FY 20A: Solid growth, despite COVID-19
Instem has reported FY 20A results consistent with its Jan-21 trading statement and in line with our forecasts. Despite the backdrop of COVID-19, the group once again delivered double-digit revenue growth for the year, alongside margin improvement and cash generation. Furthermore, revenue visibility remains high and all three business areas continue to deliver. In our view, the two acquisitions made during the first half of 2021 have transformed the group. So, while the FY 20A results demonstrate Instem’s resilience in the face of COVID-19 driven challenges, they do not reflect the group’s significant potential incorporated in our unchanged FY 21E and 22E earnings estimates.