15th Sep 2014 08:55
LONDON (Alliance News) - EKF Diagnostics Holdings PLC Monday expressed confidence in meeting market expectations for the full-year despite swinging to a loss in the half-year to the end of June on exceptional costs.
EKF said that whilst trading conditions continue to be challenging, its general outlook for the second-half is very positive.
The medical devices company posted a pretax loss of GBP2.5 million, swung from a profit of GBP191,000 in the previous year. This was despite seeing revenue rise to GBP16.8 million from GBP14.9 million, due to higher administrative expenses, and exceptional costs of GBP1.5 million relating to the transfer of production of some of its products from the UK to Germany.
EKF said the transfer of production of its Quo-Test and Quo-Lab products to Germany was now complete.
Revenues from point-of-care products grew 16% in the first-half, boosted by an order from a new distribution partner in China. EKF expressed confidence for this business going into the second-half, citing potential tender wins in South America, new product launches, and the operational benefits of the German manufacturing site.
This helped to offset a decline in the company's Central Laboratory business, which fell 18% in the first-half due to the strength of sterling and some timing issues on Enzyme orders and orders from Asian distributors.
In its Molecular diagnostics business, recent acquisition Selah Genomics Inc contributed sales of over GBP1.2 million. However, due to a reduced level of reimbursement for its drug metabolism enzymes panel, Selah did not achieve its first quarter gross revenue target.
During the first-half the company acquired three businesses; Separation Technology Inc, DiaSpect Medical AB and Selah, with EKF expecting all three to contribute to future growth. Additionally, the company also made an investment in Dx Economix Inc, which builds and implements market entry strategies for new or existing healthcare technology products.
"Our focus in the second half and beyond is on rebuilding shareholder value. Form is temporary but class is permanent and we believe we have a first class offering," said Executive Chairman David Evans in a statement.
Shares in EKF were trading down 4.7% at 23.58 pence per share Monday morning.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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