Consensus community valuation
$0.235
Average Intrinsic Value
23.5%
Undervalued by
Active Member Straws
#Management
Added 2 months ago

Kate Quirke bought 1.5M shares worth $195k today at $0.13 share price. During the March pandemic sell-off, she bought at $0.10. In total, she now owns around 60M shares. The crazy thing is that she owns ordinary shares, not options. She is aligning herself with shareholders which is what every investor hopes in seeing.  

Sometimes the best thing to do is follow management and buy with them :) Kate would not buy shares if she thinks Alcidion is worth multiples of what is valued today. The market is very short term focused. 

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#FY20 Results
Added 3 months ago

Alcidion's full year results came in pretty much as expected. 

Good to see the solid growth in recurring revenue, a healthy cash balance and some resilience in the face of covid.

Alcidion has a great product offering, important reference sites and good sales momentum. There's a big opportunity as healthcare goes digital, and they seem well positioned.

The company did stress the increased ramp up in investment needed to seize the opportunity. Scaling up began in earnest at the start of this calendar year and they expect the expanded cost base will start to stabalise during FY21.

This will delay cash flow breakeven, but I think it's a necessary investment. There's big first mover advantages when sectors are undergoing structural shifts. Not that the spend is guaranteed to deliver good results, but it's really unavoidable in my view.

On some rough numbers, assuming steady gross margins, it looks like ALC will not hit profitability until they get to close to $30m in sales -- which is likely a few years away.

They have over $15m in cash, and have a current operating cash burn of $2m pa, so they should be able to sustain themselves for a good while.

I still think $50m in sales by FY25 is possible, but with most of the growth in the second half of the period.

Anything can happen with the market price short term, but i think Alcidion remains a good bet for those working to a 3+ year timeframe

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#Contract win
Added 2 weeks ago

Alcidion has signed its largest ever deal for the Miya Precision product, worth $9.5m over 5 years. The vast majority of which represents recurring revenue. 

The deal is with the South Tees Hospitals NHS foundation trust. 

More than half of the contract value is to be booked in the current year, which takes locked revenue for FY21 to $20.2m, with 7 months of the year still remaining. Alcidion booked $18.6m in all of FY20.

Aside from the financials, this is a very positive step in my opinion.  It represents further evidence of traction in the UK market, as well as provides an important reference site and social proof.

ASX announcement here 

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#ASX Announcements
Last edited 4 months ago

Q4 FY20 results 

  • Yesterday, Alcidion announced their Q4FY20 results. Growth was flat in the final quarter despite signing/renewing numerous customers. 
    • NHS Fife – 5-year Patientrack extension across entire board
    • NHS Lanarkshire – 5-year agreement to implement Patientrack across board
    • Sydney LHD – initial 12-month contract for Miya Precision to support COVID-19 virtual care
    • Murrumbidgee LHD – 12-month contract for full Miya Precision platform including MEMRe
    • ACT Health – 2-year extension to long term integration support contract
  • From the update, it was apparent that COVID-19 is an important catalyst for UK sales growth post pandemic. In UK their products are used by the NHS where contracts range from $1M - $2M over a 5 year timeframe. To grow sales, Alcidion is forced to either sign more NHS districts or increase the price of existing contracts. Currently, Alcidion does not have pricing power with the NHS. However, they can expand within NHS to grow over time. The link below contain all NHS England trusts currently in operation. I count 226 total addressable market for NHS England customers. https://www.nhs.uk/servicedirectories/pages/nhstrustlisting.aspx
    • Doing rough maths, they currently have around 20 NHS customers, my belief is that they can capture 30% of the England market in 10 years. This equates to 60 customers in total, giving ~ $18M ARR, assuming ($1.5M contract for 5 years). 
    • Depending on how many new customers sign up post pandemic, NHS is a large market opportunity. 
    • Looking at current customers like NHS Fife, we have seen them renew their contracts. This shows that customers like Alcidion products in particular Miya and Patienttrack during COVID-19. It is very good to see exisiting customers utilise the products extensively. Post pandemic, we could see sales uptick across NHS trusts. 
  • The pandemic shows that Alcidion is a resilient business where the products and services are used extensively during the health crisis. Prior to Covid; Alcidion management conducted multiple visits to the UK, spend on marketing & trade shows to promote their products and convice hospitals to go digital. The pandemic forced Alcidion's customers to go digital and now they rely on Alcidion to manage ciritical processes and high volumes of patient data. Post crisis, I hope management either increase the sales pipeline or increase prices to drive revenues.
    • As a shareholder, pricing power makes the most sense as it lower CAC and increase margins.
      • However, it could also increase churn. The NHS is a public entity with their budget determined by the UK government. If more spending on NHS is announced, Alcidion should increase price to increase margins. 
  • I have left out the Australian business as the quarterly & half yearly reports explain their progress in detail. Miya & Patientrack used in Australia are very sticky like UK. To me, Australia was always meant to be a testing market, with most of the growth coming from international markets like UK. Thus, virtual remote hospitals trials are tested in Australia before launching in UK.    
  • The market "value" the company at ~ $150M, which is a fair valuation considering revenue growth is less than 20% p.a. However post COVID-19, Alcidion could win deals very quickly by converting customers from their growing pipeline. I see plenty of upside in the long-term, not in the short-term.          
  • In terms of my prior valuation, I assumed 25% growth from 2020-2025 which gives ~ $50M in 2025. Despite the slow revenue growth in this Financial year, in subsequent years, I expect more investment into healthcare by governments. Alcidion will be one of the winners and it could lead to more customers using Miya and Patientrack. I maintain my valuation of $378M company which correspond to $0.38 share price.           
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#Q1 FY21 Results
Added 4 weeks ago

Like some other posters, the results were largely in line with expectations.

Key takeaways

  • Reasonably well-managed company with its growth path underpinned by structural tailwinds. Hospitals and trusts have platforms/systems that will eventually need to be digitalised/automated
  • Key target markets appear to be delaying its decision points (for good reason) but the required changes are a necessity and not optional. Normality has resumed in some markets.
  • Contract with Murrumbidgee LHD runs out in December. Negotiations over an extension has already commenced - possibly an impending catalyst?
  • Alcidion is one of only two supplier to the Victorian health incident management system under option 2. Under option 1, the 86 public health services can elect to remain with their current vendor (if they can provide the service to meet the prescribed requirements). If not, it is either Alcidion or Dialog Information Technology
  • Managing Director noted that acquisition remains a possibility, particularly referencing the UK market
  • Managing Director seems confident over sales pipeline, as evidenced by the forward-looking contracted revenue pipeline. She also noted there are already some progress from the scaled up sales and marketing team. Cash receipts from customers in Q1 FY21 is also looking strong, compared to previous corresponding periods

