new-recommended-broker-banner new-recommended-broker-banner
Practice Stock Trading Your capital is at risk

Omega Diagnostics (ODX) Shares Fall As It Awaits UK Government Confirmation

Updated: 7 Jun 2021

Shares of Omega Diagnostics (LON: ODX) are trading lower on Monday after it said it is still awaiting confirmation from the UK Government on which test it will be required to manufacture.

Omega remains in regular dialogue with the Department of Health and Social Care (DHSC) to provide manufacturing capacity for COVID-19 lateral flow antigen tests.

It will utilise key pieces of manufacturing equipment loaned by the UK Government to manufacture the tests, but the confirmation has taken longer than expected.

According to Omega, the ability to supply tests produced within the UK remains a key priority for the DHSC. As a result, the DHSC has facilitated initial commercial discussions between Omega and potential partner companies with lateral flow antigen tests to potentially provide UK manufacturing services.

While they await confirmation, the AIM-listed company supports the Government with additional cassetting and pouching services for other COVID-19 antigen lateral flow tests.

As part of the manufacturing contract announced with the UK Government in February, Omega has received cash preproduction payments totalling £2.5m. An amount per test, sufficient to recover the preproduction payment, will be deducted until the funds have been repaid.

ODX-price-chart
Source: IG

“Whilst confirmation from the DHSC of which test to produce has taken longer than we had expected, we are confident that we have the capacity to produce significant volumes of tests once we receive the requisite confirmation from DHSC,” commented Colin King, CEO of Omega.

Omega Diagnostics' share price is currently down 2.38% at 61.50p.

Should you invest in Omega Diagnostics shares?

Omega Diagnostics shares are traded on the London stock exchange's AIM market (the alternative investment market), which is the submarket specifically for smaller companies. AIM stocks are attractive to investors as they have tax advantages and smaller companies have the potential to benefit from rapid growth. But are Omega shares the best buy? Our stock market analysts regularly review the market and share their picks for high growth companies

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage . 75 % of retail investor accounts lose money when trading CFDs with this provider . You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money .