Inspiration Healthcare revenue rises ahead of expectations

(Sharecast News) - Inspiration Healthcare said on Wednesday that revenue for the six months ended 31 July rose 41% year-on-year to £24m, ahead of market expectations and marking a record half-year performance. The AIM-traded medical technology company said gross margins improved on the back of stronger sales of higher-margin neonatal products and capital items, combined with cost savings introduced last year.

Profitability also benefited from the delivery of a $6m humanitarian aid contract, the largest single deal in the company's history, which was fulfilled during the period with most payments received.

A contract in the Middle East also saw initial deliveries completed in the first half, with the remainder expected in the second half subject to a letter of credit.

Net debt fell to £6.7m as at 31 July, down from £8.3m at the end of January, with further reductions expected in the second half as cash generation improves.

"I am pleased to report that we have had a robust first half performance and continue to see the benefits of our turnaround strategy," said chief executive Raffi Stepanian.

"With strong revenue growth of 41%, enhanced gross margins, a significant improvement in EBITDA and a reduction in net debt, we are seeing clear evidence that our disciplined 'back-to-basics' approach is driving financial recovery and setting a solid foundation for continued momentum into the second half of the year and beyond."

The company said it was confident in meeting full-year expectations, adding that it would publish interim results on 7 October.

At 1315 BST, shares in Inspiration Healthcare Group were 14% at 23.94p.

Reporting by Josh White for Sharecast.com.