DirectorsTalk Interviews

Tag: QP

  • Quantum Pharma PLC Disposal of Biodose Services & Trading Update

    Quantum Pharma PLC Disposal of Biodose Services & Trading Update

    Quantum Pharma Plc (LON:QP), the service-led niche pharmaceutical developer, manufacturer and supplier, announces the disposal of Total Medication Management Services Limited, the Group’s homecare dispensary and delivery business which trades as Biodose Services (‘Biodose Services’), to HealthNet Homecare Limited (the ‘disposal’).

    The disposal represents a major step in transitioning Quantum’s focus to its core Specials and Niche Pharmaceuticals divisions and improving the Group’s quality of earnings. It follows the strategic review of the Medication Adherence (‘MA’) division which we reported in the final results announcement issued on 3 May 2017. Following the disposal the MA division will cease to exist, with Protomed being accounted for within the Specials division.

    The initial cash consideration on disposal is £1.75m with a maximum additional contingent consideration of £0.2m, which will become payable on the future utilisation of tax losses of Biodose Services. The initial consideration net of working capital adjustments, arising following the exit of Biodose Services from the Group, will be applied to reduce Group borrowings. The effect on the Group’s balance sheet is positive through a reduction in net debt.

    The disposal improves the Group’s gross and adjusted EBITDA margin by eliminating low margin turnover. In the year ended 31 January 2017 Biodose Services contributed £22.4m of Group revenues and recorded an adjusted EBITDA loss of £0.1m. Internal projections for Biodose Services in the current financial year anticipate a modest EBITDA profit. Biodose Services had net liabilities of £0.2m as at 31 January 2017.

    Trading Update

    Trading across the combined Niche and Specials divisions in the early months of the year has been ahead of plan and the Board expect this outperformance to offset the majority of the disposed contribution from Biodose Services in the current financial year.

    Commenting on the strategic disposal, Chris Rigg, Chief Executive Officer of Quantum Pharma Plc, said: “The sale of Biodose Services positions Quantum as a simplified and focussed pharma business with a higher quality of earnings. It is particularly pleasing that we have been able to demonstrate a quick path to profitability for Biodose Services and exit it to a buyer who can bring greater emphasis and better synergies to that business.

    The strong trading performance in the first few months of the year means that we expect to be slightly ahead of management expectations for the remaining Group and look forward to providing a further trading update on 9 August 2017.”

  • Quantum Pharma Plc FY17 Results – A Year of Change

    Quantum Pharma Plc FY17 Results – A Year of Change

    Quantum Pharma plc (LON:QP), the service-led niche pharmaceutical developer and supplier to the health and care sectors, has reported its Preliminary financial results for the 12 months to January 31, 2017. Net sales grew by 28% to £88.8m while adjusted EBITDA was in-line with expectations at £10.1m, down from £12.5m in FY16. During the year management took a number of decisive actions to focus and simplify the business, and the company is now on a much stronger operational and financial footing as it moves forward. The actions resulted in the prioritisation of the product development portfolio within the Niche Division and the closure of the loss-making NuPharm. The core Specials division continues to generate the majority of Group adjusted EBITDA and its strength in the UK unlicensed market was underscored again by renewed exclusive supply contracts with 3 of the 4 main wholesale and pharmacy chains. Our profit forecasts for FY2018 and FY2019 remain unchanged. Quantum is valued at around a 40% discount to peers at 7.4x EV/EBITDA (9.8x PE) in the year to Jan 31st, 2018.

    Financials: Overall net revenues grew by 28% to £88.8m with sales in the Specials and Medication Adherence (MA) divisions performing better than expected. Net sales grew in all divisions: – Specials £57.6m (+7%, FY16: £53.6m), Niche Pharma £5.8m (+36%, FY16: £4.3m), and MA £25.4m (+124%, FY16: £11.4m). Group adjusted EBITDA was £10.1m (FY16: £12.5m) with an adjusted Profit after tax of £8.0m (FY16: £9.3m profit). As reported (excluding discontinued operations), the Group had an Operating Loss of £9.8m (FY16: £7.5m profit) due to impairments related to the Niche portfolio as well as non-recurring or non-operational charges. With careful management of working capital and an equity financing in November 2016 raising £15.0m (gross), Quantum ended the period with Net Debt of £13.0m (FY16: £24.6m).

    Operations: The core Specials division remains strong as evidenced by renewed exclusive supply contracts with AAH Pharmaceuticals (over 1,800 Lloyds Pharmacies and 8,000 independents), Bestway Panacea Healthcare (Well Pharmacy), and Phoenix Healthcare Distribution (Rowlands pharmacies). The Niche division was reorganised to focus and simplify the business and has since done very well with new product launches performing as expected. Glycopyrronium bromide continues to lead the way in sales while others (e.g. Mucodis) have been discontinued as part of the rationalisation of the division’s activities. MA sales grew strongly and saw small monthly profits at year end but FY profit was limited by typically thin margins. MA is under strategic review.

