Alcidion (ASX:ALC) share price dips 4% despite positive quarterly update

The healthcare technology company’s shares are having a tough time on Tuesday
The post Alcidion (ASX:ALC) share price dips 4% despite positive quarterly update appeared first on The Motley Fool Australia. –

The Alcidion Group Ltd (ASX: ALC) share price is in negative territory today following the company’s latest quarterly update.

During early afternoon trade, the healthcare technology company’s shares are down 4.17% to 34.5 cents.

How did Alcidion perform in the first quarter of FY22?

In its release, Alcidion advised it has continued to build on FY21’s momentum, leading into the new financial year. However, this has not been reflected in the Alcidion share price today.

For the 3 months ending 30 September (Q1 FY22), new contracted revenue surged to $17.2 million. This represents an increase of 17% over the prior corresponding period.

New contracted revenue grew $2.7 million in the quarter, defying what is historically known as the company’s slowest quarter.

The bulk of the contracted revenue came from recurring revenue ($12.2 million), with non-recurring revenue taking up the remaining portion.

Cash receipts totalled $6.6 million, an improvement of 2.3% compared to this time last year.

On the other hand, operating cash outflow stood at $3.4 million. The outgoings reflected a full quarter of new hires in the second half of FY21 coupled with staff bonuses and GST payments.

At the end of September, Alcidion declared a strong cash balance of $21.5 million.

Notably, a further $3.1 million in revenue has been achieved in the current quarter (Q2 FY22) by 3 significant contracts.

The first relates to a 3-year deal valued at $630,000 with Queen’s Hospital Burton in the United Kingdom. The agreement will see the deployment of ExtraMed’s Inpatient Flow Manager (IPFM).

The second is also a 3-year contract with Sydney Local Health District, worth around $1.8 million in total. This will see the use of Miya Precision in supporting virtual care, initially of acute diverticulitis patients.

And lastly, the third agreement is a $640,000, 3-year extension for ExtraMed’s IPFM Licence and support with Royal Derby Hospital in the UK.

It appears this news has not excited investors, with the Alcidion share price struggling to repeat its gains of yesterday.

Management commentary

Alcidion CEO Kate Quirke commented on the result:

Our pipeline continues to develop with several sizable opportunities now entering the contract negotiation stage which has provided a heightened optimism about the broader opportunity for Alcidion, particularly in the UK market. We are increasingly seeing the potential to cross and up-sell our products to existing customers.

We do however remain cognisant that COVID-19 continues to pose a challenge for healthcare providers worldwide resulting in longer lead times for contract completion.

Alcidion share price review

Although the Alcidion share price might be lower today, shareholders have recorded gains of almost 90% in 2021. When looking at the bigger picture, the last 12 months have seen its shares climb by almost 190%.

Alcidion has a market capitalisation of approximately $361.58 million, with more than 1.05 billion shares on issue.

The post Alcidion (ASX:ALC) share price dips 4% despite positive quarterly update appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Alcidion Group Ltd. The Motley Fool Australia has recommended Alcidion Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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