Trading Update

RNS Number : 6571W

Abingdon Health PLC

27 April 2021

 

Trading update

York, U.K. 27 April 2021:  Abingdon Health plc (AIM: ABDX) ("Abingdon" or "the Company"), a leading international developer and manufacturer of high quality and effective rapid tests, today provides a trading update for the year ending 30 June 2021 (FY21).

Guidance for the FY21

Abingdon, alongside its UK Rapid Test Consortium partners, continues to make progress on commercialising the AbC-19^TM rapid test both in the UK private sector and internationally. The Board is encouraged by the ongoing commercial discussions whilst progressing the required regulatory approvals, and continues to advance its Tier 1 order pipeline, as outlined at the time of the interim results. Further progress has been made in each of these seven countries and the pipeline of opportunities also continues to grow. In anticipation of these near-term opportunities, the Company continues to build AbC-19^TM rapid test stock alongside its consortium partners so that Abingdon can quickly satisfy demand as orders are confirmed.

Whilst each of the opportunities at the time of the interims remains in place and the pipeline continues to grow, the speed of adoption and therefore the receipt of orders is taking longer than the Board originally anticipated. The Board therefore expects the results for FY21 will be substantially below the current market expectations.

Given the level of uncertainty on the timing of AbC-19^TM orders and subsequent delivery within the financial year, the Board now anticipates FY21 revenue will be in the range of £11.4m to £17.0m, with an adjusted EBITDA range of £(3.3)m to £0.0m.

At the lower end of the revenue range this would represent revenue more than doubling with growth of 119% compared with the prior year; and excluding any DHSC revenues in either year, this would represent revenue growth of 132%, highlighting the underlying revenue growth that the Board expects in the Company's non-COVID sales in FY21.

Contract service for partners

In addition, Abingdon continues to work with contract service partners on the transfer of assays to large-scale manufacture and the Company has three such projects, two COVID-19 assays and one non-COVID-19 assay, currently within this process. Subject to successful completion the Board expects that these will lead to meaningful manufacturing revenues in the next financial year.

Department of Health and Social Care contract

As previously noted, the Company's supply contract with the DHSC expired on 14 February 2021. The Company has still not been able to establish from the DHSC when the outstanding debts in relation to this contract will be paid, as well as other monies owed in relation to the procurement of components on the DHSC's behalf by Abingdon. As at 27 April 2021, Abingdon has outstanding invoices with the DHSC totalling £6.7m (including VAT) with monies being overdue by between 79 and 135 days. This includes £5.15m (including VAT) for the 1 million AbC-19™ rapid tests which were delivered by early January 2021 and are currently being used by the DHSC within the UK Biobank study. So far as the Board is aware there is no contractual basis for the DHSC to withhold payment on products they have accepted and are using. As such, the Board continues to seek resolution to this matter. If the outstanding and overdue sums are not paid in the short-term, then Abingdon may need to reduce its cost base. As at 26 April 2021 the Company's cash balance was £7.7m.

Capacity expansion

Abingdon has made significant investment in high-throughput automation with a number of automated lines becoming operational in the third and fourth quarter 2020/1. This provides Abingdon with substantial manufacturing capacity and means Abingdon will remain well placed to support its own products, including the potential AbC-19™ rapid test demand referred to above, and its contract service customers' manufacturing requirements in the short-term and beyond.

Chris Yates, Chief Executive Officer of Abingdon Health, commented:

"Abingdon Health has made significant commercial progress across the COVID-19 and non-COVID-19 markets and the Company expects revenues to more than double this year. The Company continues to develop a strong pipeline of opportunities for its AbC-19™ rapid test. As previously stated, the timing of antibody testing programme roll-outs around the world and future orders is difficult to accurately predict given the range of factors including the evolving regulatory processes, the impact of COVID-19 virus mutations and the rate of vaccination programs. We believe there are clear use cases for antibody testing which includes checking levels of immunity both prior to and after vaccinations and we are confident that over the coming months, the Company's Tier 1 and other targets will convert."

"The Company is continuing its manufacturing expansion, after the successful completion of the first phase, in order to meet market demand for lateral flow testing. This expansion is not only for the AbC-19™ rapid test, but also for the expected demand from our contract service partners, both for COVID-19 and non-COVID assays. The lateral flow testing market is forecast to be worth $10.2bn by 2025, and Abingdon remains well-positioned to be the 'go-to' provider for high quality rapid tests."

Enquiries:

Abingdon Health plc
Chris Yates		Chief Executive Officer		Via Consilium
Melanie Ross		Chief Financial Officer
Chris Hand		Non-Executive Chairman
N+1 Singer		Sole Broker and Nominated Adviser
Shaun Dobson, Peter Steel,				Tel: [phone]
Alex Bond (Corporate Finance)
Tom Salvesen (Corporate Broking)
Consilium		Financial PR		Tel: [phone]
Matthew Neal		[e-mail]
Mary-Jane Elliot
Lindsey Neville

About Abingdon Health

Abingdon Health is a world leading developer and manufacturer of high-quality rapid tests across all industry sectors, including healthcare and COVID-19. Abingdon is the partner of choice for a growing global customer base and takes projects from initial concept through to routine and large-scale manufacturing and has also developed and marketed its own labelled tests.

The Company offers product development, regulatory support, technology transfer and manufacturing services for customers looking to develop new assays or transfer existing laboratory-based assays to a lateral flow format.  Abingdon Health aims to support the increase in need for rapid results across many industries and locations and produces lateral flow tests in areas such as infectious disease, clinical testing including companion diagnostics, animal health and environmental testing. Faster access to results allows for rapid decision making, targeted intervention and can support better outcomes. This ability has a significant role to play in improving life across the world. To support this aim Abingdon Health has also developed AppDx^®, a customisable image capturing technology that transforms a smartphone into a self-sufficient, standalone lateral-flow reader.

Founded in 2008, Abingdon Health is headquartered in York, England.

https://www.abingdonhealth.com/

This announcement contains information which, prior to its disclosure, was inside information as stipulated under Regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310 (as amended).

 

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