Revenue for 2019 will be below market consensus says Leeds-based Tissue Regenix

Tissue Regenix has provided a trading update.
Tissue Regenix has provided a trading update.
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Wound specialist Tissue Regenix today revealed that its 2019 revenues will be below current market consensus, although it stressed that demand for its products remains strong.

Tissue Regenix is a major medical devices company in the field of regenerative medicine. The company's patented decellularisation technology removes DNA and other cellular material from animal and human soft tissue leaving a tissue scaffold which can then be used to repair diseased or worn out body parts.

The trading update said: "The company announced at the time of its annual results on June 4 2019, and its interim results on September 10 2019, that it anticipated that sales in the current year would be significantly weighted towards the second half of 2019, as the company's ability to bring onstream increased manufacturing capabilities during H2 would be key to determining the company's year-end outcome.

"The increase in throughput is now expected to become available during Q4 (the fourth quarter) 2019 and, as such, the board anticipates that revenue for 2019 will be below current market consensus by approximately 15 per cent to 20 per cent, with a corresponding reduction in margin impacting EBITDA.

"Demand for the company's products remains strong and the board does not anticipate any longer term impact over and above the approximate three month delay to the manufacturing capacity increase."

Tissue Regenix has also received confirmation of a $0.3m grant from Universal City to support the initial phase of the build out programme on the company's newly leased 21,000 sq.ft. facility in San Antonio in the US.

The statement added: "Technical staff necessary to enable the second shift in the original San Antonio facility to become operational have been recruited and are in the process of being trained. Monthly processing throughput has already more than doubled in the year to Q3 and these additional products are expected to become available towards the end of Q4.

"The company is working closely with its existing outsource provider, CTS, in order to increase the yield of its DermaPure product after also announcing the launch of DermaPure Non-Oriented, for use in surgical and uro-gynaecology applications, at the American Urogynecologic Society conference in Nashville in September. The company is working closely with its strategic partner, ARMS Medical, on the roll out of this product."

John Samuel, Executive Chairman, of Tissue Regenix plc commented: "We have excellent products for which demand is exceeding our current capacity. Therefore, our current focus is ensuring we can increase our capacity to meet this significant demand."

Tissue Regenix was formed in 2006 when it was spun-out from the University of Leeds.

In November 2012 Tissue Regenix Group set up a subsidiary company in the United States - 'Tissue Regenix Wound Care Inc.', In 2016 it established a joint venture GBM-V, a multi- tissue bank based in Rostock, Germany.

In August 2017 Tissue Regenix acquired CellRight Technologies, a biotech company that specialises in regenerative medicine and is dedicated to the development of wound care scaffolds that enhance healing opportunities of defects created by trauma and disease. CellRight's human osteobiologics may be used in spine, trauma, general orthopedic, foot and ankle, dental, and sports medicine surgical procedures.

Current applications address many critical clinical needs such as sports medicine, heart valve replacement and wound care.

The firm said it is helping to transform the treatment of patients in three key areas: BioSurgery, Orthopaedics & Dental and Cardiac.

Its vision is to establish itself as a leader in the science and innovation of regenerative medicine and transform patient care to deliver favourable health economic outcomes.