AGM Statement on Impact of DHSC Settlement

Paris, France, Eastleigh and Manchester, UK - 18 July 2024 - Novacyt (EURONEXT GROWTH: ALNOV; AIM: NCYT), an international specialist in clinical diagnostics, provides the following update ahead of its Annual General Meeting ("AGM"), which will be held at 1pm BST/2pm CEST today.

As announced on 11 June 2024 (here), the Group reached a settlement with the Department of Health and Social Care ("DHSC") on terms that the Company pays £5.0m to the DHSC. Under French regulations, Article A. 821-85 of the Commercial Code, as this settlement took place before the Company's General Assembly (AGM) but after the issue of the auditor's report on the Group consolidated accounts for the year ended 31 December 2023, the Group is required to update shareholders at the AGM on the financial impact of the settlement. Consequently, the following update will be provided to shareholders on the accounting implications of the DHSC settlement that will be reflected in the 2024 Group interim accounts for the six-months ended 30 June 2024 ("2024 Interim Accounts").

From an income statement perspective, the following transactions will flow through the 2024 Interim Accounts resulting in a net loss of circa £5.0m:

• The December 2020 outstanding DHSC invoice for circa £20.0m (excluding £4.0m VAT) will be written off as a bad debt as it will not be paid;
• The product warranty provision for £19.8m will be reversed as it is no longer required;
• The settlement fee of £5.0m (gross) will be recorded to exceptional items.

From a cash flow perspective:

• The Group has paid £5.0m inclusive of all taxes, to the DHSC (paid post-period-end in July 2024);
• The Group has submitted a request to reclaim circa £12.2m VAT paid to HMRC relating to DHSC invoices that will now not be paid. The Company believes it is entitled to have all VAT refunded, however there is no guarantee that the claim will be successful and the timing of the refund is currently unknown.

Assuming all VAT is repaid, the Group's net cash position following the settlement will increase by over £7.0m.