2019 interim results - ixico · wearable biosensors £0.5m wearable biosensors £0.75m new psp...

0BUSINESS USE ONLY © IXICO plc 2019

Delivering insights in neuroscience

2019 Interim Results

22 May 2019


Disclaimer

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▪ IXICO PLC is incorporated in England with registered number 3131723 and registered address 15 Long Lane, London, EC1A 9PN.



Delivering on our strategic goals

Giulio Cerroni, CEO


Next generation biomarker services for neuroscience drug development

▪ Accurate biomarker assessment can reduce the risk associated with clinical research studies by supporting:

▪ identification of patients who are more likely to respond

▪ early detection of drug safety issues

▪ objective assessment of drug efficacy

e.g. MRI - Huntington’s disease

Tissue loss Δvol over 6 months = 0.8%

▪ Collecting and extracting data from brain scans to detect and measure imaging biomarkers

▪ Applying our data analytics expertise to develop and validate complementary digital biomarkers


Next generation biomarker services for neuroscience drug development

Medial Temporal Lobe

ALZHEIMER’SDISEASE

(AD)

Striatum

HUNTINGTON’SDISEASE

(HD)

Cerebellum

SPINO-CEREBELLAR

ATAXIA(SCA)

Brainstem

PROGRESSIVESUPRANUCLEAR

PALSY (PSP)


5 point growth strategy

① Focus on delivering scale and operational excellence

② Accelerate penetration of clinical trials market; diversify into new indications

③ Target early phase to grow into later clinical phases

④ Innovate: AI machine-learning data analytics

⑤ Enhance organic growth through selective M&A

….to deliver sustained double-digit revenue growth, targeting profitability


Giulio Cerroni (Feb ‘17)

CEO

Alison Howie (Jun ‘18)

CCO

Grant Nash (April ‘19)

CFO

Marcus Thornton (Jun ‘18)

COO

Strengthened leadership

Robin Wolz (Mar ‘14)

SVP Research & Development

Amanda Wooding (Jul ‘18)

HR Director

John Hall (May ‘08)

SVP Corporate Development

John Green (Jun ‘18)

SVP Quality, Compliance &

Regulatory Affairs



Commercial traction in an attractive growth market

Alison Howie, CCO


Our AI data analytics accelerate biopharma innovation & enable productivity

Healthy

Amyloid -ve

Accurately measure the absence/presence of

disease biomarkers (Amyloid) to ensure the

right patients are enrolled in clinical trails

Healthy

Amyloid +ve

Alzheimer’s

Amyloid +ve

Detect adverse drug reactions

(bleeds/fluid accumulation) early –

preventing serious harm to patients

Baseline Week 19

Accurately measure biomarkers that track

disease progression providing evidence of

treatment response and disease

modification

Safety - Side effects EfficacyEligibility / Stratification

MRI - Immunotherapy MRI - Huntington’s diseasePET - Alzheimer’s disease

Tissue loss Δvol over 6 months = 0.8%


Unrivalled domain knowledge

Algorithms to measure disease

biomarkers

Understand the value of different disease biomarkers is specific therapeutic areas

Network of sites trained and qualified by IXICO to ensure they can collect data (which is not standard of care) to the high level of quality required for Automated AI analytics tools.

Established operational reach

A decade of delivery

Proven, trusted partner with robust and regulatory compliant operations.

Validated IXICO AI technology to measure specific biomarkers in therapeutic areas being targeted by biopharma Understand the challenges

of deploying different biomarkers in specific populations

All phases of clinical trials

Springboard for new client acquisition

Four pillars of strength for accelerated growth

Launching innovative

new products

Leveraging our

expertise into new

indications

Building scale in

high growth

markets

Continuously enhancing

our client value

proposition


Market drivers - innovation with clients, collaborations and partners

AI-Driven

Data

Analytics

First Mover Advantage

via Public-Private

Partnerships

Partnering with Academia

in Major Government

Funded AI Initiatives

▪ Diversification into new indications

▪ Development and validation of IXICO algorithms

▪ Build track record and expertise

▪ Access to well-characterised clinical data

▪ In-licencing opportunities

▪ Access to clinical and technical expertise

Ageing population

Investment in rare

diseases

New therapeutic approaches

Earlier intervention

Patient reported outcomes

New and better biomarkers

Translational science


£12.7M Order Book

Long term client relationships; good revenue visibility

Wearable biosensors

£0.5M

Wearable biosensors

£0.75M

New PSP Imaging $2.7M

Scope expansion

£0.75M

2 study expansions in

AD +24%

New HD Study £1M

Scope expansion

£0.6M

Scope expansion

€0.5M

Phase III Study £9.1M

Scope expansion

$2.4M

New contract in HD £0.5M

New Therapeutic Area study

start up

New HD study £2.3M

Sept 17 Sept 18

£21.1M Order Book

1.5

2.3

2.8

3.4

H1-16 H1-17 H1-18 H1-19

Reported revenue growth (£m)