My thoughts

  • Normality should resumed soon to the business administration side of the public healthcare system now that they better understand what they need to do on the front/last line. Perhaps, things should pick up from here on. Personally, I expect at least one more announcement before end of year and would be somewhat disappointed if we don't get it!
  • Recent expenditure to scale up sales and marketing capability is expected to slow down and stablise over the next few quarters. I expect the cost base to stabilise around the $4.75M per quarter mark. Give or take, all else being equal, Alcidion needs consistent cash receipts of approximately +$7.6M to achieve positive cashflow. Based on the Q1 FY21 cash receipts, we are approximately 85% of the target figure
  • Going by the above rough numbers, Alcidion will probably hit profitability when revenue exceeds >$30M. Like all SaaS companies, profitability will really accelerate when recurring revenues inched closer to the cost base.Given the FY20 revenue figure of $18.6M, profitability is still some time away even if I apply various revenue growth rate for FY21. This is why FY22 is the main game for me - possibly make or break of my investment thesis on Alcidion
  • Although the 4C reads okay to me, I still expect the share price to face downward pressure despite any short term bounce for two reasons: (1) there appears to be a party still drip selling; (2) the 'huge' opportunity cost of holding on to ALC in the current relatively bullish market
  • To break the current downward trend, we need a catalyst (and a damn good one!) to provide the liquidity for the seller(s) (including frustrated retail holders) to exit. For example, an integrated product offering for a trust over 5-years around the $7M to $8M range. In the absence of any 'news' to break the current cycle, the share price will continue to drift in no man's land, particularly with so many stocks running hard in the technology (e.g. cyber security and gaming) and commodities sector which are capturing the market's attention. To be honest, the medical technology sector is not exactly 'sexy' to the average punter at the moment
  • Because what Alcidion is offering to the healthcare market is revolutionary in some sense (e.g. AI via Miya), it is going to take ongoing time and effort to educate the healthcare professionals and administrators. The big positive for Alcidion is that it now has the reference sites plus PoC from the Murrumbidgee LHD and that the networks it could leverage off recent hires (for example, Alcidion's General Manager of Business Development in Australia and New Zealand (Steve Lutz) previously worked with eHealth NSW on the statewide community health and outpatient care (CHOC) and electronic medications management (eMeds) programs
  • Pure speculation on my part regarding the NSW Single Digital Patient Record, it is almost certain Alcidion would partner up with another party to go for that contract, against the traditional big boys such as Epic and Allscript. Check out the background of our executives and then check out which EMR that Miya has already been successfully proven to work alongside with - join the dots. On its own, Alcidion will have no chance as it would be deemed too small and risky. But together with this partner, they can offer a very 'compelling proposition' via a locally proven evidence-based proposal
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#ACT Contract Renewal
Added 4 months ago

Not huge news, but Alcidion resigning ACT Health for a further 2 years (in a deal worth $1.3m) for its patient management system is nice to see.

However, when the contract was last exteded in 2018 (see here), it was worth $1.27m for 2 years. It'd have been nice to see Alcidion increase the cost more (especially given the likely platform improvements over the last 2 years), or have bundled in other offerings.

So it's good that their solution is proving sticky, but would have been a very strong signal if they could have charged more. 

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##Valuation
Added 4 months ago

Some additional thoughts from me for discussion...

Snapshots based on 4C from Q4 FY20

Pretty evident that:

  • there is still an element of lumpiness in Alcidion's revenue profile but aggregated revenues have continued to trend upwards
  • continual shift towards recurring revenues (approximately 76% of total revenues based on latest 4C, highest to date)
  • revenues from products also make up approximately 76% of total revenues based on latest 4C, also highest to date)

For context on the upward trend in staffing course, listen back to the explanations from Kate and Colin in today's webinar once it gets uploaded onto Alcidion's website. From memory, Colin did mention that he expects staffing costs to stabilise at around +4M per quarter moving forward (can't recall the exact figure)

Valuation using a multiple approach

  • Market cap/Revenue: approximately 8x sales (using today's closing price of 15 cents and lower end of revenue guidance for FY20)
  • Enterprise value/Revenue: approximately 7x sales (using today's closing price of 15 cents and lower end of revenue guidance for FY20)

Latest 4C stated that Alcidion enters FY21 with a healthy sold revenue pipeline with $12.8M contracted to be recognisedin FY2021. Previously, Alcidion added $6.8M to FY20's starting position. Remember, we had Brexit and Covid19 which impacted what would ordinarily be Alcidion's strongest performing quarters.

Deferrals in projects, structural tailwinds etc should drive continue revenue growth. Applying a top line revenue growth of 20% to the lower end of FY20 revenue guidance (which I think is achievable given Alcidion did achieve (9% revenue growth in FY20 despite difficult circumstances) gives us a full year FY21 revenue of approximately $22.1M, of which 58% or $12.8M is already contracted.

Using an EV-R multiple of 7, FY21 revenue figure of $22.1M and reverse engineering, we get a FY21 share price $0.17. Discount it by 10%, we get a share price of 16 cents for FY20.

This suggests that the current share price/enterprise value is just about right, give or take.

For comparison purposes, the same approach using different multiples would give us the following implied share price for FY20:

  • EV-R multiple of 8: 18 cents
  • EV-R multiple of 9: 20 cents
  • EV-R multiple of 10: 22 cents

 

 

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#4th QTR 2020 results
Last edited 4 months ago

Alcidion's results were ok, with record cash receipts and cash flow positive for the qtr. $15.9m in cash at the bank.

FY revenue is expected to come in between $18.4-18.7m (up ~10% from FY19), and with $12.8m of contracted revenue already locked in for FY21. There's roughly another $4.5m locked in each year through to 2025.

For a business on >8x sales, it's really not enough.

$3.7m in contracted revenue was added over the quarter, double the same time last year. Over the past 12 months they've added around $14m -- but this is over multi-year contract periods.

It's great to be start starting FY21 with $12.8m already locked in, but remember that they started FY20 with $11.7m. Not all sales are recurring (~75% are), so there's still a lot of work to be won.

Still, i think that's possible.

With an expanded presence and resources, they should hopefully be able to build on the sales won last year -- especially given the covid tailwind. $6.8m in sales were added to FY20's starting position. If we assume $10m in new sales added for FY21, we'd get full year revenue of $22.8m in FY21 -- about 20% top line growth. 

$50m in sales by 2025 would require this growth to be sustained over that period.

Definitely achievable, but I wouldn't want to bank on more than that for valuation purposes.

ASX release here

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#Investment thesis
Added 4 months ago

To promote a healthy discussion, below are my thoughts around key reasons on why the share price has been drifting down. I welcome ideas from both sides and agreeing/disagreeing in a constructive manner.

Revenues are not growing quickly enough

The market might be expecting stronger revenue growth that the 9% uplift in FY20 revenue (using lower end of FY20 guidance, $18.3M vs $16.9M in FY19).

