News blog

Avacta Group

  • BY: Andrew Hore |
  • POSTED: 09/05/2010 |

Avacta is finding it more difficult than it thought to sell its Optim analysis equipment but the launch of its Midas diagnostic system should help it grow revenues.

Optim can help pharma companies to analyse biological samples in order to find out which are the best potential drugs to take to clinical trials. Optims are sold for £75,000 each and this is proving a sticking point. Many companies have indicated that they would like to buy an Optim but they have not spent, or been allowed to spend, the money yet. Avacta would like to place machines to get consumable revenues growing but it does not have the cash to so this at the moment.

Annual recurring consumable revenues are expected to be £15,600 per Optim. Annual service revenues are £7,500 per machine. Annual recurring revenues could be more than £2.3m if 100 machines were in operation.

There have been three Optims sold so far with one sale coming after the end of the first half. Avacta still hopes to sell 10 Optims in this financial year but that could be difficult even though there are more than enough potential orders on the books.

Midas is a table top machine that analyses the blood of animals. The first test will screen for allergies.

The Midas diagnostics machine for the veterinary market is much cheaper. At £3,000 each, it should be easier to sell in greater numbers than the Optim. The Midas will be launched later this year and it will also have strong recurring consumable revenues.

The recent acquisition of Reactivlab, which develops veterinary diagnostic tests using Acute-Phase Proteins, provides additional potential tests for Midas.

Avacta reported a sharp rise in revenues - helped by acquisitions - from £203,000 to £894,000 in the six months to January 2010, while the loss was slightly higher at £1.19m.

Avacta had £1.3m in cash at the end of January 2010. The cash outflow from operations was £1.1m in the previous six months. This shows why it would be difficult to finance the placing of many Optims unless more cash is raised.

At 1.57p a share, Avacta is valued at £20.3m. 

© 2024 Aim Micro. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Browse by issue
All issues
Popular tags
All tags

betbrokers, financial, gold, health, leisure, media, mobile, resources, services, technology

AIM Micro feeds

Keep up to date with articles published at AIMMicro.com. Subscribe to AIM Micro RSS Feeds