One Medical Device Company With Long Trem Growth Potential

As the market participants are aware, the global economy witnessed the negative impacts as a result of the outbreak of COVID-19 pandemic. The lockdowns impacted the operations of several companies. However, some companies could now perform well. This company is possessing decent liquidity position which could help it moving forward. The stock price of this company has witnessed a rise of ~35.38% in 3 months. Notably, in the past one month, the stock increased ~46.67%.

Summary

  • The company stated that, the new study, which has been published in the European Journal of Obstetrics and Gynaecology and Reproductive Biology, indicated that the cervical cancer screening technology meets or surpasses the effectiveness of the alternative cervical cancer screening methods.
  • TruScreen is also expanding its penetration across Central and Eastern Europe. It is currently emphasising on Serbia and Poland markets.
  • The company’s liquidity position remained decent with cash and cash equivalents of $5.3 million as of 31 March 2021.

TRU Details

TruScreen Limited (NZX: TRU) is a medical device company. TruScreen device offers the latest technology in cervical screening and delivers real-time, accurate detection of pre-cancerous as well as cancerous cervical cells. This will assist in enhancing the health and wellbeing of women.

Results Performance for FY 2021 (For the 12 Months Ended 31st March 2021)

  • The results of the company reflect the impact of COVID-19 as well as show the 12% reduction in product revenues YoY, a 23% reduction in the total revenues which consisted the lower research and development refund offset claim from the Australian Tax Office as well as expenses, excluding amortisation and impairment, in line with the previous year.
  • However, the offtake and usage of SUS rose 20% YoY with China recovering strongly and the company remains hopeful of this trend to remain in the year ahead.
  • It reported a total loss of $3.5 million (2020: $5.2 million). FY20 figures included the impact of an impairment charge of $2.4 million along with an exchange gain of $0.11 million.
  • Net operating cash outflow increased to $2.1 million from $1.6 million in FY20 due to significantly lower R&D tax refund offset.
  • The company has stated that, despite COVID-19 challenges which were witnessed over the previous 12 months, its distribution network was committed towards the TruScreen technology. They have been reaping the benefits of this time to train the healthcare practitioners as well as Key Opinion Leaders, host virtual educational seminars, as well as continued their work with the local government departments and private sector customers to get ready for the recommencement of the clinical and commercial activities.

Financial Snapshot (Source: Company Reports)

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Recent Updates

In the release dated 20th October 2021, the company stated that, the new study, published in the European Journal of Obstetrics and Gynaecology and Reproductive Biology, indicated that its cervical cancer screening technology meets or surpasses the effectiveness of the alternative cervical cancer screening methods.

The study managed to evaluate the efficacy of TruScreen in screening for the cervical abnormalities, in the actual world, primary cervical cancer screening setting in China. Notably, as per the release, the TruScreen screening device was extremely effective when it comes to detecting cervical intraepithelial neoplasia grade 2 or worse (CIN2+ or CIN3+).

On 20 October 2021, the company also informed the market about the achievement of key milestones relating to the ongoing development of the Company’s women’s health care technology as well as its overseas growth strategy.

The company has continued to expand in China, which is its most established market as well as the world’s largest addressable cervical cancer market. With the roll out of the TruScreen Made in China device particularly for the Chinese market, TRU’s China distributor Beijing Siweixiangtai (SWXT) has managed to expand the addressable distribution market. It is marketing this TruScreen device to the Health Check sector which has been growing. SWXT expects that the first major project in the private Health Check sector would be commencing by Q4 CY 2021.  

Do Read: TruScreen (NZX:TRU):How effective is the Company’s cancer screening technology?

Stock Information

TruScreen is also expanding its penetration across Central and Eastern Europe. It is currently emphasising on Serbia and Poland. The company is presently in the final planning stages for the clinical trial in Poland, which is being led by the well-known opinion leader.

The company has managed to complete the 2-day ISO13485 accreditation surveillance audit by the Notified Body TUV SUD at the facility based in Sydney. The focus of the audit revolved around reviewing as well as approving the inhouse manufacturing and service of the TruScreen Ultra device in the state-of-the-art facility.

The stock of the company ended the session at NZ$0.088 per share, reflecting a rise of 3.53% on 22nd October 2021.

Please Read: Which are 5 NZX cheap technology stocks to explore in October?

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