LiDCO Group Plc Trading update (8874W)

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RNS Number : 8874W

LiDCO Group Plc

24 August 2020

LiDCO Group Plc

("LiDCO" or the "Company")

Trading update

Record first half performance with LiDCO product revenue up by 83%

LiDCO (AIM: LID), the hemodynamic monitoring company , provides the following pre-close trading update for the six months ended 31 July 2020 ("H1"), ahead of its interim results which are expected to be announced on 13 October 2020.

LiDCO continues to support healthcare providers to improve patient outcomes while reducing the cost of care, and in H1 successfully responded to exceptional demand related to the COVID-19 pandemic to achieve a record first half performance.

International experts treating COVID-19 patients have concluded that hemodynamic optimisation plays a major role in the management of the complex interaction of respiratory and cardiovascular factors. LiDCO provides a market leading solution, via either the arterial line or non-invasively, to support the diagnostic and therapy-guiding functional hemodynamic tests as recommended by COVID-19 frontline experts and global guidelines.

In H1, total revenues (including third party products) increased by 75% to GBP6.2m (2019: GBP3.5m) with LiDCO product revenues up 83% to GBP6.1m (2019: GBP3.3m). This exceptionally strong sales growth was due to increased demand for advanced hemodynamic monitors as healthcare providers expanded critical care services to deal with the COVID-19 pandemic, primarily in the UK where LiDCO is market leader.

As a result of the strong top line growth, LiDCO achieved net positive cash inflow of GBP1.8m in H1 (2019: GBP0.5m net outflow). The Company had GBP3.1m of cash as at 31 July 2020 and has no borrowings. Given the strong cash inflow in H1, the Board decided not to continue to take advantage of the UK Government's option to defer VAT payments and brought these payments up to date by 31 July 2020.

As widely reported, there has been a significant postponement in the number of elective surgery procedures during the pandemic. Over the last three years, the Company's key commercial strategy has been to sign up customers for its Software as a Service (SaaS) HUP business model, in which customers pay an annual license fee that is independent of the number of patients treated. HUP customers continue to benefit from this model by not having to pay any extra costs to redeploy LiDCO haemodynamic monitors from use in elective surgeries to providing critical care to COVID-19 patients. In parallel, the Company continues to benefit from the predictable, contracted HUP revenue stream, as well as additional demand from customers taking out new HUP contracts. In the period, HUP revenues increased by 83% to GBP1.5m (2019: GBP0.8m). Where customers remained on the pay per patient model, the postponement of elective surgeries led to a reduction in consumable sales by around one fifth compared to H1 2019, but the additional HUP revenues more than offset this reduction. Total LiDCO product recurring revenue in H1 was up 12% to GBP2.8m (2019: GBP2.5m).

Geographically, LiDCO product sales grew by 157% in H1 in the UK to GBP4.1m (2019: GBP1.6m). UK hospitals invested in growing their critical care provision by acquiring new monitors to meet anticipated needs. Distribution markets also grew, by 41% to GBP1.2m (2019: GBP0.8m), with the greatest demand coming from Asia. In the USA, hospitals were focussed on preparing for or dealing with COVID-19, which suppressed capital sales and the finalisation of a number of potential new HUP contracts, although recurring revenues grew slightly compared with the first half of last year. This increase was driven by the carry-through from strong growth in HUP contracts during the prior year, which offset declines in per patient disposables due to the reduced number of elective surgeries in H1.

Around the globe, the Group is actively supporting healthcare providers managing many different stages of the COVID-19 pandemic, including those preparing for a second wave. In the USA, the world's largest healthcare market, elective surgeries started to recommence during Q2 and LiDCO's commercial personnel were able to resume visits to some customers. Further local lockdowns have, however, limited efforts to close the pipeline of new HUP opportunities, which are now targeted to close in H2.

During H1, the Company sold 230 monitors compared with 111 units in H1 2019. A number of these monitors were sold with HUP licences, and, as of the 31 July 2020, the global installed base of HUP monitors with annual licences was 327 units (31 July 2019: 216 units).

Commenting, Matt Sassone, Chief Executive Officer of LiDCO, said: "I am incredibly proud of how the entire team has been able to respond quickly to the needs of our customers during these challenging times and ensure that LiDCO plays its part in supporting hospitals in treating COVID-19. The strong start in H1 combined with the forward visibility of HUP revenues and enlarged installed base, gives the Board significant confidence as we look forward."

