Half Year Report
27 September 2021
("Instem", the "Company" or the "Group")
Instem plc (AIM: INS.L), a leading provider of IT solutions to the global life sciences market, announces its unaudited half year results for the six months ended 30 June 2021.
- Total Group revenues were up 41% to £19.8m (H1 2020: £14.0m)
- Recurring revenue (annual support and SaaS) increased 18% to £9.9m (H1 2020: £8.4m) with SaaS increasing 29% to £4.9m (H1 2020: £3.8m)
- Organic revenue growth of 8% to £15.2m (H1 2020: £14.0m), excluding The Edge Software Consultancy ("The Edge") and d-Wise Technologies Inc ("d-wise") acquisitions in March and April 2021, respectively
- Revenue figures stated after a £0.65m fair value reduction to acquired deferred revenue associated with the d-wise acquisition
- Organic constant currency revenue growth was 16%
- Profit performance
- Adjusted EBITDA* increased 39% to £4.2m (H1 2020: £3.0m), representing an Adjusted EBITDA margin of 21.0% (H1 2020: 21.3%)
- Profit before tax of £1.2m (H1 2020: £1.9m)
- Adjusted profit before tax** of £2.9m (H1 2020: £2.1m)
- Basic and diluted earnings per share of 4.8p (H1 2020: 9.5p) and 4.6p (H1 2020: 9.0p)
- Adjusted basic and diluted earnings per share** of 12.8p (H1 2020: 10.7p) and 12.2p (H1 2020: 10.2p)
- Profit figures also stated after the £0.65m fair value reduction
- Net cash generated from operations of £4.1m (H1 2020 £2.8m)
- Net cash balance*** at 30 June 2021 of £10.1m (H1 2020: £7.3m)
*Earnings before interest, tax, depreciation, amortisation and non-recurring items.
**After adjusting for the effect of foreign currency exchange on the revaluation of inter-company balances included in finance income/(costs), non-recurring items, amortisation of intangibles on acquisitions
Profit is adjusted in this way to provide a clearer measure of underlying operating performance.
*** Gross cash of £17.9m less financial liabilities but pre-IFRS16
- Strong organic growth
- Continued transition to the SaaS model further increased earnings visibility and underlying margins across the business
- The acquisitions of The Edge and d-wise, which transformed the scale and reach of the business, are integrating well
- Increasing recurring revenues
- Strengthening relationships with clients
- Increasing routes to market and potential cross selling opportunities
Post-period end Highlights
- Acquisition of PDS Pathology Data Systems (“PDS”) expected to be immediately earnings enhancing
- Further extends Instem’s Study Management and SEND market share and deepening relationships with some of its largest clients
Analyst Presentation: 11:30 today
Management will be hosting a presentation via web conference today at 11:30. Analysts wishing to join should register their interest by emailing firstname.lastname@example.org or by telephoning 020 7933 8780.
Investor Presentation: 16:00 today
Management will be providing a presentation and hosting an Investor Q&A session on the results and future prospects today at 16:00, through the digital platform Investor Meet Company. Investors can sign up for free and add to attend the presentation via the following link https://www.investormeetcompany.com/instem-plc/register-investor
Questions can be submitted pre-event and at any time during the live presentation via the Investor Meet Company Platform.
Phil Reason, CEO of Instem plc, commented: “As a company, we are focussed on growing both organically and by acquisition. We are delighted with the transactions completed during and post the period end as well as the performance of our existing operations. We have a scalable platform in place and a highly leverageable business model underpinning a number of growth opportunities in existing and adjacent markets.
“We are delighted to have achieved strong organic growth, with the additions of The Edge, d-wise and, most recently, PDS underpinning a step change in the scale of the business. Market conditions remain buoyant and we have a strong pipeline of opportunities, with a significantly increased target market. The improvement in our trading profitability in the first half has been sustained post the period end and, as a result, we now expect trading performance, excluding any negative impact of the fair value adjustment to acquired deferred revenue, for the current financial year to be slightly ahead of the Board’s previous expectations.
“My thanks go to our enlarged global team of over 480 staff, who have continued to perform exceptionally well whilst working remotely. We expect that an indefinite blend of home and hybrid working will provide permanent operational efficiencies while enhancing staff work-life balance.”
Download the full report:
For further information, please contact:
|Phil Reason, CEO||Via Walbrook|
|Nigel Goldsmith, CFO|
|Singer Capital Markets (Nominated Adviser & Broker)||+44 (0) 20 7496 3000|
|Wallbrook Financial PR||Tel: +44 (0) 20 7933 8780|
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 over 700 customers worldwide, including all the largest 25 pharmaceutical companies, enabling 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 products and services address aspects of the entire drug development value chain, from discovery through to market launch. Management estimate that over 50% of all drugs on the market have been through some part of Instem's platform at some stage of their development.
To learn more about Instem solutions and its mission, please visit instem.com.