Microsaic misses revenue target for 2016

Chip-based mass spectrometry instruments developer Microsaic Systems announced its audited financial results for the year ended 31 December on Tuesday, with the board claiming a reduction in the company's cost base and a closely managed cash flow.

The AIM-traded firm said overheads stood at £3.67m - approximately 16% below the prior year, while cash at the end of the year was £5.73m and in line with market forecasts.

Revenues during the year were £0.85m, which did exceed 2015 by approximately 9% but were below the board’s August 2016 projections at the time of its fundraising.

Adverse trading conditions in the second half, where momentum was lost with a key OEM partner, affected full year results according to the board.

Despite that, the company said it continued to focus on tight cost control and managing its cash runway which were both in line with year-end forecasts.

In 2016 the company said it exceeded 2015 unit volumes by 17%, and sales growth was in line with revised market expectations.

As it reported in a trading update on 13 December, challenging trading conditions were experienced, particularly in one particular market sector.

The firm’s loss from operations before share based payments, interest and tax narrowed slightly to £3.31m from £3.82m.

It used £2.94m net cash in operating and investing activities, down from £4.02m in 2015, and held cash and cash equivalents of £5.73m at year-end, compared to £3.61m a year prior.

“2016 was a challenging year for Microsaic,” commented interim chairman Eric Yeatman.

“While we consolidated and refinanced the business, developed a more focused strategy and continued to closely manage the cost base, our progress has been adversely affected by the weaker trading conditions experienced in H2 2016, which have continued into Q1 2017.”

Yeatman said that during 2017, Microsaic would continue to implement the strategy it communicated to shareholders in August, with the focus around biopharma and the detection of larger molecules in application areas that had the potential to generate high unit volumes-value.

“Our target is to add one OEM partner in 2017.

“We are currently in early stage discussions with a potential OEM partner after completing initial work in late Q4 2016.

“Managing operating expenses and cash flow will also be a priority in 2017 as it was in 2016.”