Life sciences firm cuts sales forecast and changes CEO

● Immediate stepping down by Andrew Shepherd ● Interim profits drop amid ‘shortterm headwinds’

Medical testing kits firm Omega Diagnostics saw its shares slump after revealing a changeover in its CEO post and “short-term headwinds” in its core business, with revenue set to undershoot its expectations in this and the coming financial year.

The Alva-based life sciences firm, which focuses on allergy, food intolerance and infectious disease, said that as part of its board succession planning, Andrew Shepherd has agreed to step down as chief executive and from the board immediately.

Omega said he founded the business in 1987, building up an “extensive” distribution network in more than 100 countries. “In September 2006, Andrew led the company through its successful IPO and has been instrumental in growing the group since its first acquisition of Genesis Diagnostics and Cambridge Nutritional Sciences in August 2007,” it added.

Shepherd will remain with the group in the role of global ambassador – life president, and will be succeeded by chief operating officer Colin King.

In a separate statement, the firm reported a 4 per cent yearon-year jump in revenue to £7.11 million in the six months to 30 September. Adjusted pre-tax profit amounted to £220,000, down from £560,000, with adjusted earnings per share halving to 0.3p.

Additionally, it pointed out a likely impairment of up to £800,000 in the second half related to its Allergodip dipstick test, having experienced some “technical challenges” with the product and unsure if these can be resolved.

The firm’s offering includes a kit to check the immune system of HIV patients, recently achieving Ce-marking of its Visitect CD4 test.

Looking ahead, chairman David Evans said this was a “major milestone”, with Omega having also extended its Allersys product range.

However, he added: “Certain growth initiatives are taking slightly longer to bear fruit and thus, we now anticipate a slower build up in revenue in this and the next financial year, compared to our original expectation.

“Overall, we remain confident about our long-term prospects. Whilst we are experiencing a number of shortterm headwinds in our core business, we believe that the impact will be more than mitigated by the success we expect from positive achievements over the medium term.”

Analysts at Finncap said they lowered their pre-tax profit forecasts by about 60 per cent and 40 per cent for 2018 and 2019 respectively. The Best Western Queens Hotel in Dundee has been sold in a seven-figure deal to a Thai-based hotel group. Compass Hospitality Group has completed its newest hotel purchase in the UK after taking over the management of the six-floor, 53-bedroom property in a joint purchase with Seacare Hospitality. Stuart Drysdale, associate director at Christie & Co, said, “The new owners are excited by the ongoing development in Dundee.” The hotel’s asking price was £2.75 million.