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Kromek reports strongest sales year to date

Kromek was awarded £22mln of contracts, the largest value ever won in a year.
Radiation detection technology
It won significant contracts in nuclear detection and medical imaging.

The radiation detection firm Kromek Group PLC (LON:KMK) reported the strongest product sales year to date with over £22mln of contracts, the largest value the company has ever been awarded.

Sales topped £8.3mln for the year ended April, up from £8.1mln reported last year, accounting for half of total revenues.

It won significant contracts in nuclear detection and medical imaging, two of the largest growth opportunities for the company.

The group was selected as the sole source supplier by the US Department of Defense agency, DARPA, to supply its D3S radiation detectors as part of the SIGMA programme in an agreement worth US$6mln (£4.55mln).

In the medical imaging sector, Kromek secured a five-year contract totalling US$12.6m (£9mln) with a long-standing customer in the bone mineral densitometry sector. 

Kromek said it continued to maintain its strong market position as a key supplier of cadmium zinc telluride (CZT) detection systems.

“The year was also significant because we were awarded over US$30mln (£22mln) of contracts during the period - the largest value of contracts ever won in a year - and we strengthened our relationships with our current customers,” said chief executive Arnab Basu.

But despite being the strongest product sales year to date, the group failed to push down losses. Pre-tax losses widened to £4.14mln from £3.14mln last year.

Adjusted earnings (EBITDA) came in at a loss of £2.4mln, compared to a loss of £1.6mln last year, due to further investment of £3.2mln in research costs preparation for expected demand.

But Basu remained unfazed and was confident about the group's expansion, he said it had made good progress in the delivery of its CZT-based product in Asia.

“The group's products continue to gain traction across the globe as Kromek deepens its relationships with long-term customers and expands its reach.”

With a strengthened order book and improved revenues, he said the group was confident going forward.

"What you’re seeing is just the tip of the iceberg," Basu told Proactive, highlighting the radiation detection contract with the US government worth US$1bln.

He said that the development of the technology meant the group was "making a real difference to the end user by either reducing cost or ease of use, and that’s going to give us growth that’s going to give shareholder value."

Regarding Brexit, Basu remaind optimistic and noted that a majority of revenues are in US dollars.

Shares stood at 25p.

Watch:Kromek sees huge opportunities in three markets

--UPDATES SHARE PRICE, CEO COMMENT--

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Kromek Group PLC Timeline

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