Good afternoon, ladies and gentlemen. Welcome to the hVIVO Annual Results Investor Presentation. Throughout today's recorded meeting, you'll be in listen-only mode. Questions are encouraged. Please submit them at any time just using that Q&A tab on the right-hand corner of your screen. Just simply type in your question and press send. Before we begin, we'd like to submit the following poll, and please do give that your attention. I'm sure the company will be most grateful. I'd now like to hand over to CEO and CFO, Mo Stephen. Good afternoon.
Good afternoon. Thank you for the intro. I'm Yamin 'Mo' Khan. I'm the CEO of hVIVO. I've been with the company for just over four years, and I have with me our CFO, Stephen.
Hi, I'm Stephen Pinkerton. I've been with the company for almost nine years. I've been the CFO for the last four years.
I would like to welcome you all to our full year 2025 results. The Company has had a challenging 2025, at least financially, but operationally, I think we've done some great work. We'll go through both our operational achievements as well as our key financial parameters. We'll move straight on to the financial normal disclaimer, and then really to go through the Company's overview of what we are planning to do from a strategy point of view and what we have achieved, because it's key to have a strategy. Of course, it is. Also, it's also key to see how we are progressing in executing that strategy. As you all know, we are the world leader in human challenge trials, and we will remain so, and we are continuing working hard to expand our human challenge trial capabilities.
But one of our key focus area is to continue to diversify and add new capability. And that's been part of our action for the whole of 2025 and 2026. And we'll really talk about how we are diversifying into new areas, so new stages of clinical development from pre-clinical all the way to end of phase III, whereas historically we've run the phase II human challenge trial and also expanding our therapeutic expertise, not just doing infectious disease trials, but doing respiratory and cardiometabolic too. And on top of that, of course, through our acquisitions, we already have achieved a geographic expansion into Germany and pan-European presence. And I think the key thing is that in 2025, we have already achieved a number of the key criteria that we were looking at. So the expansion into phase I is done.
We are now retiring the brand names for Venn Life Sciences, CRS, as well as CryoStore, and rebranded ourselves under the single one hVIVO brand, which you may have seen launched yesterday on LinkedIn and other social media channels. Going forward, we want to provide our customers with an integrated end-to-end drug development platform under the hVIVO brand and operating ourselves under four different service lines, which I will describe later on. I will be focusing on the diversification of services, but please note that this is not at the cost of human challenge trials. We want to continue to build our human challenge trial capability and remain ahead of everyone else. The key focus for us is to remain more diversified and offer a greater portfolio of services across the board.
We have built a new challenge model, so we've launched contemporary human challenge models in influenza, as well as the world's only commercial HPV challenge model. We've also recognized some cross-selling opportunities where historically we may have not approached customers in phase I. Now we can offer them the phase I, phase II combination, as well as phase I and human challenge trial combination. Post period, we've had some really excellent highlights with the new trials contract we announced yesterday as a really good signal that human challenge trials are returning and back to normal. This is an influenza prophylactic antiviral challenge trial that will take place this year, and we expect to recognize majority of revenue in 2026. We also are in the process of finalizing our agreement for our world's first phase III human challenge trial in whooping cough with iLiAD Biotechnologies .
With that, I'll hand over to Stephen to go through the key financials.
Good evening, everyone. 2025 has been a challenging year for this business. We delivered GBP 46.8 million. That's in line with our downgrade that we gave in May 2025. It happened quite quickly. We faced a number of cancellations right in the April-May time. Normally, the number of cancellations that we have is around about two on an average, and we had quite a bit more than two in the current year, and that is the main reason for the lower revenue performance. However, I think the business has adjusted well. We made a profit of GBP 1.4 million despite these headwinds from the U.S., and that's after the net acquisition losses of GBP 1.4 million. The underlying performance of this business was profitable under the circumstances. Cost management was at the foreground, but the efficiencies that we achieved in 2025 to establish in 2025 pulled through in 2025.
One of the clearest examples is recruitment. We were able to leverage our database rather than go out for lead generation and spend money on advertising and things like that. Clearly one of the clear reasons for the profitability was also these cancellation fees carried no variable spend attached to them and flowed through to the bottom line. This gives you a sense of whilst HCT got impacted significantly by the headwinds in the U.S. with infectious diseases and vaccinations not being in favor, our contract model softened the blow somewhat on our HCT studies and on HCT revenues. Moving on to cash. Cash of GBP 14.3 million was a little bit better than the expectations, although this is much lower than we started the year, GBP 44.2 million.
