Immunodiagnostic Systems, the Newcastle based niche diagnostics company, announced that Interim results to September 2011 showed sales of £27.3 million (2010: £22.6 million), pre-tax profit of £7.7 million (2010: £6.6 million) and EPS of 18.7p (2010: 16.3p).
The company reported that during the half 81 IDS-iSYS systems were sold or placed, taking the total to 322 systems. Average revenue per system is £90,000 (2010: £77,000). IDS-iSYS related sales grew 155% vs.1% for non-automated Vitamin D products. This was affected by manual customers switching to IDS-iSYS. Gross margin was 75.8% (2010: 75.4%); period end net cash was £3.3 million (2010: £2.3 million net debt).
A combination of competing automated product launches and pressure on health budgets, particularly in the US, is resulting in price pressure and some disruption to ordering patterns. Based on the experience seen in markets outside the US where these products are already available, the board is confident that IDS-iSYS competes well against these alternative products, and therefore believes that placements in the US will continue to grow. The company still expects to sell 1000 IDS-iSYS systems in 5 years, a target set at the product launch in 2009. An additional US distributor has been appointed to gain access to US Government buyers, including Veterans Medical Centres, Military Hospitals and the National Institutes of Health.
DiaSorin, IDH’s main rival, recently reported that the Vitamin D market growth is slowing. IDH confirmed that they also believe this is the case. However, the company points out that the market is continuing to grow in double digits and that they are better positioned than DiaSorin to maintain growth of revenues in Vitamin D. The fall in the share price over the last few months (see below) reflects the reported slowdown of growth in the Vitamin D testing market.
The IDH share price has decreased by 49% over the last year.
Immunodiagnostic Systems Holdings Plc is currently graded B by LCF Research. To learn more, follow the link.
