Ergomed reports Jul 21
Specialised pharmaceutical services company Ergomed said on Tuesday that it had an “excellent” first half, with overall growth in revenue driven by continued demand for its services across the integrated business, despite the Covid-19 pandemic.
The AIM-traded firm said it now expected EBITDA for the year ending 31 December to be “materially ahead” of current market expectations.
Total revenues for the first half were ahead 14.8% at £40.4m.
Service fee revenues, excluding revenue from the recently-acquired PrimeVigilance USA, pass-through revenues and one-off first half revenues in 2019 of £1.6m relating to change orders and the implementation of IFRS 15, increased 18% year-on-year.
Revenues in PrimeVigilance - the pharmacovigilance business - increased 62.1% to £26.1m, with the underlying increase standing at 36%, excluding £4.2m in revenue from the now fully-integrated PrimeVigilance USA business.
The contract research outsourcing business saw its underlying service fee revenue decline 6.7% to £11.1m.
Total revenues in that division decreased to £14.3m from £19m year-on-year due to the Covid-19 impact on pass-through revenues, and the inclusion in the first half of 2019 of the £1.6m one-off revenue uplift.
Sales of new business in the first half increased 22.9% to £60.2m, which the board said included “significant” levels of new business from effective cross-selling activities between the contract research outsourcing and pharmacovigilance businesses.
Ergomed said it won major new contracts for both of those services, drawing on its expanded geographic territory, including within its newly-acquired PrimeVigilance USA client base.
Ergomed said its order book remained healthy at £151.4m at the end of the first half of 2020, up 22% from £124.1m on 31 December and up 28% on the prior year, which the boards adi provided “excellent” visibility of contracted revenues for the second half of 2020 and beyond.
Cash balances as at 30 June totalled £14.1m, with the company continuing to be debt-free with additional facilities of £30m available to support expansion.
The continuing sales growth, “healthy” order book and financing capability positioned Ergomed firmly for further growth, the directors said.
“Ergomed has delivered exceptional progress both operationally and financially during the first half of the year,” said executive chairman Dr Miroslav Reljanovic.
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