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EKF Diagnostics Holdings plc (AIM: EKF), the AIM quoted point-of-care business, announces its final results for the year ended 31 December 2019.

Following on from the trading update announced on 24 March 2020, we now present audited results. The narrative sections containing the Chairman’s, Chief Executive’s and Finance Director’s Reviews are not materially different from those included in the trading update; however, the dividend timetable has been altered to move the ex-dividend date to 6 November 2020. 

COVID-19 update – key points

The safety of employees, customers, suppliers, and all other people with whom the Group interacts is of over-riding importance to the Group. The Group is complying with governmental advice and requirements across its operations, with many employees able to continue working from home with minimal disruption to the Group’s day-to-day operations.

• Contract manufacturing opportunity with Longhorn Vaccines and Diagnostics, USA, for specimen collection tubes for COVID-19 testing – initial orders c. $1m and expected to grow significantly
• Robust plan in place to mitigate the effect of the disruption on the business
• Substantial net cash balances of £14.3m as at close of business on 20 March 2020 with continuing strong free cashflow
• Demand for diabetes and haemoglobin tests remains, with patients using these tests being in the higher risk category for COVID-19
• German state approval received to keep Barleben manufacturing facility open in event of a lockdown
• Current beneficial exchange rates as a US Dollar / Euro denominated business, with a natural currency hedge across operations in the UK, US and Europe

Financial Highlights for the year ended 31 December 2019

• Revenue up 6% to £44.9m (2018: £42.5m)
• Gross profit up 4% to £23.7m (2018: £22.7m)
• Adjusted EBITDA* up 12% to £12.0m (2018: £10.7m)
• Profit before tax £5.5m (2018: £12.2m; £5.8m excluding exceptional gain from Renalytix AI plc spin-out)
• Basic Earnings per share of 0.81p (2018: 2.21p), underlying Basic Earnings per share* of 1.20p (2018: 1.01p)
• Cash generated from operations of £6.5m (2018: £9.9m)
• Cash at 31 December 2019 of £12.1m (2018: £10.3m), net cash of £11.4m (2018: £9.4m)
• Maiden dividend preserved and payable to shareholders on 1 December 2020

* Excluding exceptional items and share based payments

Operational Highlights for the year ended 31 December 2019

• McKesson OEM of DiaSpect Tm successfully launched with positive first six months of business
• Successful completion of early stage development batches of a bulk dietary ingredient for Ixcela, Inc.
• Mount Sinai agreement provides EKF with advanced access to innovative commercial opportunities

Christopher Mills, Non-Executive Chairman of EKF, commented:

“With good cash resources and a business which is growing strongly, EKF has moved into a phase where we are confident that we can provide an income for shareholders and the prospect of significant upside from our relationships with MSIP and others. Trading in 2020 to date has been satisfactory and in line with management expectations.

“Despite these difficult times, EKF is in a very strong position. We have a substantial net cash balance, continuing solid positive cash flow and the business remains robust. We see significant opportunities globally, particularly within the USA.  Being a medical device company focussing on tests monitoring diabetes and haemoglobin, both conditions putting patients in higher risk categories should they contract COVID-19, EKF is well positioned to assist the medical and scientific community.”

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