COMPUMEDICS ANNOUNCES FINANCIAL RESULTS FOR YEAR ENDED 30 JUNE 2002
The full year results to June 30 2002 show consolidated operating revenues of $19.7 million, representing a 19% increase over the previous corresponding period and consistent with the announcement to market of July 11, 2002.
As indicated at that time revenue growth has been adversely affected by the underperformance of the company’s key distributor for the US and European sleep markets. By taking direct control of distribution in those regions, Compumedics has put in place the framework to recover that position in those important markets.
EBITDA was a loss of $0.9 million compared to the previous corresponding period, of $4.2 million profit. Overall losses after tax were $1.9 million compared to a profit of $2.0 million in the previous corresponding period.
The Board has decided to specifically provide for identified doubtful debts, the recoverable value of which is not certain and slow moving stock. These adjustments represent $1.1m. of the reported after tax result.
Executive Chairman, Mr. David Burton noted whilst these results are obviously disappointing the actions taken by the Company during the course of the last six months put it on a solid platform going forward. “Our cash position remains strong, the US market is rebounding and we have achieved record revenue for both our sleep business and the consolidated business for the months of July and August,” he said.
The Neuroscan neurological instrument business, acquired by Compumedics in April 2002, continues to achieve revenue above plan and is profitable and cash flow positive. Further gains will be made as the company fully exploits the commercial and operational synergies between the neurology and sleep businesses.
The full year results are summarised below:
|12 mths ended June 2001||12 mths ended June 2002||Change%|
|Operating Revenue (A$’000)||16,639||19,747||18.7%|
|Total Revenue (A$’000)||18,317||20,210||10.3%|
|Earnings before Interest, Tax, Depreciation and Amortisation (A$’000)||4,223||(893)||N/A|
|Earnings before Interest and Tax (A$’000)||3,041||(2,387)||N/A|
|Profit After Tax (A$’000)||1971||(1,898)||N/A|
|Basic Earnings Per Share (cents)||1.7¢||(1.4)¢||N/A|
Highlights for the twelve months ending 30 June 2002 include:
Acquisition and successful integration of the Neuroscan business.
Compumedics now has the competitive advantage of having two leading technologies to leverage the clear synergies between sleep and neurological diagnostics.
Strong investment in R&D and subsequent substantial product development pipeline.
CE (European) regulatory approval for the portable Somté cardio-respiratory diagnostic device, the only product of its kind for sleep-heart disorders (US FDA approval is pending).
Direct sales and distribution channels to both US hospital and European markets established, and back on track. Sales growth of 71% in the Asia Pacific market.
Reduction in debtor days from 212 to 131 over the year before provision for doubtful debts.
After balance date, Compumedics announced a sleep diagnostic supply and development agreement with the German based multinational, Dräger Medical. This gives the company ready access to important parts of the European market.
Consolidated US sales revenue of A$9.3m was up 28% on the previous corresponding period. The growth reflects the acquisition of Neuroscan with the sleep business recording revenue comparable with the previous corresponding period. The company’s US sleep business stalled during the year as the relationship with the former distributor wound down, but recovered by year end as the new direct sales arrangements took effect.
Sales revenue of A$2.2m were 27% below the previous corresponding period. This reflects the underperformance of Compumedics key distributor in this market. Following the successful implementation of direct selling arrangements in the US, the company took a similar course in Europe, redefining its relationship with the former distributor in May. Post balance date, Compumedics has established a relationship with Dräger Medical, giving the company a revitalised focus for the European market, and a strong technology partner.
Sales revenue in the Asian region of $5.0m increased 71% over the previous corresponding period. Growth in the Japanese market for sleep equipment as well as the establishment of new distributors in other parts of Asia Pacific account for much of this growth in sales. Compumedics’ direct office in Singapore has further reinforced its efforts in this territory. China has also shown strong growth – in excess of 350%.
Sales revenue in Australia of $3.4m was comparable with the previous corresponding period, reflecting Compumedics’ strong market position in both the sleep and clinical neurological markets. This provides an excellent platform from which new products can continue to be launched.
The Company continues to progress the underlying technology relating to its growth platforms through the application for patents and continued clinical testing. The acquisition of Neuroscan is providing excellent synergy opportunities to expedite the growth platforms.
Mr. Ko Koike who has been a Executive Director Corporate Development in a full time role is returning to a Non-Executive Director status. He will however remain in a part time role managing the company’s relationship with Teijin as well as other specific corporate opportunities as they arise.
Our strategy remains clear. We will continue to build our core sleep diagnostic business and leverage that expertise into new growth areas including neurology and cardiology monitoring, fatigue monitors for automobiles, in-depth anaesthesia and sleep treatment.
We have started the new financial year strongly with record revenues in both businesses and fully expect the businesses to be profitable and to grow strongly over the year ahead.
Compumedics is a global leader in the development of medical technology for the diagnosis of sleep and associated disorders. Selling its products in over 20 countries worldwide, Compumedics was awarded the highly coveted Australian Exporter of the Year in 1998 and again in 2001 for the category of Small to Medium Manufacturer. In 1995, NASA chose Compumedics for two separate contracts involving the Space Shuttle and International Space Station Mission Preparations. Further to this, against considerable international competition, Compumedics was selected to supply sleep monitoring technology for the largest sleep study in the world, the US Government funded Sleep Heart Health Study. Compumedics began in 1987 when the Company developed and installed Australia’s first fully computerised and digital Sleep Clinic, prior to which time sleep studies in Australia were undertaken by physicians using chart recorders and manual analysis. Fifteen years on, Compumedics has achieved a 70% share of the Australian Sleep Diagnostic Market, with 80% of operating revenues generated from overseas markets.
Neuroscan is a manufacturer and distributor of neurodiagnostic and neuroimaging systems, including electroencephalograph (“EEG”), electromyography (“EMG”) and evoked potential (“EP”) systems, for measuring electrical signals generated by the brain and nervous system. The Company is a wholly owned subsidiary of Compumedics Limited and is located in El Paso, Texas.
Neuroscan is the leading supplier of software and equipment to the neurophysiological research market. Neuroscan was the first company to commercialise the high-density EEG/EP recordings, electromagnet source localization, merging of multi-modal neuroimaging data (magnetic resonance imaging (“MRI”), EEG, functional MRI, Positron Emission Tomography (“PET”) and Magneto Encephalography (“MEG”)), and recording EEG/EP information in the MRI environment.
For further information:
Mr. David Lawson
Chief Financial Officer and Company Secretary
Tel. + 61 (0)3 8413 7300