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On 20 November 2018, the leading medical imaging IT provider Pro Medicus Limited (ASX:PME) announced that its wholly owned US subsidiary, Visage Imaging, Inc., has signed an AUD $27m, 7-year contract with Partners Healthcare. Following the release of this news, the share price of the company increased by 5.234 percent as on 20 November 2018.
Founded in the year 1994, Partners Healthcare is one of the largest and most respected health providers in North America. As per the contract, Pro Medicusâ Visage 7 technology will be implemented at Partnersâ two flagship hospitals, MGH and BWH, eliminating their legacy PACS with scope to expand to other Partners network hospitals at a later date. Both MGH and BWH are two of the most prestigious medical institutions in North America renowned for their medical research, as well as their key roles as teaching hospitals for Harvard Medical School. The first sites of the rollout are scheduled to be implemented in the fourth quarter of FY 2019.
According to Pro Medicusâ CEO Dr. Sam Hupert, not only it is the companyâs biggest deal to date, there is a potential for further upside within the Partners network after the initial rollout is completed. The fact that both MGH and BWH selected Visage 7 as their platform of choice reflects that Visageâs leading-edge technology is suitable for a broad range of clinical environments, including the most sophisticated and demanding users.
The company also held its annual general meeting (AGM) on 20 November 2018. While addressing the shareholders at AGM the chairman of the company informed about several new contracts including Yale New Haven Health and Visage Open Archive to Mercy Health, in North America as well as the expansion of companyâs relationship with I-MED Radiology Network in Australia. The chairman told that the company is in an excellent position to continue to capitalize on increasing global and local opportunities that present themselves.
In FY 2018, the Underlying after-tax profit increased by 27.4 percent to $12.57 million. The revenue of the company increased by 13.9 percent to $36.02 million in FY 2018. These results were primarily driven by the North American business which experienced healthy growth in transaction revenue from new and existing customers. The EBIT Margin of the company increase to 48.5% and the Earnings per share of the company increased by 36 percent to 9.1 cents in FY 2018. At the end of FY 2018, the company was having a strong balance sheet with Cash reserves of $25.24 million and no debt. In FY 2018, the Board increased the dividend payments to 6 cents per share fully franked which represents an increase of 50% over the previous year and payout ratio of just below 50%.
In the last six months, the share price of the company increased by 22.27 percent as on 19 November 2018, traded at a PE level of 73.950x. PMEâs shares traded at $9.650 with a market capitalization of circa $950.16 million as on 20 November 2018 (AEST 2:06 PM).
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