Companies: ASD   

Diagnostics specialist Axis-Shield expects further US progress after increasing pre-tax profits 45 per cent to £2.9 million before exceptional payments.

The Dundee-based company, which launched its award-winning AFINION ‘point-of-care’ tests in the key US market last year, increased turnover 9.7 per cent to £66.7 million in 2007, despite the dampener of a weak US dollar. AFINION sales jumped from £400,000 to £3.4 million, with 1,500 instruments sold – 435 of them in the USA.

Axis-Shield made only a flat £2 million pre-tax after paying more than £800,000 under their contracts to former chief executive Svein Lien and another executive director, who left late last year after long service with the company. Chairman Nigel Keen says they had been instrumental in taking the company through its initial development phase but now, after spending a flat £7.4 million on research and development in 2007, it is entering a more commercialisation phase and a new team is more appropriate.

Axis-Shield ended the year with cash up from £10.3 million to £12.2 million, though it has since spent £2.7 million to fund the purchase of its Swiss distributor. Ian Gilham, the present chief executive officer, who points out that the company provides its instruments free in the US but is paid by customers to fit test cartridges in them, says the US Food & Drugs Administration (FDA) has now passed AFINION to test for kidney disease in diabetics.

‘We are now waiting for a waiver from the FDA to allow unskilled staff to operate the tests,’ he adds. Next year, the company hopes to introduce the tests for blood clotting.

Shares in Axis-Shield, which fell from 393.5p in 2006 to 215.75p last June, now trade at 270p, up 7p today, valuing the company at £132.5 million. They should outperform several sector peers.

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Axis-Shield	LSE	£143.43m	290.00p	-13.00p
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