As mentioned in my previous posts, there are many factors contributing to this with the most obvious being Brexit (government in care taker mode and a new government being formed) and Covid19. Not only have these occurred during what would usually be the busiest period for Alcidion, it has also obscure the view of what would have been the first 'clean' full year (post integration etc) of the new Alcidion (old Alcidion + MKM Health). Because of this, the market does not have full visibility of the revenue generating profile of Alcidion in a typical year.

Nevertheless, I still think for Alcidion to be able to achieve revenue growth and beat revenue guidance in these difficult circumstances is a good effort.

It is also important note that the healthcare industry is a very slow moving beast, particularly so in the public system where the biggest proportion of Alcidion business reside. Customers are sticky, contracts are typically between 3 and 5 years, long winded procurement process, risk avoidance trumping innovation aka inertia etc. Consequently, things take a much longer time than many anticipate - for example:

  • customers would let their existing contract (if with a different provider) run down before they invest in a new system
  • the tendency to go with big multinationals as they are perceived to be lower risk
  • no one wants to be the first with an innovative product, safer to be follower than a leader (the concept of first movers advantage does not apply here!)
  • contract negotiations take a bloody long time (the MidCentral DHB contract took around 2.5 years to negotiate and execute, based on my previous discussion with the ex-CFO and ex-Chairman)
  • time lag between the scaling up of sales and marketing capability and growth

Alcidion has experienced the short term pain in Brexit and Covid19, but I think there would be some long-term gain. There will be an acceleration in the digitisation, data analytics and artificial intelligence because of regulatory compliance, demand for greater efficiency gains, capacity constraints etc.

Misinterpretation of contracted revenue figures

26% fall in FY21 contracted revenue of $12.8M vs. $17.2M in FY20 and also the perceived fall in recurring proportion of the contracted revenues

It is my belief that some market participants might have interpreted the 'contracted revenue' reported in the 4C of Q4 FY20. The contracted value relates solely to the start point of FY21. Without reading carefully the chart headings, some might assume there was actually a decline in contracted revenue performance.

However, if you compare it to the corresponding start point for FY20 (which was reported in the 4C of Q4 FY19, there is actually a 9% uplift. Not only is this a healthy starting point for FY21, there is also an increase in both the proportion of recurring revenue (up from $7.7M to $9.7M) and product revenues (up from $7.1M to $9.7M). Alcidion earns higher margins in revenues derived from recurring activities and products.

It can also be observed that the contracted revenue pipeline also gradually increase throughout the course of the financial year.

Growth in operating expenses has continued to outstrip growth in both revenues and cash receipts

Growth in Cost of Sale of Goods and Services is expected to outstrip revenue growth

In my view, Alcidion has been upfront in explaining this to the market for some time now. The focus is to increase top line revenue in the three key geographical markets, noting that the 'old Alcidion' pretty much did not have a sales and marketing team. The 'new Alcidion' therefore has to improve and enlarge its sales an marketing team and capability to cross and up sell the additional products and services.

As mentioned above, there is a time lag between the scaling up of sales and marketing capability and when growth actually flows through.

One of the key takeaway from the recent webinar is that the COO/CFO expects headcount to still increase but with the costs to stabilise around the $4.75M per quarter mark. Give or take, all else being equal, Alcidion really needs consistent cash receipts of approximately +$7.6M to achieve positive cashflow.

One might reasonably ask why is this important. Again, based on my previous discussion with the management, it is my understanding that some of the institutional investors that they have engaged with had given the feedback that Alcidion needs to achieve 'consistent' positive quarterly cashflow before they would consider investing, mainly due to risk management and their investment mandate.

A lot of optimism or expectations were baked into the market capitalisation

At market valuation >$120M, the market was valuing Alcidion as a typical SaaS business and expecting strong revenue growth and quicker execution of contracts. The current trajectory does not match this profile.

As mentioned above, the public segment of the healthcare sector that Alcidion is focusing on is notoriously slow. Perhaps I also have been previously guilty of valuing Alcidion as a typical SaaS business and using peer comparison without fully appreciating how slowly things can move.

I was quietly impressed with Alcidion's performance in FY20 despite the headwinds. But obviously the market holds a different view, partly explaining the recent share price decline following the release of the 4C of Q4 FY20.

But then market sentiment can change quickly - for better or worse. Hopefully, it will turn for the better as management continues to execute and hit some sixes for us.

View Attachment

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#$9.5M deal with South Tees Con
Last edited 2 weeks ago

This is the largest Miya Precision contract they have signed to date. 

  • $5.48M to be recognised in FY21 which brings total revenues to $20.2M with 7 months left to go in this financial year. 
  • South Tees is the largest hospital trust in Tees Valley in the United Kingdom, with over 1,000 beds and employing approximately 9,000 clinical and operational staff and providing care for more than 1.5 million people. Not surprised that this contract win took a while to execute. 
  • Alcidion is integrating to the heart of the NHS digital strategy. This is becoming an incredibly sticky product while forging strong relationships with the NHS. 
  • The question you should consider is would the UK government still fund NHS. If they don't then the NHS do not have enough capital to procure technology solutions. I believe they will and they have during the pandemic. Alcidion is one of the first companies in line.      
  • In terms of valuation from this contract alone: 
    • Current Revenue ~ $15M, market cap = $123M, share price = $0.125,
    • Future Revenue ~ $20M, market cap = $164M (based on 33% increase in revenue), share price = $0.165 
    • So a 33% jump in share price today is a possibility when market opens
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#Management
Added 2 months ago

More inside buying from Kate (1.5m shares at current price), which pushes her total to over 58m. The share price has been held back for quite some time now, so maybe this backing from management (once again) can help get things going. Holders have been asked to be patient with this one and we are hoping the next quarterly doesn't disappoint. 

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#FY2020 Results Presentation
Added 2 months ago

9th September 2020 – FY20 Results Presentation

Headlines

·         $18.6m revenue – 10% gain on FY19

·         $12.8m presold revenue to recognised in FY21 – (this is 9% more than presold revenue from FY19 recognised in FY20)

·         Cash reserves currently at $15.9m (cash burn has been estimated at $2m p/a so it gives them some time to get CF positive)

P&L highlights

·         Recurring revenues as a % of total sales has risen from 46% to 56% - This is a positive sign for me as that switch to a SaaS model and that revenues are ‘locked in’ for future periods

·         Cost of Sales has risen with highlights in the following

o   Sales/staff & commissions up 48%

o   Product development costs actually DECREASED

o   Salaries/wages for staff up 56%

o   Marketing costs DECREASED

o   Operations admin costs DOUBLED

 

So breaking down these highlights, the market knew ALC was pushing back the expected date for cashflow breakeven and these results mostly reflect that. I don’t see the massive drive in operating costs over FY20 as bad as it sounds, I believe it is a necessary cost that helps build the footing for the company in the future. We could compare it to the 1991 Paul Keating quote “the recession Australia had to have”. The notion here being that ALC needed to bolster its sales staff & operating spending for the business for any success to be achievable in the future.

