23 July 2018
("Instem", the "Company" or the "Group")
Results in-line with management expectations
SEND contract value in H1 2018 exceeds that for the entire FY2017
Instem plc (AIM: INS), a leading provider of IT solutions to the global life sciences market, announces a trading update for the six months to 30 June 2018 (the “Period”).
Trading for the Period was in-line with management expectations. Net cash as at 30 June 2018 was £3.7m (30 June 2017; £1.2m).
There were positive contributions in most areas, with several significant new client wins in addition to existing customers extending and expanding their adoption of Instem’s products and services.
Investment in Instem’s early phase clinical product, Alphadas, was increased with a focus on current client needs and recognising that the enhancements will have wider market appeal going forward.
Importantly, the business continued to expand its SaaS delivery model for accessing its solutions via the Instem Cloud with both Provantis® and Samarind RMS being deployed via Software-as-a-Service by additional multinational corporations.
SEND Market Update
The Regulatory Solutions business performed particularly strongly during the period following the latest FDA mandate of the Standard for the Exchange of Non-clinical Data (“SEND”).
Increasing Number of Contract Wins
Orders for the Company's SEND software solutions and technology-enabled SEND out-sourced services over the period have increased year-on-year with 103 orders won during the six-month period ended 30 June 2018, compared to 47 and 65 for the first and second six-month periods of 2017 respectively. Importantly, more SEND out-sourced services deals were closed in the first half of 2018 than for the entire 2017 financial year. These contract wins will increasingly impact overall Group revenues in H2 and beyond in line with recruitment of the necessary services personnel, which has been ongoing throughout 2018.
These new orders came from 50 unique clients during the period, compared with 32 for the equivalent period last year and the Company continues to win the overwhelming majority of all business quoted for.
All of Instem’s study conversions are performed on a secure, hosted and validated SEND services platform, which is available and supported 24/7 utilising Instem's submit™ SEND software suite. This is the same submit™ software that is in production use at pharma and contract research organisations worldwide.
Increasing Contract Value
The total contracted value of SEND-related new business for the current period increased approximately 190% over the corresponding period last year with outsourced services orders particularly strong.
The Company continues to believe that this rapid growth has been largely driven by the IND ('Investigational New Drug') legislation from the FDA, which mandated that studies started after 17 December 2017 and included in IND regulatory submissions must use the electronic SEND format.
Future demand appears to be similarly robust and the Company has a strong SEND new business pipeline for both technology and service related sales, with both the number and value of SEND contracts expected to increase in the second half of 2018 and expected to be significantly ahead of last year.
The further shift towards a SaaS based revenue model, combined with increasingly material recurring outsourced services revenue, will see a continued improvement of earnings visibility. This helps position the Company strongly to meet management’s full year expectations.
Phil Reason, CEO of Instem plc, commented:
“The financial year has started well and we are confident further new business, the delivery of recent contract wins and strong operational management will ensure we meet our expectations for the full year.”
For further information, please contact:
|Phil Reason, CEO||+44 (0) 1785 825600|
|Nigel Goldsmith, CFO|
|N+1 Singer (Nominated Adviser & Broker)||+44 (0) 20 7496 3000|
|Wallbrook Financial PR||Tel: +44 (0) 20 7933 8000|
|Paul Cornelius||or firstname.lastname@example.org|
Instem is a leading provider of IT solutions & services to the life sciences market delivering compelling solutions for Study Management and Data Collection; Regulatory Solutions for Submissions and Compliance; and Informatics-based Insight Generation.
Instem solutions are in use by customers worldwide and enable our clients to bring life enhancing products to market faster.
Instem's portfolio of software solutions increases client productivity by automating study-related processes while offering the unique ability to generate new knowledge through the extraction and harmonisation of actionable scientific information.
Instem supports over 500 clients through offices in the United States, United Kingdom, France, Japan, China and India.
To learn more about Instem solutions and its mission, please visit instem.com.