14th Jan 2019 08:28
LONDON (Alliance News) - Shares in Kromek Group PLC fell sharply Monday after the radiation detection company posted a widened loss and lower revenue for the first half due to production disruption from relocation of US facility.
Shares in Kromek were 12% lower at 24.06 pence in early trading on Monday.
For the six months ended October, pretax loss deepened to GBP2.1 million from GBP1.8 million the year prior. This was after revenue fell to GBP3.7 million from GBP4.8 million the year before.
The weaker revenue performance was driven temporary manufacturing downtime in the US as it moved its facility in the country. Some of this delayed production is, therefore, now expected to be delivered in the second half of the financial year.
"The progress of 2017/18 was sustained into the current fiscal year as Kromek remained at the forefront in developing solutions to combat some of the greatest security and health challenges that are faced by society today," Kromek Chief Executive Officer Arnab Basu said.
"Our position has been strengthened by our new state-of-the-art facility in the US, which is designed to be a world-class manufacturing base for the production of medical imaging products including SPECT cameras," Basu added. "During the six months, we undertook a significant process of relocation, installation and revalidation of our manufacturing processes, and I'm delighted that the facility is now fully operational."
Kromek does not currently pay a dividend.
"Over the last three fiscal years we have won USD80 million of contracts, across all of our core sectors, demonstrating the successful conversion of our growing order pipeline," Basu continued. "They also demonstrate the strong and long-lasting partnerships that we are continuing to build with our commercial and large government customers across the globe."
"As we continue to deliver on existing contracts as well as win new orders, our visibility of revenue for the next six to 24 months continues to increase, which includes visibility of approximately 86% of the forecast revenue for 2018/19," Basu said.
The firm, therefore, remains "confident" of delivering full year revenue growth and "positive" earnings before interest, taxes, depreciation and amortisation in line with market expectations. For the first six months, Ebitda loss deepened to GBP553,000 from GBP310,000 the year prior.
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