Just under 50% of that's due to the acquisitions supporting their working capital and also obviously the consideration for acquiring, making those acquisitions. Just over 50% of that is due to the core business and the limited number of HCT trials that we have signed in 2025, or before the end of the year. The Board has made the decision not to pay a dividend for 2025. The value of the dividend is GBP 1.4 million, and we felt it's much better spent investing and growing in the long-term future of this business. The order book of GBP 30 million compares to GBP 43.5 million. It has been restated. Previously, we would have included the full value of a contract at the time when a contract is signed. When an SUA is signed, a study startup agreement is signed. However, because we faced a number of cancellations, we have changed the methodology.
At the time we set up a startup agreement, we get startup fees, and we get a booking fee. Because that booking fee was seen as a commitment, we would use the CTA full value. However, we're now only including the contracted values in the order book, and we are also now only announcing contracts when the CTA has been signed with clients. There is a bit of delay because first of all, you've had headwinds affecting the HCT market. We're now only announcing studies once the CTA is signed. The time between SUA and CTA can be anything between five months-12 months in signature in terms of when they sign between the two. There's another slide further on, and Mo will take you through more on the order book going forward. Just touch on revenue.
This is a waterfall from 2024-2025, the key sort of drivers and changes in the revenue makeup mix over 2025. Remember in 2024, we did receive facility fees that clients paid us to effectively what we built up in Canary Wharf for a large study that was delivered in 2024. That was roughly about GBP 4 million. HCT, we've just talked about it. It did decline significantly. It's due to a number of cancellations. I also wanted just to highlight that some of that decline's got to do with, in HCT, we also include manufacturing revenue, which is around about 10%. Yeah, 10% of the HCT sales that we make is where we have manufactured challenge agents for clients. To remember that this is an important part of our portfolio is being able to develop challenge agents.
Clinical trials were slightly up year-on-year. We did have a high volume in 2024, and we've managed to be able to repeat it in 2025. I think that's quite a good performance. Labs is slightly up. It is off a low base, but we see a pretty good order book going forward on that. Consultancy was down. That's mainly because a big pharma took some work in-house. With the support of CRS, we're beginning to see some cross-selling from the CRS clients into early clinical consultancy services. That's improving. Looking at the acquisitions, CryoStore at GBP 0.8, that was their revenue for the year. That's perfectly in line with our expectations and the due diligence work that we did on CryoStore. They're delivering as expected. It is a high margin. It is a business that has sort of 90%-95% retention rate.
It's a great little business and is doing very well. CRS, our German acquisition, GBP 12.3 million, is a little lower than we expected at our due diligence stage. It was really down to the RFPs in 2024 not converting as expected as per previous sort of conversion rates, impacted definitely by the whole sector. The whole sector had a little bit of a hesitation and a hiccup across the CRO sector. Certainly that impacted. However, we have seen an uptick in the conversion rates in 2025, offsetting some of that shortfall in 2024 of the 2024 RFPs. Just to touch on cash a little bit, cash utilization, here I've just tried to split how we've utilized our cash. We have utilized some GBP 29 million. We used GBP 15.4 million, and in organic work, it was GBP 14.5 million.
Cash generated from operations of GBP 10.4 million is obviously due to the HCT. We've had unwinding of the deferred revenue and new sales on HCT still to come back. Looking at the pipeline, that's looking positive. Obviously, it's impacted us for 2025. The purchase of PPE, the GBP 1.4 million is largely lab equipment. We did purchase the first digital PCR equipment in Europe, Hamilton. It's a great piece of kit. It's quite expensive, but it supports us with our field study work that we're doing on Cidara and new field work that we're going to do. It's much faster, and it's much more efficient as well. Financing activities of GBP 4.6 million includes a dividend of GBP 1.4 million. Obviously, we're not paying that in 2025. It's in 2026, so there's no dividend going out.
