Immunodiagnostic Systems Holdings

Specialist diagnostic kits maker Immunodiagnostic Systems (IDS) has unveiled an encouraging trading update in which it announced that sales will be up 35%.

The AIM 50-quoted venture declared that revenue of £50.1m was expected for the year to March 2011 with trading in its 'main territories' described as 'having increased year on year.' It added that sales of both manual vitamin D and 'automated products' also increased. Turnover from its manual vitamin D kits in particular performed well, with sales of £27.9m compared to the £22m reported in the same period last year.

Speaking to Growth Company Investor chief executive Ian Cookson enthused that the results were 'very pleasing' to the company adding that the vitamin D testing market 'continues to grow and grow' as interest in the affects of vitamin D deficiency spreads.

Concerning the future of Immunodiagnostic Cookson insisted there was potential for even greater organic growth with a particular interest in further building sales of its iSYS testing kits. Vitamin D deficiency is linked to a number of conditions and diseases including colon cancer and depression.

Analysts at Peel Hunt are forecasting pre-tax profits of £16.7m (2010: £11m) on turnover of £49.5m (2010: £60.9m) for the year to March 2011. EPS of 46.1p and 60.5p are pencilled in for 2011 and 2012, respectively. Furthermore a dividend per share of 2p and 2.2p are also forecast for 2011 and 2012, with the shares currently offering a yield of 0.24%.

Growth Company Investor first recommended Immunodiagnostic in 2005 at 100p and since then the shares have gained 745%, currently trading at 845p. Last July we advised long-term shareholders took some profit at 800p with a reduce recommendation, but we now believe the shares offer further growth potential with the interest in Vitamin D deficiency on the rise and with research into its possible effects still being conducted. Buy.