Deltex Medical Regulatory News (DEMG)

Deltex Medical Group plc

("Deltex Medical" or "the Company")

Pre-close update on the six months ended 30 June 2014

Strong growth in export sales

14 July 2014 - Deltex Medical Group plc (AIM: DEMG), the global leader in oesophageal Doppler monitoring ("ODM") today announces an update on trading in the six months ended 30 June 2014.

Highlights

· US surgical probe sales up over 20% before foreign exchange differences

· UK surgical probe sales 13% down due to NHS de-stocking; stronger sales since May

o NHS implementation drive re-launch expected in H2 2014

o Emerging clinical evidence confirming superior outcomes from ODM

· International surgical probes up 11%

· Monitor sales up £150,000 (86%) on stronger export orders

Statutory results

Group sales for statutory reporting purposes are expected to be circa £3.0 million (2013: £2.9 million).

The Company plans to announce its interim results for the six months ended 30 June 2014 in the week of 8 September 2014.

Nigel Keen, Deltex Medical's Chairman, commented:

"Healthcare systems around the world are increasingly looking to implement evidence based quality improvements, such as ODM, that both improve patient outcomes and reduce costs and we have seen good growth in the first half in our export markets. As interest in ODM spreads internationally, we expect to generate the highest returns from systems capable of implementing such changes at pace and scale. Additionally, if the NHS takes appropriate steps to engage both clinicians and hospitals in its innovation agenda, we believe we will exit 2014 with a stronger UK market position than at the start of the year. While keeping our UK business under close review to ensure we maximise its cash generation, we are making good progress in implementing our expansion plans in the USA and expect to report further progress in H2 2014.

"The funds raised via the Placing and Open Offer in June 2014 have provided us with the resources to capitalise on the growing international interest in ODM and we look to the future with growing confidence."

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Notes for Editors

Deltex Medical manufactures and markets CardioQ-ODMÔ Oesophageal Doppler Monitoring ('ODM') systems. ODM is the only therapy to measure blood flow in the central circulation in real time. Minimally invasive, easy to set up and quick to focus, the technology generates a low-frequency ultrasound signal, which is highly sensitive to changes in flow and measures them immediately. Randomised, controlled trials using Doppler have demonstrated that early fluid management intervention will reduce post-operative complications, reduce intensive care admissions, and reduce the length of hospital stay.

The CardioQ-ODM has two distinct established clinical applications: firstly, to guide fluid management during surgery and secondly, to monitor cardiac output in critical care settings.

Surgical market

In March 2011 the National Institute for Health & Clinical Excellence ('NICE') recommended that CardioQ-ODM be considered for use in patients undergoing major and high risk surgery and in high risk patients undergoing intermediate risk surgery. NICE estimated the applicable number of such patients in the NHS in England alone to be over 800,000 each year. CardioQ-ODM has been shown to be effective in both elective and emergency surgery and with both general and regional anaesthetics. This recommendation was specific to CardioQ-ODM and was based on the robust evidence base that supports its use.

Subsequent to the NICE guidance, the NHS in England announced its selection of ODM as a high impact innovation to be rolled out across the system fully, at pace and scale with significant financial penalties starting in the NHS 2013/14 financial year ending 31 March 2014.

The NICE evaluation and recommendation confirms that the potential global market for CardioQ-ODM in surgery includes tens of millions of patients, even if confined to developed health economies: the most conservative estimate of the potential value of the market opportunity Deltex Medical has created is in excess of £1 billion per annum. The Company's core focus is on building market leading positions in this surgical market, both geographically and by type of surgery.

Critical care market

In critical care settings, well-equipped hospitals will often have more than one cardiac output monitoring technology available. In this environment, ODM's strengths are that it is quick to set up, easy to use, safe, low cost and the ideal technology for a patient in crisis requiring rapid or frequent intervention. The potential market for cardiac output monitoring in critical care is a fraction of the size of that for intra-operative fluid management.

Through the 2012 launch of the CardioQ-ODM+, Deltex Medical has added the Pulse Pressure Waveform Analysis ('PPWA') approach to monitoring cardiac output to ODM functionality. Doing this has improved Deltex Medical's offer for monitoring applications as well as providing doctors and nurses with a choice of clinical strategies appropriate to individual patients in different clinical settings.

Company goal

Our goal is to make oesophageal Doppler monitoring (ODM) a standard of care for patients in both these markets. We believe that, in most modern health systems, it is essential to have a robust evidence base of both clinical benefit and cost effectiveness in order to achieve system-wide adoption of a new medical technology. Deltex Medical is one of the very first medical technology companies to have completed the investment necessary to build such an evidence base: as a result, use of ODM during surgery has the proven potential to deliver both clinical and economic benefits that are material at each of patient, hospital and system level.

The Company is currently in the implementation phase of achieving this goal in a number of territories worldwide and there are already over 3,000 CardioQ-ODM systems in use in hospitals worldwide. Distribution arrangements are in place in over 30 countries.