On September 10, 2020 Selvita (WSE: SLV), one of the largest preclinical contract research organizations in Europe, reported its H1 2020 financial results and provided a corporate update (Press release, Selvita, SEP 10, 2020, View Source [SID1234564985]).
Schedule your 30 min Free 1stOncology Demo!
Discover why more than 1,500 members use 1stOncology™ to excel in:
Early/Late Stage Pipeline Development - Target Scouting - Clinical Biomarkers - Indication Selection & Expansion - BD&L Contacts - Conference Reports - Combinatorial Drug Settings - Companion Diagnostics - Drug Repositioning - First-in-class Analysis - Competitive Analysis - Deals & Licensing
Schedule Your 30 min Free Demo!
For the H1 2020, Selvita reports consolidated revenues of EUR 15.2 million, up by 47% on a year-on-year basis. The EBITDA result reached EUR 3.6 million, compared to EUR 2.4 million a year earlier. The backlog for 2020, as of September 7, amounts to EUR 27.6 million and indicates an increase of 39%, as compared to the values reported a year ago.
The Company consistently develops its business activities and strengthens its position on the global preclinical CRO market, especially among the U.S. customer base, considered the world’s largest biotechnology market.
Commercial revenues in the Services Segment increased in H1 2020 to EUR 12.5 million, showing a 51% increase, compared to EUR 8.6 million in the corresponding period last year. The EBITDA result of the Services Segment amounted to EUR 3.2 million, which indicates a 23.8% profitability.
Revenues in the Bioinformatics segment (Selvita’s subsidiary – Ardigen S.A.) amounted to EUR 2.0 million in 1H 2020, indicating a 43% increase compared to the same period last year. The EBITDA result increased by 217% and amounted to EUR 0.4 million, with a margin of 20,1%.
The Company’s net profit in the first half of the year amounted to EUR 2.1 million, compared to EUR 1.1 million for a corresponding period last year.
The first half of 2020 was a very intensive period for Selvita in terms of corporate and business development. The Company announced a new development strategy for 2020-2023, successfully raised over EUR 20 million from the issue of C series shares, and consequently increased its scale of business.
– We’re consistently implementing the assumptions of the development strategy, which directly translate into strengthening of our market position, as well as a solid operational and financial result. The first half of 2020 confirms that the global preclinical CRO market continues to grow and diversify, despite the uncertainties caused by the COVID-19 pandemic. For Selvita, it was a very strong half-year, as, despite the global situation and instabilities, we managed to strengthen our position on international markets, especially among U.S. based customers – comments Boguslaw Sieczkowski, Chief Executive Officer at Selvita.
Revenues from the services commissioned by U.S. customers increased almost three times by 279% y/y, and already constitute nearly 28% of the entire Services Segment revenues. At the same time, revenues from the services commissioned by customers from the United Kingdom increased by 63% y/y. Increasing customer recognition is related to the high quality of services offered and highly competent teams of specialists, which results in further contracts.
Continuity of our business operations has been assured with numerous preventive measures across our entire organization that have been taken in order to keep our scientists safe and the Company fully operational. Despite the restrictions placed on international travel, we are keeping our sales and networking activities going, which has successfully translated into the signature of numerous new contracts, as evidenced by our record-breaking backlog – adds Boguslaw Sieczkowski.
At the end of April 2020, Selvita announced its new development strategy for 2020 – 2023, which assumes increasing revenues, maintaining a stable EBITDA margin, and over EUR 230 million of market cap in 2023. For this purpose, in 2020-2023, the Company intends to execute investments worth up to EUR 75-90 million, allocated to acquisitions and organic development. In order to complete the strategy, Selvita raised over EUR 20 million in its Follow-On public offering from the issue of C series shares. Approximately 80% of the proceeds will be allocated to acquisitions, on which the Company is currently intensively working on. One of the elements of the strategy execution will be the creation of the Selvita Research Center in order to secure its own research space necessary for further growth. The Company has already made the first step towards executing this goal and signed a contract to purchase a plot of land in the neighborhood of its current laboratories in August 2020 for the value of EUR 2,3 million.
* Percentage changes in the press release are calculated based on functional currency [PLN].