Key Performance Indicators

Strategic AimKPIFY2016FY2015Explanation Narrative
Sustained organic revenue growth

Leverage core strengths/business with existing and new customers

New contracts (development portfolio) with existing and new customers
New contracts (development portfolio) with existing and new customers — the Group maintains a healthy portfolio of opportunities and monitors their progression towards commercial launch.
1412In the period, we successfully added two new projects to Bespak's development pipeline. These were a significant new development and supply agreement for our proprietary pMDI valve and actuator technology for Aeropharm GmbH, a Sandoz company; and a new strategic development and manufacturing agreement with retinal therapeutics company, Precision Ocular. With the addition of these two new programmes, Bespak's portfolio has grown to 14 live programmes.

Broaden offering into adjacent markets and territories

Market and product diversification
Bespak revenue from non-MDI products is reviewed to assess the extent to which Bespak has diversified revenues from the core respiratory MDI business.
£57.3m£50.0mBespak's revenue from non-MDI products increased by £7.3m in FY2016 as a result of its growing dry powder inhaler business; a significant increase in revenue from other sources, including a doubling of injectables sales. Group revenue has continued to diversify with Aesica's growing contribution.

DEEPEN offering capturing more of the value chain

Higher value business models
The Group's strategy is to help sustain organic growth through increased capabilities and the development of the innovation pipeline to generate future revenues.
The Aesica acquisition allows the Group to capture more of the value in the drug/device supply chain.
In FY2016, the Group was awarded a new strategic development and manufacturing agreement with Precision Ocular. This is the Group's first drug and device development and manufacturing contract and will leverage both Bespak's device development and manufacturing, as well as Aesica's manufacturing and filling, capabilities.
Aesica has been working with a leading Japanese pharma company to provide the active ingredient for an anti-inflammatory formulation containing S+flurbiprofen. Aesica is a leading supplier of the active ingredient flurbiprofen and the modified S+flurbiprofen and demand for the new formulation is expected to grow steadily from 2016.
Growth and investment
The Group reviews operating cash flow (defined as cash from operations less capital expenditure) as a percentage of operating profit (both before special items) in order to generate a cash conversion metric and understand the relationship between trading, cash and capital investment.
91%41.5%In the current year, the Group's conversion of operating profit into cash inflows has improved to 91% including the additional contribution from Aesica in the year.
Operating leverage

Margin expansion from volume growth & cost efficiency

Sales per employee
The Group reviews the level of sales it achieves against its headcount to demonstrate ongoing cost efficiency is maintained alongside current growth and expansion plans. This KPI is now being calculated using Group revenue and headcount to capture Aesica revenue performance and to facilitate a like for like comparison year-on-year.
£140k£133k1Delivery of organic revenue growth in the Group through leveraging core infrastructure and delivering productivity.
Innovation (Bespak)

develop new device and formulation technologies

New device technologies
New customer and patient-driven device technologies with near-term commercial opportunities.
The Innovation pipeline has progressed broadly during the period across a number of therapeutic areas and technologies. Following the commercial unveiling of Syrina®, Lila® and Lapas®, Bespak has continued to generate widespread interest from several pharma companies with injectable drug portfolios. At present we have an active portfolio of two early stage Vapoursoft® powered Syrina® auto-injector development programmes. We have two programmes actively developing the Lila® Mix® and Duo® technologies. We also have one early stage development programme centred on our Vapoursoft® powered Lapas® technology.
In November 2015, Bespak unveiled its latest addition to the Syrina® range of autoinjectors. The new Syrina® 2.25 is one of the most compact versions of auto-injector available today utilising a standard 2.25ml pre-filled syringe, and is based on Bespak's proprietary Vapoursoft® technology.
Innovation (Aesica)New formulation technologies
New customer-driven formulation technologies with near-term commercial opportunities.
In collaboration with a key strategic customer, Aesica has brought to market readiness a product manufactured using the first semi-continuous processing line and technology installed at a CDMO. The product is now approved and launched in the first major market with others expected to follow over the next 24 months.
Aesica has been working with a leading Japanese pharmaceutical company to provide the active ingredient for an anti-inflammatory formulation containing S+flurbiprofen. The patch has received market approval with the Ministry of Health, Labour and Welfare in Japan for the indication of osteoarthritis. We are in the process of supplying API materials for launch stock under a new long term supply agreement with demand for the new formulation expected to grow steadily from 2016.
Enhancement

Selective acquisitions and investments

Complementary acquisitions and strategic investments
Strategic fit and EPS enhancement — the Group reviews multiple acquisition and strategic investment opportunities and employs a rigorous assessment and due diligence process to validate the quality, strategic fit and valuation of each opportunity. In addition, the Group evaluates the impact of any acquisition on EPS.
Aesica successfully integrated within budget.
Equity investment in Precision Ocular.
Acquired Aesica in FY2015.Consort Medical acquired Aesica in November 2014. Post-acquisition integration restructuring actions have been completed successfully and within budget.
In February 2016, following the signing of a new agreement with Precision Ocular for the development and manufacture of a novel delivery device technology and drug formulation, Consort also subscribed £3.3m to a £13.5m dual tranche equity financing by Precision Ocular. This investment provides the Group with a 13.7% shareholding following the second tranche.
Shareholder value
EPS enhancement — the Group reviews EPS from continuing operations before special items to assess the level of return generated for investors in the period.
57.6p47.8pAdjusted basic EPS was 20.5% higher than FY2015 at 57.6p, as a result of the strong operating leverage and margin expansion.

Notes:

  1. Consort acquired Aesica in November 2014, therefore, the FY2015 Group revenue included Aesica's revenue from that date to 30 April 2015 (£78.3m at constant currency). To enable a meaningful FY2016/FY2015 comparison for the purposes of this KPI, constant currency Aesica revenues in FY2015 have been grossed-up to provide an estimated 12 month figure for the full 2015 financial year.