Australia-based medical device company Compumedics (ASX: CMP) has continued its ongoing development and focus in Asia with a new three-year distribution agreement with one of Japan’s leading medical device companies, Fukuda Denshi Co Ltd.
The A$3.6 million agreement is part of the company’s growing trend in sales for its neuro-diagnostic and monitoring products in the Asian market, which is up by a further 15% approximately over the prior year.
This Japanese distribution deal follows Compumedics’ Germany-based business, DWL, recent announcement that it had received a new, twelve-month A$2.9 million sales commitment from its long-term distributor in China.
It also follows Compumedics’ renewed distribution arrangements in China for the company’s sleep and neuro-diagnostic and monitoring products, announced in May. The A$15 million worth of deals with three key long-term distributors are for minimum commitments over the next three years.
“The new relationship with Fukuda is an important milestone for Compumedics,” said chairman and chief executive officer of Compumedics, Dr David Burton.
“The distribution of Compumedics’ range of neuro-diagnostic and monitoring systems in the Japanese market will expand and strengthen our core global business and growth in Asia,” Dr Burton added.
With this ongoing growth in Asia, Compumedics’ expected sales for the 12 months to 30 June 2018 to be approximately A$36 million compared to sales of A$34 million year-on-year.
Guidance of A$40 million to A$42 million for Compumedics’ financial year 2018 (FY2018) revenue was based on 100% of the company’s MEG sales being recognised within the financial year; however, only 60% of the MEG sales have been booked to revenue, lowering the expected sales figure.
The transition phase of the company’s US business has also taken longer than expected, given the competitive nature of the US market, which has resulted in lower than forecast sales for the US business in FY18, which has impacted on the second half of FY18.
With MEG and Somfit strategies now being implemented, further focus will be directed at harnessing the opportunity in the US market for the company’s core products.
The company expects an underlying unaudited EBITDA of between A$2.5m and A$3.5m, based on the revised revenue number.