Inspiration Healthcare (LON:IHC) rallied as it reported profits this year were ahead of market expectations.
The medical technology supplier said improved trading margins and lower research spending were the main drivers for the robust performance.
Inspiration Healthcare supplies and distributes respiratory and monitoring machinery for hospitals and healthcare organisations.
Research and development expenditure was lower in the financial year as it reviewed existing projects.
Inspiration aims to spend 5% of revenue on R&D projects and the deferment of spending was purely down to timing, assured chief financial officer Ian Smith.
Following a reverse takeover in June, it has broadened its product range, most notably diversifying into neonatal care.
The group also reported strong cash reserves and plans to commence development of its own product ranges later this year.
“Unlike a number of other small cap medical businesses, we are both profitable and cash generative,” said Smith.
Analysts at WH IRELAND said it was “a decent update and should arrest any further decline in the shares”.
Share price rose 14% to 40p.