Biotechnology companies are not renowned for the quality of their business report and accounts, but Acambis certainly bucks the trend.
In this close-run category the company won on the basis of clear explanations and simple presentation in the annual report for the year ending 31 December 2003.
The report was strong on strategy and answered shareholders’ questions comprehensively. In the opinion of the judges this was altogether an excellent package.
Acambis achieved excellent financial results in 2003, with revenue of £169.1m, compared with £79.7m in 2002. The company enjoyed a pre-tax profit of £46.8m, an increase of nearly 400% on the previous year’s figure of £9.6m.
Acambis is one of the UK’s leading biotechnology companies and one of the few to achieve profitability. In its latest annual report, the company opted for a new style of operating and financial review, with the aim of increasing transparency.
Within the review, a section has been dedicated to how Acambis has implemented robust systems to manage its financial practices, such as capital structure, treasury policy and cashflow.
The issue of risk management is discussed, and the annual report and accounts give a clear and comprehensive account of the company’s performance.
For the last three years, the company has included additional explanatory notes in the financial statements. Summarised group statements are also provided.
The report identifies the key drivers of change within the organisation and the management of future strategy. From being a typical small UK biotech, Acambis is now a profitable, commercial concern. This was due, in part, to winning a contract to supply smallpox vaccine to the US government.
A survey among the City audience and shareholders revealed a list of concerns relating to this transition and the medium to long-term future of the company. These concerns are addressed by a series of credible questions and answers in the first part of the report.
An explanation of the business, the product portfolio and the product pipeline are explained, and a ‘fully-articulated’ company model is illustrated and described. This serves to confirm and reassure investors that Acambis has all the functions in place to control the successful development and commercialisation of its products.
The next section of the report goes on to describe credible target markets and explains how vaccines will be sold. The issue of profit sustainability is discussed, and key issues, such as how to maximise opportunities, allocation of resources and the pursuit of future growth are outlined.
An interview section provides extracts from a discussion about progress and prospects between three members of the group’s senior management team. Acambis strongly believes in the importance of good communication with shareholders.
An overview of corporate governance is provided, showing the current structure of the board and its committees. The report highlights the initiatives Acambis has undertaken to improve communication with shareholders.
The corporate governance statement which follows describes the main principles of governance and how they have been applied by the company. In recognition of the increasing interest in corporate social responsibility, Acambis has made a real effort in the management of this aspect of business.
During the last year, it has analysed the diverse information requirements of key stakeholders to ascertain what they most want to know about how the business is run. Five key areas have been identified and described: namely employees; health and safety; environmental impact; community involvement; and specific industry issues.
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