CAMBRIDGE, England and WALTHAM, Mass., May 4, 2023
/PRNewswire/ -- Abcam plc ("Abcam," "Company," "Group") (Nasdaq:
ABCM), a global leader in the supply of life science research
tools, today provides the following updates.
As part of the five-year strategy set out in 2019, focusing on
generating durable revenue growth, the Company invested to remove
scalability constraints through critical investments in its people,
processes, facilities and technology.
Abcam has now successfully transitioned from implementation of
these growth initiatives to focus on driving operating leverage
from these investments, including the recently implemented Oracle
Cloud ERP.
Over the past several months, management and the Board have
undertaken a broad review of the installed capabilities with an
emphasis on delivering excellent customer experience, tightening
operational efficiency and positioning the organisation for long
term growth.
Today, the Company is announcing incremental cost refinement
actions which are expected to result in a reduction in annualised
run rate operating expenses in excess of £15 million by 2024.
The Company expects to achieve these savings through
consolidating elements of its global footprint by leveraging the
investment in the expansion of our Waltham, MA site, streamlining its
organization by reducing management structures, including
consolidation of sales and marketing functions, and eliminating
redundant processes for faster and more effective decision
making.
Revenue growth remains a priority, and the Company continues to
invest in its people and the strategic enterprise tools that will
enhance efficiency and customer experience in FY2023 and
beyond.
These changes are already underway. The costs of implementation
will be taken as an adjusting item in FY2023.
FY2023 Outlook
Based on the expected phasing of these
actions and the impact on this year's operating expenses, the
Company is providing guidance on FY2023 adjusted operating profit
margins, which are expected to be between 27% to 28%.
The Company reiterates its reported revenue guidance of
approximately £420 million to £440 million, representing 15% to 20%
constant exchange rate revenue growth.
FY2024 Goal
The Company is reiterating its 2024
revenue goals of £450 million to £525 million[1] with adjusted
operating profit margins of greater than 30%.
About Abcam plc
As an innovator in reagents and tools,
Abcam's purpose is to serve life science researchers globally to
achieve their mission faster. Providing the research and clinical
communities with tools and scientific support, the Company offers
highly validated antibodies, assays, and other research tools to
address important targets in critical biological pathways.
Already a pioneer in data sharing and ecommerce in the life
sciences, Abcam's ambition is to be the most influential company in
life sciences by helping advance global understanding of biology
and causes of disease, which, in turn, will drive new treatments
and improved health.
Abcam's worldwide customer base of approximately 750,000 life
science researchers' uses Abcam's antibodies, reagents, biomarkers,
and assays. By actively listening to and collaborating with these
researchers, the Company continuously advances its portfolio to
address their needs. A transparent program of customer reviews and
datasheets, combined with industry-leading validation initiatives,
gives researchers increased confidence in their results.
Founded in 1998 and headquartered in Cambridge, UK, the
Company has served customers in more than 130 countries. Abcam's
American Depositary Shares (ADSs) trade on the Nasdaq Global Select
Market (Nasdaq: ABCM).
For more information, please
visit www.abcam.com or www.abcamplc.com
Forward-Looking Statements
This announcement contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. In some cases, you can
identify forward-looking statements by the following words: "may,"
"might," "will," "could," "would," "should," "expect," "plan,"
"anticipate," "intend," "seek," "believe," "estimate," "predict,"
"potential," "continue," "contemplate," "possible" or the negative
of these terms or other comparable terminology, although not all
forward-looking statements contain these words. They are not
historical facts, nor are they guarantees of future
performance. Any express or implied statements contained in
this announcement that are not statements of historical fact may be
deemed to be forward-looking statements, including, without
limitation, statements regarding Abcam's portfolio and ambitions,
cost refinement and efficiency initiatives, and our future results
of operations and financial position such as our outlook for FY2023
and performance goals for FY2024 are neither promises nor
guarantees, but involve known and unknown risks and uncertainties
that could cause actual results to differ materially from those
projected, including, without limitation: challenges in
implementing our strategies for revenue growth in light of
competitive challenges; the development of new products or the
enhancement of existing products, and the need to adapt to
significant technological changes or respond to the introduction of
new products by competitors to remain competitive; our customers
discontinuing or spending less on research, development, production
or other scientific endeavors; failing to successfully identify or
integrate acquired businesses or assets into our operations or
fully recognize the anticipated benefits of businesses or assets
that we acquire; the ongoing COVID 19 pandemic, including variants,
continues to affect our business, including impacts on our
operations and supply chains; failing to successfully use, access
and maintain information systems and implement new systems to
handle our changing needs; cyber security risks and any failure to
maintain the confidentiality, integrity and availability of our
computer hardware, software and internet applications and related
tools and functions; failing to successfully manage our current and
potential future growth; any significant interruptions in our
operations; our products failing to satisfy applicable quality
criteria, specifications and performance standards; failing to
maintain and enhance our brand and reputation; ability to react to
unfavorable geopolitical or economic changes that affect life
science funding; failing to deliver on transformational growth
projects; our dependence upon management and highly skilled
employees and our ability to attract and retain these highly
skilled employees; and as a foreign private issuer, we are exempt
from a number of rules under the U.S. securities laws and Nasdaq
corporate governance rules and are permitted to file less
information with the SEC than U.S. companies, which may limit the
information available to holders of our American Depositary Shares
("ADS"); and the other important factors discussed under the
caption "Risk Factors" in Abcam's Annual Report on Form 20-F for
the year ended December 31, 2022
("Annual Report") with the U.S. Securities and Exchange Commission
("SEC") on March 20, 2023, which is
available on the SEC website at www.sec.gov, as such factors may be
updated from time to time in Abcam's subsequent filings with the
SEC. Any forward-looking statements contained in this announcement
speak only as of the date hereof and accordingly undue reliance
should not be placed on such statements. Abcam disclaims any
obligation or undertaking to update or revise any forward-looking
statements contained in this announcement, whether as a result of
new information, future events or otherwise, other than to the
extent required by applicable law.
