Clearstream reports €1.4m loss

Enniscorthy-based medical devices group Clearstream Technologies today reported a trading loss of €1.4 million for the six months to the end of January.

In a statement released with its unaudited accounts, the company blamed a sharp fall-off in co-labelling sales for part of the loss as revenues from this sector fell to just €400,000, compared to €2.3 million over the pervious six month period.

Clearstream said the substantial decline of co-labelling sales “was disappointing” and attributed the fall-off to problems experienced by one major customer, Cordis. However, it said this will improve in the second half of the year following FDA approval for Cordis to distribute two peripheral catheters.

The Aim-listed company said revenues for the six months to January 31st were €3.6 million, down from €4.7 million or 24.6 per cent when compared with the same period the previous year.

Clearstream develops and manufactures medical devices including catheters and stents and sells both branded and unbranded products.

The period also saw the company take an exceptional cost of €142,000 as part of a cost reduction programme in which 28 staff left the company as part of a voluntary, and later enforced, redundancy programme. The company currently employs 104 people.

According to Clearstream this will result in annual cost savings of €900,000 a year.

On a positive note the company said sales of its higher margin, own-brand products rose to €2.3 million, up from €1.4 million for the pervious six-month period, accounting for 64 per cent of total revenue.

Of this, 17 per cent was from devices released in the last 12 months and Clearstream said it expects additional product launches in the second-half of the year to accelerate growth in this area.

Andy Jones, Managing Director, Clearstream Technologies told The Irish Times that despite "downward pressure on pricing" he expects the second half of the year to see an improvement in the trading performance

"We would expect the third and fourth quarter to be break-even or profitable although there will still be an overall loss for the year.

"The frustrating thing about the interims is it is looking back over a period when we did have some difficulties in our  co-labelling channel. Since then we have reduced costs and driven growth in our own-branded sales and that trend is continuing in the second-half of the year", he said.

Mr Jones added that the company was also planning a number of new product launches this year including a new cobalt chromium stent and the drug eluting stent Intrepide.