Company Interview / MedAdvisor's maiden profit

Ancila Desai, CEO of MedAdvisor (ASX:MDR) reports a full-year profit of $800,000 and a 25% revenue surge to $122.1 million. MedAdvisor's cash reserves stand at $15.6 million.

Ancila highlights the success of their vaccine and chronic medication programmes in the US, noting the 7x revenue boost of their Thrive AI solution. The company's new initiative, Transformation 360, aims to bolster patient engagement and business sustainability.

Ancila discusses the MedAdvisor app and its role in connecting pharmacies and patients, improving service delivery. The company's share price increased by 105%, reflecting market appreciation for their efforts. MedAdvisor is optimistic for strong Q1 and FY25 results.

Full unedited transcript:

0:00

Digital medication management company Med Advisor has posted an inaugural full year profit of $800,000. Revenue rose almost 25% to a record $122.1 million. Med advisor has $15.6 million cash on hand as of the end of June. That is in line with forecasts, and in full year 25, the company will launch a program called transformation 360 degree for its future patient engagement, which it says will help lower operating expenses. Let's get straight to the Chief Financial officer, admin advisor and EDC who joins me now. And Sylla, tell us about this path to profitability. Congratulations.

0:40

Thank you so much, Juliet. Thank you for having me. This past year has been a year of remarkable growth. We are extremely proud of what we have achieved. You know, we started on this, uh, transformation journey in at the AGM and FY 22, and that's when we made this decision to start changing how we do things, how we leverage our collective global strengths. And a couple of months ago when we spoke, we gave guidance that we were looking at, uh, achieving this record inaugural profit. And now we have achieved it. So a couple of things to highlight here is our efforts have really been rewarded in the United States. Our revenue is close to 100 million now. And this success has been underpinned by the expansion of our vaccine and chronic medication programmes, alongside widespread adoption of our omnichannel

1:39

thrive AI generated patient engagement solution. Yeah, we've also grown our revenue sevenfold. I was going to say seven fold increase in thrive. So just tell us therefore how important I guess this digital transformation is.

1:55

It's the way we look at transformation 360 it's an initiative that we are launching now in 25, and it's pivotal to advancing our patient engagement capabilities and strengthening our business, which is then going to be sustainable and manage this profitable growth. This strategic initiative and our five year strat plan really gives us this confidence for these aspirational targets where we've put out to the market today. Okay. So that's about your five year plan. So you're targeting revenue CAGR of 20 to 25%. So tell us I guess what this five year plan involves to get there.

2:35

That's a good question. So the way we look at our revenue right now and and maybe I'll take a step back and just talk a bit more about transformation 360, because that feeds right into our five year strategy. So what transformation 360 is going to do. It's going to really it's an investment that we are going to do into the business. And what that's going to be is we're going to strengthen our patient engagement. And that foundation for growth. There's going to be a US platform transformation, which is really going to enable innovation and enhancing the pharmacist capability for patient engagement. We've got another element which is made advisor for pharmacy in Australia, which is going to empower greater patient reach and engagement in Australia. We've also got the Med Advisor app, which is empowering greater patient reach and engagement. Then we've got a pharmacy commerce platform, which is enhancing patient access to essential medications

3:35

and conversational AI capabilities, which we've talked about, and then our shared service evolution. So with all of this combined, we see our organic growth at about 15 to 17%. And that combined with some the right partnerships and the right acquisitions, is going to get us to that 250 million growth revenue in 2028, along with a lot of scale and synergies in our business, which we will then report, and EBITDA of greater than 20%. And in a large part, the Covid 19 pandemic kind of transformed the medical industry because it really pushed a lot of people to telehealth, which is becoming more and more popular. You touched there on the Met Advisor app. Just talk us through a little bit more about that and how this digital transformation is really improving. Patient and I guess doctor ability to.

4:32

So what we do, Juliet, is we really a conduit between the pharmacy and the patient. We support the pharmacies in delivering their services to the patients and improve that connection, improve, uh, the experience and also make the pharmacist life a lot easier. So that's really where we come into this unique space. Yes. The Covid 19 pandemic has got a bit more, uh, you know, the patients are more comfortable using apps and interacting with the pharmacies. But our platform primarily is a pharmacy SaaS platform that is in 5400 pharmacies. And that's how they interact with patients and provide them all their necessary services. Now we do also have a Med Advisor app, which the patients interact with and connect with their pharmacies. So coming back to your point of e-commerce and telehealth, these are the kind of enhancements we are

5:32

bringing into our app, which is really going to streamline how patients interact and receive their services. So no doubt now that you're in profitability, you want that to be sustainable. I know you have cash reserves of $15.6 million. What's your pipeline like? What is the what is further expansion look like?

5:50

So the most important thing for us is now we are cash generating, not just cash generating in Australia but also in the US. So we have, uh, positive momentum in our business. Everything is driven around supporting the pharmacists of the future while we are profitable and we want to invest in the future. So when we talk about transformation 360, that is an investment of 10 to $15 million over the next 12 to 18 months. And that is going to be from self-generated cash. While we profitable, we're also going to make the right strategic changes so we can continue to leverage scale into the future. That's 28 and beyond. Now when we look at your share price, and I know as a CFO you are not a market analyst, but I just wonder, you must be pretty happy when you look at that 105% year to date. Do you think the market is rewarding you well or you still are undervalued?

6:47

Well, there's always hope that there is more. But you know, share price is not the only measure for success. And I use that. You know, there are a lot of other measures. And I think, you know, when I started in the business two years ago, our share price was under $0.18. It went up to close to $0.58 a couple of weeks ago. So yes, that does tell us that we are being rewarded for the hard work we are doing. And this is a group effort. Every single member of our team across the globe is there for a reason. We are all there to support the pharmacists of the future. We are here to do this job which really makes us happy. But I think when you have a team that is really engaged and we interact not just with, uh, the market, the community and the analyst, we are getting the right level of support. So yes, it does feel good. And just a quick word as well, I guess. Unclear on how early full year 25 is looking.

7:47

So we've done two months right now and we're very pleased. You know, our pipeline is really strong. We are where we expect to be. We've had two positive months. The first quarter is usually our best quarter, but it's also the highest uplift. So I keep trying to explain that when we tell, uh, the analysts and the market that we're having a really good quarter and they always say, well, we expect that, but it is the highest uplift we have year on year. So we're very confident about Q1 of Q2 is looking good. All the signs are leading to the right numbers that we want. And I think that, you know, coupled with all the technology and advancements that we're looking at doing, all the enhancements, I think we're going to have a really good FY25.