ASX Health Stocks: Earnings season is in full swing. We pick three highlights from the Health sector

Quarterly earnings season is underway, and we’ve picked three highlights from the ASX Healthcare sector this morning.

Micro-X (ASX:MX1)

Highlights:

Strong improvement in Mobile DR sales and orders of $2.9m this quarter
First payment received under $21m DHS/TSA (US Dept of Homeland Security) contract extension
Baggage scanner prototype will be delivered shortly – underpinning DHS/TSA testing

During the quarter, Micro-X released a strategy refresh following a detailed operational review of the company by newly appointed CEO, Kingsley Hall.

The review identified the key pillars that will underpin Micro-X’s future success, and a number of these initiatives have already begun to materialise results.

For example, the streamlined Mobile DR sales team secured a major increase in orders during the quarter, which also meant a large proportion of the existing $6m of inventory was converted into cash.

Micro-X’s funding was also significantly improved, with up to $21m of non-dilutive funding now contracted from the DHS (US Department of Homeland Security), to develop the self-check portal from the current design stage through to live airport testing.

On top of this, the development team continued to make progress towards the final commercial version of the Argus x-ray camera, and the CT Scanner achieved the next project milestone with payment received in early October.

Micro-X finished the September Quarter with $1.3m in cash, and received cash receipts of $7.2m in October, which includes $6.2m for the FY2023 R&D Tax Incentive.

Beamtree Holdings (ASX:BMT)

Highlights:

Annual recurring revenue (ARR) for Q1 FY24 was $23.8m, up from $19.1m on pcp
Revenue for Q1 FY24 was +23% on pcp
Significant pipeline wins and milestones achieved in Q1 across all four core divisions

The healthcare data provider continues to perform in line with previously disclosed FY24 outlook.

Sales were driven by strong customer renewal rates at historical levels of +95%, plus continued international new wins.

The sales pipeline for Beamtree continues to develop, driven by a strong pipeline of opportunities in core overseas markets. These sales opportunities will provide a foundation to the long-term goal of achieving ARR of $60m by the end of 2026, says Beamtree.

The focus is now on securing some of these new customers in FY24 as well as continuing to develop core product offerings.

During the quarter, Beamtree’s distribution partnership with Abbott Laboratories continued to build momentum, with three new licences secured since the beginning of the new financial year in Greece, Mexico and Italy.

A number of new software releases were also made during the quarter to meet customer demand, including a site dashboard upgrade allowing customers to track value and activity through a new API for RippleDown.

The company says it remains on track to deliver an operating profit in FY24.

ResMed (ASX:RMD)

Highlights:

Revenue for Q1 increased by 16% to $1.1 billion, up 15% vs pcp on constant currency basis
Gross margin contracted 250 bps to 54.4%
Income from operations increased 5% on pcp
Diluted earnings per share was $1.49

The $11-billion digital health and medical devices company says it has started FY24 with strong revenue growth, driven by ongoing patient flow and solid demand across its global sleep and respiratory care markets.

Strong sales of its flagship AirSense 11 platform have positioned the company well to continue growing across global markets, with particularly strong growth this quarter in Europe and Asia.

During the quarter, Resmed began rolling out AI-driven software products into its digital health ecosystem, which it believes will create new offerings to drive future growth.

Gross margin decreased by 250 basis points (2.50%) mainly due to costs associated with a field safety notification on Astral devices, and higher component and manufacturing costs.