"Turbulent" year leads to £10m losses for medical group
THE “extremely disappointing” financial performance of Surgical Innovations in a year which saw the departure of the chief executive and chief financial officer has been laid bare.
The keyhole surgery specialist also scrapped plans for a research and development centre in November because of the company’s performance, which caused £420,000 of costs to be written off.
However non-executive chairman Doug Liversidge believes the business is getting back on track despite recording pre-tax losses of £9.83m and revenues falling by 46%, to £4.03m.
He said: “The financial performance for 2014 was extremely disappointing. However, the board and staff of SI have worked tirelessly over the last six months with the key objective of restructuring the business to secure a sustainable future for the Group.
“Following a turbulent 2014, the group now has a stronger platform to support the business over the medium term. The board remains committed to cash generation and the directors are satisfied with the progress made since the refinancing was announced in November 2014.”
The November fundraising, part equity, part loan note, raised £1.53m while Yorkshire Bank converted its £3m credit facility into a loan. It followed an investment of £1.58m by Chris Rea in June, who became a non-executive director before becoming interim managing director last October.
There were a number of personnel changes in the business as it restructured to “reduce costs and stabilise the cash position”.
“Whilst this has resulted in substantial annualised cost savings and secured an immediate future for the Group, there were unfortunately many redundancies within the business,” said Mr Liversidge. “The programme of headcount reduction was completed in February 2015 with 50 staff now being employed by the group.”
The fall in revenues was blamed on a “plan to undertake a global de-stocking of customer inventory levels” of its SI-branded products, along with weakening demand from OEM customers.
