Serving scientists, sustaining growth.
2018/19 Year in Review
“I am proud of what we have accomplished in 2019. Together, we successfully implemented our growth strategy to become a stronger partner for our customers. For our team, we continued to enhance our culture to be an even better place to work. For our shareholders, we delivered a solid financial performance, positioning our Company for an exciting future.”
Alan Hirzel
CEO
Our Purpose: Empowering scientists to their next breakthrough
Our purpose – to serve life scientists to help them achieve their mission, faster – drives everything we do.
By providing life scientists with critical biological tools and reagents needed for research, drug discovery and diagnostics, we are helping advance scientific discovery, resulting in better health outcomes and improving lives. We recognise that we succeed only because we help our customers achieve their goals, faster. We are committed to increasing and improving the ways in which we are able to support life scientists and achieving this in a way that benefits our shareholders and our other stakeholders.
As we continue to execute our strategy to deliver sustainable performance and growth, our culture will help drive success.
We will – continue to dedicate ourselves to our customers, anticipating and responding to their needs in order to deliver an exceptional experience; be audacious in our approach to innovation and in finding solutions to existing and new biological questions; and earn trust by delivering quality products and services with agility and speed, executing on our plans and, at all times, acting responsibly and with integrity.
Dedicated to excellence
How Abcam’s scientists are helping the research community move closer to a cure for Parkinson’s disease.
Audacious innovation
How an audacious approach to innovation is helping advance research in rare disease areas with high unmet medical need.
Embracing agility
How an agile approach to new product development is helping increase our knowledge of epigenetics.
Operational and strategic highlights
- All product categories growing above underlying market rates and all strategic performance targets achieved
- Continued in-house innovation, with in-house product revenue growth of 13.6% (CER) and the introduction of the Group’s 18,000th recombinant antibody
- Further enhancements to product quality through knockout validation, recombinant antibodies, and other quality initiatives
- Ongoing development of our addressable market in custom products and licensing, with 57 new agreements entered into with biopharmaceutical and diagnostic partners and over 160 custom projects completed during the year
- Implemented the financial and non-stock procurement modules of the Oracle Cloud ERP IT system
- Successfully relocated to our new global headquarters
- Acquisition of Calico Biolabs, expanding expertise in recombinant rabbit monoclonal antibody development
Financial highlights
Note:
Certain financial measures in this Annual Report and Accounts, including adjusted results above, are not defined under IFRS and are alternative performance measures as described on page 141. All adjusted measures are reconciled to the most directly comparable measure prepared in accordance with IFRS in note 7 to the consolidated financial statements
KPI performance
Recombinant antibody CER
revenue growth
22%
2018/19 target: 20%+
Immunoassay CER
revenue growth
22%
2018/19 target: 20%+
Transactional Net Promoter
Score (tNPS)
59%
2018/19 target: 57-67%
A global leader in the supply of life science research tools
Chairman’s statement
It is my pleasure to introduce Abcam’s 2019 Annual Report, which sets out the continued financial and strategic progress made by the company over the past 12 months, as well as our plans and priorities for the future.
Abcam has made good progress, both financially and strategically, over the past 12 months. We have continued to successfully implement our growth strategy whilst strengthening the organisation’s underlying capabilities to deliver further growth in the future.
Peter Allen
Chairman
Download Chairman’s statement
(pdf)
CEO’s review: Sustaining long-term profitable growth
The life science industry is vibrant, with increased research funding and capital investment supporting collaborative and global discovery networks.
Those research discovery networks – spanning genomics, epigenetics, proteomics and metabolomics – are converting physical biology into data at an unprecedented rate at a time when we are approaching unconstrained computing power. The insights from this data are not fully realised, and yet this progress is already producing rapid advances in scientific discovery and improving patient lives. Indeed, we expect the impact of the endeavours of researchers today to redefine how we will be treated in the future.
Our dedication to customer needs, team performance and our long-term investment perspective has helped Abcam to achieve sustained growth and expand its reach and influence over the last five years. Today, we are in a better position than ever before to pursue opportunities to continue to invest in, build and grow a successful global company.
Alan Hirzel
Chief Executive Officer
CFO’s review: Double-digit revenue growth delivered; continue to prioritise investment in long-term growth
Highlights
- Total revenue increased by 11.4% on a reported basis and 9.2% on a constant exchange rate (CER) basis
- Gross margin increased by 60 basis points to 70.5%
- EBITDA margin of 32.4% (2017/18: 35.0%) and Adjusted EBITDA margin of 35.6% (2017/18: 37.9%), reflecting planned strategic investments made during the year
- Reported operating profit margin of 21.6% (2017/18: 29.5%), after impact of non-cash impairment charge, and Adjusted operating margin of 32.2% (2017/18: 34.1%)
- Reported diluted EPS decreased by 27.8% to 21.8p as a result of the non-cash impairment charge and adjusted diluted EPS grew 0.6% to 32.6p
- Strong cash generation continued, with net cash inflow from operating activities of £69.3m (2018/19: £63.3m)
- Proposed final dividend of 8.58 pence (2017/18: 8.58 pence), taking the proposed total annual dividend to 12.13 pence per share, an increase of 1.1%
- £200m Revolving Credit Facility secured, providing additional flexibility for future corporate transactions
The Group delivered another solid financial performance in 2019, underpinning our continued investment in long-term growth
Gavin Wood
Chief Financial Officer
Strategy at a glance
Our strategy is designed to increase growth and improve our long-term financial performance.
An overview of the strategic and operational milestones reached in 2018/19 and our future priorities are provided in the following tables:
Sustain antibody and digital marketing leadership
| 2018/19 priorities |
|---|
|
| What we achieved |
|---|
|
Expand in related growth markets
| 2018/19 priorities |
|---|
|
| What we achieved |
|---|
|
Invest in operating capabilities for 2x 2016 scale by 2023
| 2018/19 priorities |
|---|
|
| What we achieved |
|---|
|
Sustain attractive economics
| 2018/19 priorities |
|---|
|
| What we achieved |
|---|
|
Supplement organic growth – partnerships and acquisition
| 2018/19 priorities |
|---|
|
| What we achieved |
|---|
|
Primary markets and growth trends
Abcam’s core market, the global life science research reagents market, is currently estimated at approximately $3bn, and growing at around 4% per annum. Within this figure, primary antibodies, where Abcam currently generates around three-quarters of its revenue, currently contribute approximately $1bn.
Through its Custom Products and Licensing activities, Abcam is extending the commercial application of its capabilities in antibody engineering into diagnostic and therapeutic markets in partnership with bio-pharmaceutical and diagnostic companies.
According to industry forecasts, the combined diagnostic and therapeutic antibody markets totalled over $120bn in 2017. We estimate Abcam can address up to $5bn of these markets through the development of in vitro diagnostic (IVD) products, other antibodies and immunoassays and biological therapeutics.
Registered Office:
Discovery Drive, Cambridge
Biomedical Campus,
Cambridge, CB2 0AX, UK
+44 (0) 1223 696 000
VIEW PRODUCTS
© Abcam Limited. all rights reserved.
Abcam Limited is incorporated in England and Wales, its main country of operation in the UK. Use of this website is subject to our Terms and Conditions of use and our Privacy Policy. Share price and news information on this site is updated dynamically from external data feeds.
Corporate Responsibility
Behaving in a responsible and ethical way is central to the sustainable success of Abcam. We aspire to carry out our business activities to the highest ethical standards, act responsibly and make a positive impact in our interactions with all our stakeholders.