13th Apr 2005 09:24
Premier Research Group13 April 2005 The following replaces the Preliminary Results released on 13 April 2005 at07.00 am under RNS Number: 9778K Please be advised that the Retained Profit/ (loss) for the period in the Profitand Loss account should read: Year to Year to Year to 31 Jan 31 Jan 31 Jan 2005 2004 2004 Audited Audited Proforma £000 £000 £000 (note 1) (note 2) Retained Profit/ (loss) for the period 652 (1838) (3566) Not Year to Year to Year to 31 Jan 31 Jan 31 Jan 2005 2004 2004 Audited Audited Proforma £000 £000 £000 (note 1) (note 2) Retained Profit/ (loss) for the period 652 1838 3566 All other information remains the same, the full amended text appears below: Immediate Release 13 April 2005 PREMIER RESEARCH GROUP PLC MAIDEN PRELIMINARY RESULTS Premier Research Group plc (AIM: PRG) ("Premier Research", "Company" or "Group"), the international pharmaceutical services group is pleased to announce its maiden preliminary results for the year ended 31 January 2005. Highlights: - Successful flotation on AIM in December 2004 - raising £8m (gross) - Turnover increased 170% to £9.3m (14% increase on pro-forma numbers) - EBITDA up to £2.1m from £0.6m loss in 2003/4 (pro-forma £0.7 loss) - Profit before tax of £0.65m from a loss of £2.6m in 2003/4 (pro-forma loss of £4.3m) - Growing order book of more than £22m as at 12 April 2005 * The pro-forma numbers are extracted from the AIM admission document issued on 30 November 2004 and are prepared on the basis that all the companies that comprise the Group were members of the Group throughout the 12 month period to 31st January 2005. Dr Simon Yaxley, Chief Executive Officer of Premier Research said: "I am extremely pleased with this maiden set of preliminary results for PremierResearch. Following on from our successful debut on AIM, we continue to securehigh quality long-term contracts that provide excellent visibility on futurerevenues. We remain committed to our core business of designing, managing andreporting on later stage clinical trials in our chosen specialist therapeuticareas and are actively looking to grow our customer base through complementaryacquisitions." For further information, please call: Premier Research Group Plc Tel: 01344 458 311Dr Simon Yaxley, Chief Executive Buchanan Communications Tel: 020 7466 5000Lisa Baderoon/Diane Stewart/Rebecca Skye Dietrich CHAIRMAN'S STATEMENT It is with pleasure that I present my first report as Chairman of PremierResearch Group plc following its admission to AIM in December 2004. It was ayear of significant progress for Premier Research in which we achieved excellentresults and built the foundations on which to grow the Group. Results The year to 31 January 2005, on which we are reporting, covers only two monthstrading as an AIM company, and consequently it is difficult to say too much onlife as a quoted company at this stage. Nevertheless, a review of the fulltwelve months' trading shows that the company is in robust health and benefitingfrom the integration of the businesses acquired prior to its flotation. Revenues during the year grew by 170% to £9.3m (14% on pro-forma results for2003/4). EBITDA was £2.1m from a £0.6m loss (pro-forma £0.7m loss) in 2003/4whilst profit before tax increased to £0.65m from a £2.6m loss (pro-forma £4.3in loss) in 2003/4. The order book at the year end was valued at an impressive£22m. Dividend During this period of initial consolidation, we have not proposed the payment ofany dividends. However, shareholders may rest assured that this important matterwill be kept under regular review by the board and it is our intention to ensurethat shareholders receive an income from their investment as soon as isappropriate. Board Prior to the flotation, the board was in the capable hands of its ongoingexecutive directors, Simon Yaxley, Tim Carden, Guy Patrick and BernardGallagher. However, the requirements of corporate governance dictated thatafter that event, at least two independent non-executive directors be appointedand Steven Harris and I were delighted to accept the invitation to join theboard on 29 November 2004. Current Trading & Prospects Since becoming a public company we have begun to see an increase in global bidopportunities and an increase in the size of contracts for which we are bidding.We currently enjoy a customer base of over 40 customers and a very healthy orderbook which currently stands at more than £22m of which a number of contractsextend for more than 24 months. It is the stated intention for Premier Research to grow, both organically and byacquisition. To that end, a number of opportunities are actively beinginvestigated and we are hopeful that one or more of these will be consummated inthe coming months. The success of Premier Research and the substantial corporate changes which havebeen undertaken over the last year could not have taken place without the hardwork and dedication of all our employees and I am delighted to take thisopportunity to thank them for their significant contribution. Premier Research is in good shape and operates in an exciting and growingmarket. We have a strong team in place and are now ideally poised to takeadvantage of growth opportunities as and when they arise. Geoffrey Forster Non-Executive Chairman 13 April 2005 CHIEF EXECUTIVE'S REVIEW Introduction Premier Research has made substantial progress in the year to deliver a strongset of results, benefiting from (the successful integration of recentacquisitions). This has been achieved through hard work and the execution ofPremier Research's strategy for growth. The demand for our services during the year was high and is expected to increaseas a result of several factors: • we have increased our sales activity through the addition of new and experienced