To find out more information about the use of hemodynamic monitoring in managing COVID-19 sources please use the following links:

   -     Key Opinion Leader webinar 

https://esicm-tv.org/webinar7_live_27-haemodynamic-management-in-covid-19-patients.html?fbclid=IwAR0NbnD5vH5zM_wsKvtP4j31KQwtKKfIOuEHLjXZtx_t7WMCV9zmIE0y9O4

   -     Key Opinion Leader webinar 

https://esicm-tv.org/webinar11_live_32-haemodynamic-management-of-covid-19-septic-shock.html

   -     NICE guidelines 

https://www.bmj.com/content/369/bmj.m1963

- Surviving Sepsis Campaign: guidelines on the management of critically ill adults with Coronavirus Disease 2019 (COVID-19)

https://link.springer.com/article/10.1007/s00134-020-06022-5

For further information, please contact:

 
 LiDCO Group Plc                                                    www.lidco.com 
 Matt Sassone (CEO)                                      Tel: [phone] 
 Tim Hall (CFO) 
 
 N+1 Singer                                              Tel: [phone] 
 Aubrey Powell / George Tzimas (Corporate 
  Finance) 
 Tom Salvesen (Corporate Broking) 
 
 Walbrook PR Ltd                       Tel: [phone] or [e-mail] 
 Paul McManus                                                  Mob: [phone] 
 Lianne Cawthorne                                              Mob: [phone] 
 
 

About LiDCO Group Plc ( www.lidco.com )

LiDCO is a supplier of non-invasive and minimally invasive advanced hemodynamic equipment to hospitals used to monitor the amount of blood flowing around the body and ensure that vital organs are adequately oxygenated. LiDCO's products facilitate the application of hemodynamic optimisation protocols for high risk patients in both critical care units and in the operating theatre.

Increasingly clinical studies are showing that the optimisation of patients' hemodynamic status in high risk patients produces better outcomes and reduced hospital stay. LiDCO's computer-based technology, developed at St Thomas' Hospital in London, has been shown to significantly reduce morbidity and complications, length of stay and overall costs associated with major surgery.

Key Products:

LiDCOunity: a hemodynamic monitor that combines the full suite of LiDCO technology (non-invasive, minimally invasive and calibrated technologies) into one platform. Designed to have the flexibility to adapt to a patient's changing acuity, the product enables clinicians to seamlessly transition between non-invasive, minimally invasive and calibrated hemodynamic monitoring.

LiDCOplus : a computer-based platform monitor used in the Intensive Care Unit for real-time continuous display of hemodynamic parameters including cardiac output, oxygen delivery and fluid-volume responsiveness (PPV% and SVV%).

LiDCOrapid : a cardiac output monitor designed specifically for use in the operating theatre for fluid and drug management. The monitor enables anaesthetists to receive accurate and immediate feedback on the patient's fluid and hemodynamic status - a key measure of overall well-being before, during and after surgery. The LiDCOrapid provides:

-- early and rapid warning of hemodynamic change to aid choice of therapeutic route: fluid or drug

-- quantification of hemodynamic response guidance on effective delivery of fluids to ensure the right amount at the right time

The software incorporated into LiDCOrapid allows the LiDCOrapid monitor to co-display Medtronic's level of consciousness parameter ('BIS(TM') )* and add the convenience of CNSystem's continuous non-invasive blood pressure monitoring ('CNAP')**. This addresses a growing requirement for non-invasive monitoring solutions that are more comprehensive and can effectively replace multiple single parameter monitors.

LiDCOview : an easy-to-use graphical display of historical LiDCOplus and LiDCOrapid hemodynamic data.

*BIS (TM) and Bispectral Index are trademarks of Medtronic registered in the US and foreign countries.

**CNAP(TM) is a trademark of CNSystems Medizintechnik AG.

LiDCO monitors use single-patient disposables (sensors or smartcards) which provide an ongoing revenue stream.

LiDCO Distribution Network :

LiDCO sells directly to hospitals in the UK and USA and through a network of specialty critical care and anaesthesia distributors in the rest of the world.

LiDCO's headquarters are in London and its shares are traded on AIM.

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August 24, 2020 02:00 ET (06:00 GMT)