Good evening and welcome to the hVIVO plc investor presentation. Throughout this recorded meeting, investors will be in listen-only mode. Questions are encouraged. They can be submitted at any time via the Q&A tab situated in the right-hand corner of your screen. Just click Q&A, scroll to the bottom, type your question, and press send. Due to the number of attendees today, the company may not be in a position to answer every question received during the meeting itself. However, it can review all questions submitted and publish responses where it's appropriate to do so. Before we begin, we'd like to submit the following poll. I'd now like to hand you over to Mo Khan, CEO. Good evening, sir.
Thank you. Well, thank you, everyone, for your precious time given to us on this Tuesday evening, is it, in early April, where we announced our full year 2023 update. I'm very pleased to have you on board. Going straight into it, this is the normal disclaimer. I am Yamin 'Mo' Khan. I'm the CEO of hVIVO. I've been CEO for just over two years, and I've got a long history in working at a contract research organization, or CROs. I'm joined here by our CFO, Stephen.
I'm Stephen Pinkerton, CFO from October 2022. I've been with the business for over seven years, and yeah, that's it, really.
Thank you, Stephen. Welcome, and we get straight into the presentation. For those of you who may not know who hVIVO is, we are the world leaders in conducting human challenge trials in infectious diseases and respiratory diseases. We have a huge, a large human challenge trial unit here in London. We also have several offices across the country, including a screening site in Manchester. We are due to open the world's largest human challenge trial unit later on this year in Canary Wharf, and I will talk about that later in the presentation. We also have a second subsidiary called Venn Life Sciences, who help in conducting our human challenge trial, but who also provide standalone early clinical trial or clinical development clinical services, which fits in well with what hVIVO does.
As a company, as I mentioned, we are the world leaders in human challenge trials. Human challenge trials is a niche way to develop antivirals and vaccines. In fact, expedite in the way we can develop drugs and take them forward Phase III. our mission, as stated here, is delivering today's healthcare by empowering tomorrow's innovation. We believe that human challenge trials and the concept of human challenge trials will be the future and the norm in the future of how we expedite and get vaccines and antiviral to patients much faster. I can give you a brief summary of our year of 2023 with some key numbers. We did hit our GBP 56 million target in revenue. This is what we guided towards early on last year. We also hit GBP 13 million in EBITDA, which is around a 23.3% EBITDA margin.
When you look at the GBP 13 million EBITDA, it's actually a 44% year-on-year increase. That's actually slightly ahead of guidance. A really good result and a great effort by everyone at hVIVO in not only delivering the increase in revenue but also delivering that at a really high margin. On top of that, we have GBP 37 million in cash as of 31st of December last year. This shows that not only is our business model a profitable business model but also a hugely cash-generative business model. We have a weighted order book of around GBP 80 million as of, again, end of last year. This basically means that we have over 90% of our revenue target for this year already contracted. We are guiding towards a GBP 62 million revenue target for this year and hopefully at a sustainable EBITDA margin.
I'm going to now hand over to Stephen to provide a little more details on some of the key financial parameters for 2023.
Thank you, Mo. Good evening, everyone. There's not much changed since our presentation in January, but I'll go through some of the highlights again. As Mo's just mentioned, our revenue was GBP 56 million, at 16% up on last year. Contributing to that was Venn Consulting, our business in the Netherlands. That is an early clinical consultancy business. It grew over 30% in the year. So it was a great result and a strong performance from them. One of the things that's underpinning our revenue performance both in 2022, 2023, and as we go into 2024 is these multiple bespoke full-service contracts that we have won. This is where we are manufacturing the challenge agent, characterizing that challenge agent, and then doing a challenge study then. So in 2022, we had signed three, and we'll work and two of those carried over into 2023.
In 2023, we have signed 3, and some of those have completed and are now carrying forward into 2024. That sort of strength of pipeline of work is seeing us well through in this business. We also got to recognize a bit of revenue relating to the sort of facilities accelerated, and Mo will touch on that a little bit further on. This is to do with Canary Wharf and the build-out of that facility. We were able to recognize some of that revenue went through our P&L, where the cost of it actually sits on our balance sheet. Both this and the fact that we have larger studies in train helped us sort of reduce any impact from the MHRA delays. We did have a few studies and a few amendments to our studies that were impeded by delays from MHRA in 2023.
Going on to EBITDA, this is slightly better than we had in trading update. To be honest, at trading update, we gave an indication of 22%, and this was just sort of a conservative estimate where we thought we would land. So we're very pleased with the 23% and the GBP 13 million. Underpinning this EBITDA is a couple of things. First to highlight is that during the year, we had 9 studies in quarantine units. Now, we have more studies that we're working on, but actually in the unit were 9 studies, different studies where we had volunteers for 9 different studies in the unit. This compares to 7 in 2022. As well as that is that we had 31% increase in our volunteers in the unit in the year. So that is driving a much greater usage, utilization of our staff and our facilities.
Therefore, that is really sort of supporting the EBITDA margin. Further on top of that, we have a very good well, we had a number of studies that had 5 we were screening for 5 different variants, and it's something I call our recruitment leverage opportunity. Here, we get to charge all our clients for a recruitment of a volunteer. But when we screen them, we get 5 chances of putting that volunteer onto a study. And that cost saving is tremendous and is really supporting the EBITDA margin. So that's because we're running multiple studies concurrently at the same time across 5 different variants. Moving on to cash. Cash, same as we've obviously provided in the update of GBP 37 million. Just to reiterate, we are debt-free. We paid out this is after paying out a GBP 3.1 million dividend in 2023.
