Gentronix raises £610k through rights issue
BIOTECHNOLOGY firm Gentronix which supplies kits to the pharmaceutical industry to speed up the testing of new drugs has raised £610,000 through a rights issue as it looks to accelerate its growth.
The company has seen its sales climb by 35% from £564,000 to £761,000 over the past year while cutting its pre-tax losses by £240,000 from £596,000 to £366,000.
Based at Manchester University’s Core Technology Function building, it believes that it is now on target to break the £1m turnover barrier this year while also becoming profitable.
Gentronix is in ongoing negotiations to sign off a ‘multi-year’ licensing deal with a major global pharmaceutical company and has also entered dialogue with a ‘major global regulatory authority’ regarding the use of its GreenScreen product to test agrochemicals.
Chairman John Nicholson said: “While the level of monthly sales is looking increasingly robust in relation to monthly costs… it is judged appropriate to resource these growth plans with modest capital expenditure on additional equipment plus modest extra manpower to market.
“To finance this essential expenditure and to further strengthen the balance sheet by partial repayment of a loan the company has completed a rights issue raising £610,000 before expenses.”
Mr Nicholson told TheBusinessDesk that the funding will also be used to complete further development work while also increasing its presence in the American market.
The rights issue – which took place on May 26 – saw 23,952 shares issued at £25.47 per share.
The financial statements also show that the company is now looking to broaden the portfolio of products it offers as well as the market sectors it sells into.
Mr Nicholson said: “While the post ‘credit-crunch’ commercial environment was generally difficult, with major pharmaceutical companies involving themselves either in mega-takeovers and/ or significant cost-cutting exercises… Gentronix grew its sales of GreenScreen HC via sales to 33 different companies.
“Additionally, there was a recognition that we needed to grow the company and its revenues faster.
“The business believes that this can be achieved by broadening both the portfolio of products offered by the company and the market sectors that we are selling into.”
The report states that the company intends to achieve this by developing its existing collaboration with Boston-based Apredica which specialises in ‘predictive toxicology’.
It also intends to focus increasingly on the cosmetics, skin, tobacco and materials markets.
