The Medical Developments International Ltd (ASX: MVP) share price finished 9.3% higher by the end of the day after announcing to the market a trading update.
It said that in the first quarter of FY19 sales were up by 56% compared to the first quarter of FY18. Penthrox revenue was up 57% and respiratory device revenue was up 58%.
It also said that in-market sales in the UK were up 62% in the fourth quarter of FY18 compared to the third quarter of FY18 and in Ireland it was up 26% in the same time period.
The company said that it sold Penthrox to 436 UK & Ireland customers, compared to 191 customers a year ago. The new total included 125 hospitals.
Medical Developments also said that it sold to 272 French customers, which was a lot more than the 166 customers it had a year ago.
Management revealed that it has received the first Penthrox orders in 12 countries in Europe, including Germany. The first orders in Mexico, Saudi Arabia and Hong Kong are expected during FY19.
Back to the FY19 first quarter trading update, Penthrox sales to Australian ambulance services were up 7%, North American respiratory device market sales were up 98% and sales of Breath-A-Tech respiratory devices were 24% higher in Australia.
Management pointed to the fact that Penthrox has been approved in 26 countries since the start of the 2018 calendar year as a positive factor. By the end of the 2020 calendar year the company expects approvals in 77 countries including Russia and perhaps China.
Foolish takeaway
The growth runway for Medical Developments has always been a long one – it's only when it has been approved in all of the target countries will we get to see its true revenue potential. However, this update was a positive sign of progress.
However, it's still trading at more than 80x FY20's estimated earnings – so based on valuation I'll be giving it a miss for now.
