1st February 2024

VENTURE LIFE GROUP PLC

("Venture Life" "VLG" or the "Company")

Trading Update for the year ended 31 December 2023

Venture Life (AIM: VLG), a leader in developing, manufacturing and commercialising products for the self-care market, announces a trading update for the year ended 31 December 2023 ("FY23"). The Company expects to publish its results for FY23 in early April 2024.

Financial Highlights

·      Full year revenue c.£51m was +16% YoY (2022: £44.0m) and +5% YoY on a proforma basis¹, in line with management expectations demonstrating robustness and variety within the portfolio

·      Venture Life Brands revenue c.£30m was +30% YoY (2022: £23.0m) and +8% YoY on a proforma basis¹ , representing 59% of revenues for the Group in the year (2022: 53%)

·      EBITDA margin progression of c.2ppts highlighting gearing effect from increased volume and EBITDA expected to be in line with management expectations, subject to audit

·      Cash conversion improvement and normalisation of inventory levels, leading to net cash from operations increasing over 70% to c.£9.5m (2022: £5.6m)

·      Group net leverage² reduction to c.1.25x (December 2022: 1.65x) and further reduction to c.1.1x post period end.

·      Targeted customer price increases implemented during Q4 2023, contributing to further margin uplift in 2024

Operational Highlights

·      Revenues from Lift were +20% YoY and strong second half orders for the oncology support portfolio included Gelclair growth +52% YoY

·      Ongoing focus on digital transformation saw online sales continue to grow, full year revenues from this channel were +40% YoY at £3.8m (H1 2023: £1.6m)

·      28 new listings achieved across UK retailers during the year, substantially coming from Newly Developed Products ("NDP")

·      Balance Activ Thrush Cream (launched in October 2023) exceeded High Street rate of sales target just 8 weeks after launch

·      Post period end, further listing of Balance Activ NDP confirmed with major UK retailer

The upward trend across our VLG Brands highlights a healthy revenue mix and the Company's solid partnerships with these customers. Notably, 59% of the Group's revenue is attributed to VLG brands, aligning with the Company's strategic direction for a more resilient revenue composition.

Encouraging sales performance from newly developed products ("NDP"), is a clear benefit of our investment in brand development, advertising, marketing as well as our careful analysis of consumer needs and market trends. We have successfully enhanced the visibility of Earol on the High Street through impactful in-store activations and have fortified our Women's Health portfolio in Superdrug by introducing new products in Q4 2023. Dentyl launched a cherry flavoured 500ml line in B&M in Nov 2023, which has further strengthened our presence in discounters. Balance Activ sales from Amazon grew strongly due to the introduction of new products including Intimate Daily Wash, multipacks, and thrush cream. The increased contribution of online revenue highlights our success in digitisation.

Outlook

Moving forward, we are committed to continuing to intensify our initiatives to diversify sales channels and extend our presence among customers and retailers through additional targeted investment in sales and marketing. This will involve, amongst other things, capitalising on the strong momentum witnessed in online channels, discounters, health and beauty, pharmacy and grocery, and adapting to the evolving market landscape.

Jerry Randall, Chief Executive Officer, commented: "2023 marks the first year since 2019 that the Company grew its revenue completely organically. The increase in revenue is primarily due to heightened sales volume, with some price increases passed on to the customers in the second half, reflecting the Company's ability to navigate economic challenges. This [organic] revenue growth, combined with ongoing efforts to improve efficiency and strengthen partnerships, positions the Company well for sustained future growth and profitability. The integration of online sales channels, expansion into new market segments and the strengthening of our brand power collectively reinforce the Company's position within the market place and ensures that it remains adaptable and resilient in a dynamic business environment.

Our Customer Brands team, based out of our Italian manufacturing site at Biokosmes, delivered another year of excellence, spearheading new product R&D initiatives and delivering best-in-class Contract Development and Manufacturing Organisation experiences for our clients.

Benefiting from our robust growth, clear strategic priorities aimed at refining our operation, substantial generation of free cashflow and a strong balance sheet, we are now in a prime position to deliver strong shareholder returns and I look forward to presenting the FY23 results to shareholders in April."

¹ Proforma basis i.e. if the acquisitions of HL Healthcare Limited had been in place for the whole of the prior year

² Group net leverage calculated as net debt (excl. finance leases) and using proforma¹ Adjusted EBITDA³ on a trailing 12-month basis.

³ Adjusted EBITDA is EBITDA before deduction of exceptional items and share-based payments 

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About Venture Life (www.venture-life.com)

Venture Life is an international consumer self-care company focused on developing, manufacturing and commercialising products for the global self-care market. With operations in the UK, Italy, The Netherlands and Sweden, the Group's product portfolio includes some key products such as the Balance Active range in the area of women's intimate healthcare, the Earol® product line in ENT care, the Lift and Glucogel product ranges for energy and glucose management and hypoglycaemia, the UltraDEX and Dentyl oral care product ranges, products for fungal infections and proctology, and dermo-cosmetics for addressing the signs of ageing. Its products are sold in over 90 countries worldwide.

The products, which are typically recommended by pharmacists or healthcare practitioners, are available primarily through pharmacies and grocery multiples. In the UK and The Netherlands these are supplied direct by the company to retailers, elsewhere they are supplied by the Group's international distribution partners. 

Through its two Development & Manufacturing operations in Italy and Sweden, the Group also provides development and manufacturing services to companies in the medical devices and cosmetic sectors.