    Outlook: We are encouraged that H2 FY17 saw a solid new operational footing established and Quantum Pharma plc Group businesses streamlined, particularly with the focus on the optimal product mix for Niche. With the most challenging steps now behind it and further efficiencies still to come, we are optimistic for the future.

  • Quantum Pharma PLC Pre-close trading update – on plan

    Quantum Pharma PLC Pre-close trading update – on plan

    Quantum Pharma plc (LON:QP), the service-led niche pharmaceutical manufacturer, developer and supplier to the health and care sectors, has released a pre-close trading update this morning. Zeus Capital said: The Board has indicated that adjusted EBITDA for the financial year (to Jan 31st) is expected to be in-line with market expectations (we forecast £10.1m) and that net debt will be approximately £13.5m following the successful fund raising in November last year. Following management’s strategic review of the Group it has re-directed efforts within the key divisions to focus and strengthen operations. Trading at NuPharm has ceased as planned and the unlicensed-to-licensed (UL2L) portfolio has been prioritized enhancing the opportunity to be first-to-market. We are confident that the changes made have set the company on the right path for the longer term. Based on our unchanged forecasts Quantum is valued at 9.4x EV/EBITDA for FY2017 (year just completed) falling to 8.2x for the coming year.

    As highlighted in the company’s update and earlier announcements, in addition to the cessation of trading at the loss-making NuPharm, key changes have been made to the company in the past few months including:

    * UL2L pipeline– the Niche Pharmaceuticals division has been operationally streamlined such that all products in the current UL2L pipeline are under ‘active development’ with Lamda controlling the processes such as product formulation and bioavailability as well as preparation and submission of regulatory filings. The pipeline has been prioritised to enhance the commercial potential for the company by focusing on products where there is a greater chance of being first-to-market.

    * Board and financing – following the successful equity fund raising of £15m (gross) in November 2016, the company has reduced its net debt to ensure the Group is well-financed and strengthened the Board with new appointments (Chris Rigg – CEO; Gerard Murray – CFO; Ian Johnson – Chairman; and experienced Non-Execs, Dr John Brown and Christopher Mills).

    Management has indicated that the reported final results will contain some significant one-off, mostly non-cash, exceptional items the most important of which relates to NuPharm and associated write down of the Balance Sheet value of the investment.

    As mentioned in October with the Interim results, the group experienced slower-than-expected sales of some of its generic and generic-plus products. Quantum has begun work to broaden its network of UK and international commercial relationships with a view to improving market penetration for selected generic products where it sees value in deals with partners that have greater sales and marketing expertise and presence in the generic pharma markets.

    Comment: We are encouraged that management is focusing on the Group’s valuable core operations and delivering on its new strategic directions, particularly in areas where Group performance has been challenged due to issues within the divisions. The Group is clearly on a much more solid financial and operational footing for the coming years. The company’s full year results will be reported on Wednesday, May 3rd.

    Chris Rigg, CEO of Quantum Pharma PLC, said: “The Group has made solid progress in simplifying and focusing on its core value opportunities. Prioritising the development of the UL2L products in our pipeline has given us a better opportunity to be first to market and drive value from the portfolio. We have taken decisive action to close a loss-making operation and have put the Group on a stronger financial footing going forward. I am pleased to report that we are executing in line with our plans.”

  • Quantum Pharma Plc Share purchase by CFO-Designate

    Quantum Pharma Plc Share purchase by CFO-Designate

    Quantum Pharma Plc (LON:QP), the service-led niche pharmaceutical developer, manufacturer and supplier to the health and care sectors, announced today that on 3 January 2017 the Company was notified that Gerard Murray, Quantum’s Chief Financial Officer Designate, purchased 200,000 Ordinary Shares of 10 pence each in the Company (‘Ordinary Shares’) at a price of 44.75 pence per Ordinary Share on 3 January 2017. Following this transaction, Gerard Murray holds 200,000 Ordinary Shares representing approximately 0.12% of the issued share capital of the Company.

    As announced on 8 December 2016, Gerard will join Quantum on 23 January 2017 from Ardent Hire Solutions Limited, a private equity backed plant hire business, where he has been the CFO since April 2016.

    Quantum Pharma Plc is a service-led, niche pharmaceutical developer, manufacturer and supplier to the retail pharmacy, pharmaceutical wholesaler, hospital, homecare and care home markets. Quantum Pharma operates through three divisions: Specials, Niche Pharmaceuticals and Medication Adherence, offering a portfolio of innovative and complementary products and services.