IDS reveals 27% profits rise as sales hit £24.9m

Jun 23 2009 by Andrew Mernin, The Journal

FUELLED by a 51% surge in revenues, medical test kit maker IDS will target rapid expansion by distributing its new automated machine to more than 1,000 facilities around the world.

The South Tyneside company yesterday revealed a 27% rise in pretax profits to £4.8m in the year ending March 2009, as sales soared to £24.9m.

The business, which employs around 80 people in Boldon, was also confident of hitting market predictions of ongoing growth this year, with trading in April and May having met expectations.

According to its nominated stock broker Brewin Dolphin, pretax profit will almost double to £8m this financial year while revenue jumps beyond the £30m-a-year mark.

Testing kits for vitamin D – which is becoming increasingly relied upon as a marker of bone health and wellbeing – continues to play a major role in the company’s success.

As the medical community becomes more aware that a vitamin D deficiency can signal the onset of numerous serious diseases, including colon, breast and prostate cancer, the demand for IDS products grows.

However, while IDS will retain vitamin D kits as its core business, its future success looks set to be mapped out by the mass international roll-out of its new automated machine, IDI iSYS.

The machine, which allows doctors to test blood at the touch of a button, was originally released earlier this year alongside an accompanying vitamin D assay and has since been placed in 40 medical centres.

IDS will release six new assays by the end of this year and expects to distribute more than 1,022 machines worldwide by 2014.

The firm places the machines in institutions free then aims to bring in at least £60,000 a year in revenue per unit through sales of testing kits.

By the end of this year it expects to have met the regulatory demands needed to take the machine into the vast US market and is also looking to expand its coverage into Japan, Canada and China.

Despite the company’s strong growth, chief executive Roger Duggan said it remained cautious over making acquisitions to build on the 2007 purchases of two firms, including Nordic Bioscience Diagnostics.

Mr Duggan also acknowledged the firm, although buoyed by record results, has not been unaffected by the recession.

“IDS is certainly not immune to these malevolent forces, and while we have been buffeted and bruised en voyage, I believe we have come through a demanding year with a highly credible performance,” he said.

In its annual financial report, the group told shareholders it is proposing a dividend of 1.65p for the last financial year – up 10% on the previous year.

Despite the company’s strong growth, it remains cautious over making new acquisitions