Final results

02 July 2019

Fusion Antibodies plc (AIM: FAB), a pharmaceutical contract research organisation specialising in antibody engineering services, announces its final results for the year ended 31 March 2019.


  • Significant increase in orders and revenues in H2 FY 2019
  • Full year revenues fell by 19% to £2.2m due to weak H1
  • £1.5m revenues in H2 FY 2019 was the Company's strongest-ever 6 month period
  • Loss for the year of £1.3m (2018: £0.7m)
  • New Rational Affinity Maturation Platform (RAMP™) introduced in December 2018
  • Capacity expansion completed
  • Business development team expanded and strengthened
  • Cash position at the year-end £2.0m (2018: £4.5m)

Post year end

  • Commercial roll out of RAMP™
  • New senior recruitment in business development and in marketing
  • Mammalian antibody library on track for delivery in 2020

Paul Kerr, CEO of Fusion Antibodies commented: "We have had a strong improvement during the second half of the year which has been due to a significant increase in orders and revenues. This has been achieved by a mix of factors including addressing the external competitive pressures seen during H2 FY 2018 and H1 FY 2019 and expanding and improving the quality of the Company's business development and marketing function. We are encouraged to see some good initial interest from potential customers in our new RAMP™ technology which will enable customers to improve the performance of many of their antibody based drugs. We are excited about the next 12 months and are grateful to our shareholders for their continued support."



Fusion Antibodies plc
Dr Paul Kerr, Chief Executive Officer Via Walbrook PR
James Fair, Chief Financial Officer  
Allenby Capital Limited Tel: +44 (0)20 3328 5656
James Reeve / Asha Chotai  
Walbrook PR Tel: +44 (0)20 7933 8780 or
Paul McManus Mob: +44 (0)7980 541 893
Anna Dunphy Mob: +44 (0)7876 741 001


Chairman's Statement

The year has been very significant for the Company, as we delivered our on-site expansion plans, introduced RAMP™ and responded to new competition which emerged towards the end of last year. In the first half of the financial year (H1) trading was difficult with pricing pressures and new competition significantly impacting revenues. However our response has been effective and in H2 we recorded the Company's highest revenues for a six month period. The combination of a weak H1, planned expenditure on research and investment for growth resulted in a loss for the year of £1.3m as is explained in the Chief Executive Officer's report.

Strategy and progress

As a result of difficult trading in H1, the full year revenues were 19% lower than in FY 2018. The Board recognised that trading was coming under pressure in the final quarter of FY 2018, both as a result of the impact on management of the AIM admission process and also from new competitive pressures in the market, in particular in relation to antibody humanisation. This resulted in a significant downturn in our revenues in H1.

Management and the Board responded strongly to these challenges. Prices were adjusted and operational improvements were made to improve our efficiency and maintain margin. We strategically realigned our broad technology base and enhanced antibody design with Antibody Developability by Design (ADD™) as a service providing further value to our customers. The business development team benefitted from a post IPO expansion with new team members recruited and trained in H1 and coinciding with the expansion and equipping of laboratories improving efficiency and throughput for our customer offering. As a result, the H2 revenues were more than double those for H1 demonstrating a marked turnaround and delivering the highest six months revenue on record. We believe that this can be sustained with the potential for further growth as the use of antibodies and the outsourcing of specific R&D activities in the Pharmaceutical industry continues to grow.

As part of our growth plans, over the past 12 months we have invested in the facilities and delivered a significant expansion of our laboratory and office space on time and well under budget. This gives us the capacity headroom required for future growth. Furthermore, we continue to expand the commercial team and to invest in the science behind the services to deliver ever improving techniques to a fast moving industry. I am pleased to report that the introduction of RAMP™, our advanced affinity maturation service to improve performance of antibody based drugs, was announced in December 2018 and will be commercially rolled out fully in the current year. Our scientific skills and creativity can also be seen in the progress of the Antibody Library currently under development for human antibody discovery and which remains on track for 2020.

Strategically we have aligned our business into three core services to meet our customer needs:

  • Discovery: the creation, screening and sequencing of novel monoclonal antibodies for therapeutic and diagnostic applications;
  • Engineering: maximising the performance of an antibody drug including CDRx™ humanisation, ADD™ and RAMP™; and
  • Supply: the production of material for clinical production or further research, including cGMP ready stable cell line development and transient expression.

Corporate governance

The long-term success of the business and delivery on strategy depends on good governance. The Company complies with the Quoted Companies Alliance Corporate Governance Code 2018 as explained more fully in the Governance Report in the annual report and accounts.

Current trading

The Company had a challenging first six months with disappointing revenues in H1 FY2019. Order levels picked up significantly from October 2018 onwards and revenues in H2 FY2019 exceeded all previous six-month periods. To complement the record H2 revenues, order intake also exceeded previous periods. The introduction of the new RAMP™ service towards the end of FY 2019 has been well received by potential customers and is expected to contribute to revenues in the coming year. As explained in the financial results section of the CEO's report, the Company returned a loss for the year and the combined use of cash in operations and invested in capital expenditure was £2.5m.