I found it surprising marketing costs were slightly down though, but I’m not 100% sure of the tender process ALC go through in winning new contracts and what role marketing plays in this.

 

Overall, an expected result as indicated by Kate & co through previous announcements. FY21 is a key year for these operating costs to flatten out and management begin to execute their plan and get some contracts on the board!

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#ASX Announcements
Added 4 months ago

Alcidion appointed to UK National Health Service (NHS) Clinical Communications Procurement Framework

Mobile clinical communications improve clinician and patient experience

A new multi-million pound framework that will help the NHS ‘purge the pager’ provides NHS trusts in the UK with a means to quickly and easily procure Alcidion’s Smartpage messaging system without tendering.

NHSX has awarded Alcidion a place on its £3 million Clinical Communications Procurement Framework, a new procurement vehicle to help the NHS phase out pagers by the end of next year.

Smartpage allows instant two-way messaging between busy professionals providing them with read receipts and guaranteed delivery between all care team members, as well as the ability to share images and assign tasks. Healthcare providers using the system are also given organisation wide oversight in real time.

Lynette Ousby, UK general manager for Alcidion, said: “NHSX has shown a commitment through this framework to accelerate the spread of modern technologies in the health service that can help healthcare professionals communicate effectively during the busiest of times.

“The inclusion of Smartpage on this framework is an important independent validation for Alcidion’s Smartpage product. We look forward to helping trusts modernise their communications tools through a framework in a way that is affordable and straightforward.”

The new framework follows an order from health and social care secretary Matt Hancock for the removal of pagers from the NHS for non-emergency communications by the end of 2021. Speaking at the time in 2019, he said: “Every day, our wonderful NHS staff work incredibly hard in what can be challenging and high-pressured environments. The last thing they need are the frustrations of having to deal with outdated technology – they deserve the very best equipment to help them do their jobs”.

Alcidion has had significant success with Smartpage over recent months. Reliable and secure communication between clinicians is a critical component of digitally integrated and coordinated care across the healthcare sector. However, siloed information due to a complex mix of pagers, legacy phones and whiteboards is a cause of communication delays or errors in many hospitals today. This can lead to longer waiting times, delayed or missed care and lack of visibility into staff workloads.

To address these challenges, four leading healthcare organisations have chosen to implement or extend the use of Alcidion’s smart clinical messaging platform Smartpage: ACT Health, Nelson Marlborough District Health Board, Counties Manukau District Health Board and Townsville Hospital and Health Service.

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#Contract win
Added 5 months ago

Alcidion has signed an inital 12 month contract with Sydney Local Health District valued at $560k.

Sydney LHD overseas 5 hospitals including Prince Alfred and Concord hospitals.

This is in part a result of the customer needing to remotely manage Covid-19 patients, but will have application well beyond that when fully rolled out. It's a good foot in the door, and has potential to be extended and broadened once the initial term has ended

The market has responded by puishing shares ~10% higher.

You can read the ASX announcement here

 

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#ASX Announcements
Added 4 weeks ago

27 October 2020

Q1 FY2021 Business UpdateStrong first quarter of sales, investment in growth continues

Melbourne, Australia – Alcidion Group Limited (ASX: ALC) today released its Appendix 4C for the three-month period ended 30 September 2020 (Q1 FY2021) and the below business update.

Highlights:

  • Strong start to FY2021, with $4.8M new contracted revenue sold in Q1 – up 30% on previous quarter and up 92% on Q1 last year;
  • Total contracted revenue to be recognised in FY2021 stands at $14.7M at end Q1, up 14% on Q1 last year;•Cash receipts from customers were $6.4M in Q1, a 34% increase on Q1 FY20;
  • Net cash outflow of $1.2M, reflecting ongoing investment in growing the business with cash reserves of $14.7M at end Q1;
  • Significant contracts signed or announced since 1 July 2020:

* Sydney LHD –12-month contract for Miya Precision to support COVID-19 virtual care

* Murrumbidgee LHD – 12-month contract for Miya Precision platform including Miya Memory

* NHS Lanarkshire – 5-year agreement to implement Patientrack across boardoACT Health – 2-year extension to long term integration support contract and further project work

* Queensland Health – additional work on the Referral Services Directory(RSD) platform

* Lancashire Teaching NHS Trust – 5-year Smartpage contractoPanel contract with Vic DHHS for implementation and support of the Victorian Hospital Incident Management System

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#Management
Added 3 months ago

For the sake of writing down my thoughts, here is what I took away from the Digital Health webinar.

Everything was well-presented and quite straight-forward. It didn't feel like a sales pitch, which was the issue with a previous Digital Health article on ALC. Malcolm went into great detail about the practicality of Miya Precision and how the data it collates and displays can be used by clinicians effectively and productively.

It was great to hear from Neil Perry, the Director of Digital Transformation at Dartford and Gravesham NHS Trust. He went into great detail about the selection process of why they chose Miya Precision, noting that clinicians and technical professions showed a preference to Miya Precison and pushed for it over other options, and that management are happy with the results they are seeing. The partnership aspect was an important factor to them, meaning there was no need to 'rip and replace' their previous system.

Furthering on the partnership aspect of the business, Kate mentioned the partnership with eHealth NSW, noting that it was the customer who approached them with the intention of overlaying the existing Cerner EMR with Miya Precision to strengthen it's capabilities. This resulted in what is effectively a partnership between ALC and Cerner. In another answer, Kate focused on the partnership aspect of Miya Precision, noting is their focus to build upon the strengths of other PAS/EMR systems, negating the need for hospitals to replace the systems they currently have in place.

I was aware of the capability of Miya Precision to work with other PAS/EMR systems and this presentation has increased my confidence that there isn't a need to worry when competitors win contracts, eg. Epic's recent contract with ACT Health. This should negate some of the risk for hospitals when making the decision of digitalisation in regards to the money & time investment that is often a hot-topic when hospital contracts are discussed.

For those that wish to watch, the presentation is at the bottom of the page linked below.

https://www.digitalhealth.net/events/introducing-a-new-kind-of-technology-for-the-nhs/

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#Contract win + long term view
Added 2 weeks ago

Alcidion Signs $9.5 million deal with South Tees Hospitals NHS Foundation Trust.   

Here are a few extra details; 

One of the hospitals within the trust includes The James Cook University Hospital which is a large, 1,024 bed major tertiary referral hospital.

The hospital is also a tertiary training centre for Newcastle Medical School. Which consistently ranks in the top 10 medical schools in the UK.  

Alcidion currently provides services to follow NHS Foundation Trust's; 

- Manchester university hospital
- Basildon and Thurrock university hospitals
- Westerns Sussex hospitals 
- Fife

These hospitals all provided training for medical students, junior doctors and allied health.

