TSX: OPS | CAD 2.25 | Outperform | Speculative Risk | Price Target CAD 4.00
Sentiment: Neutral
Our view: OpSens reported FQ4/22 (Aug-qtr) revenues at $9.1MM, below RBCe ($9.5MM) and consensus ($9.4MM). Revenues were down sequentially as expected (-10% q/q, from a FQ3 that benefited from the pent-up demand of FQ2 which faced Omicron- related challenges and supply chain issues in Japan) and were up YoY (+12%). Net loss of $4.0MM during the quarter was above RBCe ($3.1MM loss) and consensus ($3.8MM loss) due to the lower GMs and upfront investments for SavvyWire as the company prepares for the full commercial launch in the US. On the earnings call, we expect the focus to be on the operational outlook - procedure volumes and early feedback on SavvyWire procedures in the US and the full commercial launch of SavvyWire in Canada. We also expect updates on the company's strategy to complete a full commercial launch of SavvyWire in the US.
Revenue slightly below RBCe and consensus estimates. FQ4/22 revenue of $9.1MM (-10% q/q and +12% y/y) was below RBCe ($9.5MM) and consensus ($9.4MM). Total medical revenues were $7.9MM (-14% q/q; +7% y/y), including FFR and dPR sales of $5.7MM (+7% y/y). Other medical revenues were $2.2MM (+5% y/y). Industrial revenues were $1.0MM (+43% y/y), above RBCe ($0.8MM) aided by higher volume of orders from the military market.
FQ4 net loss of $4.0MM was below RBCe ($3.1MM loss) and consensus ($3.8MM loss). Gross margins were 48% below RBCe (52%) and the prior quarter (51%). Operating expenses at $8.5MM (+8% q/q) were above RBCe ($7.8MM). Operating expenses are increasing as the company is investing in sales and marketing of the SavvyWire product launch.
Cash position. OpSens ended FQ3 with a cash position of $23.8MM (vs. $28.0MM as of May-22).
Operational updates. The company received approval for SavvyWire from US FDA in Sep-22. After receiving the US FDA approval, OPS initiated a limited market release to a select number of physician thought-leaders in the US and expects full commercialization in CY 2023. Following the successful limited rollout launch in Canada, OPS has begun full scale commercialization in Canada. OPS has also submitted the regulatory filing for SavvyWire approval in Europe with an approval expected in mid-2023.
Conference call at 11:00am ET today. Dial-in details: 1-833-756-0865 or 1-412-317-5754 or via a live webcast