Wound care products and surgical dressings company Advanced Medical Solutions (AMS:AIM) has spooked investors after warning of slowing stock demand.
Customers had previously stockpiled extra quantities of LiquiBand, a pre-assembled skin adhesive used to stick dressings on wounds or to directly stick together skin damage. This was in reaction to worries over access to products ahead of Brexit.
Now the company is seeing demand slow as those same customers run down those stockpiles.
This has got under the skin of investors who knocked 7% off the share price on Friday to 299p.
Softening demand has overshadowed news that interim results from Advanced Medical are in line with expectations.
This is perhaps not surprising given that LiquiBand sales last year jumped 24% to £31.7m, roughly a third of the company’ £102.6m overall revenue.
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The company remains confident that LiquiBand demand will return in time, but investor may have to wait until next year before they see any meaningful return to strong growth.
In the meantime, Advanced Medical hopes that new products and new markets will pick up the slack.
The shares trade on 29 times expected earnings per share of 10.4p for the year ended 31 December 2019.
Half year result to 30 June 2019 are due to be announced on 11 September.
