Optos plc (LSE: OPTS), a leading medical retinal imaging company, provides an update on current trading in advance of its interim results announcement on 16th May 2013.
Extension of OPSM Daytona contract
- Further to the announcement in the Interim Management Statement of 22nd January 2013 that Optos would supply 250 Daytona ultra-widefield retinal imaging devices to a major corporate, we are pleased to provide further details of that agreement today.
- During the 12-month period commencing March 2013, Optos will deliver to OPSM, the leading optometry chain in Australia and New Zealand, 250 Daytona devices on rental contracts, on top of the 160 devices already installed in 2012, bringing the total number of Daytona’s supplied to OPSM to 410. All OPSM stores will now have the unique ultra-widefield technology as part of their capability to provide world leading eye care.
- As part of the agreement, OPSM’s exclusivity over the commercial supply of Daytona devices in Australia and New Zealand has been extended to 2016. Optos and OPSM will also share future technology development and are adopting a partnership approach to market commercialisation.
- Daytona continues to receive positive market feedback. Interest in the device continues to build but sales are softer than we had hoped for at this stage of its launch.
- As with all new products, we are developing and rolling out updates and enhancements to Daytona, including a new version of the software. Consequently, some customers are waiting to order machines which has contributed to lower sales in the first half of the year.
- Additional cost has been incurred to cover these updates, although other overheads have been managed to help offset the impact.
- Renewal business remains as expected.
- Geographically, Europe remains challenging, as we highlighted in our Interim Management Statement of 22nd January 2013.
- Net debt is expected to increase at the interim stage as a result of the drivers outlined above, including the shift to a higher rental sales mix, such as with the new OPSM rental deal.
Roy Davis, CEO, commented: “Q2 performance will be lower than planned, however, the additional order of 250 devices by a major corporate such as OPSM is a clear demonstration of both the value and potential of our technology. This will effectively make Daytona an OPSM network-wide technology. We believe this validates not only the importance of Daytona to eye care practices, but also our strategy to partner with OPSM in Australia and New Zealand.
“Given positive feedback from the market and our sales teams, and as we move into our historically stronger second half, our expectations for the full year remain unchanged, although it will be more weighted to the second half than previously anticipated, as it was last year”.