Back in April, researcher Equity Development forecast that Avacta would "move to breakeven in the second half of the year to July 2012". Following 2010-11 results this target is in sight.
The latest figures are also better than they look even though the reported loss almost halved. Turnover was up 42 per cent if a one-off contract in the previous year is ignored, while a nine-month delay in producing an injection-moulded plastic consumable cartridge held back the launch of an animal health product.
The sharp fall in operating losses was due primarily to the analytical division selling 14 Optim units, a seven-fold increase. These units allow drug developers to analyse a miniscule amount of a compound to try to find out how it will react if it was injected via a syringe and what its shelf life might be.
Since the July year-end, Avacta has sold eight Optim machines. That is ahead of budget and the last one was bought by a food manufacturer which is an interesting diversification. The company is also confident that its animal health division will perform much better this year. It produces quick laboratory quality blood tests in vets’ surgeries. The delayed AX-1 dianostics device machine will be promoted at the London Vet Show next month.
For the current year Equity Development forecasts sales of £3.67m and a reduced loss of £380,000.
AVACTA (AVCT) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1.025p | MARKET VALUE: | £17.1m | |
| TOUCH: | 1-1.05p | 12-MONTH HIGH: | 1.65p | LOW: 0.61p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 0.7p* | NET CASH: | £1.77m | |
| Year to 31 Jul | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 2.07 | -2.03 | -0.15 | nil |
| 2011 | 2.45 | -1.12 | -0.04 | nil |
| % change | +18 | - | - | - |
Aim: Pharmaceuticals and biotechnology. *Including intangibles of £9.3m, or 0.55p a share | ||||
