The subsidiary company of Alcidion Group Limited (ASX: ALC), MKM Health has entered into a contract with Queensland Health. Under this agreement, MKM health is supposed to establish a Referral Service Directory (RSD) using SaaS through its software partner NextGate Solutions Inc. Through the use of these contracts, Queensland Health will be using the software of NextGate which will enable to establish a central point of reference the general practitioners across Queensland for the external referrals Queensland Hospital and Health Services.
The solutions through the RSD will be provided using the deployment model of SaaS till the mid of the year 2024. Sunshine Coast Hospital and Health Service (SCHHS) and Metro South Hospital and Health Service (MSHHS) are the two places where this model will be implemented first. Further, this will combine with the GP Smart Referrals platform. Integrating the model with this platform will enable the general practitioners to submit electronic referrals through their existing software.
The contact will worth $12 million which include the service fee as well. The service fees here mean that the fee regarding the implementation of the model as well as the recurring RSD SaaS fees.
Further, it was announced that MKM Health who is now an authorized reseller of NextGate‘s Enterprise Master Patient Index (EMPI) and its Provider Registry software has also entered into a partnership with Queensland Health agencies so that this EMPI solution can be implemented throughout the Victorian public health service.
Entering into this contract will create a stronger presence of ALC in Queensland which will also increase the revenue of the company throughout five years.
It is clear that MKM health is committed to helping the healthcare sector. It will be a win-win situation for both Alcidion Group Limited and NextGate. After this announcement, there was a synergy seen in the share price of the company as it jumped up by 13.953% by the end of the day.
The performance of the company since its inception was -75.13%. The one year and five years performance of the company is -15.69% and 138.89% respectively.
For the year ended 30 June 2018, the company generated revenue of $4,179,487. However, it incurred a net loss of $2,089,313. The company shows a strong balance sheet. The net asset of the company is $3,333,246 which indicates that the company can meet its long-term liabilities. The company holds a total current asset worth $4,481,227 and the total current liabilities worth $2,386,004 which indicates that the company is in the position to meet its short-term obligations as well as the working capital of the company. As compared to the last year, there is an increase in the accumulated loss of the company in FY2018 which indicates that the shareholder’s equity is being diluted. In FY2018, the total shareholder’s equity was worth $3,333,246.
The net cash outflow from the operating activities was $1,825,305. Here the major source of outflow was due to the payment made to the suppliers and employees. The net cash outflow from the investing activities was $615,619. By the end of the year, the net cash available with the company was $2,890,339.
By the end of the day, the market price of the share was A$0.049 with the market capitalization of A$34.64 million.
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