In my opinion, if Alcidion can continue to provide quality services within these organisations it will have a large positive impact on the future perception of Alcidion's products by the junior medical and allied health professionals who are now coming through the pipeline of training and education. This group of people will be one of the important voices of feedback regarding product efficiency and quality which has a large weighting on long term success. 

 

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#$9.5M deal with South Tees Con
Added a week ago

Claude Walker from A Rich Life does a great breakdown of the recent deal here.

Update: Alcidion CEO Kate Quirke has gotten back to me and said: “The announced total contract value of $9.5M over 5 years includes all components of the total solution sold, including the resold OPENeP ePMA solution.  This solution however represents less than 20% of the total value of the 5 year contract.”

Overall, this is good news for shareholders as it suggests at least $6.5 million of recurring revenue from Miya, over 5 years. This in turn translates to about $1.3m per year in recurring revenue from Miya. That’s great news, and roughly in line with other contracts (albeit a bit bigger).

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#4th QTR 2020 results
Added 4 months ago

I thought the quarterly reads okay to me. In fact, it has given me extra confidence that management is continuing to execute on their strategy, despite the current difficult times.

Key highlights include:
 

  • Positive net operating cashflow - plus for me, wasn't expecting this
  • Uplift in FY20 revenue forecast - from $17.2M (as at end of Q3 FY20) to the range of $18.4M to $18.7M (as at end of Q4 FY20). Also uplift from FY19 revenue of $16.9M. Bloody impressive in the context of Brexit and Covid19, if you ask me for the reasons Kate mentioned about resources being diverted to the front/last line!
  • Continuing uplift in operating expenses - within expectations given management has reiterated this multiple times that the increase in sales and marketing investment/expenditure is to drive top line revenue growth. You have to be either living in lala land or not bother carry out some basic research before posting any criticism


Additional highlights for me include:
 

  • Very low customer churn rate - Kate mentioned that she cannot recall a contract not being renewed once the product is embedded into the customer's system
  • The is a level of pent up demand that will flow through
  • Recurring revenues will continue to increase as contracts gets renewed based on a subscription model
  • Developments in NZ as a result of the Simpson review. Well worth a read as it touches on digital and virtual care. One recommendation in particular caught my attention: 'priority for digital investment shouldbe given to initiatives that will accelerate interoperability'
  • Alcidion currently in active discussions with a number of parties about their products
  • Structural tailwinds remain intact or might have even accelerate - e.g. virtual care settings and ongoing increased focus on digitalisation in UK and NZ.


If I remember correctly, Kate also hinted at an uptake of Patientrack in NZ.

Based on 'current' operational performance and valuation, Alcidion's current market cap is probably about right or a bit tad higher.

But for some of us, we are investing in what Alcidion could be in 4 or 5 years time. For things to play out as we think it should, it requires a combination of luck, good execution by management etc. Things may either play out exactly the way we believe it should or turn shit house - all part of investing.

Everyone's valuation of Alcidion will be dependent on a number of factors, including: your investment horizon, confidence in management execution, view of structural tailwinds or headwinds, sustainability of growth rates, capacity of Alcidion to upsell and cross sell its products, etc.... hence my previous comment of Alcidion probably being a case of 'averaging up'...

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#ASX Announcements
Last edited 4 months ago

NHS Lanarkshire to deploy Patientrack across entire board

Highlights:

* NHS Lanarkshire to deploy Patientrack to all three Lanarkshire hospitals and into the community setting, covering approximately 1,250 beds

* $1.52M total value to be recognised over five years to 2025

* NHS Lanarkshire is the second NHS Scotland Health Board to implement the Alcidion Patientrack solution
 

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#ASX Announcements
Added 4 months ago

Murrumbidgee LHD signs contracts for Miya Precision

* Contracts signed for Murrumbidgee LHD continued use of Miya Precision and Miya MEMRe

* COVID-19 and out-of-hospital monitoring capabilities incorporated into the solution

* Miya MEMRe to be rolled out to up to an additional 200 doctors

* Total contract value of $686k for 12 months from Jan 2020

View Attachment

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#Chart
Added 7 days ago

17 Nov 20: Since ALC annouced it's largest ever contract, the share price had a break out to $0.18.  It fell back down to $0.155 but the buyers have soaked up all the selling and now it has broken above the trading range is hit a new high of $0.195.

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#FY20 Results
Added 3 months ago

Alcidion's full year result pretty much came in as expected.

Ongoing investment in sales and marketing capabilities continue to delay cash flow break even. But this is a necessity to capitalise on the market opportunity. In fact, I think the structural shifts that were occurring prior to Covid19 and subsequently accelerated by the pandemic makes first mover advantage in the emerging land grab more the important.

Increased cost base is expected to stablise in FY21. Colin mentioned in the previous 4C webinar that he expects costs to stabilise around the $4.75M per quarter mark. Give or take, all else being equal, Alcidion really needs consistent cash receipts of approximately +$7.6M to achieve positive cashflow.

Going by the above rough numbers, Alcidion will probably hit profitability when revenue exceeds >$30M. This probably means profitability is still a few years away given the FY20 revenue figure of $18.6M. Like all SaaS companies, profitability will really accelerate when recurring revenues inched closer to the cost base.

Having said that, the timeline will be dramatically shorten IF Alcidion manages to secure a major contract. the Managing Director mentioned that she envisaged a integrated product offering for a trust over 5-years would be around the $7M to $8M range. Obviously the actual number might differ depending on the number of individual hospitals and beds involved, but it still provides a useful reference on the size of contract that could potentially eventuate.

The Managing Director also kinda hinted that she expects revenues to accelerate in the second half of FY21. All the necessary building blocks are slowly being placed in position to facilitate the emerging market opportunity. It all comes down to execution now.

The only bit of the webinar that I had me a little concerned is the CFO's explanation for cost of sale of goods and services, in response to Alcidion's low gross profit.

In the FY19 Annual Report, Alcidion stated the following:

NOTE: The Cost of Sale of Goods and Services for 2019 and 2018 differs from that presented in the unaudited Preliminary Financial Statements which followed the presentation used in the 2018 Annual Report, which deducted only the cost of third party product and hardware (i.e. cost of sale of goods only) from revenue to determine Gross Profit. This was inconsistent with how Gross Profit was presented in the 2019 Half Year Review where the cost of direct labour used to deliver services and develop, maintain and support product was also included in the Cost of Sale of Goods and Services. Accordingly, the cost of direct labour has been reclassified from the total Directors and Employee Benefits Expense amounts shown above to Cost of Sale of Goods and Services and the calculation of Gross Profit reflects this

I previously queried Alcidion on this change and their response is pretty much that it was permitted by standards, auditor did not raise concerns and that it was more reflective of the nature of their business.

