Angel downcast by plant delay.

Angel Biotechnology Holdings, the Aim-listed biopharmaceutical contract manufacturer, released interim results for the half year to June 30. Revenues increased 263% to pounds 755,000 compared with the same time last year and after a pounds 5,000 research and development tax credit the company made a loss of pounds 821,000.

Chairman Dr Paul Harper said revenue was below expectations because of a potential client delaying signing a contract and the handover of a new factory at Cramlington being delayed three months. As a result of the delay in getting the plant from the builders, the company incurred unplanned spending in gaining a licence from the Medicines and Healthcare products Regulatory Agency (MHRA).

A direct consequence of this delay has been the lost opportunity of revenue generation. Dr Harper warned that the financial impact of this would affect the whole year. However, every effort was being made to generate revenue and the order book stood at pounds 6.69m, assuming successful delivery of services.

Although the cash outflow in the first half was greater than budgeted, the management expects the short term cash position to improve substantially in the second half as revenues from current and new contracts flow through.

The receipt of the MHRA licence late last month marks the end of the development phase of Angel and moves the company into a significant growth phase.

The Pentlands laboratory in Edinburgh has been successful in attracting cell culture projects and is becoming recognised as a centre of excellence, especially for stem cell work. Angel has a number of prospects looking for commercial manufacturing as distinct from manufacturing material for clinical trials. This is welcome as commercial manufacturing means higher margins and longer contracts.

Shares were marked down almost 7%, reflecting the impact of the building delays.

Simon Inness ( Assistant director, Wise Speke.