Interim Results 2021 28 September 2021 - plc - Ergomed
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plc Interim Results 2021 28 September 2021
Disclaimer
The information contained in this presentation (“Presentation”) has been prepared by Ergomed plc (the “Company”) for discussion purposes only and is not intended for any other use. The Presentation is
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2 www.ergomedplc.comPresenters
Dr Miroslav Reljanović Executive Chairman
Richard Barfield Chief Financial Officer
3 www.ergomedplc.comOUR VISION Global specialised leadership in Orphan Drug Development, Oncology and Patient Safety 4 www.ergomedplc.com
Specialised Pharmaceutical Services
World-class expertise in drug development and drug safety
Clinical Research Outsourcing Pharmacovigilance
Management of Clinical Trials Monitoring Drug Safety
• Contract Research & Clinical Trial • Process Adverse Events and monitor the
Management scientific literature to detect safety issues
• All Phases (I to IV) • Data analysis, to identify new and
potential risks
• Plan, manage, monitor and report on the
most complex clinical trials • Prepare reports to the Regulatory
Authorities
• Specialisation in oncology and rare disease
• Appoint the QPPV
5 www.ergomedplc.comAt a Glance – Global Platform Europe
• Robust infrastructure throughout Europe
Full-service specialist • Comprehensive network of PV and CRO
specialists with in-depth knowledge of EU and
country-specific regulatory requirements
North America
• 4 offices across the USA
employing over 200 people
• Ergomed USA revenue growth
H1 2021: 71%
Asia-Pacific
• Japan office opened in 2021
• Expanding operations in India
£56.0m 71% 22%+ • The Asia-Pacific region is one of the fastest growing
regions in the CRO industry
• Ergomed works with longstanding partners throughout
H1 2021 total revenue US revenue growth Revenue CAGR Asia-Pacific and MENA region
up 38.8% in H1 2021 From 2016-2020
25 >60 >140 1,250 185k 300k
offices countries with countries supported employees and clinical patients pharmacovigilance
worldwide active trials by PV services 300+ contract staff enrolled case versions processed pa
6 www.ergomedplc.com20+ YEARS OF GROWTH
Ergomed plc Global Expansion
1997 2014 2016
Ergomed founded Ergomed plc IPO PharmInvent acquired 2020
on London Stock Exchange Ashfield Pharmacovigilance
Inc. acquired
2017 2020
2008 2015
MedSource LLC
PrimeVigilance PSR Orphan Experts
acquired
founded Sound Opinion acquired acquired
7 www.ergomedplc.comLong-term Revenue Growth
Continuing growth trend – organic and inorganic
£86.4m
REVENUE CAGR
22%
£68.3m
£54.1m
£39.2m
£47.6m 2020
January:
2019
2016 2017 2018
December:
Acquisitions
8 www.ergomedplc.comMarket Update
Ergomed focused in high growth sectors
Oncology
$15.6bn
9.2% p.a. growth (2020 – 2026)
Global CRO market Rare disease (non-oncology)
$42.3bn $5.6bn
target markets in 10.8% p.a. growth (2020 - 2026)
6.6% p.a. growth (2020 – 2026)
high growth areas
Pharmacovigilance
$5.1bn
15.8% p.a. growth (2020 – 2026)
USA focus
> 50%
Clinical trials need US presence
Sources: GrandView Research, clinicaltrials.gov, GM Insights, Global Genes
9 www.ergomedplc.comMarket Opportunity
Competition and consolidation
Large Consolidation
COMPETING
• $1bn+ CRO revenue • IQVIA (IMS + Quintiles)
Companies
• Global public companies • Syneos (INC + Inventiv)
6-8
• 10,000+ employees
• ICON PRA
• Mid single digit growth
• Big pharma oriented
Mid-tier Consolidation
$100m+ CRO revenue
PENETRATING
• • Covance Chiltern
Companies
• Global (Excluding Asia)
10- 15
• Syneos Synteract
• 1,000+ employees
• dMed Clinipace
• Double digit growth
• Further consolidation in the pipeline
• Biotech & specialty pharma
Ergomed is a leading mid-tier CRO well positioned for consolidation
10 www.ergomedplc.comH1 2021 Headlines
Comparison to H1 2020
29%
Service Fee Revenue
71%
North America Revenue Growth
33%
Adjusted EBITDA
1 Jan 2021 1,015
MedSource + 125
Organic + 139
29%
Employees 30 June 2021 >1,250
11 www.ergomedplc.comH1 2021 Income Statement
Organic growth and acquisitions drive increased revenue and profit
H1 H1
(£ millions, unless stated) 2021 2020
Total Revenue 56.0 40.4 • Revenue up 38.8%
Gross Profit 23.0 18.5 • Gross profit up 24.2%
Gross Margin 41.1% 45.8% • Decline due to FX and higher pass-through revenue in MedSource
Adjusted EBITDA 12.1 9.1 • Adjusted EBITDA up 33.0%
Net Cash at 30 June 24.6 14.1 • Cash up £10.5m
Order book at 30 June 227.8 151.4 • Order book of contracted future revenue up 50.5%
Retained Earnings (consolidated) 51.9 (0.8) • Retained Earnings increased due to capital reduction and profits
Basic adjusted Earnings Per
Share (pence)
16.8p 11.3p • Basic adjusted EPS up 48.7%
12 www.ergomedplc.comGrowth in Service Fee Revenue in CRO and PV
