Ran­dox in £11m loss as po­lice probe into ‘data tam­per­ing’ claims goes on

Belfast Telegraph - Business Telegraph - - News - BY RYAN MCALEER

A PO­LICE in­ves­ti­ga­tion into a di­vi­sion of North­ern Ire­land med­i­cal test­ing gi­ant Ran­dox over al­leged data tam­per­ing re­mains ac­tive after al­ready cost­ing the firm £2.5m, it has emerged.

It comes as the Co Antrim com­pany, which em­ploys 1,250, re­ported a £11.2m pre-tax loss dur­ing 2017.

It com­pares with pre-tax prof­its of £12.3m in 2016 and £18m in 2015.

Head­quar­tered in Crum­lin, Ran­dox also op­er­ates out of cen­tres in Done­gal and Ban­ga­lore. It is de­vel­op­ing a site across the At­lantic in West Vir­ginia.

How­ever, de­spite in­creas­ing turnover by £4m to £104.5m, the com­pany was hit by a se­ries of im­pair­ments and ex­cep­tional items dur­ing 2017.

They in­cluded £2.5m to re-run a num­ber of tests at the cen­tre of an in­quiry con­cern­ing al­leged data tam­per­ing at Ran­dox Test­ing Ser­vices in Manch­ester.

The probe led to a crim­i­nal in­ves­ti­ga­tion and more than 10,000 cases be­ing re­viewed. The UK’S Po­lice Min­is­ter Nick Hurd con­firmed in Novem­ber that po­lice had sus­pended all con­tracts with Ran­dox.

Greater Manch­ester Po­lice has con­firmed that its in­ves­ti­ga­tion re­mains live, with two peo­ple still on bail.

It has also re­sulted in a num­ber of peo­ple caught up in the con­tro- versy at­tempt­ing to sue Ran­dox.

Econ­o­mist John Simp­son said the retest­ing re­quire­ment was just part of a num­ber of sig­nif­i­cant costs it in­curred last year.

“Group prof­its have been hit by a se­ries of im­pair­ments and ex­cep­tional items.

“Over £10m was de­ducted from prof­its to al­low for the im­pair­ment of tan­gi­ble and in­tan­gi­ble as­sets and nearly £9m was de­ducted for ex­cep­tional costs,” Mr Simp­son said.

While Ran­dox has de­clined to comment on its ac­counts, a strate­gic re­port re­leased with its fi­nances in re­cent days and ap­proved by the board of di­rec­tors, de­scribed the costs in­curred as “one-off trans­ac­tions”, which it said “ob­vi­ously had an im­pact on the re­ported prof­itabil­ity for the year”.

The re­port fur­ther said: “The group and com­pany have in­curred ex­cep­tional losses this year, which have im­pacted per­for­mance, but the group is cash gen­er­a­tive and is fore­cast to re­main cash positive.”

How­ever, Mr Simp­son added: “Even al­low­ing for the im­pair­ments and ex­cep­tional costs, the un­der­ly­ing trad­ing po­si­tion re­flected a more dif­fi­cult trad­ing year. The group bank loan agree­ment with Danske Bank was tem­po­rar­ily in de­fault. How­ever, the group was given a covenant waiver by its bankers and re­ceived an as­sur­ance that bank fa­cil­i­ties would be re­tained on ac­cept­able terms.”

Mr Simp­son said the com­pany’s prof­its could re­turn from red to the black next year, but noth­ing was cer­tain.

Ad­dress­ing the cur­rent eco­nomic un­cer­tainty, the re­port from Ran­dox added: “The cur­rent eco­nomic con­di­tions cre­ate un­cer­tainty, par­tic­u­larly over the level of de­mand for the group’s prod­ucts; ex­change rates be­tween the euro and other cur­ren­cies im­pact­ing on the cost of the group’s raw ma­te­ri­als; and the avail­abil­ity of bank fi­nance in the fore­see­able fu­ture.”

It con­cluded: “The group’s strat­egy is to con­tinue to build on the philosophy of pro­vid­ing world class di­ag­nos­tic prod­ucts to im­prove health­care and cre­ate shareholder value by in­vest­ing for the long term and by po­si­tion­ing the group to be the leader in its cho­sen mar­kets.

“In fu­ture years the di­rec­tors ex­pect the group to re­turn to op­er­at­ing profit.”

Ear­lier this year, Ran­dox an­nounced its plan to in­vest £50m on de­vel­op­ing tech­nolo­gies to di­ag­nose con­di­tions like can­cer and in­fec­tious dis­eases through ‘cen­tres of ex­cel­lence’ in three of its premises, where sci­en­tists will work with aca­demics from Queen’s Univer­sity and Ul­ster Univer­sity.

❝ The ex­change rates be­tween the euro and other cur­ren­cies im­pacted on cost of raw ma­te­ri­als

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