Volpara Health Technologies Limited

Volpara Health Technologies Limited (ASX: VHT) with a market cap of $232.94m operates in the field of breast imaging analytics and associated products that help in the clinical decision making and early detection of breast cancer. The group now has 99 VolparaEnterprise SaaS customers as at end of HY19, and annual recurring revenue (ARR) has been up 35% at $4.8M. The aggressive forecast for FY19 is to achieve $9M ARR and end of a record October demonstrated ARR of over $5.1M.
Footprint expansion to drive future growth: VHT has expanded its presence in Asia, mainly in Japan where the company has now 16 contracts. Footprint expansion was well driven by major key wins across both Australia and New Zealand through Australia - Alfred Imaging and New Zealand - Broadway Radiology, Mercury Radiology Auckland and BreastScreen Central, NZ. Renewal of contracts of the existing customers such as Charlotte Radiology and Austin Radiological Association Diagnostic Imaging further showed the strong confidence of customers on VHT products.

Financial growth has been mixed: Volpara ended FY18 year with Annual Recurring Revenues (ARR) of NZ $3.6M (up 223%) and Total Contract Value (TCV) of NZ $11.2M (up 173%) respectively over FY17. Volpara’s net loss was down 8% with cost management and higher sales. For last six months ending September 2018, the group’s revenues were up to NZ $ 2.6m from prior corresponding period’s NZ $ 1.7M. However, operating loss increased to NZ$5.37m in HY2019 from NZ$4.37 in HY2018. Net loss for the period has grown to NZ$5.1m as compared to NZ$4.2 in the corresponding period.

Technically on a 3-month chart with daily candle interval, the scrip is on upside trend from the month of June and has continued the rally till the month of October. The scrip is showing some downside move in the current month of November but trading well above 50-day EMA (Exponential Moving Average). Major indicators have been more on a positive side. The fundamental ratios also are improving over a period of time. We have a wait and watch view on the stock at the price of $1.32, which is inching closer to the 52-week high price.

OncoSil Medical Limited

OncoSil Medical Limited (ASX: OSL) with a market cap of $113.53m, is a medical device company that works on the interventional oncology in the pancreas. The group is aiming to realize value from its OncoSil™ device.
OSL on the commercialization path: After the securement of strategic partnerships and the licensing agreements in all key geographies, the company is ready to explore and tap broader market opportunities. OSL with its partnership with leading cancer centres will provide multiple paths to tap the market and result in overall value addition for the company.

 

Clinical Pathway (Source: Company Reports)

On financial performance, OSL reported a double digit growth to $4.59m in FY18 from $3.75m in FY17, but operating losses increased to $8.5m from $7.02m in FY17 owing to increase in the operating expenses that moved up to $13.09m from $10.81m, while cash in hand reported a significant growth to $15.21m from $8m in FY17. Cash outflow from operating activities increased to $8.4m from $6.11m of prior corresponding period.

Technically on a 3-month chart with daily candle interval, the scrip is on a downward trend from the month of July and has continued the downside move for the current month of November. The scrip is still trading well above 50-day EMA (Exponential Moving Average). Major indicator base some case for pull backs.

Driven by broad technology platform that provides the treatment for multiple solid tumours, excellent clinical results and EU regulatory approval CE Mark certification for pancreatic cancer expected in near-term, we give a “Speculative Buy” on OSL at the current price levels of $0.18.
 

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