Omega suffers 'famine' as company swings to pre-tax loss

Omega Diagnostics saw its share price plummet on Monday after saying it swung to a loss due to flagging sales in the year ended 31 March and placing its German allergies unit under administration.

The medical diagnostics company focused on allergy, food intolerance and infectious disease registered a pre-tax loss of £7.3m, compared to a profit of £0.7m the prior year, after turnover fell 5% to £13.6m.

The drop in revenue was driven by a 6% decline in food intolerance revenue to £7.6m and an 8% fall in revenues from the allergy and autoimmune business, to £3.3m.

Omega had cash and cash equivalents of £0.12m at 31 March, down from £0.74m at the end of the previous year.

Chairman David Evans said: "Ultimately, we are judged by our results and it may end up being a rather circuitous route to success, but I do believe that after many years of famine shareholders will see some bread in their basket by this time next year. The key thereafter will be to replenish that basket. I am confident we can achieve both."

The year saw the AIM-traded firm shell out exceptional costs of £6.9m through the closure of sites in Germany and Pune, India.

The closures, which followed a strategic review, mean that Omega will now focus on AIDS progression testing product VISITECT CD4, allergy detection test Allersys and its food intolerance division.

"As we move forward we have a difficult balancing act to maintain in terms of keeping the core business moving along whilst successfully executing our strategic priorities. That challenge should not be underestimated in terms of management stretch but I know that we have a good team here and they are up to that challenge," said Evans.

Omega Diagnostics shares were down 14.52% to 13.25p at 0831 BST.