Image Scan ends year below market expectations

6th Oct 2022 12:51

(Sharecast News) - Security and inspection x-ray technology company Image Scan confirmed in an update on Thursday that revenues and profit for the year just ended would be below market expectations.

The AIM-traded firm put the result primarily down to the "slippage" of contracts into next year, which were expected to complete before the year end.

It said the second half of the period ended 30 September was "challenging", due to government contract delays and component supply issues which had an impact across its product range, and would continue for the foreseeable future.

There was an uplift in market activity, however, particularly around government opportunities which had been suppressed or delayed over the last two years.

The board said the levels of demonstration activity were improving, along with attendance at trade shows, which it described as "encouraging" for the coming year.

Although the prospects for the global economy in the months ahead were uncertain, and the exchange rate would provide "opportunities and risks", Image Scan said it believed it was "well-placed" to deliver an improvement on the year's suppressed results.

That, the board said, was based on the continued opening of the global marketplace post-pandemic, allowing its new products greater exposure, both at trade shows and through customer demonstrations.

Although its opening order book was stronger than last year, its expectations for the coming year were now lower than previously expected, due to a "prudent assessment" of the continuing challenges.

"Despite the challenges of the uncertain economic outlook, contract delays, supply side challenges and exchange rate concerns we retain our optimistic outlook for the future and an improved 2023," said chief executive officer Vince Deery.

"We continue to invest in new products and product developments to maintain and grow our market share."

At 1036 BST, shares in Image Scan Holdings were down 18.53% at 1.1p.

Reporting by Josh White at Sharecast.com.