The other thing that we benefited in 2024 was we had a rent-free period in Canary Wharf. Our lease payments have jumped up by about GBP 2 million-GBP 3 million in 2025. That's the makeup of the GBP 4.6 million. Just the acquisitions, GBP 10.5 million spent on consideration costs and the GBP 4 million is really the sort of the working capital and funding the loss for the year. Overall, I think the business has reacted quite well to the headwinds that we have faced and tried to reflect there is some resilience in the business in terms of the way we contract to soften the blow, and we're well set to go forward. With that, I'll hand you over to Mert.
Thank you, Stephen, for going through the numbers. I want to really focus on why do I feel bullish going forward. We've just been through a challenging 2025, and we had a profit warning in 2025. Share price has been depressed, but I still believe that as a company, we've had a transformational year. We've gone through two acquisitions, CryoStore in London and two clinical research units in Germany from CRS. We realigned our company under the single one hVIVO brand. The reason why that is important is we want to offer a one-stop shop for our customers to go from preclinical, this is at the consulting stage, all the way to end of phase II or end of proof of concept, basically to show a signal whether a drug works or not, as well as offering phase III site services.
Under the four different arms we have right now that we are fully operational and currently in working practice, the consulting arm focuses on CMC, PK, regulatory type of consulting. Majority of it really falls under the former Venn team. They work very closely with a clinical trial service arm in the sense that when we are running a phase I trial, as part of that, we may be helping our customers to design protocols, write clinical development plans, obtain regulatory advice. The clinical trial service unit works very closely with the consulting arm. Under the clinical trial unit, we also include the phase II non-human challenge trials we run both in Germany but also in the United Kingdom, in London in particular.
The third arm is the human challenge trial arm, or this is the legacy arm, where we manufacture new challenge models, we validate them, and then we run the human challenge trial work on that. The final piece to this jigsaw is, of course, the laboratory piece, which historically has catered human challenge trials, but now is a standalone business on its own. It will continue to provide services to the human challenge trial, clinical trial business. On top of that, we also expect it to service third-party clients, trials run by third-party CROs. Cidara being a key example where we provided full central laboratory assistance in the laboratory aspect to 50 sites in phase II to 150 sites into phase III. What this enables us to do is to handhold a client from the beginning to the proof of concept.
It also means that we're able to access new clients independent of the stage they're at with regards to the clinical development program. Historically, we were a phase II human challenge trial business. Now we can attract clients whether they're in preclinical phase I, phase II, or phase III. This automatically increases the portfolio of our customers. Having said all of that, I want to reiterate, human challenge trials remain a key component of our offerings. We are no longer relying on them as the sole provider of future revenue. In 2024, over 85% of our revenue was generated from human challenge trials. In this year, we are forecasting less than 50% of our revenue to come from human challenge trials. Of course, this is partly due to the downturn in the human challenge trial awards and the cancellations we've had in 2025.
It does show the progress we have made in the non-challenge trial business, the fact that we can now expect over 50% of our revenue to come from non-challenge trial business. The scale and breadth of the company has also drastically changed. We now have over 200 beds in a variety of different locations where we can treat patients for all sorts of clinical trials. We've created centers of excellence for different type of therapeutic areas. In infectious diseases and also respiratory in London, cardiometabolic in Mannheim, renal and hepatic special populations studies in Kiel. Now this gives us, again, access to new customers that we have not had access before. CRS historically have mostly worked with German customers. Now we are targeting our sales activities to pan-European and also U.S. customers to run their trials in Germany for the phase I part.
We're seeing volatility within the FDA and more and more customers looking to do early-stage clinical development outside of the U.S., whether that's in Australia or in Europe. We want to play a key role in attracting those customers to Europe, especially in Germany, when it comes to phase I trials. On the human challenge trial business, as I said before, we want to continue to build on this and be the world leader. We do majority of the commercial human challenge trials that are conducted in the world. We've added a new human metapneumovirus model, hMPV challenge model. It is the only active challenge model commercially available in hMPV. We've renewed our influenza viruses in a number of different strains. Traws Pharma is taking advantage of a new contemporary viral model that we have in place that we launched last year.