It's developed because we've been profitable in the year. Our order book continues to grow. We get upfront fees from our clients, which are non-refundable. So this is why our cash continues to grow. Actually, the position on how cash is generated is a bit clearer on the next slide. This is our sort of cash flow statement, sort of bucketed into sort of categories. On the left-hand side, the column is our opening cash position of GBP 28.4 million, and then our closing cash position on the right-hand side of GBP 37 million. The graph buckets in between are highlighting how we move from the beginning of the year in our cash to the end of the year. So you can see GBP 13.1 million cash generated from operating activities. That's before working capital. That's a 46% up on 2022.
So, I mean, if you look at that, that's GBP 13.1 million. Our EBITDA was GBP 13 million, practically 100% flow-through, very, very strong performance. Another thing I want to really highlight is that the GBP 4.1 million is a positive working capital movement. Because we extract from our clients a booking fee upfront and also that our milestone payment plan relating to our work is in advance of the work that we deliver, generally, and provided our business continues to grow, we will have positive working capital. So as our business grows, we don't have to fund our working capital. It will fund itself. And so as we project going forward, we project and expect a positive working capital balance every year. Then we have what we've spent. How we spent some of the cash during the year is capital spend. We spent GBP 5.2 million.
4.8 million of that was spent on Canary Wharf facilities, which, I remind you, has been 90% funded by our clients. So, which, as I said, so the facility fee that I've just mentioned that we recognize partly in 2023, that was a very modest amount. And the majority of it will be recognized in 2024. But it's GBP 4.8 million is what we've completed on have spent so far on Canary Wharf fit-out. And that remains leaves a balance of GBP 0.4 million, which is really sort of a nominal amount just to replace existing equipment, clinical or lab equipment, no more than that. The dividend, which we've just touched on, and the net figure of GBP 0.5 million is the lease payments were year-on-year flat. And that was offset, mostly offset by our interest on our deposits. Obviously, we're sitting with a lot of cash.
At the end of the year, I think something like GBP 32 million of it was held in deposits, earning around about 5%. The other offset, partly offset, was we issued some options. This is the cash impact of so the exercise of options during the year. So that gets you to your GBP 37 million. Just to highlight again why this is a cash-generative business as we continue to grow, this is a typical study of well, so a typical graph of a study, a particular study that we completed during 2023 is a very good example of all the other studies as well. So the green line is highlighting the revenue recognition. Revenue recognition is the total cost incurred to date versus the total cost expected on the study. So it's a percentage of completion, cost completion model on how we recognize revenue.
So as we incur cost, we recognize revenue as a percentage of the total cost of the budget. But it is very at a very granular level. So it's not at a very high level that we recognize the revenue. It is down to task and phase of each of those projects. So there's about 60 different lines on which we recognize the revenue. So it's quite accurate. But the darker line shows you the cash that we've received whilst delivering this study. And you can see the cash is always ahead pretty much of revenue recognition right until the very tail end. You can see in the very first stage, we take that upfront fee of 15%-20% of the contract value plus some service charges, setup fees, where we design the protocol. We finalize the protocol with the client. We submit it to the MHRA.
At the same time, we then refresh our budget. As soon as the budget is refreshed and finalized, the client will enter into an agreement, a CTA agreement, a clinical trial agreement. Here, they will pay us a contract fee on signature. A screening fee will be the next milestone. The next milestone is the first inoculation, 25th inoculation, or 30th inoculation, and so on until you get to data lock and CSR report, which is the very final stages. It's only at the very final stages of a study that we go into an accrued revenue position. And you can see that cash continues through. Right at the very end, you can see there's a little jump up in the dark green. And that was because in this study, we had a small change order right at the tail end of the study.
That was agreed and transacted. Therefore, the cash jumped up ahead of revenue at the very last stage of this study. Hopefully, that gives you a picture of why we are a cash-generative business and gives you sort of confirms the cash receipts that we receive upfront and that we're always in a cash-positive position on all our studies. The last slide is just to highlight at the trading update, we announced that we would be paying a dividend. We are confirming that we're going to be this business is committed to paying an annual dividend. This is to reward our existing customers and also to attract investors that require a bit of a yield to invest.
We've always had to try. We're wanting to try and diversify our share register because different investors have different horizons, different motives for holding shares, and different timelines. That just stabilizes the share price. That's what we've been aiming to do. This is why we're implementing this dividend as well. This is part of the reason. In arriving at that dividend policy, we also wanted to take into account that while we are cash-generative, we've got quite a bit of cash on the balance sheet, we also want to use that cash to grow this business. We do want to hold onto it for mergers and acquisition activity. So we arrived at this by taking a dividend cover about six times of adjusted basic earnings per share, right? We rounded it down. So it's actually the figure is around 6.3.
We expect that as that adjusted basic earnings per share grows, so will the dividend. But we do want to take into account that we do want to have a strong cash balance for M&A activities going forward. I think that's all I wanted to say on the dividend. Yeah, I think I'm going to hand over back to Mo.
