Confident outlook for detection tech business, despite revenue drop
Detection technology group, Kromek, says it expects to become profitable from the current financial year, despite reporting a fall in its revenues and a pre-tax loss in its interim results for the six months ended 31 October 2024.
The Huddersfield-based group recorded revenues of £3.7m (H1 2024: £7.1m) and a pre-tax loss of £5.7m (H1 2024: £3.5m loss).
However, post-period end, Kromek has signed agreements with Siemens Medical Solutions USA, Inc. (Siemens Healthineers) to enable the production of cadmium zinc telluride (CZT) detectors.
Under the terms of this deal, the group will be paid a total of $37.5m/£30.2m in cash in four instalments over a four-year period, with the first instalment of $25m/£20m to be received in the current financial year, of which a material amount will be recognised as revenue.
Dr Arnab Basu, Kromek CEO, said: “Today’s announcement is an exciting moment as both Siemens Healthineers and Kromek are aligned in our vision to enhance healthcare through technological advancements.
“The initial $25m payment from Siemens Healthineers will be used to support the delivery of various milestones under the agreements, significantly reduce our debt and strengthen our balance sheet, ultimately enhancing our operational capabilities.
“These significant agreements enable us to deliver profitability in FY 2025, significantly ahead of market expectations and lay the groundwork for further growth in revenues and sustainable profitability beyond that period.
“Looking beyond FY 2025, we expect to deliver growth in revenues for the fifth year in a row in FY 2026 and remain profitable as we continue to deliver on our agreement with Siemens Healthineers and our other OEM customers as well as the CBRN contracts won with governmental agencies in UK and abroad.”
