Instem drops on profits warning

Instem Life Sciences, a software provider to the healthcare industry, has barely been quoted for a year but already has a profits warning under its belt.

The company dropped to a 52-week low after it said profits for 2011 will be "materially below market expectations". Only one broker covers the AIM-listed tiddler and, prior to the profits warning, it was forecasting pre-tax profits for 2011 of £2.90m, up from £1.41m in 2010.

The firm says research organisations, which make up its main client base, are being cautious in software investment and so expected orders for 2011 have been delayed.

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Instem says its cash position "remains strong" at £3.3m and it is looking at possible acquisitions within what it describes as its "fragmented market place".

The company's stock has dropped 24% in the last 12 months.

BS