(Sharecast News) - Advanced medical imaging analytics specialist Ixico said in an update on Friday that its earnings for the financial year would either meet or exceed market predictions, even though it faced a minor revenue shortfall.
The AIM-traded firm put the discrepancy down to a delay in the start of new client trials.
It expected revenue for the year ending 30 September of £6.5m, marking a decline from the £8.6m recorded in 2022.
The significant decrease primarily stemmed from the culmination of large client trials that ended prematurely, combined with the initiation delays for new client trials.
However, the year-end order book was set to expand, predicted to reach at least £14.5m, up from £13.3m at the end of the first half.
Moreover, the company's financial health seemed robust, with cash reserves projected at a minimum of £4m by year's end - a drop from the first half's £5m, although the company continued to operate without any debt.
Regarding profitability, EBITDA for the year was projected to improve on current expectations for a £1m loss, compared to 2022's profit of £1.5m.
Looking ahead, Ixido anticipated a contraction in the start of new clinical trials throughout 2023, reflecting a broader trend in the sector.
The reduction was seen as a result of a global tightening of funds, although the company's board remained optimistic.
It anticipated market growth rebounding due to significant advancements in neurological drug development, notably in areas like Alzheimer's disease and gene therapies.
Such progress fuelled the firm's confidence in an increase in clinical trial initiations in 2024, although the financial implications of those trials were expected to manifest more substantially in subsequent years.
In light of that, the board predicted that Ixico's financial performance for 2024 would mirror that of 2023.
It expected a decrease in cash use compared to 2023, and was optimistic about returning to double-digit revenue growth by 2025.
As the market evolved, Ixico said it remained vigilant about its expenses, but was also keen on investing in critical areas like image analysis innovation and business development.
"I am proud of Ixico's achievements reflected by the strengthening of the orderbook since the half year," said chief executive officer Giulio Cerroni.
"Given the significant and growing unmet need for new therapies across a wide range of neurological diseases, I remain confident of the runway for growth for Ixico's specialist neuroimaging services, underpinned by the increasing inclusion of imaging biomarkers in neurodegeneration clinical trials."
Ixico said it planned to release its audited results for the year ending 30 September in December.
At 0801 BST, shares in Ixico were down 4.64% at 18.5p.
Reporting by Josh White for Sharecast.com.
Ixico (IXI)