TIDMDEMG
RNS Number : 0363B
Deltex Medical Group PLC
05 January 2018
5 January 2018
Deltex Medical Group plc
("Deltex Medical", "Deltex" or "the Company")
Pre-close Trading Update
Deltex Medical Group plc (AIM: DEMG), the global leader in
Oesophageal Doppler Monitoring ("ODM"), today announces an update
on trading for the year ended 31 December 2017.
Highlights
-- Overall revenues of GBP5.9m (2016 GBP6.3m)
o US revenues of GBP2.0m, ahead by GBP0.1m
o International sales of GBP1.9m, down by GBP0.1m
o UK revenues of GBP1.9m, down GBP0.4m
-- US revenues ahead by 5%
o Over GBP0.2m of expected additional revenue from major account
wins in H2 2017 delayed due to extended procurement processes
o Signs of pipeline blockages easing in Q4 2017. First revenues
generated from three new potentially large accounts
-- International revenues down by 5%
o Probe growth on plan across key focus markets of France,
Scandinavia, Peru and Korea
o Low margin monitor sales behind plan by GBP0.2m due to
scheduled hospital tenders being delayed into 2018 and distributor
destocking
-- UK revenues reduced by 18%
o December sales were down with c.GBP0.3m of bulk orders not
repeated from 2016
o Promising clinical response to release of HD-ICG module offset
by well documented NHS funding issues
-- Cash consumption over the year reduced by c.GBP1m to GBP1.3m (GBP0.8m H1, GBP0.5m H2)
o C. GBP0.4m savings in year from manufacturing efficiencies
leading to improved margin
o Cash overheads reduced by c.GBP0.5m in 2017 with a further
GBP0.5m of reductions already in place for 2018 and further
annualised savings of GBP0.5m planned for H1 2018
-- Loss for 2017 expected to be higher than market expectations
with some of the impact of lost revenue partially offset by
improved margin and reduced overheads
-- Cash at 31 December of GBP0.2m (2016: GBP0.6m). Discussions
on the future funding of the Group are in progress and the Company
expects to be able to make a further announcement in the near
future
Nigel Keen, Deltex Medical's Chairman, commented:
"Procurement process headwinds held sales back to disappointing
levels in 2017. However, Deltex enters 2018 positioned to benefit
from momentum in the USA and other focus export markets. The UK
continues to be a difficult market due to NHS funding
constraints.
"We have substantially reduced our rate of operating cash
consumption in order to meet our key goal of getting past the
operating cash breakeven point. In the final quarter of 2017 we put
in place a number of changes to our cost base with effect from the
start of 2018 and, in view of the actual level of 2017 sales, we
are reducing our costs further to match our operating cash costs
with current levels of sales. These actions should allow us to fund
future organic growth out of operating cash flows.
"We have completed a large part of the investment necessary to
move the Company from a single technology to a multiple technology
business and are moving our marketing focus forward accordingly. We
expect to see the impact on sales growth of these developments
starting to come through during 2018 to supplement our established
position in major export markets as a significant provider of
haemodynamic monitoring solutions."
For further information, please contact:-
Deltex Medical Group 01243 774 837
plc investorinfo@deltexmedical.com
Nigel Keen, Chairman
Ewan Phillips, Chief
Executive
Jonathan Shaw, Group
Finance Director
Nominated Adviser &
Broker
Arden Partners plc 020 7614 5900
Chris Hardie
Ciaran Walsh
Joint Broker
Turner Pope Investments 0203 621 4120
(TPI) Ltd info@turnerpope.com
Andy Thacker
Financial Public Relations
IFC Advisory Ltd 0203 053 8671
Tim Metcalfe
Graham Herring
Heather Armstrong
Notes for Editors
Deltex Medical manufactures and markets haemodynamic monitoring
technologies. Deltex Medical's proprietary ODM is the only
technology to measure blood flow in the central circulation in real
time. Minimally invasive, easy to set up and quick to focus, the
technology generates a low-frequency ultrasound signal, which is
highly sensitive to changes in flow and measures them immediately.
Deltex has been the only company in the enhanced haemodynamic space
to build a robust and credible evidence base proving the clinical
and economic benefits of its core technology, ODM which is proven
to reduce complications suffered by patients after surgery and save
hospitals the costs of treating those complications.
Deltex Medical's CardioQ-ODM+ platform also now provides
clinicians with two further advanced haemodynamic monitoring
technologies. High Definition Impedance Cardiography is an entirely
non-invasive monitoring technology which creates an electrical
field across the chest and measures the disruption to this field
when the heart pumps blood. Pulse Pressure Waveform Analysis uses
peripheral blood pressure signal analysis to give doctors
information on changes in the circulation and is particularly
suited to monitoring lower risk or haemodynamically stable
patients.
Company goal
Haemodynamic management is now becoming widely accepted as an
important major new medical modality. Consequently, the Company's
focus is on maximising value from the opportunities presented as
enhanced haemodynamic management is adopted into routine clinical
practice around the world. The Company aims to provide clinicians
with a single platform, a 'haemodynamic workstation', which offers
them a range of technologies from simple to sophisticated to be
deployed according to the patient's condition and skill and
expertise of the user. Doing this will enable the Company to
partner healthcare providers to support modern haemodynamic
management across the whole hospital.
The Company is currently in the implementation phase of
achieving this goal in a number of territories worldwide, operating
directly in the UK, USA, Spain and Canada and through distribution
arrangements in a further 30 countries.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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