In yesterday's webinar, the CFO acknowledged that their approach has made the result look much worse that it actually is, compared to if the direct cost of labour (which is quite significantly) was to be put below the top line. He further flagged the possibility of taking those costs out next year to boost the gross profit margin figure.

I am not implying something dodgy is going on and is convinced every adjustment will be done in accordance to accounting standards etc, BUT can anyone with an accounting background explain this discretion for companies to change their reporting methodology as they see fit?

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#Bull Case
Added 6 months ago

ALC have generated a strong array of products/services that are unique to the healthcare/technology sector, especially the MIYA MEMRE product. This allows for patients to be monitored at home.

On the back of COVID we will expect to see a lot of funding driven into patient management, not necessarily to deal with another pandemic, but to better improve the healthcare system and management of patients by hospitals. This will be particularly focused on the UK, with NHS massively struggling with the COVID outbreak. (still applies in Australia, not as strong as a case however). The overall hope here is that there is a great demand for electronical medical records (EMR’s) on the back on this pandemic and that ALC management are able to execute a plan that sees large revenue growth in the coming years.

They have been winning a fair number of contracts and have performed very strongly in the first half of FY20 respective of FY19. Currently ALC only operate in the UK, AUS & NZ as far as I am aware. This leaves the US market (amongst others) completely[at1]  untapped, which leaves room for great potential in the future.

In terms of financial metrics, they have no debt and cash reserves of $17.2 million. (due to cap raise) in H12020. Overall revenue in h1 FY2020 grew by 12.3%, and hopefully we can see continued growth down the line.

 [at1]

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#Bull Case
Added 2 weeks ago
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#ALC
Added 4 weeks ago

**I have taken for of an opinionated view of the Q1 report  to differentiate my straw to @GetSmart's

 

October 27th, 2020 – Q1 FY2021

 

Headlines

·         Q1 revenue at $4.8m (30% versus sequential and 92% on pcp)

o   This reflects the new contracts signed over the past 12 months. (NHS, Murrumbidgee..)

·         Total contracted (pre-sold) revenue for FY2021 is at $14.7m (14% increase pcp)

o   Though last year, the pre-sold revenue for FY2020 was $12.9m (which was a 16% increase from that of FY2019)

o   Hence the rate of change in growth has slowed (2%) – i.e the second derivative of revenue growth has become negative (thanks high school maths)

·         Cash outflow for Q1 of ($1.2M)

o   We know ALC have dipped back into cash flow negative as the cost base has been rising

o   This cost base expected to flatten out over this current FY2021

·         Cash receipts @ $6.4m

·         Reclassification of non-recurring revenues as recurring revenues

o   Product license fees that were previously recognized as non-recurring as now counted as recurring. This results in a $269k or 3% increase.

o   These license fees “nearly always continue” hence the reclassification

·         Presold revenue

o   $32.8m revenue sold out over the next 5 years, equating to ¬$6.5m per year presold.

 

My thoughts

·         Rather in line with expectations, slight changes to accounting and classification for revenues make may things look attractive, but these results are in line with previous expectations

·         The announcement mentions a new NHSX ‘Clinical Communications Procurement’ that ALC are involved in where the NHS is turning to tech for its health departments, but no details provided regarding revenues etc…

·         Cash reserves at $14.7m, which gives them around 5-6 quarters of continued cash outflows before they need to tap up shareholders for capital again

·         The recent announcement of employee incentives was not a good look, as these incentives become activated if ALC manages to outperform the market between now and FY2023

o   6.5m performance rights given that TSR is positive and/or greater than the market (S&P/200) by JH23, which is not an overly ambitious goal in my view.

 

{I hold ALC shares, though I have lost some confidence on the back of some of the latest decisions by management as well as some of the reports from some healthcare workers here on Strawman}

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#Management
Last edited 3 months ago

Re-energising the health tech landscape

https://www.digitalhealth.net/events/re-energising-the-health-tech-landscape/

There will be a webinar in conjunction with Digital Health at 7pm (Melbourne, Sydney) on the 4th of September, 2020. The webinar will take place on Zoom.

https://zoom.us/webinar/register/WN_IQz1RZrqRU6_Z8PULWRcpQ?timezone_id=Australia%2FSydney

From the article:

"A new type of technology is being launched into the NHS that will re-energise the health tech landscape.

Miya Precision – the very first smart clinical asset for the NHS – is already attracting the attention of healthcare organisations looking to accelerate their digital adoption. Whether they are pursuing an electronic patient record, best of breed digital programme or are an integrated care system joining up disparate systems, Miya Precision offers an intelligent solution to unlock value from existing investments.

Using its clinical decision support engine, Miya Precision provides the necessary automation to alleviate the cognitive burden faced by clinicians. Early communications about the smart clinical asset sparked significant reaction from Digital Health readers and now Alcidion is holding this webinar with Digital Health to share more detailed information.

This webinar will:

  • Introduce how and why the NHS needs a smart clinical asset as a new type of technology
  • Provide details of the solution and how it works
  • Offer an opportunity to ask questions of those bringing the new product to market and supporters from the health sector

Speakers include:

  • Kate Quirke, CEO Alcidion
  • Malcolm Pradhan, Director, chief medical officer
  • Lynette Ousby, general manager UK
  • Tom Scott, sales director UK, Alcidion
  • Other industry supporters (to be announced)
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#Investment thesis
Added 4 months ago

Comparing to the end of FY19 (30 June), we have seen positive developments on the following fronts:
 

  • Share price - up 15% (28/07/20 closing share price of $0.15 vs. 30/06/19 closing share price of $0.13). This also ignores the extra shares issued as part of the capital raise)
  • Market capitalisation - up 40% (28/07/20 closing value of $148.6m vs. 30/06/19 closing value of $106m)
  • Enterprise value - up 29% (28/07/20 closing value of $132.7m vs. 30/06/19 closing value of $102.9m)
  • Revenue growth - at the end of Q4, contracted revenue in the range of $18.3M - $18.7M in sold revenue set to be recognised in FY2020, exceeding FY2019 full yearrevenue of $16.9M
  • On market purchase by Managing Director and Chairperson - the former to the tune to $137,000
  • Partnership signed with Healthscope for data and analytics - contract with a big private hospital operator (approximately 43 hospitals). It wasn't so much the $2.1mil contract number as it is the potential that it unlock
  • Patientrack renewals, extensions etc - for example, NHS Fife extends Patientrack across Board and renews for five years
  • PoC - Murrumbidgee LHD to expand and extend use of Miya Precision and Miya MEMRe


I am certainly not suggesting that everything is rosy but credit should be given to the management for the achievements to date, bearing in mind that Brexit had slowed things in Q3 FY10. Covid19 further slowed things down as all available health resources were rightly diverted to the front line. Hence, procurement, sales and marketing etc has all taken a back seat. This delay is not specific to Alcidion but is consistent across the various health companies that I follow.

Based on current available information, the risk-reward proposition has definitely changed somewhat because of the following:
 

  • some revenue recognition would be pushed back possibly into FY21 due to performance milestones being delayed at customers' request as they are focusing efforts on the covid19 front
  • similarly, lengthening in the sales cycle for the above mentioned covid19 reason, cancellation of trade shows, restrictions in air travel etc
  • growth in operational expenses exceeding revenue growth (due to Alcidion's expansion strategy and hence recent increased spending in new hires and boasting their sales and market capability)


But on the other hand, the current pandemic should also accelerate the structural tailwinds that were already in play, namely:

  • increased uptake of technological solutions in the delivery of healthcare
  • greater emphasis to maintain hospital capacity (via moving people out of the hospital system quicker where possible)
  • focus on seeking greater operational efficiencies and/or effectiveness of healthcare delivery etc
  • increased healthcare spending


At this point in time, Alcidion is probably a company that one should consider 'averaging up' as management further earn their stripes as opposed to 'averaging down'. I suspect this is probably the approach some smart investors are adopting in respect to Alcidion.

Some potential positive developments include:
 

  • PoC results from the evaluation study and possibility of a statewide roll out (including remote monitoring). Also the possibility of accelerated growth in other states if PoC results are positive
  • Accelerated revenue growth in FY21 or FY22 from resumption of procurement, purchasing etc
  • Shorten sales cycle and greater uptake of the higher margin Miya platform business due to cross-selling and possibly lower customer acquisition costs
  • Potential M&A (unlikely but I can't help but feel something is brewing in the background). My guess is that Alcidion growth would be driven by acquisitions, mergers and organically. I am thinking any acquisition (should there be one) would have to be around the >$30 million market to deliver a substantial impact
  • Further developments on the Healthscope and Calvary fronts (remembering that the development of a data warehouse is always the first phase of a more substantive piece of work) and the private hospital segment
  • Geographical expansion and/or announcement of distributors in new geographical markets


If one take a longer view (>5 years), I really think that Alcidion is at a sweet spot - intersection of technology and healthcare. It is more likely to be a 'growth at reasonable price' company rather than one that would experience explosive growth rates. I would be extremely happy to be wrong though!

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#Management
Added 4 months ago

Alcidion Managing Director Kate Quirke said, “Despite challenging market conditions during the final quarter of the financial year, as the COVID-19 Pandemic (“COVID”) continued globally, we are pleased to deliver a healthy sales performance in the final quarter. Whilst COVID has delayed the signing of some contracts, with frontline healthcare organisations focused on the provision of critical care, we are pleased that the pipeline of potential business has continued to grow and we remain confident of our further growth.”

“The benefits that our technology can deliver; in managing risk, assisting clinicians to monitor patients and manage resources, both in the hospital and remotely, has been highlighted during COVID. This environment, and the enhancements we have made to our product suite to help healthcare providers manage COVID-19 risk, have contributed to us securing new customers and contracts in Australia and the UK.”

“Our involvement in the Monklands digital hospital experience run by NHS Lanarkshire was a springboard to our first Patientrack contract with this NHS board, further expanding our presence in NHS Scotland. We are also pleased to see the use of Miya Precision expand across NSW, with both Sydney LHD and Murrumbidgee LHD signing contracts for initial 12-month periods.

“Despite the current global climate, we are pleased to report growth in Q4 and FY2020 overall. We enter FY2021 well prepared to drive further growth, with a solid base of contracted revenue, much of which is recurring revenue, and a healthy pipeline of potential sales. In the current environment the strength of our value proposition to support both short term COVID-19 management and the longterm digital transformation of healthcare, is being increasingly recognised.”

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#ASX Announcements
Added 1 day ago

If I understand things correctly, we will have a good 4C either Q2FY21 or, more likely, Q3FY21. This would be mainly driven by the recent $9.5M South Tees' contract for the following reasons:
 

  • The £28 million Digital Aspirant programme is only available for the first year
  • The programme was announced by the UK Health Secretary in December 2019, but the 23 selected NHS Trusts were only confirmed by NHSX in March 2020.
  • In the UK the financial year began on 1 April 2020, and runs until 31 March 2021, for the purposes of government working out their finances and budgets
  • There is an emphasis on the selected NHS Trusts to utilise their grant funding in the financial year to which the funds are granted, as reiterated by Kate in the webinar


Because the South Tees contract is structured in such a way that it is heavily front loaded with approximately $5.48M of the total contract value is planned to be recognised as revenue in FY2021 (subject to milestone achievement), I suspect there is a sense of urgency in dispensing the grant funding as soon as practicable before the end of the UK financial year and therefore potentially boosting the cash inflow in either Q2 or Q3 of FY21. However, there can be a small difference in the timing of the cash inflow and revenue recognition.

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#Management
Last edited 3 months ago

Introducing a new kind of technology for the NHS: Alcidion’s Miya Precision platform

https://www.digitalhealth.net/events/introducing-a-new-kind-of-technology-for-the-nhs/

As I mentioned in a previous Straw, there was a webinar on the Digital Health website last night about Alcidion and its introduction to the NHS. The webinar is now available to watch at the bottom of the page linked above.

Worth a watch for any shareholder, new or old!

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#FY2020 Results Presentation
Added 1 day ago

Key takeaways for me are:
 

  • Profitability - first time (I believe) this has been publicly stated. I still believe FY21 to be a year of accelerated revenue growth and that just maybe, profitability in FY22.
  • Revenue growth - question is how many more contracts can they win and how high can the total FY21 revenue figure be? As at 19 November 2020, Alcidion is expected to recognised $20.2M of revenues in FY21, with seven more months to go. Management has repeatedly stated that they expect accelerated revenue growth for 2HFY21
  • Operating leverage - cost base expected to stabilise at 1HFY21 levels. In my view, the key revenue threshold is around $30M. Once revenue exceeds this figure (assuming all else being equal), operating leverage will kick in and the majority of any new revenues will flow straight down to the bottom line. To be sure, Alcidion has a highly scale-able business model and is easily capable of generating sales in the several tens of millions of dollars with just a few NHS contracts.
  • Regulatory tailwinds - still intact and accelerating. Traction in key markets such as NZ (Simpson Review) and UK (Digital Aspirant program). Important to note that for some such as the latter, the funding is there - £28M in the first year and further funding to be provided over the next four years.
  • Progress on GP and community system - interesting developments taking place in this space. For context:


Key players from the NHS, big tech and pharmaceutical companies have been in discussions over the potential to commercialise 65 million NHS medical records, valued at up to £10B a year. Plans are for a “single, standardised, event-based, longitudinal patient record” pulled together from GPs, hospitals, mental health professionals, demographics registers, prescription records as well as information from the private health sector, with the aim of improving improve outcomes for clinical trials, drug discovery and medical technology.
 

