Avacta looks ahead to future growth
HEALTHCARE group Avacta today said it is looking forward to reporting growth in the forthcoming financial year, despite seeing revenues fall as anticipated.
The AIM-listed Wetherby-based company provides innovative diagnostic tools, consumables and reagents aimed at reducing the cost of human and animal healthcare. It operates three businesses – Avacta Analytical, Avacta Animal Health and Avacta Life Sciences.
The group said the fall in revenue, from £3.13m last year to £2.7m this year, was largely due to slow sales in the first half of the financial year within its Avacta Analytical division – which provides high-end analytical instrumentation, consumables and services to the biopharmaceutical sector – due to the re-engineering of its upgraded product, Optim2.
For the year ended July 31 2013 Avacta reported a pre-tax loss of £1.85m, a slight increase from a £1.6m loss in 2012.
However, the group, which launched its in-clinic blood analysis system, Sensipod, to veterinary practices in the UK along with the first point of care test to screen dogs for environmental allergies last month, said it remains confident of the forthcoming financial year.
Alastair Smith, chief executive officer, said: “Our recently re-engineered Optim2, with increased functionality and performance improvements, has been well received by the market which bodes well for the coming financial year.
“We will also see the first revenues from our Sensipod product as they are sold to veterinary practices in the UK. We have already seen a good level of interest and expect this to accelerate as we expand the menu of diagnostic tests over the coming months and years.
“Good progress has been made with our Life Sciences business and we remain confident that our Affimer based products will generate revenues in calendar year 2014.
“I am very excited about the prospects for the business and look forward to reporting on growth in the forthcoming financial year.”
Earlier this year, Avacta raised £4.7m through a share placing to allow it to speed up development of new products.
The group also said today it continues to believe that the Animal Health and Life Science divisions could individually be worth significantly more than the current value of the group.
Avacta said Optim sales picked up sharply in the second half of the financial year and said the additional functionality and improvements in the Optim2 product have been well received by the market and the directors expect to see a good performance from this business unit in the coming financial year.
The group added: “The directors are naturally very pleased to see the shipping of the first Sensipod units to veterinary practices in the UK and recognise that the expansion of the menu of diagnostic tests over the coming months and years is critical to the growth of the installed base.
“This is a key area of focus for the group. The animal health business unit now has three revenue streams from reference laboratory testing, diagnostic kit sales and Sensipod in-clinic testing and the directors are confident that the pipeline of new products in each of these three areas will drive growth.”
Avacta said progress in the two focus areas for Affimers, commercialisation as reagents for life sciences research and microarrays for drug and biomarker discovery, is good and the group remains on target to generate first revenues in calendar 2014.
