared to €49.4 million (£43 million) in H1 2020
· The Company's cash position at 31 December 2020 was €101 million (£91.8 million), compared to €1.8 million (£1.6 million) at 31 December 2019 and €19.7 million (£18.0 million) at 30 June 2020
· Investment in pipeline of next generation COVID-19 tests to address evolving clinical needs
· Acquisition of IT-IS International, a profitable diagnostic instrument development and manufacturing company, in line with strategy
Overview
As a result of significant work, focus and innovation, the scale and financial performance of the business continued to accelerate during the second half of the year. This was driven by the continued successful global commercialisation of the Company's COVID-19 product portfolio, underpinned by one of the world's first approved polymerase chain reaction (PCR) tests for the virus, and has resulted in the rapid transformation of Novacyt into a leading European integrated molecular diagnostic player.
The strong cash position at the year-end followed significant investment in the Group's working capital, including inventory to meet product demand and ensure uninterrupted supply to customers, and the Group paying down all outstanding debt during the year, making the Company debt free for the first time in its history. On an ongoing basis, we expect conversion of EBITDA to free cash flow before acquisitions to be close to 80%.
Novacyt has successfully integrated the acquisition of IT-IS International Ltd (IT-IS), a profitable diagnostic instrument development and manufacturing company, which was acquired in line with the Company's stated growth strategy. The acquisition allowed Novacyt to become a fully integrated instrument and consumables player, with the ability to expand its product offering into broader COVID-19 opportunities and beyond. As detailed at the time of the acquisition, the Company is focused on delivering higher manufacturing volumes at IT-IS to reduce its cost of goods and therefore improve the gross margin of its instrument sales.
The Group has expanded its global presence, with the UK, Middle East, Germany and US being its four largest revenue generating markets. It has secured significant contracts with national governments, including two with the Department for Health and Social Care in the UK (DHSC), as well as with other national non-government organisations, for the supply of its COVID-19 products.
Novacyt continues to leverage its proven capabilities in PCR test R&D to expand the range of high quality and differentiated products it offers to its customers. This has resulted in ten further product launches during the year to address new needs in the market, which has driven diversification of the Company's revenue base. This includes a test panel to differentiate COVID-19 from common winter diseases and new reagents to aid PCR testing workflow for users.