Investors are eager to sell stock in diagnostic testing kit producer Immunodiagnostic Systems (IDH: AIM) after it fails to stem a decline in revenue, triggering a share price drop of 14% to 178p.
The company has been unable to reassure the market following a profit warning in June after a major client decided to use another firm's equipment.
Immunodiagnostic says revenue has declined on a like-for-like basis by 9% and expects turnover of £19.5m for the six months to 30 September, slightly higher than £19.4m for the same period in 2015.
Automated 25OH Vitamin D revenue is 25% lower at currency exchange rates due to laboratory customers transferring the assay to workhorse analysers after terminating contracts with the firm.
This decline also had a knock-on effect on manual assay sales, which are 2% lower at £6.2m.
Immunodiagnostics intends to tackle the decline by offering more CLIA assays unavailable by other pharma workhorses.
A 14% fall in revenues in Licensing and Technology to £3.3m comes as a result of less income royalties from a major customer is expected to continue in the second half.
The company aims to save £3.5m through cost-saving initiatives and will incur restructuring charges of £1.5m, which has been booked as a one-off fee.
On a positive note, the automated speciality business has grown by 16% at constant exchange rates.
