Axon returns to profit, ships new products

Austerity measures have borne fruit at US-based Axon Instruments (ASX:AXN) -- the company's results, announced yesterday, trumpeted a profit after tax of US$1.1 million, compared to a US$9.5 million loss in 2002.

Lower research expenses and higher profit margins both contributed to the result. Sales revenues increased by more than 20 per cent, clocking in at US$33.5 million. Sales were boosted by the release last year of both the PatchXpress and the ImageXpress cellular imaging system.

PatchXpress is an automated 'patch clamp' instrument for ion channel drug screening. Axon says the instrument can screen thousands of compounds each day by measuring tiny electrical currents produced when a drug triggers activity in a cell's ion channels. Regulating ion channels is important in treating pain, stroke, epilepsy, diabetes and high blood pressure

Since releasing PatchXpress in September, Axon has shipped 20 instruments to pharmaceutical, biotechnology and safety-screening companies worldwide. According to the company, PatchXpress "substantially increases the rate at which lead compounds can be validated and optimised".

Increased sales volumes also improved Axon's gross profit margins, up from 45 per cent in 2002 to 53 per cent in 2003. Research and development expenses declined 31 per cent to US$9.3 million from US$13.5 million in 2002.

Axon anticipates another profitable year in 2004 and will focus on increasing sales and developing higher throughput versions of PatchXpress and ImageXpress.