SomnoMed taps tech for new board hires, posts full-year profit
Health & Biotech
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SomnoMed (ASX:SOM) is the latest Australian health company to look to Silicon Valley for its board, although it has pilfered from a division closer to home than the US.
The company brought onto the board Amrita Blickstead, Ebay’s Australia COO, a woman who hails from the local biomedical industry.
The company also released its full-year results, which saw a swing to a small profit of $71,280 and a 3 per cent revenue slide to $57m, as COVID-19 hit the company but not as badly as expected in March.
“SomnoMed’s business was making good progress to March 2020, where revenues and EBITDA were on track to achieve guidance,” it said in the annual report.
“Since then and into Q4, the impact of COVID-19 has meant that the final year-end results were severely affected.”
Chief Neil Verdal-Austin took a 50 per cent pay cut and salaries across the board were cut by 30 per cent.
Director fees were reduced to nil, costs were cut, and new investments were frozen. That combined with government support, helped the final result.
The company expects trading in the first half of 2021 to be inconsistent across the 28 countries where it operates, as sales rely on patients visiting a doctor or dentist in order to be fitted with a SomnoMed device.
But it expects the second half should be better.
The sleep apnoea business has also replaced its chair with retail turnaround expert and former Wesfarmers and Kmart boss Guss Russo, and added Rokt CFO Michael Gordon and TDM Growth Partners partner Hilton Brett to the board.
The company says the chair appointment is indicative of a wider trend of companies considering going direct to consumers.
SomnoMed tried the direct-to-consumer pathway before, with a network of sleep diagnostic centres in the US. The strategy did not work, for a variety of reasons, and that division was closed in December 2018.
The addition of an Ebay exec to the board is more in line with Volpara’s (ASX:VHT) move to name former Apple and Pixar marketing Katherine Singson chief of its US operations.
“That signals a real change in the way that the services of companies like Volpara will be delivered to the marketplace,” Morgans analyst Scott Power said.
“With companies like Volpara that offer a cloud-based service, a lot of installations are done remotely anyway.
“What is changing is the training, which now takes place much more online, and face-to-face sales meetings were difficult to get even before the pandemic, so they’re having to change how they do sales.”
PharmAust’s (ASX:PAA) research program by the Walter and Eliza Hall Institute of Medical Research in Melbourne has shown in early findings that SARS-CoV-2 virus particle counts in some cells can be suppressed by up to about 95 per cent by its treatment. It cautions that work in the specific cell type has not been repeated and is not as yet verified.
Osprey (ASX:OSP) has delivered a $US7.4m loss for the half year, an improvement of 19 per cent compared to the same period last year. It did not offer guidance for the remaining six months but was optimistic thanks to signing a deal with GE Healthcare and cost cutting measures.