We will continue to build on our human challenge trial business, and that's key. We're also potentially expanding into respiratory human challenge trials, challenging asthmatic or COPD patients to cause mild exacerbation and testing new antivirals or asthma and COPD products. Human challenge trials will remain a crucial part of the business. We have three other key growth initiatives that I want to walk you through, and the reason why they're important is I expect them to contribute significantly going forward as part of our non-human challenge trial business. The first one is the cardiometabolic. I'm sure you are all aware of the recent boom in anti-obesity drugs, and we want to be part of a clinical development team that tests new anti-obesity drugs. Cardiometabolic is more than just anti-obesity drugs. It also includes drugs targeted against diabetes, for example, hypertension, high cholesterol levels in patients.
We have a world-renowned endocrinologist, key opinion leader in Professor Thomas Forst, who was our Chief Medical Officer at CRS, or now the Clinical Trial Service arm, who's responsible for leading this franchise. He acts as Director on several advisory boards for big pharma. We believe through our initiatives in attracting new customers outside of Germany, supplementing the patient recruitment with the U.K.-based FluCamp now fully implemented in Germany, we can run more trials in Germany. The key for us is that we offer phase I and phase II combo trial delivery platforms, phase I in healthy volunteers and expanding into phase II patient-based studies. Now, in our group of service providers, there are not many vendors out there that can provide both healthy volunteer phase I trials and phase II patient studies.
There's a gap in the market which we want to make the most of. A second key driver is respiratory. Historically, on the human challenge side, almost all of our challenge trials have been run in infectious diseases that target the respiratory system. We inherently have a really strong respiratory franchise with some really good experts and our facility's equipped already to monitor different respiratory parameters when it comes to running phase II and phase III trials. That's something we are now making the most of in the sense that we are targeting clients, respiratory clients, to conduct non-challenge trials. We run a number of non-challenge asthma trials. We have a huge database of patients both in asthma and COPD, and we're now seeing traction from our clients who are interested in running field studies with us on both asthma and COPD indications.
This is something, again, we want to build on and then build new indications on the back of delivering these types of patients. The third and final piece of the puzzle is the laboratory. We want to build the laboratory. As I mentioned earlier, historically, laboratory services catered for our human challenge trials. We now have a strong standalone business. We've added new capabilities to this. We have added a Droplet Digital PCR machine that can automate and speed up the analysis of samples for PCR purposes. We've also added a next-generation sequence capability, which is NGS capability. It means that we can sequence pathogens or other molecules much faster than we have previously done. In fact, we formerly outsourced this piece of work because it was part of the human challenge trial business. Now by bringing it in-house, we can increase our revenues and improve our margins.
Our goal is to continuously monitor the requirements in the market for different types of laboratory requirements and to target customers for repeat business in this area. The end-to-end platform isn't just fancy words that I say to try and promote hVIVO to you. It's something that we have seen in action. Cidara is a really good case study. Cidara is a U.S.-based biotech company that came to us three years ago almost when we ran the human challenge trial. On the back of positive results from the human challenge trial, we were a site, a clinical site, in their phase II field study, where we contributed around one in six patients in the total recruitment phase. On top of that, we acted as a central virology laboratory for the phase II trial.
That was a positive outcome for that trial, and on the back of that trial, Cidara was sold to Merck for $9 billion. We are currently, again, working with Cidara, now Merck, on a phase III study, also acting as a clinical site and a central virology laboratory for over 150 sites or hospitals around the world who send their samples to our laboratory, where we analyze the primary endpoints. This is something we want to do more of, and we have now diversified to include both the consulting and the phase I. Now, for example, we can speak to a customer at the pre-clinical stage, help them formulate their product through our CMC and our PK consulting services, take them to the regulatory bodies through our regulatory consultants, do and conduct the phase I trial, first-in-human clinical trial, and then the phase II trial in patients.
Along this journey, by doing it under one contract, one roof, it means you improve on the efficiencies, you enhance the quality, and you reduce the costs. All these are very attractive sentiments to a biotech who's looking to get to end of proof of concept as fast as possible and potentially as cheap as possible. The reason why I feel this is important is because I believe that going forward, we will see an increase in number of trials run by biotech to get to phase II. That's because the big pharma are cash-rich right now, but they also have a challenge of a very big patent cliff. Around $300 billion worth of new branded drugs will expire their patents in the next five years.