sales professionals both in the UK and the US; • through our acquisition strategy and subsequent sales focus we have developed a broad customer base of more than 40 customers and we are starting to see repeat business come through from several of these customers with the potential for more to come; • the outsourcing market in general is buoyant with the requirement for outsourced clinical research services continuing to grow and we see no signs of this changing as we move through our new financial year. Estimates are that by 2007 the Phase II - IV CRO market opportunity will have grown to more than $6 billion, from an estimated $4 billion in 2004. Today, CROs are used in approximately two thirds of all clinical trials and this continues to be a growing trend. In the last quarter of 2004, the Company signed new orders with ten customers toa value of £5.0m, approximately 50% of which was repeat business for existingcustomers and 50% from new customers. Operational Review Our efforts during the year have been concentrated on integrating our two mainacquisitions made during the preceding twelve months, CRC (acquired in May 2003)and Premier Research USA (acquired in January 2004), and reorganising theenlarged group. We have built the operational staffing and managementinfrastructure to compete successfully for new business and to achieve ourproject deliverables. The sales team has been significantly strengthened tosupport the company's growth plan with the recruitment of new, experienced,sales staff both in the US and in the UK. In addition, we have added a globalquality assurance function to ensure we are fully compliant with regulatoryrequirements within all the territories in which we currently operate. We remain committed to our core business; that of designing, managing andreporting on later stage clinical trials, principally Phase II to Phase IVtrials, on behalf of pharmaceutical, biotechnology and medical device companiesand other organisations involved in drug development. We are not involved inundertaking discovery level identification or in pre-clinical studies. Similarly we continue to focus on three main therapeutic areas: oncology,central nervous system disorders and anti-infectives; plus we have developedparticular expertise in another specialist area, paediatric clinical research.All of these areas of expertise are expected to grow significantly in the comingyears. Paediatrics in particular is expected to benefit from changes in theregulatory environment in both the UK and the USA and we are confident that thiswill be extended to the remainder of the European Community from 2006. There isnow a much stronger emphasis on the provision of safety and efficiency data inchildhood populations Current Trading As a result of this strengthening and our consistent sector focus we havesuccessfully increased both the number of requests for proposals and the averagesize of the contracts that we are bidding on. We are also beginning to see anincrease in global bid opportunities. We have signed substantial new businessand improved the value of our order book to more than £22 million. Whilst itenjoys a broad customer base, the Group can now boast some substantialmulti-million pound contracts with some of the world's largest pharmaceuticalcompanies with those contracts typically running for between 24 and 36 months.However, we also have a number of very valuable longer term contracts, not leastof which is our contract with the National Institute for Health in the USA for aprogramme of eight paediatric projects spanning a five year period. Through 2004 we have continued to use our technologies for handling clinicaltrial data to the fullest, including successfully completing multi-country EDC(Electronic Data Capture) studies. We expect to see increasing demand for thesedata handling solutions as we move through 2005. The acquisition in January 2004 of Research USA has dramatically altered thefootprint of out trading activities. More than 50% of our turnover is nowderived from the US with a third coming from the UK and the remainder fromcontinental Europe. Whilst the US will clearly continue to be our largestmarket, we are working to significantly increase our European operations. Outlook The changes we made to the business as a result of the integration of theacquisitions are designed to support growth in turnover and to improve ourability to win and deliver higher value, multi-national projects. We believe that the current climate for outsourced clinical research is good andwe remain confident that we are on track to deliver on plan for FY 2005/6. We see growth by acquisition as an important value driver and therefore continueto explore numerous acquisition opportunities both within Europe and also withinthe USA. There are a number of companies that offer discrete competitiveservices, with complementary customers, in similar target markets that presentthemselves as attractive targets. Acquisitions will provide us with the abilityto offer more to a large, growing market, and create new competitive solutionsto emerging market segments. In addition, they will allow us to rapidly buildon sales and project delivery capabilities in particular territories. Great progress has been made across the business at Premier Research in order todeliver the results achieved this year. This progress is testament to thequality and commitment of our people, and the relationships we enjoy with ourcustomers and partners. I would like to thank our staff for their tremendousefforts and our clients for their continued support to help shape and grow oursuccess. Dr Simon Yaxley Chief Executive Officer 13 April 2005 FINANCIAL REVIEW The results compare favorably with the pro-forma numbers which have beenextracted from the AIM