22%

▪ H1-18 +25%

▪ H1-17 +51%

Comparatives reflect adoption of IFRS15

▪ Generating high quality earnings growth from repeat business

• Expanding scope

• Multiple projects

▪ Reaching new biotechs to expand franchise to new therapeutic areas

▪ Working with earlier-stage assets creates long term opportunities

Sept 17 Mar 19


PhII & III Phase IV On Market

• Exploratory outcome measures

• Translational science

• 2° & 1°outcomes measures

• Patient outcomes in the real world

• Supporting therapeutic decisions

£150 - £500k £1m - £10m £200k - £2m £££

Typical Value Per Study

Phase I, II & III (sub-study)

Current Markets New Markets

Winning in current markets + reaching into new markets

Recurring revenue

Digital biomarkers providing objective measures of patient

outcomes

Digital and imaging biomarkers to monitor

disease progression and therapeutic

response

Imaging services de-risking outcomes: better insights to changes to brain structure and function



Financial Review

Grant Nash, CFO


H1 2019: Revenue, Gross Margin & EBITDA

1.5

2.3

2.8

3.4

H1-16 H1-17 H1-18 H1-19

Reported revenue growth (£m)

22%▪ H1-18 +25%

▪ H1-17 +51%

Comparatives reflect adoption of IFRS15

47

61 60 66

H1-16 H1-17 H1-18 H1-19

Gross Margin (%)

+610bps ▪ Operating leverage & product mix

EBITDA (£m)

Break-even▪ Progressive growth towards

profitability.

▪ Investments in H2 will increase

expenditure.

▪ H1-18 excludes £0.3m May 2018

placing costs.

Income per head (£k)

-1.1

-0.4

-0.1

0.1H1-16 H1-17 H1-18 H1-19

55

78

95

113

FY16 FY17 FY18 H1-19

Efficiency gains▪ Productivity continues to increase

Average headcount in period at bottom of bar

chart

69 61 63 66


H1 2019: Order Book & Cash

3.22.8 2.7

7.5

H1-16 H1-17 H1-18 H1-19

Cash position (£m)

▪ Oversubscribed £5.5m in May

2018 (net £5.2m)

£4.8mOperating cashflows (£m)

-2.0

-1.2

-0.1 -0.3

FY16 FY17 FY18 H1-19

£0.2m

▪ Roche PIII contract £0.9m

paid in FY-18 with services

provided across FY-19

Confidential, IXICO plc 2019

19.3 19.3

5.2

21.2

3.3

21.2

Opening NewWins

Revenue(ex fx)

Closing

H1 2019 order book analysis (£m)

9.9

12.7

19.321.2

Sep-16 Sep-17 Sep-18 Mar-19

Order book growth (£m)

▪ Sep-18 order book increase

included £9.1m PIII contract

▪ 10% growth in order book in H1-19

£21.2m▪ £5.2m contracts won in H1-19

▪ Revenue excludes £0.1m fx

▪ Phasing of customer payments

negatively impact H1-19

cashflows.


H1 2019: Working Capital and Investment

3.3

2.5

7.2 7.4

FY16 FY17 FY18 H1-19

Working Capital Growth (£m)

£7.4m▪ Cash balance underpins

strengthened WC position.

▪ Strong position from which to drive

growth 24

49

75

102

FY16 FY17 FY18 H1-19

Capital Investment (£k)

▪ Number of years of low capital

investment.

▪ Investment to redress balance.

▪ Investment to underpin and

accelerate growth.

R&D Investment (£k)

21%▪ Refocus of R&D resources on

driving commercial growth.

▪ Refocus and expand R&D

investments to strategic priorities.

