Inspiration Healthcare confident after weaker first-half

Medical technology company Inspiration Healthcare reported total group revenue of £20.5m in its first half on Tuesday, down slightly from the £20.9m it recorded in the same period last year.

The AIM-traded firm said its gross margin for the six months ended 31 July slipped to 45.1%, from 52.5%, while branded products represented 54% of total group revenue, compared to 55% year-on-year.

EBITDA fell to £2.2m from £3.6m, and operating profit weakened to £1.1m from £2.6m, as the company’s net cash position weakened to £3.3m at period end, from £8.6m a year earlier.

The board said the company’s dividend for the first half remained unchanged, adding that it was “confident” in the profit forecast for the current financial year.

On the operational front, Inspiration noted its successful relocation into the new manufacturing and technology centre in south London.

It said it had prioritised securing its supply chain in the half-year by increasing stock, adding that it received large export orders from Iraq, worth £1.3m, and from Egypt, worth $1.4m.

European regulatory work and UKCA mark approval was also being prioritised, with “good progress” reported.

‘Project WAVE’ had now recruited 14 patients at University Hospitals Sussex, while the company’s new distributed product, ‘Genedrive’, had been launched in Britain and Ireland.

“The first half of this financial year changed dramatically following the invasion of Ukraine by Russia and with further lockdowns in China,” said chief executive officer Neil Campbell.

“These two events had an impact on supply chain and sales in our first half.

“Needless to say, the team has worked hard to ensure the business is in the best shape it could be, prioritising solutions to short term supply issues and offsetting delayed NHS orders by focussing on other areas of our portfolio.”

Campbell said that, with production transferred to the company’s new “state-of-the-art” manufacturing and technology centre, a “comprehensive and diverse range” of products and a “strong” order book, he was “impressed” with the resilience of the firm’s team and business model.

“This resilience, along with the investment we have made in our infrastructure, stand us in good stead for the remainder of the financial year and for the longer term.”

At 1313 BST, shares in Inspiration Healthcare Group were down 15.89% at 73.6p.

Reporting by Josh White at Sharecast.com.