Were the recent investor presentations targeted at generating...

Were the recent investor presentations targeted at generating awareness and interests from retail investors and/or institutional investors? What is the general feedback from attendees?

Investor presentations recently held in Sydney, Melbourne and Brisbane were largely targeted at retail investors.

Behind the scene, meetings were also held with various institutional fund managers and etc. Overall reaction was positive, albeit the institutional investors were more than likely to adopt a wait and see approach.

Based on your knowledge of the past and current investor relation activities, what are the major impediments to institutional investments in our company (e.g. lumpy cash flows, lack of a sustainable track record or low market capitalisation)? If you are aware of the barriers, what can the company doing to overcome these impediments?

Based on feedback from institutional investors, the three main things they want to see before investing are:

a) Consistent positive cash flows
b) Consistent growth in profitability
c) Consistent sales growth

This is, in part, underpins the acquisition of MKM Health and co. Management believes that it would lead to a steady growth in revenues via annuities payments, a more steady flow of contract wins, opportunities for cross-selling via offering a more compelling integrated service offering and etc.

As a stand-alone company, Alcidion cash flows are heavily derived in Q1 and Q4 of each financial year. Institutional investors typically do not like companies with lumpy cash flows.

Management also strongly believe leveraging the established customer base and relationships of MKM Health would enable Alcidion to overcome the general reluctance of many potential customers to invest in Alcidion products such as the Miya platform.

Does the company have any further plans to advance or promote the company?

As I pointed out in my post yesterday, Henslow is now involved with Alcidion. Henslow coordinated the investor roadshow in Hong Kong for Kate and will be providing corporate advisory services to the company.

In my view, Henslow will soon publish a research coverage on the enlarged Alcidion group. Company has specifically noted that they are not in favour of paid research coverage as it may potentially compromise the independence of the research note. It is therefore more than likely that the upcoming Henslow research note would be independent.

Also, Alcidion will soon undertake a series of investors roadshows in New Zealand – targeting institutional investors specialising in small to mid-caps companies and/or those specialising in the medical and medical technology space. Given the progress made by the company in New Zealand (e.g. contracts executed and being negotiated with Health Districts), the company sees this as logical.

What catalysts will affect the company going forward? In your view, how close is the market in terms of valuing the company?

In the short-term, the known catalysts are the contracts that have reached the pointy end of negotiations. Whether those contracts get executed by the end of Q4 FY18 or Q1 FY19 are largely outside the control of the management. As previously discussed, the multiple layers of approvals in the “public sector” is a nightmare.

However, management remains confident that a contract will be executed with an Australian public hospital very very soon. Very close to announcement.

In the medium-term, the known catalysts include progress and additional clinical validation of predictive analytics and the application of artificial intelligence in health services. This, in my view, would largely be driven by developments in UK where there is a significant push for clinical decision support systems.

The unknown catalysts includes the implication of the new SA Government. My understanding is that the rollout of EPAS has been put on hold at the direction of the Premier, and that a review is being carried out. In the past week, management has met with senior executives (also possibly the Health Minister) to discuss innovations and the capability of the enlarged Alcidion with its suite of products (e.g. Patientrack, Miya and etc). Management indicated that reception was very positive as it largely align to the new government’s heavy emphasis on innovation, efficiency and etc.

Where this would lead to is the big question…All i know is that many things are happening in the background!