Post year end trading has been in line with expectation. Order acquisition has remained firm and revenue levels maintained incorporating initial contributions from RAMP™. The Company continues to innovate and develop its services, and in particular the development of the Mammalian Antibody Library will continue throughout the coming financial year.

I would like to extend my thanks to all staff at Fusion for their hard work and to our shareholders for their ongoing support.


Dr Simon Douglas


01 July 2019


Chief Executive Officer's Statement

This year has been our first full year as a listed Company and has come with some early challenges as well as good reason for optimism. Weak H1 revenues required a strong management response while we also implemented the actions planned at the time of listing. As a result of the weak H1 and investment for growth, losses increased this year to £1.3m (2018: £0.7m loss). I am delighted to report a full recovery of revenues in H2 along with the expansion of laboratories, targeted recruitment and continued delivery from our research and development programme. This is an exciting time for the Company and I am pleased to work in a team of talented people well equipped to capture the full value of opportunities presented by the growing market in global drug research.

Business review

Revenue performance across the financial year to 31 March 2019 divides very clearly into two six month periods. In the second six months (H2) the Company delivered revenues of £1.5m, a new high for the Company and indicates a strong recovery from the weak trading (£0.7m) in the first six months (H1). However, revenues for the full year were 19% lower than the previous financial year as a result.

Sales from our humanisation service were again the main contributor to revenues. Our newly introduced Antibody Developability by Design also began to generate modest revenues in the year.

In terms of geographical performance, revenues from North America grew by 23% to become our largest market in the year with a reduction in revenues recorded for the UK, rest of Europe and rest of world. During the year the business development team welcomed new recruits who have been increasing our client contact for increased order acquisition. In particular several trips have been made to Asia as the Company builds relationships in Japan and South Korea and develops new opportunities in China.

In addition to the fees charged for performing services, several contracts now carry a royalty or success payment which becomes payable when the customer project reaches a certain milestone. Having received a small milestone payment in FY 2018, the Company did not receive any milestone payments in the FY 2019. We maintain our interest in several molecules humanised by the Company and developed by others, including Mab Discovery, and have added new milestones for work performed this year which will crystallise if these projects proceed to clinical trials in the coming years.

In August 2018, we completed the expansion of our laboratory capacity which has improved the workflows and efficiency so that we maintained our gross profit margin in H2 in the face of competitive pressures. Our newly equipped laboratories provide bespoke facilities for delivery of our RAMP™ service, research and development of new services and a foundation for the future growth of all the Company's services.

We continued to invest in both RAMP™ and the development of the fully human antibody library during the year. We view these as a source of substantial growth over the next few years. Following the introduction of RAMP™ we will produce more scientific data in parallel with, and to support, the commercial roll out.

Inventory of consumables was increased at the year end to allow for any supply chain disruption from the UK's planned exit from the European Union, which has now been deferred to October 2019. In the year, 30% of the Company's revenues arose from exports to the EU countries. The Company continues to monitor potential risks and opportunities arising from leaving the EU. We also continue to develop other export markets to mitigate risks of overexposure to any one geographical market.

Net current assets of £2.5m at 31 March 2019 mainly comprised inventories and cash and cash equivalents.

The Company ended the year with £2.0m of cash, having used £1.1m of cash in operations during the year and invested almost £1.4m in property, plant and equipment. This cash level puts the Company in a strong position to progress plans for growth in existing services and the introduction of new services in 2020.

Financial Results

The decline in revenues seen in the second half of FY 2018 accelerated sharply in H1 FY 2019 for the reasons discussed above. However, the Board addressed the factors contributing to this and H2 FY 2019 recovered strongly to record our strongest ever six month period and a resumption in our organic revenue growth seen in recent years. However, revenues for the year in total were down 19% to £2.2m (2018: £2.7m). Revenues were lower in all geographical markets apart from North America which grew by 23%.

The EBITDA loss for the year was £1.1m (2018: £0.6m loss) as a result of the lower than expected revenues in H1 and the investment the Company has made in future growth, investing in employees, facilities and research which are expected to deliver further significant revenue growth. The Company produced a loss before tax of £1.5m (2018: £0.7m loss).

The Company used £1.1m of cash in operations (2018: £0.1m generated) and invested £1.4m in expenditure on capital equipment and intangible assets. Cash and cash equivalents as at 31 March 2019 totalled £2.0m (2018: £4.5m).

The Company's full results are set out in the financial statements included with this report.

Key performance indicators

The key performance indicators (KPIs) regularly reviewed by the Board are:

KPI 2019 2018
Revenue change year on year (19)% 41%
EBITDA (£1.1m) (£0.6m)
Adjusted EBITDA (£1.1m) £0.1m
Cash (used in)/generated from operations (£1.1m) £0.1m


The directors remain confident that order levels seen in the second half of FY 2019 can be maintained in FY 2020 augmented by new orders for the RAMP™ service, such that significant revenue growth is achievable in the current financial year.


