Volpara raises A$7M in discounted placement, to raise A$3.7M more in entitlement offer

Tuesday 22nd November 2016

Volpara Health Technologies, the Wellington-based, ASX-listed digital health company, has raised A$7 million in a discounted placement and plans to raise a further A$3.7 million in an entitlement offer to shareholders.

The company, which is focused on early detection of breast cancer, sold 11.6 million shares at 60 Australian cents apiece to institutional investors, a 28 percent discount to their last trading price. It is now undertaking a one-for-20 non-renounceable entitlement offer at the same price.

The capital raising would lift Volpara's proforma cash-on-hand to A$16.6 million from a closing cash position of A$6.4 million as at Sept. 30, the company said in a statement.

Proceeds will be used "to accelerate the business development and sales of the company’s products by growing the global sales team and increasing focus on product development, and to supplement working capital to support the rollout of VolparaEnterprise, its software as a service (SaaS) subscription-based model," it said.

The company posted its first-half results this month in its debut as a listed company. Total revenue climbed 4.8 percent to $1.2 million, while operating expenses more than doubled to $5.4 million, resulting in a wider loss of $4.7 million from $2.1 million.

The company first listed on the ASX in April, having raised about A$10 million selling shares at 50 Australian cents each. The shares recently traded at 76 Australian cents, down 9 percent today but up 67 percent this year.

About 75 million women each year are screened for breast cancer globally, including 40 million in the US. Volpara’s proprietary software has been used to analyse the mammograms of over 9 million women to date.

Working in Volpara’s favour is the fact it's operating in a large, high growth market with the incidence of breast cancer expected to double by 2030. It also holds extensive, clinically validated, intellectual property patents on its core VolparaDensity software and there are high barriers to entry for any newcomers into the market.

BusinessDesk.co.nz

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