EKF Diagnostics tanks as it swings to annual loss on exceptional costs

16th Mar 2015 09:24

Shares in medical diagnostic equipment producer EKF Diagnostic tanked on Monday as the group swung to an annual pre-tax loss in 2014 on exceptional costs.The London-listed company said it swung from a pre-tax profit of £607,000 to a pre-tax loss of £4m, as administration expenses increased on the back of costs relating to acquisitions.EKF posted exceptional charges of £P3.3m related to the closure of its Dublin facility and to moving the manufacture of some of its products, while revenue grew 26% to £40.1m.The group said the increase in revenue was boosted by acquisitions it made during the year, including DiaSpect Medical AB and Selah Genomics.However, the latter, a provider of panels of molecular diagnostic tests, suffered a setback shortly after being acquired by EKF, as Medicare, the US national social insurance programme, reduced the level of reimbursement it will pay for the drug metabolising enzymes panel.The setback meant revenue from the business was "materially lower" than EKF, though the group said it remained confident the acquisitions will lead to bigger business opportunities in the future."Our ambitions remain to achieve double digit growth and to be able to exploit the opportunities in front of us," executive chairman David Evans said in a statement."We are under no illusion that we must deliver on expectations."The group warned that it expected revenue from its Russia business for the current financial year to amount to 30% of 2014's levels because of the continued effect of sanctions.EKF shares were down 18.97% to 19.65p at 10:05 on Monday