Thursday 21 October 2010IM MEDICAL Acquisition Generates Strong...

Thursday 21 October 2010


IM MEDICAL Acquisition Generates Strong Revenue

Dear Shareholder,

As the newly appointed Managing Director of IM Medical (IMI), I am writing to inform you of the completed acquisition of Melbourne Specialist Imaging (MSI) as announced through Australian Stock Exchange (ASX) announcements.


As a result of this acquisition, which was completed on the 16th August, the previous owner of MSI, Dr Mark Scott has now become the major shareholder of IMI, and has also joined the Board as a Non-Executive Director. Dr Scott continues in his clinical capacity as the Chief Radiologist of the Radiology practices.


As Managing Director, my focus will be on improving the businesses of IMI so that it can provide shareholders with better value for their investment. We plan to achieve this by increasing the market share of MSI through increased marketing activities as well as relaunch Intelliheart as a
Cardio-Vascular Screening product.


The MSI group has well established radiology practices with historically strong cash flows in both Medical and Dental Imaging areas. It is our intention to consolidate and grow these Radiology businesses to provide enhanced profitability to our company. All MSI practices have considerable room for organic growth and we are currently focusing on allocating additional marketing resources
to increase our market share.

Additionally there are some exciting growth opportunities in the specialist Dental imaging market which we are pursuing by the introduction of Cone Beam CT (CBCT) at our Box Hill and Camberwell sites, as announced to the ASX recently. The success of which will be closely monitored as a guide to introducing this service to all our centres as well as for the establishment of boutique independent Dental Imaging Centres. Most Radiology services offered by
MSI qualify for Medicare reimbursement.


Cardio Vascular disease is a major health issue in Western Society. IMI has in the past few years made a considerable investment in the Research and Development of Intelliheart, a non-invasive Cardio Vascular Disease screening product. To date, Intelliheart has conducted a substantial number of tests. Despite the considerable number of tests, Intelliheart has not as yet been effectively marketed. This does not however reduce the importance of this product to the Company in pursuing
early screening of this life threatening disease.

IMI will therefore be pursuing alternative marketing
strategies as well as new distribution channels aimed at ensuring the successful relaunch of the Intelliheart product. The allocation of resources to Intelliheart will be managed conservatively on a standalone unit basis.


In summary, the Board and management are determined that through the acquisition of MSI, the effective marketing of the Intelliheart product and increased efficiency in the utilisation of our resources, IM Medical will experience a financial transformation.


I look forward to keeping you informed on how we are progressing in the achievement of our aims.


Yours faithfully,
Sergio Del Vecchio
Managing Director