Use of Non-IFRS Financial Measures
To supplement our
audited financial results prepared in accordance with International
Financial Reporting Standards ("IFRS") we present Adjusted
Operating Profit, Adjusted Operating Profit Margin, Total Constant
Exchange Rate Revenue ("CER revenue"), which are financial measures
not prepared in accordance with IFRS ("non-IFRS financial
measures"). We believe that the presentation of these non-IFRS
financial measures provide useful information about our operating
results and enhances the overall understanding of our past
financial performance and future prospects, allowing for greater
transparency with respect to key measures used by management in its
financial and operational decision making. These non-IFRS
financial measures are supplemental in nature as they include
and/or exclude certain items not included and/or excluded in the
most directly comparable IFRS financial measures and should not be
considered in isolation, or as a substitute for, financial measures
prepared in accordance with IFRS. Further, other companies may
calculate these non-IFRS financial measures differently than we do,
which may limit the usefulness of those measures for comparative
purposes.
Management believes that the presentation of (a) Adjusted
Operating Profit, Adjusted Operating Profit Margin, provide useful
information to investors and others as management regularly reviews
these measures as important indicators of our operating performance
and makes decisions based on them, (b) CER revenue provides useful
information to investors and others as management regularly reviews
this measure to identify period-on-period or year-on-year
performance of the business and makes decisions based on it, and
(c) Adjusted Selling, General and Administrative expenses and
Adjusted Research & Development expenses provide useful
information to investors and others as management regularly reviews
these measures to identify period-on-period or year-on-year
performance of the business and makes decisions based on it, and
(d) Free Cash Flow provides useful information to investors and
others because management regularly reviews this measure as an
important indicator of how much cash is generated by business
operations, excluding capital related items, and provides an
indication of the amount of cash available for discretionary
investing or financing after removing capital related items, and
makes decisions based on it.
Please see the following "Non-IFRS Financial Measures" for a
qualitative reconciliation of non-IFRS financial measures presented
in this Trading Update to their most directly comparable IFRS
financial measures. We define:
- Adjusted Operating Profit as profit for the period / year
before taking account of finance income, finance costs, tax,
exceptional items, share-based payments, restructuring activities,
and amortization of acquisition intangibles. Exceptional items
consist of certain cash and non-cash items that we believe are not
reflective of the normal course of our business; and we identify
and determine items to be exceptional based on their nature and
incidence or by or by their significance ("exceptional items"). As
a result, the composition of exceptional items may vary from period
to period / year to year.
- Adjusted Operating Profit Margin as adjusted operating profit
calculated as a percentage of revenue.
- CER as our total revenue growth from one fiscal period / year
to the next on a constant exchange rate
basis.
Management is unable to present quantitative reconciliations of
Adjusted Operating Profit, Adjusted Operating Profit Margin, and
CER revenue to their respective most directly comparable IFRS
financial measures of Operating Profit, Operating Profit Margin and
Reported Revenue on a forward-looking basis, because items that
impact these IFRS financial measures are not within our control
and/or cannot be reasonably predicted. Such information may have a
significant, and potentially unpredictable, impact on our future
financial results.
Abcam plc
Tommy Thomas,
CPA
Vice President, Investor Relations
tommy.thomas@abcam.com
+1 617-577-4205
152 Grove Street, Building 1100
Waltham, MA 02453
[1] FY24 Revenue goals calculated at the average exchange rates
for the 12 months ended June
2021.
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SOURCE Abcam