  • Growth strategy - Alcidion's success in the short to medium term will continue to be heavily reliant on the UK market. Current growth strategy in that market of focusing on early adopters and digital exemplars to establish reference sites and leveraging off the NHSX Clinical Communications Procurement Framework makes sense to me.
  • Near term catalysts - Management noted the strong potential to expand scope of initial customer contracts signed in Australian market. My guess is that there have been discussions with some health districts in NSW in particular. Also, do not discount the potential for some catalysts from NZ. Remote patient monitoring will also will also be increasingly be a new market.


Separately, my understanding is that there have been some movements in the share register:
 

  • Cyan Investment has increased its holdings
  • Two nominees (Citicorp and JP Morgan) have also been buying. Question is for whom? Also, I wouldn't be surprised if they are not behind the repeatedly 1 share after market trade (as have yet happened again today!)
  • Donald K has sold down some of his holdings via (presumably) an arranged trade with Kate
  • Found of Patientrack (Michael Buist) has sold down some of this holdings. Good on him, he deserves a nice payoff.
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#Bear case & inflection point
Last edited 4 weeks ago

*I'd like to start off by saying I do own some ALC shares and the purpose of this straw is to play devil's adovcate and highlight some risks.

 

On the back of the Q1FY2021 result, we can see that there was a net cash outflow for the quarter of $1.2m. Given the incoming receipts of $6.4m, this implies a cash burn of $7.6m p.q

Extending this to a yearly basis gives a cash burn of of ~$30m indicating they should hit profitability around revenues exceed $30.4m (which is a lot higher than the current $18.61m), given that the cost base stabilises which is what management have mentioned they expect in FY21.

 

Given the current rate of receipts of $6.4m per quarter, they will reach ~$25m in revenue by year end if NO NEW CONTRACTED REVENUE IS SIGNED. I approximate in my head this figure will be closer to $26m given that the last quarter of each FY has tended to have higher receipts.

 

Given that last JH20 had a negative NPAT of ~$2m, i expect that the EPS/NPAT this FY will be further negative unless more sales are brought in this year. Given that the Murrimbidgee site is only a 12-month contract, we must hope that ALC are able to renew this. (I did ask Kate during the Q1 Presentation this week and she told me "they are in talks over renewal" which is somewhat positive".

 

Given the number crunching, i put a lot of thought into the sales pipeline for ALC. COVID has obviously made this process harder, but hospitals in general are extremely slow-moving when it comes to embracing change. To supplement this, there is plenty of commentary regarding the lack of change in hospitals from posters on Strawman (@Chagsy wrote a straw I believe). 

The sales pipeline in the UK is more difficult than that in Aus due to the need for a tendering process and all the political/legal crap that is involved with this. In saying that, the industry & ALC still face a tailwind moving forward - the digitisation of the medical industry but I think it is further in the future than we imagine and I believe Alcidion's sales plan is lofty.

 

 

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#Valuation
Added 4 months ago

Very much a novice here but just wondering what the market would need to see for Alcidion to increase its value? From what I have seen/read they have been increasing contracts and earnings but yet the share price has sat steady now dropping slightly.

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#contracts
Last edited 4 months ago

Execution from management...?

This ABC article points out the major need for SaaS products such as that offered by Alcidion.

Winning contracts in the next 12-18 months is a MUST for the long term success of this company. When else is a major opportunity such as COVID going to present itself.

 

Kate & her team need to position the business in the best position to get contracts over the line rather than revenue going to competitors

View Attachment

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#Contract win
Added 5 months ago

Really nice to see ALC winning a contract domestically(allbeit fairly small).

My investment thesis when i purchased ALC shares was on the basis that they can use COVID as a performance booster to nail down some contracts and boost sales growth.

This new annoucement with hospitals in Sydney (Concord etc) shows a foot in the door, and gives potential for further contract winnings. - very pleased

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#ASX Announcements
Last edited 4 months ago

Q4 FY2020 Business Update Solid results during challenging times

Highlights:

* Healthy Q4 sales performance despite challenging market, with $3.7M contracted revenue added in the quarter, more than double the corresponding period last year

* Final FY2020 revenue anticipated to be in the range of $18.4M and $18.7M

* $12.8M in revenue has already been contracted to be recognised in FY21 with a further $17.0M sold out to FY2025

* Net operating cash flow surplus for the quarter of $0.25M, resulting in cash reserves of $15.9M at 30 June 2020

* Cash receipts for the quarter from operations of $7.6M, consistent with usual uplift at year-end

* Alcidion products have been enhanced for in-hospital and remote monitoring of COVID-19 patients and deployed live into hospitals

* Significant contracts signed and announced since 1 April 2020 include:

o NHS Fife – 5-year Patientrack extension across entire board

o NHS Lanarkshire – 5-year agreement to implement Patientrack across board

o Sydney LHD – initial 12-month contract for Miya Precision to support COVID-19 virtual care

o Murrumbidgee LHD – 12-month contract for full Miya Precision platform including MEMRe

o ACT Health – 2-year extension to long term integration support contract

View Attachment

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#Business Model/Strategy
Last edited 2 months ago

Alcidion Group Limited (ALC) are a healthcare technology-based firm that engage in the development of software products to be used in hospitals, with the overall aim of improving systems deployed in hospitals and ultimately saving lives. They are based out of South Australia but sell products in Australia, NZ & the UK.

Most recent contract wins (most are recurring revenues)

·         Townsville hospital

·         NHS Fife (UK)

·         Murrumbidgee LHD

Products they offer

Patientrack – tracks patient status and uses predictive and recursive algorithms to support time-critical care.

MIYA Precision – combines AI-based Predictive analytics and a Clinical Decision Support (CDS) to create a dashboard for hospital staff. Used for decision making, patient flow monitoring and track patient deterioration risk using data.

MIYA MEMRE – Creation of a mobile platform for MIYA precision, allows for a mobile patient record.

 

(I hold)

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#ASX Announcements
Added 3 months ago

Alcidion grows recurring revenue base, while investing to accelerate growth

Melbourne, Australia – Alcidion (ASX: ALC) has today released its audited full year results and Annual Report to Shareholders for the Financial Year ended 30 June 2020 (FY2020).

Highlights:

  • $18.6M revenue reported for FY2020, 10% increase vs FY2019;
  • Recurring revenue significantly increasing to $10.5M, 35% up on the prior year;
  • Net loss of $3.1M, reflecting planned investments to accelerate growth;
  • Cash reserves of $15.9M, well capitalised to support further growth in FY2021;
  • Significant product contracts signed in the UK and Australia
  • Entering FY2021 poised for further growth, with strong pipeline of potential business and $12.8M already contracted revenue to be recognised in FY21.

View Attachment

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#Bull Case
Added 10 months ago

revenue for 6 months nearly equal to prior 12 months...

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