Tue Sep 10 15:57:00 UTC 2024: ## hVIVO (LON:HVO) Soars on Strong Interim Results, Investor Sees Further Growth Potential
**London, UK – September 11, 2024** – AIM-listed hVIVO (LON:HVO), a specialist contract research organisation (CRO) focused on human challenge trials, saw its share price surge today following strong interim results. The company, which has already experienced a remarkable 400% rise in value over the past five years, is poised for continued growth, according to one investor.
hVIVO, known for its unique approach to vaccine and treatment testing using healthy volunteers in controlled environments, reported a 30.6% year-on-year increase in revenue, reaching £35.6 million for the first half of 2024. EBITDA also saw a significant jump of 67.6%, reaching £8.7 million, resulting in a robust EBITDA margin of 24.5%. The company ended June with a healthy £37.1 million in cash, a substantial increase from £31.3 million the previous year.
The company’s strong performance is attributed to its new state-of-the-art quarantine facility at Canary Wharf, the world’s largest human challenge unit. This facility, which boasts a pneumatic chute system for rapid sample delivery, has significantly improved operational efficiencies, leading to further enhancements in profit margins.
Management expects full-year revenue to reach £62 million, representing an 11% growth, with 100% of the guidance already secured through contracts. The EBITDA margin is anticipated to be at the higher end of market expectations, ranging from 22% to 24%.
Looking ahead, the company anticipates reaching an annual revenue of at least £100 million by 2028, indicating a compound annual growth rate of approximately 14%. This growth will be driven by a diversified revenue stream encompassing clinical trial design, volunteer recruitment services, and hLAB, its specialized laboratory service offering.
Despite its strong performance, the company acknowledges potential reputational risks associated with human challenge trials. However, the investor remains optimistic, citing the stock’s valuation as reasonable, with a price-to-sales ratio of 3.5 and a forward price-to-earnings multiple of 20.5.
“I think the stock could fly higher, especially if a bull market takes off,” said the investor, who added that they became a shareholder last year and have since increased their position in hVIVO. The investor believes the company remains a strong contender in the small-cap market and is one of their favorites.
It is important to note that investing always carries risk, and the value of investments can go up and down. Potential investors are encouraged to consider their individual circumstances and seek independent financial advice before making any investment decisions.
First Piper 