Thank you, Stephen. So hopefully, that gives you a summary of our 2023 performance when it comes to the financial metrics. As you can see, over the last few years, we've seen a sustainable growth in revenue, EBITDA, EBITDA margin, and order book. So all the key parameters when it comes to the past performance of the company and also forward-looking indicators, we've seen a positive trend across all that. And we hope to continue to do that as we move forward. So this year, we're guiding towards GBP 62 million. And as I mentioned, 90% of that is already contract. So for us, I think we are in a very good place. But we're just starting the growth cycle.
Hopefully, as you listen to the rest of the presentation, you'll begin to realize why we are bullish for the future and how we're going to continue to expand and grow the business as we move forward. Before we do that, I think one of the key things I want to address is the utility of the human challenge trial concept. Why are companies running more and more human challenge trials? There's various reasons why this is happening. When you look at the commercial market, these are the biotechs and the pharmaceutical companies, the reason why they're running it is, of course, biotech companies, for example, they want to get a signal of efficacy or effectiveness of the drug in a very fast manner.
It means that they can either raise more money and run Phase III themselves or, more likely, they have a reason to be acquired by a big pharma. ReViral is a case in point that got acquired by Pfizer for $500 million on the back of a human challenge trial. Also, the big pharma, for example, Pfizer in this case, were able to get fast-track designation for their RSV vaccine, which is now on the market from last year. In fact, today, they received additional data to expand the label for this particular vaccine. Again, both biotechs and pharma are able to get really good data. One of the other key trends has been that our clients are not just looking to compare their drug against a placebo arm. They're now using the human challenge trial model to get additional data.
One of the things we've seen is clients are not only looking at placebo versus active, but they're looking at different doses and which dose will work the best in a clinical trial setting. This means, for example, we're running a trial with 3 arms: a placebo, dose one, and dose two. Now, that straightaway increases the size of the human challenge trial by 50%. And of course, the biggest indicator for the contract value of a given clinical trial is the number of volunteers we recruit. So the more volunteers we need for each trial, the bigger that contract size. And as I mentioned, our clients are using human challenge trials for different purposes to get more insights into endpoints, into sample sizes, also into doses when they move Phase III, as well as de-risking a potential Phase III.
From a regulatory point of view, we've seen very positive feedback from the FDA. For at least five of our different clients, we've been able to get either fast-track designation and/or breakthrough designation based on human challenge trial data, which I think is really key as we make progress in making human challenge trials the mainstream and the main kind of clinical development pathway for developing vaccines and antivirals. The other key thing we've also seen is organizations such as the WHO issue guidance on how to conduct human challenge trials, as well as Wellcome Trust issuing guidelines on how to manufacture challenge agents. CEPI, a nonprofit organization, geared towards pandemic preparedness, had also issued a grant of over $55 million to help and assist academic sites into creating more human challenge agents for challenge trials, as well as standardizing the methodology of how challenge trials are conducted.
All this goes toward harmonizing how human challenge trials are conducted. Of course, as you know, with over 75 trials conducted and over 4,500 volunteers through our clinical trials, we are the world leader. In fact, we believe we have over 90% of the commercial market, at least. This market continues to go on a daily basis. As an operational summary for 2023, some of the key indicators here are given is that we ran 9 different human challenge trials through our quarantine process across 6 different challenge models. Now, the reason this is important is the more challenge models we can run in parallel, the more efficiencies we can realize in our patient recruitment or healthy volunteer recruitment, as well as increasing utilization both from staff and also from the facility.
And that really bleeds well into increasing our EBITDA margins, which are evident in our numbers from last year. We also expanded our capabilities in lab. So you can see we had assays of over 112 samples conducted last year. And with regards to FluCamp, which is a brand name for recruiting healthy volunteers into our clinical trials, we had over 145,000 leads registered. With regards to some of the key operational highlights, I'm not going to go through each one. It's there for everyone to see. But one thing I do want to outline really is that we did sign two master service agreements, one with a big pharma and one with a mid-sized pharma. Now, this does not mean that these clients are now committed to conducting X number of human challenge trials.
It does show the depth of commitment that they are considering more than one human challenge trial with us. This is why they are basically creating and agreeing a legal framework. When they do come to the right time and the stage to be able to run a human challenge trial, then the legal framework is already taken care of. All you're doing is negotiating the project budget and the timelines. You can move straight into conducting a clinical trial. For me, this is a very positive sign and a good indicator for the future. It also establishes us potentially as the sole provider of human challenge trials to these customers and also us gaining more repeat business from our current clients. We are also the only company that can provide end-to-end human challenge service. This basically is divided into three subsections.
The first part, of course, is the manufacturing part. This is where we take a swab sample from an individual who has flu or RSV infection. We use that to effectively grow a bank of virus, which we can use to basically challenge our healthy volunteers. The second stage of this process is called the characterization study or effectively a dose-determining study, where we determine the right dose of the virus to give the symptoms that we need to measure to be able to see a difference between a placebo and an active group. Once we have completed the characterization study, we then go out and conduct the full human challenge trial. As Stephen mentioned, over the last couple of years, we've seen an increase in this full-service conduct.
