29th March 2022
Record Revenues As EKF Focuses On Sustainable Growth In Core Business
EKF Diagnostics Holdings has pushed revenue up past £80m and said current trading was strong. The AIM-listed global diagnostics business, which also announced details of a share buyback programme, said its focus is on returning its core business to pre-pandemic 2019 levels and positioning for future sustainable growth outside of short-term contract manufacturing.
In the year to 31 December 2021, revenues at EKF rose by 25 per cent to £81.8m while adjusted EBITDA also hit a record £26.5m.
Revenue from EKF’s contract manufacturing operations were up 38 per cent to £36.3m, driven by Covid sample collection kits manufacture.
The business said it expects that Covid-related revenues from contract manufacturing will materially reduce in 2022, given the rapid step-back in testing requirements across global markets.
Accordingly, EKF’s focus and strategy have already turned to positioning the business to deliver growth across all core business areas, while redirecting the capabilities developed for Covid into other activities.
Chairman Christopher Mills said: “2021 was a year that delivered record revenue and adjusted EBITDA performance. Our key focus remains on implementing our strategy to position our core business for sustainable future growth, utilising cash generated from short-term contract manufacturing activities.
“At the end of 2019, and pre-pandemic, we had a core business that generated revenues of £43.3m and an adjusted EBITDA of £12m. These results show that in 2021 our core business revenues were broadly in-line with these levels and we have already implemented our investment plans to support growth in our core business in 2022.
He added: “Current trading is strong and we expect to deliver a solid first quarter performance in line with that of 2021. However, we are adopting a pragmatic view that we expect there will be a significant reduction in pandemic-related contract manufacturing activity for the remainder of the year and guiding analysts accordingly.
“The new management team is keenly focused on delivering the growth plan through to 2024 which assumes no benefit from further Covid-related manufacturing, but instead is targeting sustainable revenue growth in our expanded core operations.”
EKF also announced that it intends to conduct on-market purchases under a share buyback programme to repurchase up to 9m ordinary shares. The purpose of the buyback is to return cash to shareholders and to reduce the share capital of the company.
Singer Capital Markets Securities has been appointed to execute and manage the buyback.