S&M Investment (£k)

776697

582

458380 370

232 227

H1-16 H1-17 H1-18 H1-19

26% ▪ Investing in S&M team

▪ Investing in Marketing initiatives

▪ Investing in PR

69 61 63 66Grant income – function of R&D spend

400

335 322

406

H1-16 H1-17 H1-18 H1-19

Accelerate investment


Revenue growth

• Broadening range of neurological disease areas

• Across all phases of clinical development

• With leading biopharmaceutical companies

Strengthening gross margin

• Operational leverage & service mix

OPEX

• Increased Opex - investment in building scale &

capabilities to drive growth

Overview

• Strong position from which to deliver FY-19

market expectations

H1-19 Summary Income Statement: Revenue growth, margin accretion and breakeven

*Figures adjusted to reflect adoption of IFRS 15

Income Statement H1-19 (unaudited)

H1-18* (unaudited)

H1-17* (unaudited)

FY-18 (audited)

FY-17* (audited)

£’000 £’000 £’000 £’000 £’000

Revenues 3,426 2,817 2,255 5,394 4,100

YoY% Growth 22% 25% 51% 32% 34%

Gross Profit 2,271 1,697 1,375 3,173 2,314

Gross Margin % 66% 60% 61% 59% 56%

Other Income 303 300 441 562 643

R&D 458 582 697 1,033 1,256

S&M 406 322 335 754 823

G&A 1,574 1,201 1,037 2,593 2,117

Non-recurring - 332 112 - 165

Total Opex (ex Depreciation) 2,438 2,437 2,181 4,380 4,361

EBIDTA 136 (440) (365) (645) (1,404)

Operating Profit/(Loss) 105 (513) (791) (797) (1,912)

Net Profit/(Loss) 215 (419) (681) (668) (1,537)


H1-19 Summary Cashflow: Capitalised to fund growth

Cashflow H1-19 (unaudited)

H1-18* (unaudited)

H1-17* (unaudited)

FY-18 (audited)

FY-17* (audited)

£’000 £’000 £’000 £’000 £’000

Cashflow from operating activities

(305) 331 (281) 363 (644)

Cashflow from investing activities

(103) (47) (14) (79) (49)

Cashflow from financing activities

- - - 5,164 -

Movement in cash and cash equivalents

(408) 284 (295) 5,448 (693)

Opening cash and cash equivalents

7,861 2,414 3,120 2,414 3,120

Effect of exchange rate fluctuations

- 1 (25) (1) (13)

Closing cash and cash equivalents

7,453 2,699 2,800 7,861 2,414

Closing cash

• £7.5m, increase on H1-18 due to £5.5m

gross placing in May 2018

Operating cash flows

• £0.3m outflows H1-19 vs £0.3m inflows H1-

18m - due to phasing of project advance

payments in FY18

Investing cash flows

• Initiating investment in building scale &

capabilities to drive growth & address prior

years’ under-investment

*Figures adjusted to reflect adoption of IFRS 15



Operational scale for success

Marcus Thornton, COO


Investing to scale

IMAGE DATA

BIOSENSOR DATA

IMAGING

DATA

PLATFORM

BIOSENSOR

DATA

PLATFORM

DATA LAKE

AI LAYER

PUBLISHING

LAYER

WEARABLES IN CLINICAL TRIALS

Patient selection and stratification

Objective biomarkers & endpoints

Real world data sources

CLINICAL TRIALS

Imaging Site Selection and qualif ication

Fast and selective enrolment drives down study

duration and cost

Safety Monitoring

3RD PARTY

DATA SETS

POST MARKETING

Early and accurate diagnosis

Therapeutic recommendations tailored to the

individual

Early identif ication and monitoring of side

effects and disease progression


Focus on delivering process improvement and scale efficiencies

Key programmes delivering efficiencies:

• Site qualification

• Site management system

• New reporting platform

Impact:

• Speed and quality of site start-up

• Efficiency improvements

• Enhanced responsiveness to stakeholders

• Build knowledge base

• Enhance trusted partner and supplier relationships

Income per head (£k)

55

78

95

113

FY16 FY17 FY18 H1-19

Efficiency gains

▪ Productivity continues

to increase

Average headcount in

period at bottom of bar

chart

69 61 63 66

47

61 60 66

H1-16 H1-17 H1-18 H1-19

Gross Margin (%)

+610bps

▪ Operating leverage &

product mix



Summary & Outlook

Giulio Cerroni, CEO


Inflection point in the transformation of the business

▪ Fifth consecutive reporting period reporting +20% revenue growth

▪ Expanding franchise with blue-chip biopharma client base, driving quality earnings

▪ Visibility to future revenues from large contracted order book & strong pipeline

▪ Delivering operational gearing and executing operational efficiencies

▪ Break-even & debt free; continued progress on path to profitability

Delivering on our financial commitments

2019 interim results - ixico · wearable biosensors £0.5m wearable biosensors £0.75m new psp...

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