TIDMVLG
RNS Number : 4009X
Venture Life Group PLC
19 December 2019
RNS
19 December 2019
Venture Life Group plc
("Venture Life" or the "Group")
Acquisition and trading update
Earnings enhancing acquisition of PharmaSource BV, an
established Netherlands based development and distribution
business
Trading update
Venture Life Group plc (AIM: VLG), a leader in developing,
manufacturing and commercialising products for the international
self-care market, announces the acquisition of PharmaSource BV, a
Netherlands based development and distribution business, and
provides a trading update for the year ending 31 December 2019.
Acquisition of PharmaSource BV
Venture Life announces that it has agreed to acquire the entire
issued share capital of PharmaSource BV ("PharmaSource"), for an
initial consideration of EUR5.23 million, and deferred contingent
consideration of up to EUR1.27 million. These payments will be
funded entirely from the Company's existing cash resources, and the
acquisition is expected to be immediately earnings accretive. The
acquisition is also subject to conditions and price adjustment for
cash and debt.
PharmaSource owns a number of medical device products in key
therapeutic areas including fungal nail infections, wart removal
and women's health. These products are distributed both through
retail pharmacies in the Netherlands and through key international
distribution partners outside of the Netherlands, including the UK,
Germany, the Nordics, Belgium and France. Strategically, this
acquisition will enable the Company to broaden its product range
and extend its global reach by providing additional retailers and
distribution partners to its existing partner network.
PharmaSource is a growing business and revenues for the year
ending 31 December 2019 are expected to be in excess of EUR2.5
million (2018: EUR1.8 million), with Profit Before Tax in excess of
EUR0.9 million (2018: EUR0.5 million). It is expected to have gross
assets of around GBP0.6 million at completion. PharmaSource owns
various medical device registrations, for products marketed under
several different brand names. Once the post-completion integration
process gets underway, there are expected to be strong synergistic
benefits of the acquisition for the Venture Life Group going
forward, anticipated to enable the acquired business assets to
continue to grow both revenues and profitability under our
stewardship.
Completion of the acquisition is, among other matters,
conditional on the receipt of some regulatory documentation from
the Notified Body in relation to one of the PharmaSource products,
which is expected to be received shortly.
Trading update
The Company also announces that it expects its revenues for the
year ending 31 December 2019 to be at least GBP20 million and
adjusted EBITDA to be at least GBP3.2 million, before non-recurring
operating costs of approximately GBP0.2 million, principally
relating to the restructuring of the Company's finance team. As
mentioned in our half year results, our distribution partners in
China experienced some difficulties, which impacted sales in the
first half of 2019. Whilst the causes of this have been rectified,
it has not been possible to catch up on orders fully from those
partners in H2 2019, with a consequent knock-on effect to our
expected full year performance. However, we expect orders from our
Chinese distribution partners to grow in 2020. The Company already
has an overall order book in hand for the first quarter of 2020
that is more than EUR1 million (and more than 40%) ahead of the
same time last year. These factors, together with completion of the
PharmaSource acquisition on an earnings accretive basis, provide an
excellent platform for the Venture Life Group to continue to grow
into 2020 and beyond.
Jerry Randall, CEO of Venture Life Group, said: "We are
delighted to acquire this high quality, growing and profitable
business, which gives us our first European footprint directly into
the retailer market. Once completed, the acquisition should be
immediately earnings enhancing for Venture Life, is being funded
totally from our existing cash resources and will benefit from the
operational leverage we can bring. The acquisition brings an
excellent range of products and customer relationships to Venture
Life, which we expect to be able to leverage through our existing
products and relationships further. We see this as another
excellent add-on to our existing business, that we can further grow
and develop within our existing structure.
We expect to finish the year with revenues and profits ahead of
2018. Despite some one-off costs in the first half, we have been
pleased with the performance of the wider Group, which has
delivered good growth against a complex macro-economic backdrop.
This performance, when enhanced by completion of this excellent
acquisition opportunity on an earnings accretive basis in our
profit and loss account for 2020, provides us with confidence for
the year ahead, and makes us very well positioned for continued
growth."
THIS ANNOUNCEMENT, INCLUDING THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED
STATES OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A
VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT
JURISDICTION.
The information communicated within this announcement
constitutes inside information under the Market Abuse Regulation
(EU) No. 596/2014.
For further information, please contact:
+44 (0) 1344
Venture Life Group PLC 578004
Jerry Randall, Chief Executive Officer
+44 (0) 20 7397
Cenkos Securities Ltd (Nomad and Broker) 8900
Mark Connelly / Stephen Keys / Cameron MacRitchie
(Corporate Finance)
Russell Kerr / Michael Johnson (Sales)
Alma PR venturelife@almapr.co.uk or + 44 (0)
203 405 0208
Helena Bogle / Hilary Buchanan
/ Jessica Joynson
About Venture Life (www.venture-life.com)
Venture Life is an international consumer self-care company
focused on developing, manufacturing and commercialising products
for the global self-care market. With operations in both the UK and
Italy, the Group's product portfolio includes some key products
such as the UltraDEX and Dentyl oral care product ranges, food
supplements for maintaining brain function, medical devices for
women's intimate healthcare and proctology and dermo-cosmetics for
addressing the signs of ageing.
The products, which are typically recommended by pharmacists or
healthcare practitioners, are available primarily through
pharmacies and grocery multiples. In the UK these are supplied
direct by the company, outside of the UK they are supplied by the
Group's international distribution partners.
Through its Development & Manufacturing business in Italy,
Biokosmes, the Group also provides development and manufacturing
services to companies in the medical devices and cosmetic
sectors.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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December 19, 2019 02:00 ET (07:00 GMT)
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