Kromek Group PLC (AIM:KMK) shares climbed 5% to 7.59p after the North East-based detection technology company said it expects to post a first-half profit, boosted by a major contract with Siemens Healthineers.
In a trading update for the six months to 31 October, Kromek forecast revenue of at least £14.5 million, up from £3.7 million a year earlier.
Around £8.2 million of that came from an “enablement agreement” with Siemens, announced in January, to supply advanced imaging components used in medical scanners. Excluding the Siemens deal, underlying sales rose about 70% to £6.3 million.
The contract has helped improve margins and move the group into the black, compared with last year's pre-tax loss of £5.7 million and an adjusted EBITDA loss of £2.3 million.
Kromek said its chemical, biological, radiological and nuclear (CBRN) detection division and its advanced imaging arm both delivered strong growth.
The company added that the first-half performance supports its confidence in achieving full-year revenue growth in line with market expectations.
"With the company tracking towards full-year revenue growth and results in line with expectations, we maintain our investment thesis as Kromek drives towards sustained profitability," analysts at Cavendish said in a note to clients.
The broker values the shares at 26p each.