Trading Statement

Source BioScience plc

('Source BioScience', the 'Group')

Trading update for the year ended 31 December 2015

Nottingham, UK, 29 January 2016 - Source BioScience plc (LSE: SBS), the international Laboratory Services and Products business, today announces an update on its trading performance for the year ended 31 December 2015.

Trading

Source BioScience has sustained the consistent growth previously reported and the results for the year ended 31 December 2015 are expected to demonstrate continued progress in financial performance and represent another record year for the Group.

Revenue is anticipated to be ahead of last year, albeit slightly lower than expected. Revenue growth has been driven by the performance of Laboratory Services and the acquisition of Select Pharma Laboratories ('Select') in the second half of 2015. In contrast, as previously highlighted, the ongoing decline in the liquid based cytology market for cervical cancer screening has acted as a drag on revenue growth.

The delivery of significant operational and commercial objectives during the year is expected to result in all key financial performance metrics, including gross margin, EBITDA, operating cash flow and profit before tax, exceeding those reported in prior years, as the Group continues to progress its strategy to deliver higher margin Laboratory Services.

The results for the year will also reflect the impact of the recent adoption of the Group's new Long Term Incentive Plan, which was approved during the second half of 2015. The adoption of this Plan has increased the 2015 non-cash charge in respect of share-based payments to £0.4 million and accordingly the Board anticipates full year 2015 profit before tax to be £0.4 million lower than expectations.

Highlights

The acquisition of Select in August 2015 was the most recent step in the Board's strategy to enhance the Group's Laboratory Services capability and roll out its highly respected and accredited outsourced service offering into new and adjacent markets.

The acquisition provides the Group with the expertise and capability to provide stability testing and Quality Control product and batch release testing services that are highly complementary with the Group's stability storage services. The integration is progressing well and to plan.

Commercial initiatives to increase the Group's geographic reach and exploit opportunities in the USA have been rolled out during the year as previously reported. This reflects the Board's ambition to further progress the Laboratory Services business across all activities in Diagnostics, DNA Sequencing and Genomic Services and Analytical and Regulated Services.

In addition to the acquisition of Select, investment has also been made in a number of operational initiatives to increase capacity, improve the efficiency of operations and respond to customer demand. These have included:

· rapid, 10 hour DNA sequencing service launched in Atlanta, USA

· launch of our new non-invasive prenatal testing ('NIPT') service

· commissioned high throughput, high capacity serology production capability and serology laboratories at the Group's Rochdale site including "Class A" GMP clean room facilities

· further growth of sexually transmitted infection ('STI') testing and engagement with a number of new sexual health screening initiatives

· launch of enhanced Just Between Us™ online sexual health service including access to at-home sampling for HIV, syphilis, hepatitis B and C

· award of first contract with the European Centre for Disease Control ('ECDC') for next generation DNA sequencing, worth up to €1.2 million over three years

· analytical chemistry laboratory fit-out underway in Rochdale; start of roll-out programme for analytical testing across the Group's stability storage sites

· planned launch of the world's first -70oC walk-in environmentally controlled chamber, the flagship Polar50™, in February 2016; first chamber installed in the Group's facility in Rochdale with applications for research and drug manufacturing customers

The investments made during the year serve to consolidate our capability and broaden the service offering to leverage the full range of Group Laboratory Services and Products expertise to the healthcare, life science research and biopharma markets.

Dr Nick Ash, CEO of Source BioScience, commented:

"We are pleased to report another record year, with continued improvement in the financial performance of the Group and are encouraged by the opportunities and outlook for 2016.

During 2015 we completed the acquisition of Select and invested in a number of significant infrastructure projects to improve operational efficiencies, enhance capacity to meet demand and address new markets for our expanded portfolio of Laboratory Services and Products.

Source BioScience will announce preliminary results for the year ended 31 December 2015 in the second half of March 2016."

Investor site visit

Source BioScience is also pleased to announce that it will be hosting a site visit for institutional investors at its Rochdale facility today, Friday 29 January. No further, material information will be disclosed during this visit than is included in this trading update.

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For further information, please contact:

Source BioScience plcDr Nick AshChief Executive OfficerT: +44 (0)115 973 9010www.sourcebioscience.com

N+1 Singer (Financial Advisor, Sponsor and Broker)

Nic HellyerTel: +44 (0)20 7496 3000www.n1singer.com

About Source BioScience:

Source BioScience plc (LSE: SBS) is a trusted provider of state of the art Laboratory Services and Products to the healthcare and clinical, life and applied sciences and biopharma industries. It is an international business operating ten state of the art facilities in five countries and with customers in over 90 countries worldwide. The Group offers a complementary portfolio of Laboratory Services and Products that share common technologies, laboratory processes, infrastructure and expertise. These include Diagnostics, DNA sequencing and genomics, Analytical and regulated services, Clinical products, Life science research reagents and Controlled environment for a diverse range of markets. These Laboratory Services and Products are provided to a large and diverse customer base including the top 50 pharmaceutical companies, leading universities and research institutes worldwide, the UK NHS and other healthcare providers. The Group is listed on the Premium Main Market of the London Stock Exchange.