One point to remember is that once we finish the human challenge trial part of this component of this process, we are then free to use that challenge agent for other customers and other studies. This is one of the key drivers for our expansion of portfolio. We are continually adding new challenge agents. I think we added three or four last year. We are building some new ones this year. We are basically waiting for demand from the market before we are going out and investing in new challenge agents. We are always renewing the challenges we have. When we add new challenge agents, as we did with H1N1, for example, or FluB, these are very often funded by our clients who will provide the funding for manufacture, characterization, and the challenge trial.
FluCamp is a very important part of our provision of services because FluCamp is the key brand we use to recruit healthy volunteers. Without the recruitment of these volunteers, we would not really have a good business model. Patient and volunteer recruitment is the single biggest reason why studies get postponed or canceled or even delayed. For us, the fact that we have got such a strong team and a great system to measure the engagement of volunteers means that we are the leader in the UK with regards to how many people visit our website, how many people register on the website, how many people we screen, and how many people go through our clinical trial process. You have to remember that conducting human challenge trials is a very strenuous exercise. The criteria for people qualifying into this challenge trial is very strict.
In fact, we worked out that it's easier to get into the University of Oxford than getting into one of our clinical trials because of those strict criteria. We've given you some breakdown of the various parameters we measure. You can see the age group is fairly young people. We estimate the average age of the person going into quarantine is around 31 years of age. You can see from the people who log into our website, the gender breakdown is more or less 50/50. We also have made some changes with regards to the volunteer experience. One thing, for example, we did was we bought a kitchen in-house. We're giving freshly prepared food to our volunteers. As a result, we've seen significant improvements in the scores we're getting from the volunteers who have been through our quarantine process.
The graph here shows you the number of leads we are generating. So these are people who are registering on the website showing interest in our challenge trial. Now, as you can see, we have a consistent level of people who are interested in our clinical trial, which is a great thing. But one of the other key factors we've also shown this year is that we've been able to reduce the cost to get these leads on board. And that's really good for us because it means that we can fulfill the quarantine at a lower cost. And this is partly due to the improvements in our internal processes, but also in running concurrent trials using different challenge models.
So effectively, we're able to screen an individual multiple times so that increases the chances of getting into one of our clinical trials rather than just screening them for a single trial at a time. So as Stephen mentioned, Venn Life Sciences showed a 30% increase in revenue year-over-year, which is a great effort by that team. We also increased the headcount. The great thing about the Venn Life Sciences model, of course, is that they have a high level of repeat business. Up to 75% of the customers come back for more business. And one of the other things that people sometimes forget is that Venn Life Sciences has an integral part in the conduct of human challenge trials. So the protocol writing, which is effectively a manual of how we run a challenge trial for a given drug, is written by the Venn Life Sciences team.
hVIVO in London then recruits the patients. We screen the patients here. We then put them into quarantine. Venn Life Sciences is responsible for collecting the data, for analyzing the data, and producing the final clinical study report, which goes to our customer. So both subsidiaries are working hand in hand in a very complementary manner to make sure we deliver a full service to our customers. We also opened up a very small office in Leiden last year. The main reason behind this is to take advantage of the huge number of startup biotechs in that region and for Venn Life Sciences, who are very, very good at providing standalone early clinical development services, to utilize that biotech part and gain more exposure and gain customers. We've already seen some success in that.
One of the key factors I may have mentioned last time was we had recruited some experts in ATMP, advanced therapy medicinal products, such as cell and gene therapy consulting expertise. I'm pleased to say that now we have signed contracts in that field. What are we doing as we move forward? One of the key forward-looking indicators, of course, is the order book. At the end of 2023, our order book stood at a weighted order book stood at GBP 18 million. What we do is we take each award that we have, each contract we sign, and we assign a probability factor as to what is the probability that we will recognise the full value of that contract. By that, we calculate, we aggregate the sum, and we communicate that value to you guys.
The reason why we do this is because clinical research is notoriously volatile. Not so much for us, and I'll explain why. Generally speaking, in CROs, projects very often get delayed, postponed, or even canceled. We make sure that we only communicate the numbers that we are comfortable with with regards to the project going to the finish. One of the key differences between us as a CRO versus the standard CRO model is that we have a 15%-20% upfront payment that is non-refundable. So if the client was to cancel the project, then they will lose that upfront payment. The key reason behind this is because when a client signs a contract with us, there are dedicated and allocated a space in the quarantine room.
Of course, if they for whatever reason cancel the project, then that would basically mean that we would lose that space. We couldn't potentially allocate it to another client. And that's what the cancellation fee is for. In addition to that, there is a postponement fee. So depending on how much notice we get and how long the postponement is, there's a postponement fee allocated to any delays from the client side. The order book, as you can see, as I mentioned earlier, goes well into 2025. 90% of this year is already contracted. But you can see already we've seen a good number of quarters in 2025 seeing order book recognition. And this is the longest visibility we've seen in the history of the company.
So very pleased that our sales team has done an excellent job in making sure that the order book has continued to be fulfilled, even though we are recognizing more and more revenue. One of the other things I wanted to talk about really is to give you a little bit more breakdown, more color on the order book. One of the things I wanted to do is make sure that we have diversification in our order book. So we're not really relying on one project or one client for a majority of work. So on the left-hand side, you can see the breakdown of the order book by customer. And you can see client A and client B are big pharma clients, which is great to see because we know they're much more stable and they get their study to finish. And third in place here is Venn Consulting.