admission document issued on 30 November 2004 and areprepared on the basis that all the companies that comprise the Group weremembers of the Group throughout the 12 month period to 31st January 2005. • Revenues increased by 14% from £8.1m to £9.3m, reflecting the organic growth achieved in the core therapeutic areas of the business. • EBITDA improved from the £0.7m loss in prior year to £2.1m profit in the current year. This result was achieved through a combination of the increased revenue achieved and a 19% reduction in operating expenses as a direct consequence of headcount savings implemented in Q1. The reductions achieved were implemented co-incident with improved customer responsiveness. • The increased level of amortization charges reflects the increased goodwill write-off though this was in part compensated by the reduced depreciation charged as a result of the ongoing lack of required capital expenditure. • The exceptional charges of £154,000 during the year is the cost of one-off legal charges associated with the Premier Research acquisition in the USA compared with prior year charges of £2.5m associated with the rationalization charges to reduce fixed costs of the enlarged group. • The profit and loss account charge of £44,000 reflects the FRS treatment of the difference between fair value (as defined by Inland Revenue) and grant price of current EMI share options. • Interest charges of £724,000 reflect the historical cost of the previous debt incurred by the Group in facilitating the acquisition strategy. The ongoing cost of interest to the group will reduce significantly in 2005 as a result of the replacement of the debt with accumulation of equity and revised bank funding at significantly reduced levels. Bernard Taylor Finance Director 13 April 2005 CONSOLIDATED PROFT & LOSS ACCOUNTfor the 12 months ended 31 January 2005 Year to Year to Year to 31 Jan 31 Jan 31 Jan 2005 2004 2004 Audited Audited Proforma £000 £000 £000 (note 1) (note 2) Sales 9,282 3427 8,118 Overheads 7,145 4014 8,772 EBITDA 2,137 (587) (654) Depreciation 262 76 376Amortisation 345 290 290 EBIT pre non recurring costs 1,530 (953) (1,320) Exceptional costs 154 1161 2,494 EBIT 1,376 (2114) (3,814) Interest 724 510 534 Pre tax profit/(loss) 652 (2624) (4,348) Tax - 786 782 Retained Profit/ (loss) for the period 652 (1838) (3566) Note 1. The actual results for the period to 31 January 2004 comprised the results ofTherapeutic Management Limited for the 12 months ended 31 July 2004, of CRCDevelopment GmbH for the 9 months ended 31 January 2004 and of Premier Researchfor the month of January 2004, those being the only trading entities with theGroup during that period. Note 2. The actual results for the period to 31 January 2004 comprised the results ofTherapeutic Management Limited for the 12 months ended 31 July 2004, of CRCDevelopment GmbH for the 9 months ended 31 January 2004 and of Premier Researchfor the month of January 2004, those being the only trading entities with theGroup during that period. CONSOLIDATED BALANCE SHEET As at 31 January 2005 31 Jan 31 Jan 2005 2004 Consol Consol Audited Audited £000 £000 Fixed Assets Goodwill 6,249 6,466 Investments 52 44 Tangible assets 835 1,084 7,136 7,594 Current Assets Trade debtors 1,797 1,194 Other debtors 1,640 892 3,437 2,086 Cash of bank/ (overdraft) (608) 873 Current liabilities Bank loan 276 - Trade creditors 1,072 458 Other liabilities 1,160 3,369 2,508 3,827 Net current assets/ (liabilities) 321 (868) Creditors over 1 yearBank loan and HP 1,953 -Funder and other loans - 8,121Deferred consideration - 479 5,504 (1,874) Financed by:Share capital 7,159 1Reserves (1,655) (1,875) 5,504 (1,874) CONSOLIDATED CASH FLOW STATEMENTFor the year ended 31 January 2005 Year to Year to 31 Jan 31 Jan 2005 2004 Draft audit Proforma £000 £000 EBITDA 2,137 (654)Non recurring (154) (2,494) 1,983 (3,148) Working capital movement Trade debtors movement (603) 2,034 Other debtors (748) 144 Trade creditors 614 (102) Accruals and other creditors movement (2,441) 1,535 Operating cash flow (1,195) 463 Other cash movements Acquisition and investment movm't (128) - Net capital expenditure (21) (29) Tax payment - (73) Cash flow pre-financing (1,344) 361 Financing New bank loan 2,229 - Funder and other loans (8,121) (130) Deferred consideration (479) - Share capital and premium 6,958 - Interest (724) (534) (137) (664) Net cash (out)/inflow (1,481) (303)Opening cash 873 1,176 Closing cash (608) 873 Notes to Financial Statements 1. The financial information contained in this preliminary announcement does notconstitute statutory accounts as defined in Section 240 of the Companies Act1985. Copies of the directors report and the audited financial statements forthe period ended 31 January 2005 will be posted to shareholders in due courseand may be obtained thereafter from the Company's registered office at 30Wellington Business Park, Dukes Ride, Crowthorne, Berkshire RG45 6LS. 2. Exceptional Items Actual Y/E Actual Y/E Pro-forma 31.01.05 31.01.04 31.01.04 Legal Fees associatedwith acquisitions £154,000 - - Rationalisation costsassociated with acquisitions - £1,161,000 £2,494,000 3. Earnings per share Actual Y/E Actual Y/E Pro-forma 31.01.05 31.01.04 31.01.04 Profit/(Loss) after tax £608,000 (£1,838,000) (£4,348,000) No of shares* 40 million 40 million 40 million EPS 1.52p (4.60p) (10.87p) *No. of shares is assumed at current level for previous years for comparison purposes (as previous periods were when the company was private). 4. Loans (£000's) As at 31.01.05 As at 31.01.04 Bank Lending £2,799 - Debenture Lending - £8,121 Note: Current bank borrowing is at between 1.5% and 1.75% above base. Debenture borrowing was at between 10-12% above base. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
PRG.L