TruScreen widens annual loss as delayed certification hits sales

Tuesday 14th June 2016

TruScreen, the NZAX-listed cervical cancer test developer, widened its annual loss as revenue dropped 21 percent because of delays in getting a new device certified.

The Auckland-based company reported a net loss of $1.3 million in the year ended March 31, from $692,077 a year earlier.

Revenue fell to $1.84 million from $2.22 million a year earlier. Within that, revenue from sales slumped to $472,104, from $1.57 million in the 2015 year, while 'other income' more than doubled to $1.37 million. Most of that came from a 45 percent refundable tax offset worth $1.17 million, and $180,867 in foreign currency gains.

TruScreen chairman Robert Hunter said growth in sales was restricted by an inventory gap after the company sold out of its original devices in July 2015 and faced delays in getting its new Ultra device certified.

Last December, the company reduced its annual sales forecast due to the Ultra delay and said annual revenue would be below the $10.6 million forecast in the company's listing disclosure document.

TruScreen started selling the Ultra device in April 2016 and chief executive Martin Dillon said it had been "very well received", although it can't yet sell the device in China, the market it is most focused on, because it doesn't have approval there. The first sales have been in Mexico, Jordan, Kazakhstan and Ukraine.

“TruScreen is optimistic for the year ahead," Dillon said. "We have a strong distribution network in targeted markets, with an appropriate production schedule to meet our growing demands. In China there is a growing number of customers using our devices and TruScreen is currently being evaluated as the preferred technology for a number of screening programmes.”

TruScreen has made a number of deals with Chinese hospitals over the last year, most recently a public screening programme of 160,000 women in north-eastern China which it announced a month ago. Dillon said the company had finished training medical staff to conduct the programme and 103 hospitals in China have applied to purchase a TruScreen device.

The NZAX-listed shares last traded at 26 cents, down 3.7 percent today, and are unchanged for the year.

BusinessDesk.co.nz

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