Yourgene shares fall 7% despite Covid testing revenue

Shares of Manchester-based molecular diagnostics firm Yourgene Health plc fell about 7% on Monday after it issued a trading update for the half-year ended September 30, 2020.

Amid its work on COVID-19 testing, Yourgene shares have risen almost 50% in past 12 months to give the firm a current stock market value of about £130 million.

Revenues for the half year were up 5% to £8.2 million “with strong European revenues offsetting the headwinds from COVID-19 on international sales.”

Yourgene said revenues from the company’s UK COVID-19 testing services and international Clarigene SARS-CoV-2 diagnostic product “started to build in the latter part of H1 and are showing strong growth in the early part of the second half of the financial year.”

In its full-year outlook, Yourgene said: “Core laboratory customers are now returning to more normal patterns of testing which, if sustained, we expect to restore the previous growth trends in NIPT, reproductive health, oncology and research markets.

“In addition, Yourgene’s UK COVID-19 testing service is expanding rapidly and from the beginning of October 2020 is now operating at its full capacity of 10,000 tests per month.

“Capacity is being further expanded to 20,000 tests per month which is due to come on stream in the third quarter. 

“This will increase COVID-19 testing revenue potential to approximately £1m per month and there is potential for further expansion in line with anticipated demand. 

“This in-house testing uses Yourgene’s own Clarigene Sars-CoV-2 product, which is also being sold internationally through our distribution network in our channel markets and through our growing direct sales force. 

“Regulatory submissions for Clarigene are underway to access additional key regions and enable further geographical penetration.”

Yourgene CEO Lyn Rees said: “I am pleased to report continued year-on-year growth in the first half in the most challenging of circumstances, and it goes to show the core resilience that Yourgene has developed through its greater geographic and business diversity.  

“With the US and Japan now reopening for business, I expect to see international revenues growing rapidly around our core products and we are busy recruiting commercial resource to support the growth in activity from existing customers and to drive the on-boarding of new ones.

“In our UK service laboratory we have successfully achieved our initial capacity objective of 10,000 COVID-19 tests per month and are now focussed on delivering 20,000 tests per month, which we hope to have in place by January 2021.

“Furthermore, our acquisition of Coastal Genomics in this period demonstrates our continued ability to execute on select, highly attractive inorganic growth opportunities. 

“Our full year outlook remains in line with management expectations and we look forward to updating investors again when we publish our half-year results in December.”