This means that after that, the revenue that these companies will get from their branded product will reduce significantly because there will be copycat generics on the market at a much cheaper price. To fulfill their pipeline, Big Pharma will spend money to buy new assets. Because they're cash-rich, they can afford to pay a higher price and get a drug that is at a later stage of development, so lower risk of development. If that was to happen, the biotech companies need to run phase I and phase II trials, and that's where we come in. We can work with these biotech companies and give them an enhanced package to get to end of phase II. The therapeutic areas we work in are what we call primary care indications. These are indications where you would typically go to your GP for rather than the hospital.
We focus on infectious diseases, in respiratory, in cardiometabolic. We can add other franchises, for example, women's health or dermatology and so on. The key for us here is to have an integrated end-to-end delivery system that requires minimum effort and resources from a biotech, so their team can remain small and nimble, and we could be the workhorse underneath them to get to the stage where they're ready to market themselves to big pharma, just like we helped Cidara to do. The diversification, again, isn't all talk. Okay? I mentioned the fact that 50% of the revenue will come from non-challenge trials. You can look at the order book. The order book is also diversified. Stephen explained our new algorithm when we announced the order book and new contracts.
The key to that is that it should be more resilient, more reliable, because it's closer to the execution of the work rather than at the start of agreement. It also means that our order book, in this instance, as you can see, will be lower than previously stated because we are announcing this contract at a more mature stage. This order book for 2025, of course, does not include the Traws Pharma contract because that was signed in post-period. I would want you to focus on the other areas and the growth we are seeing across the board in the different service lines. That's key for us. We want to build the human challenge order book. Of course we do, but we also want to continue to build and grow and accelerate the order book in the non-human challenge trial areas.
When it comes to new proposals, we've also seen really good uptake. 2025 numbers were significantly better across the board compared to 2024. This year already, in the first quarter of 2026, we've seen a 50% increase in new proposals submitted year-on-year. The variety of clients we're getting is also much greater than ever before. I want to reiterate this. We're now attracting clients in new therapeutic areas. We're also attracting clients at different stages of clinical development. That's key for us to build a future to diversify and de-risk. If something like what happened last year were to ever happen again, we are much better placed to manage that downturn. A final slide just to sum up where we're at. I totally understand people's frustrations, the investor's frustration with regards to the financial outcomes and the share price depression in 2025.
I hope I have relayed some of the key work we have done. We've been very busy in getting the acquisitions on board, realigning the company to diversify and integrate an end-to-end delivery system. That's something we want to continue to go forward with. The CRS and the CryoStore integration are fully complete. We have all the line management realigned. We have launched new group-wide systems that work across all our colleagues across the group. You've seen from the pipeline is strong. The short- and medium-term outlook is very good. We have signed Traws Pharma as a major human challenge trial. We hope to finalize the ILiAD contract soon. The pipeline is very strong. In the meantime, by the way, we are continuously signing phase I contracts. These are generally between GBP 600,000-GBP 1 million in value, so they're not announceable.
I'm pleased to say we are continuously working with new clients as well as some repeat clients in our preferred providerships that we are building the order book on that side as well. With having said all that, we are confident that we will achieve high single-digit revenue growth in 2026. Thank you for your attention.
That's great, Mo, Stephen, thank you very much indeed for updating investors. Please ask investors just to continue to submit your questions using the Q&A tab on the right-hand corner of the screen. Just before we go into the Q&A session, a recording of this presentation will be available via the Investor Meet Company platform shortly after today's call. Mo, Stephen, you received a number of questions from investors both ahead of the event and during today's event. Thank you firstly to everyone for your engagement. If I may just hand back to you, Mo, and maybe you could kindly navigate us through the Q&A and I'll pick up from you at the end.
Great. Thank you. Okay, I'll get straight onto it. What is the outlook of firming orders with ILiAD now that funding has been secured by the firm? The funding has been secured by the firm, you're absolutely right. Part of the funding has been allocated to run a human challenge trial with us, of course. The contractual negotiations are almost fully complete, and we are near finalization of this contract. Look out for, hopefully, the RNS soon with regards to the announcement of the fully signed contract with ILiAD, which will be the world's first phase III pivotal whooping cough trial.