They've got multiple clients in that. Then we have client D, which is a mid-sized pharma. Of course, we've got other pharma and biotech clients. In the middle, you see the same breakdown by project. So you can see we've got multiple projects with the same client. The risk we have with regards to cancellation and postponement is a lot less than it was maybe a couple of years ago, even maybe 18 months ago. We've added new clients. On the right-hand side, you can see we've added new challenge agents. The diversification of the order book by challenge agent is the best it's ever been. This is not to say that a client will cancel or all our clients will cancel all of the projects with a certain challenge agent.
But for us, we need to make sure that we diversify any risks. So if there's a downturn in the demand for one particular challenge agent, we have working other challenge agents that we can recognize. But the rumors that we heard previously, for example, that this could potentially be the end of the RSV market have been proven to be untrue. We still see a large demand for RSV work, which is great to see. So the other item I wanted to cover was how this order book is burned across the coming 12 months. So you can see each month how many volunteers we are contracted to deliver to all our clients. So you can see it's a very healthy pipeline. But the key thing I want you to focus on is the fact that each bar chart here is a different color.
This means that we are recruiting against multiple challenge agents each month. This is really good because this means our conversion rate from the website leads into our healthy volunteer making it into quarantine improves because we can screen the same individual for influenza, H1N1, for H3N2, for example, and RSV at the same time. If an individual comes in for screening and they fail to go into H1N1 trial because, for example, they may already have immunity against that virus, that variant, we can screen the same blood second time and the third time and hopefully get them into a clinical trial. That's not to say it's still a very, very big job to get all of these healthy volunteers. I think we screened 17,000 people that came through our doors. We took their bloods last year to fulfill this proportion of work.
This is kind of a big task. It's one of the key reasons, I believe, is also a hurdle for new competitors coming into the market. One of the big milestones for us this year in the company is going to be our move to Canary Wharf. What we've done is we've basically split this new facility built out into two phases. Phase I is to build out the 50-bed quarantine floor. I'm pleased to say this is now complete. The commissioning audit is happening next week. If that is successful, we plan to have our first quarantine in Canary Wharf come towards the end of April. This, again, is ahead of timeline to have the full 50 beds available for quarantine. One of the key reasons for this is because we have one of our clients who wanted to accelerate their trial.
We've been able to accommodate them into the new facility. This facility will be, at the end, a CL3, a category level 3 pathogen compatible. It means that we could potentially run challenge trials in coronavirus, for example, as well as other category 3 pathogens, which I think is key for us. We have new updated rooms. As you can imagine, this is a fit for purpose building for human challenge trials. It is the world's largest challenge trial facility. I think we all should be proud of the fact that the UK is the world's leader in conducting human challenge trials and boasts the largest facility in the world. As we go forward, each bedroom here is a single quarantine unit. It means that it gives us a much greater ability to run concurrent trials compared to the restrictions we have at the moment.
It also brings our multiple builders under one roof. So long term, we're hoping we know that this will give us the potential to realize up to GBP 90-GBP 95 in revenue and also improve our margins by bringing everyone together on top of the automation initiatives that we have planned, which I will talk about in a second. The second Phase Involves the lower floor, which includes the laboratory and also the offices. That is planned to be ready by the end of June with the CL3 lab to be planned by the end of July. This is also going on track. Now, this lab will be much bigger than what we currently have. Our current lab space really is just about enough for us to cater for the human challenge trials we run.
Our goal is that we will market hLAB, which is our laboratory brand, going forward so that we can conduct standalone non-challenge trial lab assays. This is one of the growth areas we expect to see as we move forward. We also will have an outpatient section within the Canary Wharf facility. The reason behind this is we want to be able to Phase II and Phase II outpatient clinical site studies. This is one of the additional revenue streams we have planned for our growth to hit the GBP 100 million revenue target in 2028. I mentioned with regards to the automation. We have 3 fairly large initiatives currently in different phases of implementation. The laboratory information management system, or LIMS for short, Phase I and Phase II is complete. We already have certain automation within our central lab.
We also will complete all of this implementation by the end of this year. While the management system is already fully implemented, of course, there will always be ongoing continuous improvement. We are using a system that will help us manage our volunteer, improve how we engage with the volunteers, as well as get more leads in and convert a higher fraction into quarantine. Finally, the third initiative we are planning this year, at least complete the phase one, will be the eConsent or eSource. This basically means that we will have all our medical health records of our individual in electronic format. This, of course, will be more efficient. It will improve quality as well as speed. All in all, these initiatives are all under the way in some way and format.
We hope to realize full potential and the efficiencies of this come 2025. As a whole, the CRO market continues to grow. So you can see here, by 2030, that's estimated the global CRO market will sit at $124 billion. You can see in the chart that the number of trials that are either planned or being conducted in the different pathogens that you could potentially put in a challenge trial model for continues to be consistent. If not, the trend, of course, is growth. So this suits us well because this is the stage. These are the viruses we could potentially use a challenge trial model against. With regards to potential competitors, well, I talked about CEPI, for example, increasing investment in the development of human challenge trial models.
We have a small company established in Australia called Doherty Clinical Trials that are looking to develop human challenge trial models. The Dutch government has issued a grant of EUR 9.5 million to a couple of local nonprofit organizations to develop a challenge trial unit to prepare for the next pandemic. I'm very pleased that all this is happening now because this basically raises the profile of human challenge trials. I expect us to see an increase in market awareness. We expect to get more requests coming in. Being the company that has done the most human challenge trials, has the patient recruitment database, and the widest human challenge model portfolio, I believe we are in a really good place to take use and make use of this increase in the market. The growth drivers towards going 2028.
