Horizon Discovery : Trading Update

Revenue and EBITDA expected to be ahead of consensus driven by at least 120% growth in product sales

Cambridge, UK - 18th January 2016: Horizon Discovery Group plc (LSE: HZD) ('Horizon' or the 'Group'), the international life science tools business today announces a trading update ahead of its full year results for the twelve months ended 31 December 2015. The Group intends to announce its preliminary full year 2015 results on 26 April 2016.

The Group reports a second consecutive year of on-target performance since its IPO, with full year 2015 revenues expected to be at least 2% ahead of the £19.8 million market consensus, representing growth of at least 69% (year ended 31 December 2014: £11.9 million). In addition, the Group is eligible to receive future R&D milestones of up to £208 million plus future product royalties, an increase of 32% over the prior year (year ended 31 December 2014: £158m).

Revenue growth is reflective of strong product and service sales to large pharmaceutical and diagnostic development companies as well as an increasing number of academic customers purchasing from a product inventory that increased from 2,750 to 23,000 in the year.

Growth in the Products business has been particularly strong, with organic revenue growth of at least 120% expected to be reported (year ended 31 December 2014: £3.5 million), driven by strong demand for genetically-defined cell lines and derived molecular diagnostic reagents.

Growth in the Services business of at least 65% (year ended 31 December 2014: £7.2 million) has been driven by a strong demand for custom gene-editing, genetic screening and drug combination screening projects.

The Leveraged business continues to generate a portfolio of up-front, milestone and product royalty upside as exemplified by the deals announced with two new collaborations signed in 2015 with Redx and Servier. Further, commitments were made to invest up to £10 million across the following two years in two cutting-edge areas of cancer biology: synthetic lethality and immuno-oncology, which have the potential to deliver significant upside.

The Group also expects to report a full year EBITDA loss that is a positive improvement to the £7.7 million market consensus as investment continues in the long term growth of the business consistent with our previously reported strategy.

Year-end cash is expected to be reported at £25.1 million (year ended 31 December 2014: £18.5 million).

Dr. Darrin M. Disley, Chief Executive Officer of Horizon Discovery Group, commented:

'2015 has been another strong year for Horizon, with growth underpinned by organic and inorganic revenue, new product launches, and the establishment of new channels to market. Horizon's reputation as a leader in gene-editing, translational genomics and personalised medicine is exemplified by the range of partnerships we have announced in the areas of product development

(e.g. Axol Bioscience, CareDx, Definigen), market access (e.g. ThermoFisher, Abcam), and leveraged research (e.g. Servier, Redx).

'Horizon continues to deliver on its strategy of: sustainable core revenue growth; increasing the value of what we provide customers; scientific leadership via academic partnerships and grant funded research; and accelerated growth through product in-licensing and M&A activities. Our rAAV, ZFN and CRISPR gene editing platform continues to prove that it is fundamental to the elucidation of the genetic basis of disease and the evolving personalised and genomic-medicine value chain, and we are confident and excited about the prospects for the year ahead.'