Shares in point-of-care company EKF Diagnostics (EKF:AIM) surged 7.5% to 83p on Tuesday after it said strong trading had continued into the second quarter and it now anticipates full year results will be comfortably ahead of market expectations.

Strong demand for the company’s contract manufacturing services for Covid-19 sample collection devices help drive revenues 46.5% higher year-on-year to £38.56 million for the six months to June.

Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortisation) was 43% ahead to £12.76 million while net profit increased 122% to £9.19 million.

The board said it was ‘very confident’ that trading to 31 December will be comfortably ahead of ‘already materially’ upgraded management expectations.

Consensus expectations for full year revenues are pegged at £73.7 million, up 13% on the prior year, while pre-tax profit is expected to be £20.5 million, up 5.5%. Comfortably ahead is usually code for at least a double-digit beat, implying profit of at least £22.6 million.

Since the start of 2021, analysts’ estimates have increased by around 86% according to Refinitiv data.

At the end of June, the company had net cash of £20.38 million. Net cash generated from operations fell to £1.1 million from £16.9 million last year as inventories increased to meet demand but also to ensure security of supply.

Shareholders approved a full year dividend of 1.1p per share to be paid on 5 November 2021.


Find out how to deal online from £1.50 in a SIPP, ISA or Dealing account.

Issue Date: 14 Sep 2021