The Abingdon Health PLC (LON: ABDX) share price barely moved after releasing its financial results for the six months to 31 December 2022. The company highlighted that it had fully transitioned from COVID-19 to a contract development and manufacturing organisation (CDMO).
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The lateral flow test manufacturer revealed robust revenue traction from numerous clients across all facets of its fully integrated CDMO solution, including technical transfer, contract development, quality assurance, manufacturing, regulatory and commercial support.
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Abingdon Health generated revenues worth £1.1 million during the six months, marking a decline from the £1.7 million generated in H1 2022. However, the company expects its revenues to increase significantly in the 2023 financial year from 2022’s £2.8 million sales.
The muted reaction from investors could be attributed to the lack of surprises in the six-month report. Most investors now know that Abigdon Heath transitioned its business to become a CDMO, which was the report’s main highlight. The revenues generated by the firm were okay.
Investors expect more from the company, hence, the muted reaction. The company had £4.4 million in cash at the end of 2022 and expected its cash reserves to fall to £3.7 million as of 31 March 2023.
Abingdon Health’s gross margins rose slightly to 25.9% compared to the prior year’s 25.4% margins. The company attributed the improvement to the reduction in its headcount.
Chris Yates, Abingdon Health’s CEO, commented: “Our dedicated lateral flow CDMO service continues to gain traction with a number of new customers onboarded in recent months. Importantly, all of our CDMO activities are non-COVID-19 and are spread across a range of sectors, including clinical and animal health. We believe our fully integrated CDMO service is offering customers a straightforward solution to bring their products to market in the most cost-effective and efficient manner.”
“We are also pleased with the progress that our lateral flow product portfolio, including Abingdon Simply Test™, is making, and whilst we are still in an early phase of our strategy, the distribution channels we have worked hard to build are beginning to generate repeatable revenues.”
*This is not investment advice.
Abingdon Health share price.
The Abingdon Health share price was trading flat at writing amid a muted response from investors.
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