Shares of Omega Diagnostics (LON: ODX) are down Thursday after the company announced unaudited interim results for the 6 months ended 30 September.
At the time of writing, Omega Diagnostics shares have declined 30% to 27.98%.
Omega announced an 81% increase in revenue, rising to £5.73m compared to £3.16m during the same period in 2020. it also reported an adjusted loss per share of 1.3p compared to 0.19 the previous year.
Gross margin decreased to 34.4%, caused by increased direct labour in anticipation of DHSC COVID-19 contract work, while there was a statutory loss for the period of £2.75m.
Meanwhile, the AIM-quoted firm said it still has no test to manufacture under the DHSC contract but remains in dialogue for commercial use of equipment.
“Our contract with DHSC dated 12 February 2021 was made up of two phases. Phase one was a scale-up phase, where DHSC furnished the company with equipment and working capital in order to support its scale up activities whilst DHSC selected and licenced the chosen test to the company,” said Omega.
“Unfortunately, DHSC did not provide the company with a licence to manufacture an approved test and as such Phase 2 of the contract, covering manufacturing, has not been activated and therefore no orders have been placed. We now have confirmation that the contract expired at the end of Phase 1, although both parties remain in dialogue,” they added.
Looking ahead, the company's chairman Simon Douglas, said they are “confident that revenues in the second half will see significant growth in Health & Nutrition and for our CD4 product,” with COVID-19 revenues “expected to be more reliant on commercial partnerships than UK Government supply opportunities.”
“Overall, we expect to see an improved sales performance across the group for the full year and to see losses reduced in the second half,” he concluded.
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