So rest assured, we are a human challenge trial CRO. And we remain a human challenge trial CRO. This is our major niche. It's the biggest advantage we have in the market. And the revenue continues to go up. So we will continue to develop and market the challenge models we have. We are looking to expand and add more challenge agents into our portfolio. In addition, we will add more revenue to the revenue streams I talked about, so the hLAB, the clinical trial site services, as well as volunteer repurposing. So all of this, of course, will increase our revenue. We expect this to get us GBP 290 million in revenue come 2028. And then we also have planned for M&A activity to add GBP 10 million in revenue in 2028. Now, the M&A process is active now. We are looking for targets.
But one of the key messages I want to give to you is that if we don't do any M&A activity this year, it's not a failure. Remember, we are in a niche service. We are the world leader. It's not like there are other five, 10, 20 challenge units that we can go and acquire. The key thing is to find the right target at the right price and the right fit. And for that, we may have to wait a little longer. But our goal is to bolster what we have and have bolt-on M&A assets, M&A targets to what we already provide. So just to reiterate our guidance for 2024, we expect to hit GBP 62 million and try and sustain our EBITDA margin. We expect to see one H waiting in this year. This is driven by two factors.
One, we did have a small cancellation with regards to our hMPV characterisation study. We finished the manufacturing and recognize that revenue. We did not complete the characterisation study. But we did get the cancellation fee for that. We've also been asked by our client, as I mentioned earlier, to accelerate one of the studies. So we're pushing that more into H1. And with the combination of both of those factors, we expect to see a higher H1 weighting compared to H2. But in the meantime, of course, there may be additional projects coming in that we may still be able to run later on this year. But we just want to kind of give you full transparency and give out the metrics right today.
We expect to see H1 weighting rather than H2 weighting, which I think is also not a bad thing, the fact that you can deliver and get to your target of GBP 62 million in time. We mentioned 90% of the revenue already contracted. And we have visibility going into 2025 and an order book of GBP 80 million. So in summary, I hope the numbers we have provided to you today show that we have a robust model. It's definitely profitable. It's obviously sustainable. And the margin continue to grow. And we will continue to build on that. I always have this ethos of underpromise that we'll deliver. And we'll continue with it in the same manner. The Canary Wharf facility is a large facility that will help us get to the next level.
That will be a 50-bed, as I mentioned, the largest facility of its kind in the world. We will be adding new challenge agents, GBP 62 million of revenue already guided for. We also have an annual dividend policy announced. Just remember, the main reason for this isn't to have large amounts of dividend payouts. This is a nominal or modest dividend that we are paying out to attract new institutional investors. Thank you very much for your attention.
Fantastic. Mo, Stephen, thank you very much indeed for the presentation. Ladies and gentlemen, do please continue to submit your questions just using the Q&A tab situated in the right-hand corner of the screen. I just want the team to take a few moments to review those questions submitted today.
I'd like to remind you the recording of the presentation, along with a copy of the slides and the published Q&A, can be accessed via your investor dashboard. Mo, Stephen, as you can see, you've had a number of questions that have come through, no surprise as always. So thank you to all the investors that have submitted those. If I could just hand over to you just to start at the top and read out those questions, it would be appropriate to do so. And I'll pick up at the end, sir.
Thank you. So yes, we have a lot of questions. Thank you for your interest. And thank you for staying with us into this evening. So I'll shoot through these questions and answer as many as I can between myself and Stephen. So first one is, is there any program to monetize the non-core assets?
So as I mentioned before, the non-core assets are really an upside. For us, our current focus is in developing and increasing the human challenge trial market. So not only the portfolio of challenge agents we have, but also adding new challenges. And that's our key goal. We are in conversations with regards to the non-core assets. But when that happens and that does come to fruition, then, of course, that will be an upside for everyone. Is there any latitude for expanding our human challenge trial offerings into non-infectious diseases, for example, drugs for autoimmune diseases like psoriasis, where continuous monitoring of inflammatory markers will be desirable combined with controlled volunteer diets and activities? This is a question for somebody who knows the subject really well. So we have to be careful because we do want to diversify, absolutely.
But our core business really is providing human challenge trials for respiratory and infectious diseases. And our team has the experience and the expertise in that. So that's our core goal. And that's what we want to do. We haven't really covered all the challenge models that we can do. So for example, Zika or dengue or whooping cough, there's so many out there that we haven't really worked on. I mean, COVID is another example. So I think that's our core business. That's what we are marketing aggressively at the moment. But these are something potentially to add in the long term. Of course, there are other things like allergen testing or, for example, asthma allergy testing. So there's lots of different aspects of human challenge trials that are conducted globally. But we really haven't focused on the autoimmune for the moment.
I think this one is for you, Stephen. What is the right tax rate to model? Why do you recognise R&D tax credit at other operating income and not as a contra account in the tax line?
