BTG posts profits after litigation ordeal
driven by growing recurring revenues and litigation settlements
that threatened to dissolve into a long running legal dispute.
Revenue for the year climbed 31 per cent higher achieving a 2006 figure of £50.2m (€72.8) when compared to £38.8m last year.
The group also generated non-recurring revenues in the form of one-off settlements and milestones, including the settlement with Zimmer and the sale of the Teleshuttle patents.
BTG's legal disputes centred around a dispute concerning patent infringement actions relating to the two-part hip cup patents as well as cases filed by Zimmer against BTG in Germany and in State Court in Indiana.
As a result of the settlement, Zimmer made a payment resulting to BTG of £9.2m as well as an undisclosed royalty on future sales.
The group also posted a free cash figure of £44m, up from £34.5m a year ago. Research and development expenses fell from £16.8m to £9.1m thanks in part to lower costs for varicose vein treatment Varisolve.
"We consider £44m is free cash after allowing for known commitments on the sale of the Teleshuttle patents, an increase of over £9m in the year," said Brian Fender, chairman of BTG.
Research and development expenses fell from £9.2m to £9.1m, which they attributed to lower costs for varicose vein treatment Varisolve.
Meanwhile overall investment in BTG's drug development pipeline was lower at £3.3m, down from £6.6m.
BTG attributed this expenditure to a focusing down of funds to a core portfolio rather than investing small amounts in large numbers of activities.
Indeed, BTG's strategy announced in May 2005 was to move its R&D investment to approximately £10m per annum over the next three years.
"We are delighted to report these strong financial results and excellent progress in delivering on the strategy announced in May. With increasing revenues, reduced costs and healthy cash balance, we can move forward with confidence and continue to build value by investing in our life sciences pipeline," said Louise Makin, BTG's chief executive officer.
However >BTG were disappointed with two investee companies, which resulted in write-offs of £4.2m with losses arising when RFID specialists SAMSys Technologies, went into liquidation reflecting the difficult environment in the sector.
