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Currency in AUD
Last close As at 26/05/2023
AUD0.04
— 0.00 (2.63%)
Market capitalisation
AUD41m
Research: Healthcare
In a recent business update, Respiri recapped its commercialisation efforts for the wheezo device and associated remote patient monitoring (RPM) programme. Towards the end of Q323, the company has onboarded roughly 100 patients across eight clients, including two client wins during the quarter. We understand that Respiri is also in advanced RPM discussions with two private health insurers and four clinical services companies. Patient onboarding commenced earlier this month at Arkansas Heart Hospital and at an undisclosed North Carolina-based healthcare organisation, and the onboarding process is underway at Michigan Children’s Hospital. Respiri’s recent commercialisation strides, along with new client wins, are anticipated to support the company to reach break-even (c 40,000 unit sales), which we estimate by FY25.
Respiri |
Wheezo commercialisation picking up pace |
Business update |
Healthcare equipment |
29 March 2023 |
Share price performance
Business description
Analysts
Respiri is a research client of Edison Investment Research Limited |
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In a recent business update, Respiri recapped its commercialisation efforts for the wheezo device and associated remote patient monitoring (RPM) programme. Towards the end of Q323, the company has onboarded roughly 100 patients across eight clients, including two client wins during the quarter. We understand that Respiri is also in advanced RPM discussions with two private health insurers and four clinical services companies. Patient onboarding commenced earlier this month at Arkansas Heart Hospital and at an undisclosed North Carolina-based healthcare organisation, and the onboarding process is underway at Michigan Children’s Hospital. Respiri’s recent commercialisation strides, along with new client wins, are anticipated to support the company to reach break-even (c 40,000 unit sales), which we estimate by FY25.
Year end |
Revenue (A$m) |
EBITDA* |
PBT* |
EPS* |
P/revenue |
P/E |
06/21 |
1.4 |
(8.4) |
(8.5) |
(1.22) |
30.2 |
N/A |
06/22 |
0.8 |
(6.2) |
(6.3) |
(0.87) |
58.5 |
N/A |
06/23e |
1.7 |
(4.2) |
(4.2) |
(0.51) |
29.8 |
N/A |
06/24e |
5.9 |
(1.1) |
(1.1) |
(0.13) |
8.9 |
N/A |
Note: *EBITDA, PBT and EPS are normalised, excluding amortisation of acquired intangibles, exceptional items and share-based payments. FY23 and FY24 EPS are adjusted for new shares.
Management has communicated that Michigan Children’s Hospital has started patient onboarding for the full wheezo RPM programme and plans to initiate the wheezo rollout via hospital clinics and outpatient clinics by April or May this year. We note that Michigan Children’s Hospital generates traction of about 8,000 new patient consultations every year, indicating the potential growth opportunity. Additionally, Arkansas Heart Hospital and the undisclosed North Carolina-based healthcare organisation commenced patient onboarding in March 2023. Around 100 patients have been onboarded to the wheezo RPM programme, with management targeting 30–40k patients by 2024. Based on our internal estimates, we expect break-even to be achieved at around 40,000 unit sales, which we project by FY25.
In addition, Respiri has disclosed that it has finalised an additional two client contracts in this quarter (a major home and transition care provider and a respiratory clinical group with over 100 clinics across the US), and discussions are ongoing with several others (120+ sales leads). Also, management indicated that it is in advanced discussions with two private health insurers in the US, including one Nasdaq-listed third-party administrator supporting employer-funded health plans and a major national insurer state office, creating an opportunity for higher volumes of enrolments and cost management through third-party services. Alongside this, Respiri is in talks with four new clinical services companies, which will extend its geographic coverage to an additional 15 US states. We view these as positive developments that should support the company’s top-line growth in the near to medium term with continued traction.
Additionally, management expects the appointment of the first head of US operations, to provide support in approaching institutional sales leads and to maintain sales momentum.
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Research: TMT
Esker reported FY22 revenue growth of 19% (13% constant currency (cc)), operating profit growth of 29% and normalised diluted EPS growth of 29%. SaaS revenue grew 23% (17% cc) and now makes up 80% of group revenue. Bookings intake increased 19% cc y-o-y on an annual recurring revenue basis, providing support for growth in FY23 and FY24. Management maintained its guidance for FY23; we have trimmed our FY23 forecasts, which sit within the guidance range, and introduce forecasts for FY24. We forecast EPS to decline 1% in FY23 (as the currency benefit and accrual reversal are not expected to repeat) and increase 17% in FY24.
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