LONDON (ShareCast) - Shares in Scientific Digital Imaging (SDI) on Monday fell after revenue for the year dipped 9.1% to £7m against £7.7m last year.

The company says its Syngene product is facing competition from other companies' cheaper alternatives.

It also spent more on research and development, which represented 9.8% of group sales against 7.8% last year.

Operating profit decreased from £300k in 2013 to £123k this year before acquisition costs. Currency losses were £66k against only £2k last year.

However, the group improved cash flow, with a cash balance of £539k against last year's £388k.

SDI said: "With the acquisition of Opus Instruments and advances in SDI's in-house product development programmes, we now have several newly launched and attractively priced automated systems in our product range for which demand is increasing and the board is optimistic that SDI is positioned for growth."

The company's chairman, Ken Ford, said: "The board expects SDI to make steady progress over the coming financial year as we continue to pursue our strategy of organic and acquisitive growth."

SDI's shares were down 7.69% to 12p on Monday at 11:19.

However, broker FinnCap said the shares are under-valued for a scientific instrument company, establishing a 27p target price.

FinnCap said: "As SDI shows positive momentum and gains traction with ProReveal in particular, we expect the shares to re-rate significantly."

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