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Revenue up at Oxford Biomedica

The drug developer beat market expectations with these full-year numbers
March 15, 2019

Oxford Biomedica's (OXB) shares moved up slightly on the release of these preliminary results, after the drug developer beat broker Peel Hunt’s operating and cash profit forecasts. Gross income rose 72 per cent on increased licensing income and higher bioprocessing activity, which helped to deliver revenues – in line with market expectations. Even better, the group swung into a positive operating profit position of £13.9m thanks to lower research and development (R&D) costs, while cash profits of £13.4m also beat Peel Hunt’s £12.7m forecast.

IC TIP: Hold at 670p

This suggests the company’s latest strategy – a combination of innovative drug development and product manufacturing – is bearing fruit. To that end, the group has been busy signing several new collaboration and licence agreements, including one with Bioverativ – part of French pharma giant Sanofi (FR:SAN) – for $105m, while also taking on additional manufacturing facilities in Oxford to expand its specialist capabilities.

That’s not to say this isn’t still expensive work. Thankfully, Oxford’s latest fundraising generated gross proceeds of £20.5m, as capital expenditure rose from £2m to £10.8m year on year. For now, analysts at Peel Hunt still expect EPS of 7.3p in 2019, rising to 23.7p in 2020.

OXFORD BIOMEDICA (OXB)  
ORD PRICE:670pMARKET VALUE:£443m
TOUCH:670-680p12-MONTH HIGH:1,063pLOW: 511p
DIVIDEND YIELD:NILPE RATIO:58
NET ASSET VALUE:53pNET DEBT:26%
Year to 31 DecTurnover (£m)Pre-tax profit (£m)Earnings per share (p)Dividend per share (p)
201413.6-10.8-0.4nil
201515.9-17.0-0.5nil
201627.8-20.3-0.6nil
201737.6-11.8-14.5nil
201866.85.011.6nil
% change+78---
Ex-div:na   
Payment:na