Ann: Quarterly Cash Flow and Summary of Activities, page-41

i was initially very interested in ime because of South America/developing world.
They have a clear first mover advantage in South America and as the presentation suggests, they are replacing archaic systems including wet film. This provides a great tailwind.

So why on earth are they wasting time and money on aus and America? They don’t have a hope of competing in those markets. The cost of pacs/ris for a radiology clinic is a tiny tiny fraction of revenue in developed countries, and therefore radiology providers are going to favour efficiency over cost (except sometimes in the public health sector in aus but care stream and cdn are competitors in that space too). So ime trying to undercut their bigger competitors who have more scale means they are up against an impossible task in my view. They can’t be the most functional or efficient provider because the r&d spend of their competitors is many multiples of ime’s revenue.

Cybically, i think they are signing up a hicksville mobile ultrasound company in aus and applying for fda to help their share price to help them raise capital.

so that brings us back to South America. I think ime has a chance of doing very well if their product is reasonable (which I highly doubt given that they were touting ‘new cross referencing ability’ 12 months ago, which is a feature that the better provider have been providing for more then a decade).
If they can keep signing up hospitals in South America and the developing world while the big competitors concentrate on the growing developed world, then they will do well. But the second a better competitor comes along, due to scalability of the software which is increasing by the year, I believe ime will be cactus, and I don’t think carestream/pme/intelerad will need to bother buying ime.

Having said that there is every chance ime 5bags prior, but I just don’t think they have a long term business, and buying this hoping a competitor buys them is rarely a strategy for success.