On March 26, 2020 Selvita S.A. (WSE: SLV) – one of the largest preclinical contract research organizations in Europe – reported its annual financial results for 2019 and provided a corporate update (Press release, Selvita, MAR 26, 2020, View Source [SID1234555891]).

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The total commercial revenues of the services segment in 2019 amounted to EUR 19.6 million which marks a 43% increase compared to revenues in 2018. The company has recorded an exceptional dynamics of commercial revenues in the services segment in Q4 2019, achieving EUR 6 million, a 61% increase, compared to a corresponding period in 2018.

Bioinformatics segment (Selvita’s subsidiary – Ardigen S.A.) reports an increase in annual commercial revenues of 23 % compared to 2018, i.e. EUR 2.4 million.

Selvita recorded also EUR 24.5 million of total revenues, indicating a 37% increase comparing to revenues in 2018. Operating profits result amounted to EUR 3.3 million, an increase of 27% compared to 2018, with a 13% operating margin. The EBIDTA net result* (EBITDA excluding IFRS16 impact) in 2019 amounted to EUR 4.9 million which constitutes 23% more than in 2018. Taking these into account, Selvita has delivered all the financial goals, it has set itself in previous year.

"Selvita consequently strengthens its position on the global preclinical CRO market. Our offer reaches nearly 600 clients operating on 5 continents. We’re specializing in delivering integrated research solutions and we have a proven track record of not just providing scientific excellence, but also building long-term partnerships with our clients, playing an active, consultative role in the project execution. This is what allows us to report such good financial results as we do today, as well as to build solid foundations for further growth in 2020," explains Bogusław Sieczkowski, CEO at Selvita.

The backlog **for 2020 currently amounts to EUR 18.4 million and is 43% higher than at corresponding time in 2019. In the two main areas of the services segment i.e. drug discovery and regulatory studies, the commercial revenue backlog for 2020, amounts to EUR 15.3 million and is 58% higher compared to the corresponding period last year.

"A solid backlog this early in a year allows us to feel optimistic despite the current global situation and uncertainties caused by the coronavirus spread. At the moment, we’re up and running. In the new reality setting created by COVID-19, we have digitalized all the activities possible, and we’re taking extra care about the work being done in the labs. We have adopted numerous preventive measures across our entire organization to keep our scientists safe and at the same time assure business continuity. Current situation shows us very explicitly how important discovery and development of new drugs is. Our partners’ projects are important to us and we’ll do our best to keep them going. We’re fully functional, focused on current projects’ execution and in touch with our business partners. We have a quite simple mission right now: ensure safety of our employees and successful execution of customers’ projects," adds Sieczkowski.

Selvita after the split

At the beginning of October 2019, the National Court Register of Poland has recognized the corporate split of Selvita into two distinct organizations, one which is focused on oncology therapeutics and the contract research organization (CRO). After the split Selvita operates independently with separate executive management teams as well as supervisory boards.

For 2020, Selvita focuses on further organic growth, consequently strengthening its team of specialists, expanding the portfolio of services offered and extensively investing in new technologies and infrastructure.

The company is also planning to grow through acquisitions, being interested in both domestic and foreign companies which will allow it to either expand scale of operations or complement its current portfolio of services. Selvita is hoping to conduct the first transaction in 2020.

Selvita provides comprehensive research and development services, mainly to clients in the pharmaceutical and biotechnology industries. The company’s medium-term goal is to enter the top ten largest preclinical CROs in the world.

*EBITDA net result not including IFRS16 influence. If IFRS16 is included, EBITDA net results amounts in Q4 2019 r.to EUR 1.9 million.

**Backlog defined as the value of the portfolio of contracts signed as on 18/03/2020, incl. commercial contracts and grant agreements.