Weak first half leads to lower full-year sales for Image Scan

Security and industrial x-ray and screening technology company Image Scan said in a trading update on Wednesday that its order bookings increased to £2.8m for the financial year just finished, from £2.4m in 2020.

The AIM-traded firm said sales fell to £2.9m for the 12 months ended 30 September, from £3.5m in the prior financial year, following a “weak” first half.

Its gross margin improved to 53% from 49%, as the company said it maintained “strong control” of its overheads, which reduced by 18% to £1.3m.

Reportable unaudited pre-tax trading profit came in at £0.19m from £0.11m, while Image Scan’s pre-tax trading profit, adjusted for capitalized research and development spend, narrowed to £0.1m from £0.11m.

On the operational front, the company noted that it had received the first orders for its new cabinet x-ray systems, as well as first orders from government customers in the United States.

Image Scan’s period-end order book totalled £0.52m, from £0.63m at the end of 2020, while the firm reported a “strong” year-end cash balance of £1.2m.

“The Covid-19 pandemic has continued to impact all aspects of the business,” said chairman and chief executive officer Bill Mawer.

“Launching a new product without being able to visit customers or attend trade shows has presented a considerable challenge, as has servicing our widely deployed industrial x-ray machines.”

Mawer said that first orders were received for the new product, however, while the firm’s industrial service contracts were delivered, and a profit was made for the second year in a row.

“Disruption to global supply chains remains a concern but, with more product launches planned for the new year, and a world that is starting to adjust to the presence of Covid-19, we retain our optimistic outlook for the future.”

At 1358 GMT, shares in Image Scan Holdings were down 5.66% at 2.5p.