Manufacturer’s shares plunge 20% as post-IPO misery continues

Covid test manufacturer Abingdon Health saw its share price plunge to a new low after it revealed it did not know when, or if, the Government would pay overdue bills totalling £6.7m.

Investors reacted badly to the news, sending its share price down 21% on Thursday.

It is the latest blow to the York-based company which only went public less than a year ago.

Abingdon Health floated in December 2020 at 96p-per-share, raising £22m as it listed on the Alternative Investment Market (AIM).

The price briefly went up to 136p in January but since then has been losing value throughout 2021. Abingdon Health’s market value is now £100m lower than at its January peak.

Its share price closed at 37p on Wednesday night – more than 60% below its IPO level – before the price plummeted again after the company’s cashflow position was revealed.

The life sciences company won two lucrative Government contracts to produce a rapid antibody test but those agreements are now subject to a legal challenge by the Good Law Project about the way the deals were agreed.

Abingdon Health says the Department for Health and Social Care (DHSC) has now said it won’t pay the £6.7m plus interest it owes until after the judicial review proceedings are complete, even if Abingdon takes legal action to recover the money.

The company has been forced to reduce its workforce by 60 in the last four months, with 130 people now left at its York and Doncaster sites. It said “the pressure on cash flow will increase the longer that payment by DHSC is outstanding”.

Abingdon Health’s chairman Dr Chris Hand said: “We stepped up to what was asked of us at a time of national emergency.

“Some of our employees have unfortunately lost their jobs as a direct consequence of the DHSC not paying for products they have taken delivery of, are using and told us were passed for payment in January 2021.”

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