Release Date: August 16, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Nexstim Oyj (FRA:5NX, Financial) reported a 27% increase in total net sales for H1 2024, reaching EUR3.2 million.
- The company achieved a significant improvement in profitability, with operating losses decreasing by 38% compared to the previous year.
- Recurring net sales, which provide stability and predictability, grew by 39% and now represent 61% of total net sales.
- Nexstim Oyj (FRA:5NX) has a promising sales forecast for the full year of 2024, indicating continued growth.
- The company is making effective use of its global team structure, resulting in a 30% increase in gross margin while keeping operating costs growth at only 3%.
Negative Points
- Nexstim Oyj (FRA:5NX) is currently in a disagreement with Magnus Medical regarding royalty payments, which may impact expected income.
- The company reported a negative EBITDA of EUR0.5 million, although this is an improvement from the previous year.
- There is a need for more clinical trials and approvals, particularly in the United States, for the chronic pain treatment application.
- The development and regulatory approval process for the new NBS-6 system is ongoing, which may delay its market availability.
- Nexstim Oyj (FRA:5NX) faces investment challenges in balancing operational profitability with the need for further clinical research and development.
Q & A Highlights
Q: Can you provide an overview of Nexstim's financial performance for the first half of 2024?
A: Mikko Karvinen, CEO, stated that Nexstim saw significant growth in both revenue and gross margin during H1 2024. The company reported a total net sales increase of 27% to EUR 3.2 million, with a notable improvement in operating results compared to the previous year. The diagnostic and therapy businesses each contributed EUR 1.6 million in revenue, showing growth of 16% and 39%, respectively.
Q: What are the strategic objectives for Nexstim in 2024?
A: The key strategic objectives include achieving profitable growth, launching the new NBS-6 platform with diagnostic applications, and expanding strategic partnerships. The company aims to increase net sales, improve operating results, and minimize future capital needs while maintaining technology leadership and fostering partnerships.
Q: How is Nexstim addressing the healthcare cost pressures and the need for effective rehabilitation?
A: Mikko Karvinen highlighted that Nexstim's systems provide effective and fast rehabilitation for conditions like major depressive disorder and chronic neuropathic pain. The company aims to reduce healthcare costs by enabling patients to return to productive life quickly, thus benefiting both the healthcare system and society.
Q: What is the status of the strategic partnership with Sinaptica Therapeutics?
A: Nexstim has signed a letter of intent with Sinaptica Therapeutics to develop a new Alzheimer's treatment using Nexstim's navigated TMS system. The partnership is expected to generate EUR 6 million over the first two years, with the trial phase anticipated to begin in 2025. The definitive agreement is currently being finalized.
Q: Can you elaborate on the disagreement with Magnus Medical regarding royalty payments?
A: Mikko Karvinen mentioned that there is a disagreement with Magnus Medical over royalty payments from a 2022 licensing deal. Nexstim does not expect to receive royalty income from Magnus Medical in 2024. The company is working with advisors to resolve the issue and aims to reach an agreement on the royalty payments.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
