Pharmaceutical firm Immunodiagnostic Systems Holdings has posted revenue growth for the first time in five years, chalking up like-for-like sales of £38.5m.
The Boldon-based business, which develops medical testing kits for use in clinical and research laboratories, said the full year to March 31 had been one of stabilisation, following several years of revenue decline.
It said it achieved its target of returning the group to like-for-like growth for the first time since its 2014 financial year, increasing sales by 1% to £38.5m.
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Adjusted Ebitda, however, fell from £6.023m to £4.797m, while research and development costs increased from £1.677m to £2.44m.
The company said it had stabilised its manual business after many years of significant decline by focusing on its current distribution network and signing new distribution partnerships.
Strong growth in its technology business was also reported, but its automated business declined slightly, with growth in most regions being offset by a shortfall in the US.
Jaap Stuut, CEO of IDS, said: “We met our target of returning the group to revenue growth, with revenues increasing 1%. Additionally, we placed or sold 127 instruments, compared to 103 in the prior year.
“Our gross margin declined year on year due to a sales mix swing towards lower margin distribution territories. We built good momentum towards the end of the financial year, and our objective will be to carry this forward into the next.”
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Chairman Dr Burkhard Wittek said: “For IDS, FY2019 was a year of stabilisation as group revenue saw growth of 1% on a like-for-like basis. Thus, the group met its stated target of returning a like-for-like revenue growth for the first time since FY2014.
“Our share price, however, did not reflect this outcome; it dropped by 21%, from £2.21 at 31 March 2018 to £1.75 at 31 March 2019.
“FY2019 was the first year after many in which we returned to slight growth. We also improved several KPIs which suggest positive momentum which will become fully effective next financial year.
“Furthermore, beyond all the numbers, we worked on ‘fixing the engine’ - improving the transmission mechanism to make board decisions happen.
“I have said numerous times that I felt we had fixed so much that there could not be much left. Each year has made me admit that there is so much more to do, and there is still a long road to reach best practice.
“What has not changed, though, is that I remain confident that IDS has a good future; the automated part of the IDS business is a razor/razorblade-type business with recurring revenues at a very predictable rate. These have always been businesses with outstanding profitability and returns to shareholders and the results achieved by our competitors confirm this.”