Advanced Medical Solutions

HOLD

04/10/2010 Ben Jaglom

Wound care products developer Advanced Medical Solutions (AMS) has announced a 47% increase in revenue to £14.5m for the half-year to June.

AIM-quoted AMS also reported pre-tax profits of £1.44m, a substantial improvement on losses of £53,000 for the same period last year. Don Evans, CEO, explained that the revenue surge reflected improved sales of products such as the ‘ActivHeal’ range of wound treatments, which rose by 21%, as well as the acquisition of foam wound care specialist Corpura in October of last year, with Corpura contributing £2.2m to the top line during the half.

Cheshire-headquartered AMS is also behind a technology called ‘LiquiBand’, a wound sealant range of products that can be used in everything from surgical operations to the treatment of relatively minor cuts and injuries. Evans sees future growth coming from 'taking AMS’ products worldwide’, in particular the US, where the company recently won approval for LiquiBand. AMS currently has four distribution partners in place in the US and aims to take market share away from biggest competitor ‘Dermabond’, which is owned by US Pharma giant Johnson & Johnson.

House broker Investec is forecasting profits of £5.1m on sales of £30.7m for the year to December, with earnings of 3.6p a share pencilled in and AMS also expected to pay out a maiden dividend at the year-end.

First backed by Growth Company Investor in 2008 at 34p, the shares have since risen by an impressive 93% to 65.5p, where they trade at just over eighteen times earnings. A high-growth business boasting exciting market share gain potential in the US through LiquiBand, AMS is not to be sold. Sit tight.