So the answer to the first question is most of our profits are in the U.K. So we'll be subject to U.K. corporate tax rates. So that's the rate to pretty much use in your modelling. Why do we recognise R&D tax credits? Well, that's more of a historical thing. That's the way I've done. I have seen it done both ways. I've seen a number of reports where it is other income and other places where people have it within the tax line. I quite like it separated because it highlights two different things. You're paying normal tax. It goes on the tax line.
R&D tax credits is something additional that you get from the government. It is a cash receipt, whereas the other one is a cash payment. So I quite like them separated. But there are two ways of seeing it around. And it's historical. And at this stage, I'm kind of think of leaving it that way.
Thank you very much. Can you give us any insight into why there is a H1 weighting this year and how the order backlog has evolved? I hope I've answered that question during the presentation. So as I mentioned, the hMPV characterisation study, as well as acceleration of another large project coming in earlier. The order backlog, again, hopefully, you've seen the chart. We've given you a quarter-by-quarter breakdown of when we expect the backlog to be recognized into revenue.
With the cancellation of the hMPV characterization, are there other candidate companies looking at developing a vaccine that could then take this further? So yes. I mean, so I'm not sure if I answered this correctly. So we have a hMPV virus manufacturer that's ready to go into a characterization study. So we have that. And we hold the IP on that. So we are currently looking for companies and partners who are looking to develop a vaccine or antiviral against hMPV. And once we have that, of course, we will then work with them to characterize this hMPV virus, find the right dose, and then conduct a challenge trial. So this basically is a new challenge agent and a new challenge model that we will look to develop, adding onto the portfolio of the challenge agents we already have. I hope I've answered that question appropriately.
How do you guard against the risk that someone may fall seriously ill within your facility and lead to negative headline risk to the company? What safeguards can you put in place? It's a really good question. Clinical research, of course, there is a certain level of risk. We have liability insurance coverage across a number of factors. For example, for errors in admission, for any side effects of the challenge agents, or even the investigational drug that we are testing. Our screening process is very strict. As I mentioned, we screen out overnight 90% of the people who register on our website. It's very strict. On top of that, we don't do any first-in-human clinical trials. All the trials we run, that drug has already been in humans in a phase 1 setting before it gets to Phase II human challenge trial setting.
On top of that, we've had over 4,500 healthy volunteers go through our quarantine facility and have been inoculated with different challenge agents with no severe safety issues. Finally, and just to reiterate maybe, every challenge agent that we have manufactured maybe manufacture is the wrong word, to be honest. But effectively, the seed, the virus, comes from a person who has got that infection naturally. So we're basically growing that virus that somebody has caught naturally. So it's not something that we use or mutate in any way. I think that's key. So you can imagine for RSV or influenza, this is out there in the field. We take it from a laboratory or a hospital. And then we grow that. We purify it. We sequence it to make sure that it's the right strain of the virus we're looking for. We characterize it.
So we start with a low dose. We increase the dose to make sure we get the right level of symptoms before we use it in a challenge trial. So hopefully, that gives you some reassurance as to all the steps we undertake before we actually use it in a challenge trial. How many of the top 10 pharmaceutical giants are using HCCs today? So around four that we know of. I don't believe there is a big pharma that is running human challenge trials with a third provider, at least in the respiratory and ID space that we are in. So we have full access to the market. In fact, almost every big pharma client we have has come back to us for multiple challenge trials. So we've had repeat business from all of our big pharma clients.
Any news on new models such as C. d ifficile, norovirus, Strep pneumoniae , dengue, chikungunya, Zika? Excellent question. So you've really done a good job here in identifying the potential challenge model we can look forward to. So as an example, for example, norovirus challenge trials have been run in the US. Strep too, dengue, has also been done in the US. Even Zika challenge trial has been done in the UK academic site, so US academic site. And that's one of the important points. So we rarely invent new challenge models. These challenge models originate in an academic site where academics are conducting this trial on a small scale to study the scientific progression of viral infection. And we basically take that model. And we basically big-size it. And we commercialize it to help develop our clients' products.
But one of the key things we have changed not so long ago is that we're really looking for our customers to come and partner with us in the development of new challenge models. So you can see from Flu B, for H1N1, even for hMPV, we had a client who was interested in that challenge model before we invested into developing that further. And we continue to seek customers. And we give them the opportunity to discuss the different models that are available, including these ones. And as soon as we have a client interested, we would, of course, help develop these challenges. Will we ever see a commercial COVID human challenge trial? Any companies considering this now? So as you know, we have run a COVID challenge trial that was sponsored by the UK government. But since then, of course, no further COVID work.
None of our revenue this year at the moment is estimated to come from COVID trials. In the order book, there's zero COVID-related work. So we really are non-COVID stock. But I do think as we move forward, there will be more interest in COVID challenge trials, especially as we move into the next generation of vaccines, which, for example, oral vaccines, or also multivariant or combo vaccines, which work against more than one virus. And these are some areas of potential growth for us as a company focusing on conducting human challenge trials. One for you, Stephen, I think. This one, stripping out the Venn Consulting acquisition at the Canary Wharf cost, reimbursing our customers, what would organic revenue growth have been?
Right. So Venn Consulting accounts for about 12%, 13% of revenue. And it grew over 30%.
We're not giving away what the Canary Wharf reimbursement from our customers has been. But that underlying margin organic growth is pretty close to the 16% that we've disclosed overall for the business. It probably is 1% or 2% lower than that.
