TIDMINS
RNS Number : 6981N
Instem plc
22 January 2019
Instem plc
("Instem", the "Company" or the "Group")
Trading Update
All business areas performing well with total order value for
SEND services up 500% year-on-year
Instem plc (AIM: INS), a leading provider of IT solutions to the
global life sciences market, announces a trading update for the
year ended 31 December 2018 (the "Period").
Financial Highlights
All three key areas of the business contributed positively
during the Period, with strengthening margins and underlying
EBITDA(1) in line with management's expectations.
Net cash at 31 December 2018 was approximately GBP3.6m and will
increase early in the current year as delayed payments from a small
number of large pharma customers are received, returning the
Company to more normal working capital cycles.
Operational Highlights
The three areas of the business, Data Collection, Regulatory
Solutions and Informatics, all made a positive contribution to the
full-year performance, with a continuing and steady transition of
new and existing clients moving away from perpetual software
licenses to recurring Software-as-a-Service ("SaaS")
subscriptions.
In addition to several new client wins, many existing clients
upgraded and extended their use of Instem's products and services.
The Company also experienced a strong year for SEND (Standard for
the Exchange of Nonclinical Data) related services, with the total
order value received during the Period showing an increase of more
than 500% compared to 2017.
To manage this additional workflow, as planned, Instem has
recruited more staff to its outsourced SEND services team in 2018
across the UK, the US and India. The latest version of SEND, as
mandated by the US FDA, becomes mandatory for studies starting
after 15 March 2019. Instem has released an updated version of its
software, which is already being implemented by our SEND Services
team, as well as product customers, to enable them to meet early
demand for this version of the SEND standard.
Our KnowledgeScan Target Safety Assessment service continues to
build good momentum with strong repeat business and further new
client wins. The launch of an additional "core data" service has
generated increased interest from the larger pharmaceutical
companies, who often have the in-house resources to apply their own
scientific interpretation to the high-quality data available from
our augmented intelligence technology platform.
Update on historic contract dispute
As highlighted in the preliminary results announcement for the
year ended 31 December 2017, released on 26 March 2018, the Company
made a cost provision related to historical contract disputes.
A dispute, which does not affect ongoing operations of the
Company, will now be heard by the German courts, with the initial
hearing on 22 January 2019. Instem has taken legal advice and is
defending the action. The Company strongly believes that the claim
should be dismissed. Notwithstanding this, the cost provision made
in 2017 will be maintained in the 2018 accounts.
Further announcements will be made as and when appropriate.
Phil Reason, CEO of Instem plc, commented:
"Instem has invested significantly in the business in recent
years and these results further illustrate such investment
converting into profitable growth. In addition to a host of new
client wins, many existing clients have extended their use of
Instem's products and services and, importantly, have transitioned
to our SaaS solutions. The Company looks forward to building on
this momentum, particularly for SEND related services, where order
backlog and future revenue visibility is continually
improving."
1. Earnings before interest, taxation, depreciation and amortisation.
For further information, please contact:
Instem plc +44 (0) 1785 825 600
Phil Reason, CEO
Nigel Goldsmith, CFO
N+1 Singer (Nominated Adviser
& Broker) +44 (0) 20 7496 3000
Richard Lindley
Rachel Hayes
Walbrook Financial PR +44 (0) 20 7933 8000
Paul Cornelius instem@walbrookpr.com
Nick Rome
Sam Allen
About Instem
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 customers worldwide and enable
our 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 supports over 500 clients through offices in the United
States, United Kingdom, France, Japan, China and India.
To learn more about Instem solutions and its mission, please
visit instem.com.
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END
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