Dr Paul Kerr

Chief Executive Officer

01 July 2019


Statement of Comprehensive Income

    2019 2018
  Notes Before non-
(note 29)
After non-
(note 29)
After non-
    £ £ £ £ £ £
Revenue 4 2,181,838 - 2,181,838 2,690,744 - 2,690,744
Cost of sales   (1,377,836) - (1,377,836) (1,207,331) - (1,207,331)
Gross profit   804,002 - 804,002 1,483,413 - 1,483,413
Other operating income   86,406 - 86,406 54,626 - 54,626
Administrative expenses   (2,398,842) - (2,398,842) (1,475,646) (772,936) (2,248,582)
Operating (loss)/profit 5 (1,508,434) - (1,508,434) 62,393 (772,936) (710,543)
Finance income 8 12,596 - 12,596 4,043 - 4,043
Finance costs 8 (4,033) - (4,033) (4,862) - (4,862)
(Loss)/profit before tax   (1,499,871) - (1,499,871) 61,574 (772,936) (711,362)
Income tax credit/(expense) 10 235,489 - 235,489 (63,883) 75,304 11,421
Loss for the financial year   (1,264,382) - (1,264,382) (2,309) (697,632) (699,941)
Total comprehensive expense for the year   (1,264,382) - (1,264,382) (2,309) (697,632) (699,941)
        Pence     Pence
Loss per share              
Basic 11     (5.7)     (4.3)

The statement of comprehensive income has been prepared on the basis that all operations are continuing operations.


Statement of Financial Position

  Notes 2019
Non-current assets      
Intangible assets 12 6,214 -
Property, plant and equipment 13 1,587,999 546,734
Deferred tax assets 15 1,342,385 1,156,047
    2,936,598 1,702,781
Current assets      
Inventories 16 242,669 81,815
Trade and other receivables 17 1,056,382 926,220
Current tax receivable   22,645 6,906
Cash and cash equivalents   1,984,338 4,490,931
    3,306,034 5,505,872
Total assets   6,242,632 7,208,653
Current liabilities      
Trade and other payables 18 729,360 536,299
Borrowings 19 66,539 33,758
    795,899 570,057
Net current assets   2,510,135 4,935,815
Non-current liabilities      
Borrowings 19 72,636 43,529
Provisions for other liabilities and charges 20 20,000 20,000
    92,636 63,529
Total liabilities   888,535 633,586
Net assets   5,354,097 6,575,067
Called up share capital 22 883,648 883,648
Share premium reserve   4,872,327 4,872,327
(Accumulated losses)/retained earnings   (401,878) 819,092
Total equity   5,354,097 6,575,067


Statement of Changes in Equity

  Called up
share capital
At 1 April 2018 883,648 4,872,327 819,092 6,575,067
Restatement (see note 30) - - (23,632) (23,632)
At 1 April 2018 restated 883,648 4,872,327 795,460 6,551,435
Loss and total comprehensive expense for the year - - (1,264,382) (1,264,382)
Share options - value of employee services - - 97,634 97,634
Tax charge relating to share option scheme - - (30,590) (30,590)
Total transactions with owners, recognised directly in equity - - 67,044 67,044
At 31 March 2019 883,648 4,872,327 (401,878) 5,354,097
At 1 April 2017 547,655 6,161,269 (5,251,909) 1,457,015
Loss and total comprehensive expense for the year - - (699,941) (699,941)
Capital reduction - (6,161,269) 6,161,269 -
Issue of share capital 335,993 5,270,359 - 5,606,352
Cost of issuing share capital - (398,032) - (398,032)
Share options - value of employee services - - 330,176 330,176
Tax credit relating to share option scheme - - 30,590 30,590
Total transactions with owners, recognised directly in equity 335,993 (1,288,942) 6,522,035 5,569,086
At 31 March 2018 883,648 4,872,327 819,092 6,575,067


Statement of Cash Flows

Cash flows from operating activities    
Loss for the year (1,264,382) (699,941)
Adjustments for:    
Share based payment expense 97,634 330,176
Cost of raising capital - 609,836
Depreciation 429,385 69,625
Amortisation of intangible assets 1,830 -
Finance income (12,596) (4,043)
Finance costs 4,033 4,862
Income tax credit (235,489) (11,421)
Increase in inventories (160,854) (11,554)
Increase in trade and other receivables (157,938) (225,322)
Increase in trade and other payables 193,061 14,974
Cash (used in)/generated from operations (1,105,316) 77,192
Income tax received 6,906 -
Net cash (used in)/generated from operating activities (1,098,350) 77,192
Cash flows from investing activities    
Purchase of intangible assets (8,044) -
Purchase of property, plant and equipment (1,372,533) (444,595)
Net cash used in investing activities (1,380,577) (444,595)
Cash flows from financing activities    
Proceeds from issue of share capital - 4,598,650
Repayment of borrowings (36,229) (25,182)
Finance income - interest received 12,596 4,043
Finance costs - interest paid (4,033) (4,862)
Net cash (used in)/generated from financing activities (27,666) 4,572,649
Net (decrease)/increase in cash and cash equivalents (2,506,593) 4,205,246
Cash and cash equivalents at the beginning of the year 4,490,931 285,685
Cash and cash equivalents at the end of the year 1,984,338 4,490,931


Notes to the Financial Statements

Notes to the Financial Statements are available in the printable PDF version


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