HealthTech company focused on early detection of breast cancer, Volpara Health (ASX: VHT), has reported a fourth consecutive positive net operating cash flow quarter. As a result, it does not have to submit quarterly ASX updates anymore. What’s better, the Company surpassed its initial guidance by a year and a half.
For the quarter ended 30 September 2023 (Q2 FY24), Volpara Health reported record cash receipts from customers, totalling over $10.7 million. This represents a substantial increase of more than 32% compared to the $8.2 million reported in PCP. Cash receipts from customers exceeded expectations, totalling over $10.7 million, reflecting strong growth of over 32% compared to Q2 FY23 or 31% when considering constant currency.
Additionally, this quarter marked the first time customer receipts exceeded $11.04 million.
Volpara CEO & Managing Director, Teri Thomas, said, “What a milestone quarter for us! I’m delighted to see current customers, happy with our software, expand their use of Volpara to save even more families from cancer.
“We had a record number of contracts up for renewal and customers have chosen to expand and extend their contracts with us for longer, with more software than ever before.”
Volpara Health reported a net operating cash inflow of $1.14 million in Q2 FY24, a significant improvement over the $10.7 million net operating cash outflow reported in Q2 FY23. This financial turnaround aligns with Volpara’s revised strategy, which initially indicated that net operating cash flow positivity would be achieved for the first time in Q4 FY24, with FY25 resulting in the first full year of net positive operating cash flow.
The Company reached this milestone a full year and a half ahead of guidance.
Thomas added, “Our growth and financial strength, approaching US$100M TCV, allows us to turn increasingly to growth endeavours like a brand-new product, called Quiver, due out next year. Leveraging our Analytics platform, this new product provides administrative simplification for mammography centres so they can spend more time with patients. We do good and we do it well and that is reflected in this positive quarter.”
In Q2, Volpara added $1.9 million of Contract Annual Recurring Revenue (CARR), bringing the total CARR to $44.8 million. The growth was attributed to significant customer contracts, including Memorial Sloan Kettering, Northwell Imaging, and Hackensack. Volpara Health also expanded its presence within the Veterans Affairs (VA) segment, adding $269.7k in net new CARR during the quarter, bringing its total CARR to $1.69 million. The Company welcomed several new customers, such as Northeast Georgia Medical Center, Riverside Medical Center, and West Tennessee Imaging Center, all of whom added Risk Pathways.
There has been a focused selling effort on risk due to the National Accreditation Program for Breast Centers (NAPBC) recently requiring mammography providers in the United States to adhere to mandatory guidelines. This resulted in a notable number of upsells and the acquisition of new customers for Volpara.
Volpara Health’s annual recurring revenue (ARR) has now reached approximately $35.5 million, up from $33.9 million reported in Q1 FY24. With the ASX quarterlies out of the way, Volpara has promised shareholders periodical business updates.
Alinda is a Business Reporter for The Sentiment
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