Just to kind of comment on this further, this will create a significant precedent when it comes to human challenge trials because the FDA, the MHRA, and the EMA, the European agency, have agreed to use a human challenge trial data as a part of the submission package to get to marketing authorization. This had not been done before proactively. This sets a precedent, hopefully, for future clients and sponsors to ask the same from regulators to use a human challenge trial as a way to get to licensure, something we are very proud of. We are, of course, very delighted that ILiAD have preselected us as their preferred partner, but this is bigger than just hVIVO. This will impact the whole human challenge trial franchise once that data is produced. What is the value of Traws Pharma deal to hVIVO plc?
As you know, we have not published the value of the contract. I know this is price sensitive and competitor sensitive, and I'm sure our clients would not like to us share confidential information with you guys. It's a good, strong contract with up to 150 people being enrolled into study. As I mentioned, this will start almost immediately. In fact, the preparatory work has already started, and we look to complete majority of the trial in 2026. In light of the new Traws Pharma HCT, will we have better capacity for ILiAD? Yes. The way we have planned out all this work, of course, there is capacity to conduct both trials in 2026. The ILiAD contract, by the way, is multi-year. It will go from 2026, but the majority of the revenue, in fact, now will be recognized in 2027.
I think it goes to show to the resilience of the company now, whereas if you asked me 12 months ago, ILiAD would have formed a large proportion of 2026 revenues. For a variety of reasons, that study has been delayed, but we are still sticking to our guidance. Even though ILiAD will form a much smaller portion of the 2026 revenue, we still are very confident of our guidance we have put out there. In 2027, we expect ILiAD to perform even more with regards to revenue recognition. Isn't the CRO market extremely crowded? In that case, why are you expanding your CRO offering instead of doubling down on Human Challenge? It's a very good question. Human Challenge Trial, I think we have doubled down, if you will. We are the world leader. We have over 12 different challenge models. Nobody comes near us.
We have around 350,000 people on a database that we can use to recruit healthy volunteers. Again, nobody comes near that. We've done 50 trials to date or 5,000 healthy volunteers in our database. We are the world leader in this. There's no doubt about that. You have to be careful, as we've seen in 2025. If you rely on one single modality, you do risk your future growth. For that reason, we do want to grow further. Your key point that the CRO market is crowded, it's correct. It's crowded in certain stages of development. There are not many multi-site CROs out there that can do healthy volunteer phase I studies and then expand into multi-site patient studies. We own our own clinical site. Most CROs will go to third-party sites and rely on their recruitment capability.
80% of the trials that are delayed are delayed due to poor patient recruitment, and that is a problem we will solve by internalizing patient recruitment. Our own team, our patient recruitment team, will recruit patients into the London facilities as well as the general facilities. Although the CRO market is crowded, I believe we have a niche that will grow because of the pharma requirements of a more product from biotechs, and that's what we want to service. The choice to reduce your over-dependence on human challenge trial studies and smooth out the revenue cycle. We're not reducing our human challenge trial capability, but we are diluting it by increasing the non-challenge franchises. Absolutely. The reason behind that, of course, as you mentioned, is to reduce volatility and lumpiness and cycle, if you will. I think this one is for you, Stephen.
Is hVIVO plc evaluating further cost-cutting measures given the business outlook?
We have a very good operational team where we plan out all our known studies. We plan based on our contracted work, and then we always look to scale accordingly. Yeah, we plan our costs based on known factors, on our known studies. We are always looking at our cost base, but there's no significant change that we're expecting in the short term.
Thank you. The next question is a long question. I'll just get to the end. Will the company ever start winning new HCT trials again, and if so, when? Well, we won one yesterday, which was announced, so that's something. As I mentioned earlier, we are looking to finalize the agreement with ILiAD on what will be our largest ever human challenge trial. Stephen, this is one for you. Will you be paying dividends, as I'm sure shareholders will be quite disgruntled about the past few years?
Okay. As I mentioned earlier in the presentation, the Board has decided not to pay a dividend this year. We'd rather spend the money on investing for the future growth of this business. If you think about it, at the beginning of the year, we had GBP 44.2 million, and it seemed churlish not to pay a dividend. Now we have GBP 14 million, which is more than enough for our sustainable growth. We think it's better to spend that money, all of that money, going forward and investing and growing this business forward.
