Improved H1 and year-to-date performance supporting higher full-year expectations
Yourgene (AIM: YGEN), a leading international molecular diagnostics group, provides the following update on performance for the six months ended 30 September 2021 (“H1 FY22”), on year-to-date trading and expectations for the full year.
First half performance (unaudited)
* Adjusted EBITDA is the operating profit/(loss) before interest, tax, depreciation, amortisation and expenses
In line with stated strategy, management and employees have worked hard, supported by focused investment, to establish a broader operating platform from which to sell a growing range of products and services. There has recently been a shift in the balance between genomics services and genomic technologies with the focus on the integration of these unique portfolios being an enabler for precision medicine.
Genomic Services (unaudited H1 FY22 revenues: up 260% to £10.5m)
Launched as Yourgene Genomic Services (YGS) in September 2020, the Company has established an international laboratory network capable of processing human samples as a full life-cycle partner for clinical, research and pharmaceutical organisations. YGS now offers non-invasive prenatal testing (NIPT), high throughput COVID-19 testing services and a range of services to clinical research organisations.
COVID-19 testing services in the UK were the major driver of growth, recording unaudited revenues of £9.1m in the first half. Testing volumes have steadily increased over the period, with record volumes processed in September 2021. Whilst travel PCR testing was an early contributor to growth, market channels have been expanded into non-travel related testing, particularly through our previously announced surge testing contract with the Department of Health and Social Care and other third-party channels. Other non-COVID-19 services offered from Yourgene’s UK laboratory also delivered double digit growth and the YGS laboratory in Taiwan continues to rebound from a challenging FY21.
Genomic Technologies (unaudited H1 FY22 revenues: up 32% to £6.9m)
The Genomic Technologies business stream provides an integrated portfolio of instruments, reagents, consumables and software, all aimed at supporting laboratory customers around the world. Flagship screening and diagnostic products include NIPT, Cystic Fibrosis, DPYD genotyping and Clarigene™ SARS-CoV-2. DNA handling platforms include the LightBench with Ranger® Technology, acquired as part of Coastal Genomics acquisition, for size selection in cell-free DNA applications such as NIPT, oncology and liquid biopsy. This capability supports longer sequencing reads and is a key attraction to customers seeking efficiency and accuracy gains.
Sales of the Company’s Clarigene® SARS-CoV-2 PCR test to third-party testing providers contributed revenues of £1.4m in the period (H1 FY21: £0.2m), and non-COVID product sales delivered growth of 7% to £5.5m (H1 FY21: £5.1m). The growth rates in non-COVID product sales reflect the slow, but now evident, post pandemic normalisation of international NIPT and other reproductive health markets, as well as the Company’s Illumina-based NIPT platform becoming more established in antenatal screening workflows after a transitional year in FY21. Revenues from Ranger® Technology have exceeded US$1m for the first time in the six-month period, more than double the equivalent period prior to its acquisition in August 2020 and before further anticipated inflection points when recent new contract wins start to go live in the coming months.
Due to the strong performance in H1 FY22, and despite the inherent unpredictability of COVID-related revenue streams, the Board is confident that trading for the full year will remain robust and that full year revenues are therefore likely to exceed current market expectations. However, the exact scale of out-performance remains difficult to judge at this stage in the financial year. The Company expects to report positive adjusted EBITDA of approximately £2m for the first half (H1 FY21: loss of £0.2m), when it publishes its unaudited half year financial results in mid-December 2021. With travel corridors now open for business travel we remain confident in the continued recovery of non-COVID revenue streams to underpin previously stated longer-term forecasts.
Lyn Rees, Chief Executive Officer of Yourgene, commented: “These results demonstrate the breadth and depth of the integrated service offering that Yourgene has created to support its increasingly global customer base. I am very proud of the hard work that has driven a strong improvement in performance and created a more diverse platform for future growth. Yourgene is now a truly global genomic services and technologies business working in partnership with world leaders in DNA technology to develop and commercialise high quality diagnostic solutions.
“Performing a significant role in the response to the COVID-19 pandemic has also enabled us to expand our capabilities rapidly, not just to capture the current opportunity, but with a very clear focus on our longer-term progress. The growth in non-COVID services demonstrates the advantage of having multiple capabilities to deploy flexibly according to our clients’ needs and in rapidly changing market conditions. Having invested significantly in our capabilities and business development last year, we look forward with confidence for the rest of this year and at the broader growth prospects ahead.”
This announcement contains inside information for the purposes of the UK Market Abuse Regulation.
The Directors of the Company take responsibility for this announcement.