The Nanosonics Ltd. (ASX: NAN) share price is up around 25% in response to the release of its FY19 report to investors.
Nanosonics is a medical technology company with its flagship product being the trophon EPR system. The trophon system disinfects ultrasound probes with rapid efficiency. It claims to reduce error and increase efficiency.
Why The FY19 Result Has Sent The Nanosonics Share Price Nuts
Nanosonics revealed that it achieved record full year sales of $84.3 million, an increase of 39% compared to last year. The healthcare company reported continued strong growth of its global installed base, which rose by 18% to 20,930 units.
Capital sales grew by 29% to $32.8 million and consumable & service revenue increased by 47% to $51.5 million compared to last year.
During the year Nanosonics broadened its geographical footprint through an expanded distribution agreement with GE Healthcare to include Norway, Denmark, Finland, Spain and Portugal as well as new distributor agreements in Switzerland and Israel.
Nanosonics also said that trophon2 was launched during the year into North America, Europe and Australia.
Japanese market development is ongoing with: the establishment of a Nanosonics entity there, the regulatory approval of trophon2 and a distribution agreement signed with GE Healthcare Japan.
Management also revealed that substantial investment has been made in new product development with important milestones met for the introduction of the next ‘significant’ new product targeted by the end of FY20, subject to regulatory approval.
All of the above positive news helped net profit after tax (NPAT) grew by 137% to $13.6 million. The market consensus was for a net profit of $10.27 million, so Nanosonics heavily outperformed against expectations here.
The company ended with $72.2 million of cash, providing the foundations for its increase investment in growth.
Is The Nanosonics Share Price A Buy?
Management are expecting installed base growth at a similar pace in FY20 compared to FY19.
All of the investing and growth that Nanosonics is experiencing will take a little bit of time to turn into revenue and profit growth, with FY20 profit heavily weighted towards the second half.
The share price reaction today has already adjusted for the performance of Nanosonics, so there’s probably no quick money to be made on this result – but the company is clearly one to keep watching with growing profit and an increasingly global earnings base.
Nanosonics, along with the quality shares in the free report below could be ones to think about for a growth portfolio focused on long term returns.
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