18 August 2022; Company Announcement – Full Year Results 2022 Final – Acrobat pdf 123k

Highlights

  • Revenue from ordinary activities $93.5m – up 37.7%
  • Underlying profit before tax $62.4m – up 46.8%
  • Net profit $44.4m – up 44.1%
  • Cash and other financial assets $90.6m – up $28.8m
  • Company remains debt-free
  • Fully-franked final dividend 12c per share

Leading health imaging company Pro Medicus Limited [ASX: PME] today announced a full- year net profit of $44.4 million for the year to the end of June 2022, 44.1% higher than for the previous corresponding period.

Revenue from ordinary activities increased by 37.7% to $93.5 million.

The company’s cash and other financial assets at June 30 2022 were $90.6 million, up $28.8 million, an increase of 46.5%.

Pro Medicus announced a fully-franked final dividend of 12c per share, making the full year dividend 22c fully-franked, an increase of 47%. The company remains debt-free.

During the year Pro Medicus announced the following key contract wins:

  • A $40M, 7-year contract with Novant Health, Inc, a community-based Integrated Delivery Network (IDN) headquartered in North Carolina, USA, spanning three states, including 15 medical centres and hundreds of outpatient facilities and clinics.
  • A $32M, 8-year contract with Inova Health System, the leading not-for-profit healthcare provider in Northern Virginia, USA. Inova Health’s 20,000+ team members service more than two million patient visits per year.
  • A $28M, 7-year contract with Allina Health, a not-for-profit healthcare system based in Minneapolis, USA, which has 28,000 employees and 6,000 associated and employed physicians and operates 11 hospitals and more than 90 clinics throughout Minnesota and Wisconsin.
  • Fourth extension of the German Government contract, Visage 7.0 being deployed to a large government hospital in the Hamburg region.
  • Two key contract renewals with a combined value of A$47M. Sutter Health, a large IDN based in Sacramento, California signed for a further seven years, and Wellspan Health, based in Pennsylvania, for a further five years. Both deals were transaction-based with committed minimums and were negotiated at a higher per transaction cost than their original contracts.

Pro Medicus CEO Dr Sam Hupert said the result represented the best revenue and profit performance in Pro Medicus’ history. Margins improved from 63% to 67%, and cash and other assets rose by $28.8 million to $90.6 million despite increased spending on research and development, a share buy-back and increased dividend payouts.

“FY22 year was another year where all our key financial metrics headed in the right direction and we continued to make significant progress with key implementations,” Dr Hupert said. “All three jurisdictions did very well. North America – our biggest market – was the key contributor, with a 65% jump in transaction revenue coupled with three new material contracts and two contract renewals. We were also pleased with the fourth extension of the German Government contract which was material for the European region. In Australia we continued to see incremental growth, which was pleasing.”

Dr Hupert said the steep jump in transaction revenue was driven by large implementations including Northwestern, NYU Langone and MedStar which contributed a full 12 months of transactions and Intermountain Healthcare which contributed 8 months.

“Revenue from recent contract wins in Novant Health, Inova Health and Allina Health will commence in the FY23 financial year, so these three sizeable contracts are still ahead of us and will build on the solid base we formed in FY22.”

Dr Hupert said renewals of contracts – like Sutter Health and Wellspan Health – should also not be underestimated. “Our aim is to retain 100% of our client base and even though it is still early days, we have been successful in achieving this so far,” he said. “The fact that our clients are renewing for five years and in some cases longer we feel is a powerful endorsement of our offering and the leadership position of our technology.”

In August 2021, the company established its R&D centre in New York and is making good progress with its research collaborations with NYU as well as other research partners Yale and Mayo.

Dr Hupert said Pro Medicus’ pipeline remains strong, with a good spread of opportunities in different market segments. “As we have previously mentioned, we are seeing interest from multiple market segments, including Tier-1 academic medical centres, large and mid-sized IDNs as well as renewed interest from the for-profit sector, which was the sector hardest hit during COVID.”

“We also see the dynamic of Cloud as a major theme in virtually all our pipeline opportunities, as well as a material number of opportunities considering multiple Visage products. These are the trends that benefit us and importantly, ones we think will continue.”

** Pro Medicus Ltd hosted a webcast conference call on Thursday, 18 August at 11am (AEST) where the results were discussed. A video replay of the discussion is found below: