Omega Diagnostics will lose money this year, but it is on course to become profitable in 2020-21 as sales of the VISITECT CD4 test.
Sales from continuing operations increased by 6% to £4.5m in the six months to September 2019. The improvement came from the food intolerance division, which currently dominates revenues. The interim loss was lower following the closure of the German business.
A further order has been received for VISITECT CD4 from Nigeria and if it is approved by the authorities it will be shipped by next March. The Nigerian orders are worth £1m and £500,000 is expected to be earned this year.
Further approvals from WHO and other countries will provide the opportunity to generate more sales.
A full year loss of £600,000 is expected for the full year and this is forecast to become a pre-tax profit of £400,000 next year. That is expected to be achieved on the back of a trebling of revenues from the infectious disease division.
Omega will generate cash from operations, but high levels of capex mean that net debt will be £800,000 by the end of March 2020 and then £1.4m one year later.
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