RUA Life Sciences PLC Trading Update & Change of Accounting Date

RNS Number : 1194K

RUA Life Sciences PLC

30 October 2024

 

 

 

30 October 2024

 

 

 

RUA Life Sciences plc

("RUA Life Sciences", the "Company" or the "Group")

 

Trading update and change of accounting reference date 

 

 

RUA Life Sciences, the holding company of a group of medical device businesses focused on the exploitation of the world's leading long-term implantable biostable polymer (Elast-Eon^TM), is pleased to announce a trading update for the six months ended 30 September 2024 ("H1 2025" or "the period").

Trading update                                                                            

Revenue

The Group expects to report substantial first-half revenue growth from £790k in HY23 to £1,485k in the current period. This growth is stated before the benefit of the Group's acquisition of the Abiss Group announced on 9 September 2024.

·    Biomaterials royalties for the period from Elast-Eon increased to £237k, representing year-on-year growth of 19% (H1 2024: £199k)

·    Contract Manufacture revenues for the period increased to £1,247k. This represents a 110% increase over the depressed H1 revenues reported last year. Like for like growth over normalised revenues last year was 49%.

Cost Control

Costs in the period of approximately £1.6 million benefited from stringent cost control measures and are expected to be down by approximately 25% on those incurred in H1 2024.

Cash

Cash and cash equivalents at 30 September 2024 were £3.5m compared to £3.9m at 31 March 2024 (H1 2024: £0.5m)

Profit for the period

The Group is expected to announce a pre-tax profit of £0.4m for the period compared to a loss of £1.4m last year.

This turnaround is attributed to the increased revenues and cost control described above together with, as described in more detail below, other income of £0.9m on consolidation of Abiss.

 

RUA Vascular and Structural Heart

The objective for RUA Vascular and Structural Heart is to find alternative ways to fund the remaining regulatory pathway for the polymer sealed graft products and to introduce the Group's heart valve leaflet material (AurTex) to the wider industry as a realistic alternative to animal tissue in heart valves. The teams working on these projects have continued to make good progress with significant improvements made in the handling of the graft to address feedback from potential partners.

In addition, the AurTex material has positively advanced in both manufacturing consistency and testing milestones. The materials tested under the Company's Material Transfer Agreement ("MTA") with a heart valve company have successfully met all the expected results for the tests undertaken; however, at this point, it is not expected to lead to a commercial agreement due to current priorities of the Company's MTA partner.  Notwithstanding this, the results of the MTA have confirmed the management's belief in the potential for AurTex.

Several opportunities are being pursued for each of the Vascular and Structural Heart businesses, and further updates will be made as appropriate.

 

Acquisition of ABISS

On 6 September 2024, the Group acquired the entire issued share capital of Abiss (France) and its 60% subsidiary, Abiss (Poland), (together the "Abiss Group"). The sale of the Abiss Group was conducted as an auction by the court appointed liquidator of the former parent company of the Abiss Group. The total consideration paid for the Abiss Group was €80,000.

Abiss is the legal manufacturer of several implantable surgical products, mainly for pelvic floor repair procedures. In addition, it is a subcontract manufacturer of similar products for other companies, including a shared customer of the RUA Group.

Based on the provisional management accounts of Abiss (France), shareholders funds amounted to £1 million which will result in other income of some £900k being recognised in the Interim Results of the Group. This bargain purchase gain is provisional and is expected to be revised once the fair value calculations have been finalised.

 

Shortly after the acquisition of the Abiss Group, it was subject to a rigorous FDA audit of its activities and systems and came through the audit process with no issues to report, which provides a strong confirmation of the quality of the team and systems employed at the Abiss Group.

The Board's short-term priorities with the Abiss Group are to ensure that the €1m order backlog caused by supply chain issues relating to packaging components (now resolved) is dispatched to customers over the next quarter.  A business and strategy review is underway to seek to grow the Abiss business further and incorporate the Abiss Group into the overall strategy for the device manufacturing business unit of RUA.

 

Change of accounting reference date

The Group announces that it will be changing its accounting reference date and financial year end from 31 March to 30 September. Going forward, interim and annual accounts will be prepared and published for the six months ending 31 March and the twelve months ending 30 September, respectively.

The Company has changed its financial year end to better guide business planning and international business unit assimilation.

As a result of this change, the Company's future reporting calendar is expected to be as follows:

•           Publication of unaudited accounts for the six-month period ending 30 September 2024 in mid-December 2024.

•           Publication of unaudited accounts for the 12-month period ending 31 March 2025 in mid-June 2025.

•           Publication of audited accounts for the 18-month period ending 30 September 2025 by end of January 2026.

•           Publication of unaudited interim accounts for the six-month period ending 31 March 2026 in mid-June 2026; and

•           Publication of audited accounts for the 12-month period ending 30 September 2026 by the end of January 2027.

 

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the UK version of the EU Market Abuse Regulation (2014/596), which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended and supplemented from time to time.

 

For further information contact:

 

RUA Life Sciences                                                                                    Tel: [phone]  

Geoffrey Berg, Non-Executive Chairman                                                

Bill Brown, Chief Executive                                                                   

Lachlan Smith, Group Chief Financial Officer

 

 

Cavendish Capital Markets Limited

(Nominated Adviser and Broker)                                                             Tel: [phone]

Giles Balleny/Dan Hodkinson (Corporate Finance)                                  

Charlie Combe (Broking)

Michael Johnson (Sales)

 

About RUA Life Sciences

RUA Life Sciences plc is the ultimate parent company of the Group, whose principal activities comprise exploiting the value of its IP & know-how, medical device contract manufacturing and development of medical devices.

 

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