Okay. "Why did you decide to have your largest facility in Canary Wharf instead of a cheaper location elsewhere in London? What tilted the decision in favor of Canary Wharf?" It was an economical decision. So we did look at a number of options in and around London, and this was the optimum with regards to location. So to get access to healthy volunteers and patients, but also economically, it was a very favorable terms for us. Remember, Canary Wharf were and still are attracting more life science companies to this campus. And as part of that, they really wanted us to be involved and spearhead that campaign. "Apart from ILiAD, are there any other HCT deals that are close to signing over the next three months or so?" So I can't comment on next three months or so, but absolutely.
There are multiple deals we are currently working on, which are currently at the proposal stage. You saw the increase in proposals that we have seen in 2025, which have increased by 50% in the first quarter of 2026. The pipeline of work remains very strong, and we do hope to close a few of these in the coming months and in the future periods. Is hVIVO plc evaluating further acquisitions? We always will keep an open eye on further acquisition for the right fit. I think that will be key rather than the size and the timing. If the deal is good and it gives us access to new therapeutic areas, new geographies, then we will seriously have a look at those options. This is one for you, Stephen. How would you say your fixed cost and variable cost splits? Just a rough split would be useful.
This is actually not a straightforward answer because we have quite a number of different contracts in place with our clients and different revenue types. If you're thinking about our consultancy business, it's got capacity. It's not fully utilized. What is my variable spend in that case? There isn't any. I could take on more work. If I look at HCT trials, the variable spend on an HCT trial is maybe 15%. If I look at a clinical trials business, the variable spend will be roughly 25%-30%. It's very much dependent on your revenue mix.
Thank you. I can see we are running out of time. I've only got one minute left, so I'll quickly go through a couple of, I guess, different questions. Does the lab only service samples taken in London, or can it be processed samples from anywhere in the U.K.? We process samples that are taken anywhere in the world, to be honest. We have a whole biologistic arm that works with courier partners and ships samples, at the right temperature controlled environments, to our Canary Wharf facility here on this floor, in fact, where we have all the equipment ready to process samples. We do manage a large number of samples in any given week, especially for our ongoing trials, such as the Cidara trial.
Is the strategic move towards diversifying our revenue sources also margin accretive in the medium to long run compared to previous revenue mix? Stephen, you want to get that?
Sorry, where are you? Sorry, I missed that one.
Is the strategic move towards diversifying our revenue sources also margin accretive in the medium-long run compared to the previous revenue mix?
No. HCT is definitely a much more profitable piece of the business, especially when you're running multiple HCT trials at the same time. We're able to leverage our fixed cost base a lot more efficiently over HCT. Clinical Trials, there's a lot more outpatients, so obviously you have a lot more sort of transactional type of work to get through. Clinical Trials is a lot more competitive environment as well, so your margins are a little bit tighter. Labs is probably a bit better, and your margins are a bit better there because it's a contact with the client. Consultancy has also got a different margin. The new revenue streams don't necessarily improve the margin, but when you start dealing with scale, then you start getting an improvement in margin.
With HCT coming back and with the scale that we're envisaging and driving towards on the other new revenue streams, which should get closer to where we were previously.
Good. Thank you. On that note, I will close our presentation. I think we've gone two minutes over. Thank you, everyone.
That's okay. Thank you, Mo, Stephen. Of course, we'll make any other questions available post today's call. Mo, Stephen, I know investor feedback, as usual, is very important to you both. I'll shortly redirect those on the call to give you their thoughts and expectations, but perhaps final words over to you, Mo, and then I'll send investors to give you feedback.
Yeah. I want to thank everyone for your loyalty in hVIVO. I hope we have described at least some of the key points that we have achieved in 2025 and continue to do so in 2026. I appreciate financially it was a challenging year, but you've seen the actions we have completed, and I think our strategy is sound. We are going for a market gap that currently exists. We're offering services that are unique, and I think our future is now de-risked, and we are a much more resilient and less volatile company.
That's great. Mo, Stephen, thank you once again for your time. If I could please ask investors not to close this session, as we'll now automatically redirect you so you can provide your feedback directly to the company. On behalf of the management team of hVIVO plc, we'd like to thank you for attending today's presentation, and enjoy the rest of your day.