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(Alliance News) - Integrated Diagnostics Holdings PLC on Thursday reported a steep drop in annual profit as its Covid testing saw a sharp fall in numbers.
The consumer healthcare firm reported a pretax profit of EGP853.6 million, around GBP22.2 million, in 2022. This represented a sharp 62% drop from EGP2.23 billion the previous year.
Revenue fell 31% to EGP3.61 billion from EGP5.22 billion. Integrated Diagnostics said that revenue in the year was supported by a "sustained expansion" in the company's non-Covid offering, which represented 81% of revenue, and partly outweighed an "anticipated drop" in Covid-related revenue throughout the year.
The company explained the growth in its conventional business was driven by an increase in conventional tests performed and by an increase in the average revenue per conventional test.
The number of conventional tests performed rose to 30,985 from 28,542. Net sales per conventional test rose to EGP94 from EGP86. This compared to Covid-related tests dropping to 1,700 from 5,117 year-on-year, with net sales per Covid-related test falling to EGP376 from EGP507.
Looking forward, the company said that while progress has been made to overcome the economic challenges faced throughout 2022, it has become "increasingly apparent" to the firm that they will persist throughout 2023. Nonetheless, Integrated Diagnostics said that its "targets and priorities" for the new year remain unchanged.
"Front and central will be the continued double-digit growth of our conventional business, in particular across our two largest markets of Egypt and Jordan. To deliver on this, we are targeting the roll out of an additional 20 to 25 branches, including three new branches in Jordan and two new Al-Borg Scan branches in Egypt. Meanwhile, on the pricing front, while throughout 2022 and early 2023 we introduced multiple price adjustments to partially account for the fast-rising inflation in Egypt, we have thus far refrained from passing on the full burden to patients," said Chief Executive Hend El-Sherbini.
"In light of the above and the results recorded in the first three months of the year, we are confident that despite the ongoing economic challenges witnessed in our geographies, we have put in place the necessary strategies and mitigation mechanisms to continue delivering double-digit conventional revenue growth in 2023.
"On the profitability front, we expect margins for the coming year to remain healthy and broadly unchanged compared to the year just ended despite rising inflation, in particular in Egypt. Meanwhile, in the longer-term, we see margins converging back to our historical averages as the impacts of the post-Covid-19 normalisation and the recent EGP devaluations subside," the CEO concluded.
The firm postponed its dividend decision in light of the "ongoing uncertainty and lack of foreign currency availability in Egypt." It said it will review the situation at its upcoming board meeting in August.
Shares in Integrated Diagnostics fell 6.9% to USD0.45 in London on Thursday afternoon.
By Heather Rydings, Alliance News senior economics reporter
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