Equity Analysis /
Australia

AU : ImpediMed - Moving to breakeven

    Scott Power
    Scott Power

    Senior Analyst - Healthcare, Life Science & Technology

    CGS-CIMB
    28 April 2022
    Published by

    IPD posted its 3Q cashflow result which was in line with previous guidance. Management is calling out a pathway to breakeven using the existing cash reserves. Key to achieving breakeven includes growing the number of IDNs signed and increasing the average monthly licence fees. The net cash outflow is expected to be <A$3.0m in 4Q which the market will appreciate given the 3Q outflow of A$6.5m included short-term incentive bonuses paid to staff after the important milestone of the publication of the PREVENT trial was achieved. We have lowered our FY22 sales forecast but left FY23/24 forecasts unchanged. Our valuation and target price remain unchanged. We maintain our Speculative Buy rating, with key catalysts of the NCCN decision, renal observational trial results and improving 4Q cashflows likely to reignite investor interest.