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Optos shares soar on back of profit rise

RETINAL imaging company Optos has seen its share price soar five per cent after boosting profits and predicting it is on course for a strong second half of the year.

The Fife company saw its half year revenue fall back slightly from $73 million (£44m) to $72.7m.

Revenue from the core Americas market was up three per cent from $49.5m to $50.8m and Optos suggested it was trying to open up new markets in Latin America.

There was a reduction in turnover from Australia because of the timings of device installations which will slip into the second half of the year. That saw revenue from the rest of the world dip from $23.5m to $21.7m. Optos said performance in Asia was generally good but some European markets, particularly Italy, France and Spain, remain soft.

However, pre-tax profits more than doubled from $700,000 to $1.6m for the six months to March 31 on the back of improved margins and lower costs.

The growth in the customer base, up by 628 in the period, was led by the continuing adoption of the Daytona device.

The Daytona, a lighter and more user-friendly ­technology than its predecessors, was launched two years ago.

Now more than 2000 have been installed around the world, making up about 30 per cent of the company's active devices.

Chief executive Roy Davis said progress was being made on reducing the manufacturing costs of Daytona, which should see the average drop from $20,000 to about $15,000 by the end of the current financial year.

He said: "We continue to see traction with it. It is the lion's share of the new installations. We continue to work on bringing the cost of Daytona down, which helps back through on the margin side of things."

A consolidation of operations into its main sites in Dunfermline, Boston in the US and Adelaide in Australia is also under way and is anticipated to lead to savings of around $4m next year.

Mr Davis said: "We are just saying we don't need as many locations so let's move into areas where we have critical mass. It will be nothing other than a positive impact for Scotland."

According to Mr Davis the research and development pipeline, run from the Dunfermline headquarters where around 200 people are employed, is looking strong with new products scheduled to launch in the 2015 financial year.

Shares closed up 8p at 176.25p.

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