Ergomed — H1 2019 Earnings Presentation
27 slides from Ergomed's earnings presentation, Sep 25, 2019
Slide 1: Interim Results 2019
TRANSFORMING DRUG DEVELOPMENT Interim Results 2019 25 September 2019 www.ergomedplc.com 1
Slide 2: Disclaimer
DISCLAIMER The information contained in this confidential document (“Presentation”) has been prepared by Ergomed plc (the “Company”). It has not been independently verified and is subject to material updating, revision and further amendment. This Presentation has not been approved by an authorised p
Slide 3: Our Vision
OUR VISION GLOBAL LEADERSHIP in Pharmacovigilance and Orphan Drug Development www.ergomedplc.com | 3
Slide 4: H1 2019 Overview
H1 2019 OVERVIEW Consolidation and Growth • Strong financial performance H1 2019 vs H1 2018 • Strengthened executive team and Board changes • Commercial integration process on track • Accelerated Business Development • Focussed strategy • Confidence in market and ability to deliver future growth www
Slide 5: H1 2019 Key Developments
H1 2019 KEY DEVELOPMENTS Consolidation and Growth Strengthened Executive Team • Richard Barfield appointed to the Board as Chief Financial Officer • Roy Ovel appointed as Chief Commercial Officer • Sally Amanuel appointed as Head of Regulatory and Clinical Delivery • Jon West appointed as President
Slide 6: 2019 Interim Results: Financial Summary
2019 INTERIM RESULTS Financial Summary Financial performance H1 2019 vs H1 2018 • Revenue of £35.2 million, up 36.8% on a comparable Unaudited H1 H1 IFRS 15 basis (H1 2018: £25.7 million) (£ millions, unless stated) 2019 2018 Total Revenue 35.2 25.7 • Gross Margin £14.5 million, up 61.4% on a compar
Slide 7: 2019 Interim Results: Financial Highlights
2019 INTERIM RESULTS: FINANCIAL HIGHLIGHTS Focus on services business model Total Total gross Service Fee Service Fee Total Service revenue up profit up revenue up gross profit up Fee margin 36.8% to 61.4% to 32.7% to 63.4% to 49.8% £35.2m £14.5m £29.5m £14.7m overall (H1 2018: £25.7 m) (H1 2018: £9
Slide 8: Financial Highlights: Strong backlog growth and H1 sales performance
2019 INTERIM RESULTS: FINANCIAL HIGHLIGHTS Strong backlog growth and H1 2019 sales performance £118.3 million £66.2 million £52.1 million c £98 million £49 million contracted contracted contracted Strong pipeline Order intake backlog at CRO backlog PV backlog 30 June 2019 up 28.0% up 25.5% New BD te
Slide 9: Co-development Strategy Closing Out
CO-DEVELOPMENT STRATEGY CLOSING OUT All projects approaching completion with minimal focus and spend going forward PROGRAMME STATUS UPDATE • Awaiting Phase III trial, seeking financial / license partner Peprostat • Fully impaired – no carrying value on Ergomed balance sheet Readyflow • Minimal ongoi
Slide 10: Commercial Update
COMMERCIAL UPDATE Renewed Business Development team in key global markets USA Europe ~ 50% of global clinical trials market 2nd largest global clinical trials market ~ 47% of all global clinical trials started in ~ 25% of all global clinical trials started in 2018 required US operations 2018 require
Slide 11: Focus on Services Business Model
FOCUS ON SERVICES BUSINESS MODEL Project A Project B Project C June 2019 August 2019 September 2019 New Client Repeat Client New Business / Repeat Client Rare disease Pharmacovigilance Full service Phase II Automation Full service Phase III CRO study Pre-case processing New technologies 1,400 patien
Slide 12: H1 2019 Scorecard
H1 2019 SCORECARD Orphan drug strategy Focused on pharmacovigilance & gaining traction; overlap with orphan drug development Service fee growth of 32.7% driven by CRO PV offers cross-selling potential growth of 32.3% and PV growth of 33.1% 45% of CRO new business won in H1 2019 was orphan drug relat
Slide 13: Global Platform – Full Service
GLOBAL PLATFORM – FULL SERVICE 16 $80m+ offices worldwide PV / CRO revenue 750+ Combined PV / employees specialized CRO 300+ ~20% growth contractors Public / AIM- Clinical trials listed in 59 countries (LSE: ERGO) Supporting products in Biotech / small 100+ countries pharma www.ergomedplc.com | 13
Slide 14: Exploiting Potential in the CRO Market
EXPLOITING POTENTIAL IN THE CRO MARKET Ergomed - mid-tier specialist CRO within reach LARGE MID-TIER Characteristics Characteristics • $2Bn+ CRO revenue • $100m+ CRO revenue • Global • Global (excl Asia) • 10,000+ employees • 1,000+ employees • Multi-divisional • Pure CRO models Dynamic Dynamic • Mo
