Companies: CEL   

Life sciences products and services group Celsis has suffered in sympathy with sector peers of late, but with strong annual results to March forthcoming, the company is worth revisiting.

Celsis's business is to save 'big pharma' time and money; it is a theme that chief executive Jay LeCoque recites regularly. ‘Now, possibly more than ever,’ he says, ‘big pharmaceutical companies are under immense pressure to reduce costs and we offer products and services to do that.’

The group's original business of microbial monitoring services to clients such as Colgate Palmolive and GlaxoSmithKline contributes around 40% of sales. 2006 acquisition IVT sells kits for drug discovery companies to tell if their potential treatments can be processed by the human liver. Celsis's smallest divison, analytical services, which provides outsourced laboratory facilities for routine tests such as product stability testing, is the one disappointment as its revenues are expected to slip slightly against strong comparitives.

With the company due to report results in June, LeCoque told Growth Company Investor that both divisions had ‘a very good year’, with IVT on track to be ‘profitable this year’. House broker Numis forecasts US$54.4m (£27.7m) sales, US$9.2m pre-tax profits and 28.45c (16.4p) earnings, with double-digit earnings growth into 2009.

With lots happening behind the scenes, including new developments and products coming through, Celsis looks oversold, having slipped from a 244p high to present levels. Tipped here at 23.5p in June 2003, the shares are again worth buying for recovery.

Save 50% off your first year’s subscription to Growth Company Investor magazine, and gain immediate access to all the recommendations online. Click here.

Celsis	LSE	£34.37m	157.00p	1.00p
Click here for interactive charting
Other company articles:
Celsis ‘on track’			12/11/2008
Healthy prospects			02/06/2008
Celsis			21/05/2008
'Strong trading' at Celsis			07/02/2008
Celsis passes international test			06/07/2007