Compumedics revises revenue figure, shares drop

Sleep device developer Compumedics (ASX: CMP) has flagged a 10 per cent reduction in its forecast sales for the year, triggering a share price slide.

In April, the Melbourne company predicted its consolidated operating revenues would be in the region of $22 to $24 million.

Today it announced the figure was more likely to be about $20 million.

While the adjusted figure represents a 20 per cent increase on the previous year, it is 10 per cent less than the company had earlier anticipated.

The company said that an operating loss was now expected where a profit of $2.4 to $3.4 million had been predicted.

Executive chairman David Burton said the result did not alter the company's fundamentals.

"This year's result is disappointing, but we have made the necessary changes in order to drive the performance forward," Burton said.

"We have technology and products for the high growth sleep market and we have strengthened our position to penetrate that market."

But investors were less than impressed with the revision, shaving more than 21 per cent, or 7 cents, as the stock changed hands at 26 cents about 1pm today.

The company attributed the revenue slide predominantly to lower than expected sales in United States and European markets.

It told the market that a decision made this year to sell directly in these markets rather than through distribution networks was producing a greater penetration rate, but was yet to translate to sales.

It said the US market, which comprised 2400 specialist sleep clinics, was currently growing at 10 per cent annually.

"We know we have the technology the market wants and we now have clearer and direct access to the biggest markets in the world in the United States and Europe," Burton said. "We are now starting to see our investment in infrastructure within these vital markets bear fruit."

Burton said that recently acquired Texas-based neurological instrument business Neuroscan had met expectations and was likely to contribute a small profit to the consolidated result.

He said that improving productivity throughout the company's operations was a major focus for the company.

"We have world-class technology and now the sales organisational infrastructure to get our products to market directly," he said.

"We are committed to continuously improving the efficiency of all of our operations."

The company produces computer-based medical monitoring and diagnostic equipment for sleep disorders, general physiology, cardiology and neurology.