Thank you. OK. There's a lot of questions. I've got five minutes. I'm going to answer these in a fast way. So hopefully, you guys can keep up. From here on, should we look at hVIVO as a growth company or a stable dividend-paying firm, a growth company, although we will be paying a nominal or a modest dividend? Do you have statistics to show how concentrated or diversified is your revenue by client or geography? Hopefully, you've seen that from our breakdown of the order book that I showed on one of the slides.
Generally speaking, how many healthy volunteers take part in one of your challenge trials? And how long does the challenge section of the trials last? The size varies depending on the reasons why the client wants to do a challenge trial. At the minimum, I would say it's around 60-80. But it can go up to 200 healthy volunteers. The actual quarantine part, so depending on the virus, the volunteers are in the quarantine between 10-15 days. But the overall, the beginning of the quarantine phase and the end typically takes about 2-3 months, depending on the size of the project. But of course, for bigger studies, it could take longer than that. You have screened 17,000 people last year for trial participation, correct? How many of those 17,000 turned out to be less than 1%, I would say?
Or maybe a little bit more than that. Less than 10%, definitely. Are volunteers used more than once? So typically, not. The only way we can use more than one volunteer is they can come back after 6 months and take part in a challenge trial with a different virus, not the same virus. Can you give a bit more detail on the financing of the new Canary Wharf facility? Not more than what we have already shared because we have to basically abide by our client's confidentiality. We can't give out those numbers. Is there an advertising budget? Of course, there is for volunteer recruitment. You say you have 50-bed capacity. Do you have plans if you grow and exceed the capacity? Yes. So Canary Wharf has a capacity to add 20 more beds.
So we can go up to 20 beds, sorry, up to 70 beds in total in Canary Wharf. To what extent do you view yourself as a possible acquisition target? That's a question with an unknown answer, to be honest. You potentially have to ask a PE company or other global CROs for that. And our goal basically is to continue to grow the company, continue to hit our targets. Why Canary Wharf, surely less prosperous area, would attract a greater number of volunteers? So why Canary Wharf? Economically, the primary reason, to be honest. I'm not sure there's anything else to add to that. A great place to be. But economically, it made sense after we assessed different locations. And for the location of the volunteers, so we actually have a UK-wide reach. So volunteers come from all over the country.
We will continue to have the screening facility in Manchester. We will continue to have the screening facility here in East London. And the only people who go into Canary Wharf will be the ones that qualify the screening process and go there. So it's not an issue from that point of view. In view of the excellent cash position, would you consider the payment of a special dividend later this year? Not at the moment. Thank you. And well done to everyone at hVIVO. Thank you for that. How was the dividend amount determined? As it seems rather small, given the company's cash pile. You want to take that, Stephen?
Sure. I think I alluded to it in the presentation. We looked at having been conservative to keep a robust amount of cash on the balance sheet. We looked at six times cover of adjusted basic EPS.
As that grows, so will the dividend. We really are looking to retain cash on the balance sheet for mergers and acquisition activity.
Thank you. With the new facility coming online earlier than planned, will you be looking to run studies at both facilities? Absolutely. This is one of the reasons why we think H1 will have a slightly higher weighting than the H2. So good question. Hopefully, that makes sense. Why does the company attend so many conferences? Is this the only way of generating leads? It's one of the ways of generating leads. Of course, it is. I was at the World Vaccine Congress last week. We had a presentation that we gave out on human challenge trials. I mean, the key goal for us really is to raise awareness. That's the key thing.
We know there's a bigger market that we're currently aware of. So the bigger the platform for us to talk about human challenge trials, the more. You'd be surprised that even now, at our booth, when we're standing there, we have companies coming in asking us about what a human challenge trial is. So that work will continue to happen. And as I mentioned, people like CEPI, WHO, Wellcome Trust, and other small academic sites are helping us in getting the message out there. Thank you for all your questions. I think we've gone one past the hour. So I'd like to close the question section now.
Fantastic. Well, Stephen, thank you indeed for covering off so many questions. And thank you for everyone for submitting those.
Before redirecting investors to provide you with their feedback, which I know is particularly important, Mo, let's start just with a few closing comments before we wrap up.
Thank you for that. Again, thank you for your time today. Hopefully, this is a good, positive update for you. No kind of surprises. The only kind of surprise, I guess, would be that we have increased, now it's a higher EBITDA margin than we had previously communicated, and the fact that we've been able to get Canary Wharf up and running earlier than planned. We stand by guidance of GBP 62 million for this year and a GBP 100 million goal come 2028. So hopefully, you've seen over the last couple of years that we've basically delivered on the numbers that we communicate. Sometimes you may feel these numbers are conservative. But we communicate them as we see them.
Hopefully, we'll continue to beat the numbers. So thank you for your interest and for your holdings. For those of you who are holders and for those of you who are not, what are you waiting for, really? But again, thank you for your time. Really pleased to be talking to you. And hopefully, we will be talking to you next time from the world's largest quarantine unit in the world. Thank you.
It's fantastic. Mo, Stephen, thanks indeed for updating investors today. Now, please ask investors not to close the session. You'll be automatically redirected to provide your feedback. In order that the team can better understand your views and expectations, this will only take a few moments to complete. And that was greatly valued by the company. On behalf of the management team of hVIVO plc, we'd like to thank you for attending today's presentation.
Good evening to you all.