Keyhole surgery instruments maker Surgical Innovations has cheered investors with the news that its CELLIS range of products used in breast and abdominal wall reconstruction surgery will have its accreditation restored.
Shares in the Leeds-based group rose 9 per cent to close at 3.00p on the news.
Formal certification is expected in the next four to eight weeks, which will enable Surgical Innovations’ Elemental Healthcare distribution business to resume selling the CELLIS range.
In addition to this, an extended agreement has been signed allowing Elemental UK distribution rights to the range for a period of three years expiring in June 2021, with subsequent automatic renewal of two years subject to meeting minimum purchase obligations. This will incorporate new product launches in the UK during 2019.
Surgical had announced in May that sales of CELLIS would be hit due to an imposed change of the notified body.
Analyst Eric Burns at WH Ireland said: “This announcement shows CELLIS is back on track if anything slightly earlier than we had budgeted for whilst the extension of the distribution agreement is further positive news.
“This should help restore positive momentum to the share price which traded at the 3.5p-4p level prior to May’s statement.“
Surgical said a further update will be provided in due course and a trading update will be issued together with the company’s interim results on September 11.
In May, the firm cut its annual revenue expectations by 10 per cent. The group said revenue expectations for 2017 had been cut by £1.25m.
The company said it was experiencing delays in the supply of products for its UK distribution business, Elemental Healthcare, which are sourced from Meccellis Biotech.