Slide 15: Confidence in Market
CONFIDENCE IN MARKET Biotech / spec pharma Target areas for future growth $14.0bn market (2018) outsourcing 66% to 77% (2018-2022) Oncology $9.9bn market (2018) 9% p.a. growth (2018-2022) Orphan drug / rare diseases Global CRO market $7.2bn market (2018) $26.9bn (2018) target markets in 11% p.a. gro
Slide 16: Strategy for Accelerated Growth
STRATEGY FOR ACCELERATED GROWTH SOLID 2ND HALF AND TRANSITION TO 2020 AND BEYOND • Strong backlog and pipeline provide good visibility to H2 and beyond • Complete work in progress on integration to maximise cost synergies • Complete integrated commercial team and drive new sales • Continue to streng
Slide 17: Appendix
APPENDIX 18. IFRS16 19. IFRS15 20. Income Statement 21. Balance Sheet 22. Cash Flow 23-27. Ergomed’s Business Segments www.ergomedplc.com | 17
Slide 18: Impact of Financial Reporting Changes: IFRS 16
IMPACT OF FINANCIAL REPORTING CHANGES IFRS 16 – Impact on H1 2019 of IFRS 16 reporting of right of use assets Income statement Six months to 30 June 2019 IAS 17 IFRS 16 Unaudited 1st Half Operating profit EBITDA impact Total impact As reported (Figures in £000’s) 2019 impact Total Revenue 35,179 - 3
Slide 19: Impact of Financial Reporting Changes: IFRS 15
IMPACT OF FINANCIAL REPORTING CHANGES IFRS15 – Impact on H1 2018 originally reported under IAS18, now under IFRS15 Income statement Six months to 30 June 2018 Balance Sheet At 30 June 2018 IAS 18 IFRS 15 IAS 18 IFRS 15 (Figures in £000’s) Originally Revised (Figures in £000’s) Originally Revised Adj
Slide 20: Abbreviated Profit and Loss Account
ABBREVIATED PROFIT AND LOSS ACCOUNT Unaudited 1st Half Restated 1st Half (Figures in £ millions, unless otherwise stated) 2019 2018 Total Revenue 35.2 25.7 Cost of Sales (14.8) (13.2) Reimbursable expenses (5.9) (3.5) Gross Profit 14.5 9.0 Administrative and Other Expenses (9.2) (10.3) Research & De
Slide 21: Abbreviated Balance Sheet
ABBREVIATED BALANCE SHEET Figures in £ millions, Unaudited Restated Unaudited* Audited unless otherwise stated 30 Jun 2019 30 Jun 2018 31 Dec 2018 Non-current Assets 27.1 38.7 21.4 Current Assets 26.4 21.8 25.5 Current Liabilities (14.8) (12.9) (17.2) Net Current Assets 11.6 8.9 8.3 Non-current Liab
Slide 22: Abbreviated Cash Flow
ABBREVIATED CASH FLOW Unaudited 1st Half 1st Half (Figures in £ millions, unless otherwise stated) 2019 2018 Operating Profit / (Loss) 4.2 (2. 2) Add: Depreciation & Amortisation 1.9 1.3 Share based payment charge 0.4 0.4 Exceptional items and acquisition costs 0.5 EBITDA (adjusted) 6.5 0.0 FX and O
Slide 23: PV & Medical Information Services
PV & MEDICAL INFORMATION SERVICES Business enabler for biotech and pharma Pharmaco- PV: vigilance market Ensuring drugs get on the market quicker & stay there, even if benefit-risk profile is challenged by regulators. Automation accelerated growth. $2.4bn (2018) Medical Information: ↑ 16% p.a. growt
Slide 24: Pharmacovigilance (PV) Services
PHARMACOVIGILANCE (PV) SERVICES Critical business enabler in both developed and emerging markets Pharmacovigilance The science and activities relating to the detection, assessment, understanding £27.5 m and prevention of adverse effects, or any other drug related problem. Revenue in 2018 (WHO, 2002)
Slide 25: Pharmacovigilance (PV) Services
PHARMACOVIGILANCE (PV) SERVICES Reinforcing our position in orphan drug development services. Acquisition Acquisition of Mesama - Acquisition of Harefield – specialist Formation of Launch of IPO on AIM Acquisition of of PharmInvent – pharmacoepi PrimeVigilance Medical Sound Opinion – small UK PV exp
Slide 26: Clinical Research Services
CLINICAL RESEARCH SERVICES Efficient management and control of complex trial protocols In its Clinical Research Services division, Ergomed undertakes on behalf of our clients all facets of clinical trial management and execution from Phase I to IV. Ergomed CRO – Service Fee (€m) £26.6 m Revenue in 2
Slide 27: Clinical Research Services: Orphan Drug Focus
CLINICAL RESEARCH SERVICES Focus: global leadership in Orphan Drug development Orphan Drug trials are complicated by the nature and types 2018 Revenue of therapy and patient recruitment. Specialist knowledge combined with tailored recruitment and 32% 2018 Studies site management required for optimal