SomnoMed Limited Reported Core Revenue Growth of 13% in Q2 FY19

SOM

Healthcare company, SomnoMed  Limited (ASX: SOM) today (i.e., 29 January 2019) announced that its core revenues have increased by 13 percent in the Q2 FY 2019 as compared to the prior year, reaching $15.675 million for the three months period.

In the US, the company recorded the revenue growth of 10 percent in Q2 FY 2019. For the same period, the company’s group revenues decreased by 3 percent due to Renew Sleep Solutions (RSS) business revenues declining by 52 percent in its final quarter of operations.

As per the announcement, the 10% business revenue growth in the North American has confirmed the view that this region will continue to recover and grow again in the wake of the RSS closure. 

According to the Global CEO of SomnoMed, Mr. Neil Verdal-Austin, this quarter has been very disruptive due to the decisions made during the latter part of 2018. He told that the management of the company is pleased with the company’s core business growth and overall direction, which will show half-year revenues of $28.8 million (unaudited) and a 15 percent growth over the prior year.

In Europe, the company’s business reported 14 percent revenue growth for Q2 FY 2019. The revenue growth was slightly below the company’s expectations due to the December month being softer than anticipated. The business in Europe was impacted by the political disruptions in France which caused some logistical upheavals, and there were some delays in recognizing some Swedish revenues due to technical laboratory issues, which have since been corrected.

As per the announcement, the volume growth of Finland, Spain, and the UK was very encouraging, and the outlook for Europe remains very positive into the second half of FY 2019. The APAC (Asia-Pacific) region reported revenue growth of 22 percent in the second quarter, with strong results from Australia.

Sponsored ad by Kalkine

The Renew Sleep Solutions (RSS) has shut down their business in the US, and all centres treated their last patients to 31st December 2018. Over the next six months, RSS will continue to wind down, and the company will negotiate to exit or sublease the contracted premises leases across all centres.

The Company’s core business generated an unaudited EBITDA of $1.3 million for the first half of FY 2019 which was 60% higher than the prior year. The EBITDA includes an allocation of the one-off group corporate overheads of $300k relating to the severance payment to the former CEO. In the first half of FY 2019, the Renew Sleep Solutions generated EBITDA losses of $7 million (unaudited), resulting in the group’s net EBITDA loss being $5.65 million (unaudited).

During Q2 2019, the company generated $1.5 million in operating cash from which the core business generated $2.7 million while the RSS cash losses totaled $1.2 million. At the end of December 2018, the company had a cash position of $8.5 million.

In the past six months, the share price of the company decreased by 20.19 percent as on 24 January 2019. SOM’s shares traded at $1.690 (-0.588% intraday) with a market capitalization of circa $106.77 million as on 29 January 2019 (AEST 2:43 PM).


Disclaimer

This website is a service of Kalkine Media Pty. Ltd. A.C.N. 629 651 672. The website has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. Kalkine Media does not in any way endorse or recommend individuals, products or services that may be discussed on this site. Our publications are NOT a solicitation or recommendation to buy, sell or hold. We are neither licensed nor qualified to provide investment advice.

Facebook Comments

Join Our Discussion

Start discussion with value Investors for ASX Stock Market Investment and Opinion.


6 Cannabis Stocks under Investor’s Limelight…

Cannabis companies that sell both medicinal weed and recreational pot. Marijuana stocks to look at. Marijuana mergers and acquisitions. Dispensary data analytics. Upcoming marijuana IPO’s Those phrases have become increasingly common as marijuana legalization spreads.

Global spending on legal cannabis is expected to grow 230% to $32 billion in 2020 as compared to $9.5 in 2017, according to Arcview Market Research and BDS Analytics. As of June 29, 2018 the United States Marijuana Index, despite a lot of uncertainty around regulations, has over the past 1 year gained 71.49%, as compared to about 12% gain seen by the S&P 500.

Click here for your FREE Report

LEAVE A REPLY

Please enter your comment!
Please enter your name here