Profit warning as tough trading conditions hit listed biotech business
Sheffield-based biotech firm Benchmark said it faces “challenging conditions” in its global shrimp and Mediterranean seabass/bream markets.
The AIM-listed company, which specialises in aquaculture health, nutrition and genetics, has today released its quarter three trading update.
It said: “The company has continued to face challenging conditions in the global shrimp and Mediterranean seabass/bream markets, as outlined in its half year results in June 2019, which has impacted sales volumes in Advanced Nutrition.
“Additionally, the company is experiencing a reduced contribution from trials of certain pre-license pipeline products within Animal Health, as a result of making good progress towards satisfactorily concluding trials with fewer treatments than expected, and from delays in commencing trials in several territories.
“The company’s expectations of the revenue and profit mix for the full year have also changed.
“It is actively progressing its programme of operational and structural efficiencies, including key commercial licensing deals for its non-core animal vaccines, which, if completed this financial year, are expected to substantially offset the negative variance referred to above.
“However, there is a risk to the delivery of these deals within the current financial year.
“Notwithstanding these short-term challenges, the Board believes the company is well positioned in its markets and the opportunities for its existing products and those coming from its pipeline are strong.
“The company continues to progress delivery of its five-year strategy to drive future growth and profitability.”
In June, Benchmark announced increased revenues in a six-month period where its profitability suffered as it focused on delivering a higher value product mix. For its six-month results to 31 March 2019, the company said its revenues rose 3%, from £75.7m to £78.3m. But its adjusted pre-tax profits fell 80% from £3.6m last year to £700,000 this year.