Constant currency impact
(excluding MedSource)
£13.4m £30.2m
+20.7% +17.0%
£11.1m £25.8m £28.6m
£12.4m
+11.7% +10.9%
H1 2020 H1 2021 H1 2020 H1 2021
Stronger GBP vs USD in H1 2021 vs H1 2020
Reported (average rate H1 2021: $1.38)
Constant Currency (average rate H1 2020: $1.28)
13 www.ergomedplc.comStrong Service Fee Gross Margin in CRO and PV
Constant currency impact
(excluding MedSource)
51.9% 51.8%
47.7%
45.9%
51.0%
44.2%
H1 2020 H1 2021 H1 2020 H1 2021
Stronger GBP vs USD in H1 2021 vs H1 2020
Reported (average rate H1 2021: $1.38)
Constant Currency (average rate H1 2020: $1.28)
14 www.ergomedplc.comGeographic Analysis of Revenue by Client Location
Significant client growth in North America
H1 2020 H1 2021
Revenue - £40.4m Revenue - £56.0m
4% 6%
16% 12%
51% 18%
63%
28%
Total revenue up 38.8%
N America up 71% from
£20.7m to £35.5m
EU UK Asia USA EU UK Asia USA
15 www.ergomedplc.comSales and Order Book
H1 2021 sales and order book underpin forward visibility
Net Sales Awards Contracted Order Book Growth
£90.8m
£227.8m
+50.8%
£193.0m
£60.2m
£151.4m
H1 2020 H1 2021 30 June 2020 31 Dec 2020 30 June 2021
16 www.ergomedplc.comCash Flow
Strong operating cash flow
Cash Flow H1 2021
26.0
11.0 24.6
24.0 -0.4
£ millions
22.0
20.0
19.0
18.0
-2.1
16.0
-1.6
-0.5
14.0 -0.5 -0.3
12.0
10.0
01 Jan 2021 Tax paid Finance and lease Working capital Capex MedSorce working Operating FX 30 June 2021
costs capital adj cash flow
17 www.ergomedplc.comTechnology Driven Trial Execution
Global
Workforce
Mobility H1 2021 Achievements
• Enhancement of Risk Based Quality Management with
Cyntegrity
• Targeted site and country selection through Citeline
Informatics
Decentralised
Clinical Trial
& Virtual
Informatics • Clinical Trial Management System (Flex Database) fully
Trials
implemented
Innovation,
Integration &
Orchestration
Upcoming Milestones
• Further develop strategic partnerships to accelerate
digital capabilities
• Integrate technology solutions to deliver Electronic
Consent and Electronic Patient Reported Outcomes
Patient
Engagement & Telehealth • Consolidate Quality and Learning Management System to
Concierge drive efficiency and compliance
18 www.ergomedplc.comCRO Therapeutic Area Focus
Oncology & rare disease focus
H1 2020 Oncology & Rare – H1 2021 Oncology & Rare –
New Business New Business
2%
22% 12%
£3.9m
£8.3m £7.9m
49%
22%
£7.5m
11%
64%
£22.2m
£8.8m
18%
Oncology Oncology Rare Rare Other Oncology Oncology Rare Rare Other
19 www.ergomedplc.comMedSource
Accelerated Integration
December 2020 Ergomed plc acquires MedSource CRO
March 2021 Single branding established
April 2021 Business Development fully integrated
Earn-out concluded
August 2021
August 2021 - $3.8m earn-out paid
- Total consideration $21.8m -PrimeVigilance Continuing Momentum
Excellent client retention sustained
H1 2021 Achievements Revenues by customer cohort (£m)
50
• Opened office in Tokyo, Japan - now fully staffed
40
• Strategic technology partnerships with key vendors
• Significant new wins with major pharma accounts 30
• Restructuring to increase cost-efficiency and
rationalize service delivery 20
10
0
2013 2014 2015 2016 2017 2018 2019 2020 H1 2021
2014 2015 2016 2017 2018 2019 2020 H1 2021
21 www.ergomedplc.comPV Digital Transformation
Developing technologies to achieve state of the art PV services
Argus H1 2021 Achievements
• Significant progress in consolidation of safety databases into
Case
Processing Oracle Argus
• Enabled Oracle Argus and Axway automation features
• Enhanced signal detection capabilities
Embase Empirica
Literature
Screening Integration, Signalling
Orchestration
& Automation
Upcoming Milestones
• Upgrade Oracle Argus and complete cloud migrations
• Migrate ASaPPV to MS Azure Cloud to extend capabilities
• Further automate regulatory submissions via Axway
• Further develop strategic partnerships to accelerate digital
Medical LSMI transformation
Writing Medical
Information
22 www.ergomedplc.comInvestment Case
Strong delivery and positioned for growth
Market Drivers Strong Market Position
• Increased pharmaceutical R&D spend
• Robust order book provides high visibility
• Rare Disease, Oncology & Pharmacovigilance forecast
to be higher growth sectors • Leading expertise and brand
• Increasing regulation and harmonisation
• Specialisms in oncology, rare disease and PV
• Accelerated technology innovation due to COVID-19
Leadership & Delivery Growth Drivers
• Complementary geographic and service offerings with • Revenue CAGR 22% from 2016 – 2020
market leadership
• Strong balance sheet and access to capital
• Leading mid-tier global CRO, market cap now >$1bn,
well positioned to consolidate • Robust basis for future organic and strategic M&A growth
23 www.ergomedplc.com24 www.ergomedplc.com
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