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Alcidion share price rockets higher after delivering strong revenue growth in FY 2019

It has been a very positive day of trade for the Alcidion Group Ltd (ASX: ALC) share price on Thursday.

In late afternoon trade the healthcare technology company’s shares are up a sizeable 13% to 17 cents following the release of its full year results.

How did Alcidion perform in FY 2019?

During the 12 months ended June 30, Alcidion delivered a 33% increase in revenue to $16.9 million. This strong growth was driven by a series of major new contracts, including strategically important contracts for integrated Miya, Patientrack, and Smartpage installations in Australia and the UK.

On the bottom line Alcidion posted a loss after tax of $84,000, which was a big improvement on FY 2018’s pro forma loss of $1.6 million. This improvement was delivered despite incurring one-off costs relating to acquisitions, investments in integrating new businesses, and increased expenditure on marketing.

Another positive was that the company reported its first full year of positive operational cash inflow of $2 million and an overall net inflow of $0.3 million. This boosted its end of year cash reserves to $3.2 million.

Pleasingly, the company has had a strong start to the new financial year and revealed that it has already achieved $11.7 million sold revenue for FY 2020 and a further $19.5 million out to FY 2025.

Alcidion Group’s managing director, Kate Quirke, was very pleased with the company’s performance in FY 2019.

She said: “I am delighted with the strong growth and progress of Alcidion in our first financial year as a combined business. In a year where the Alcidion business has incurred M&A costs, increased its investment in marketing and operationally has been very focused on integrating our businesses and capabilities, we were able to achieve significant growth, sign strategically important customers, expand our presence in the UK, generate sufficient cash from operations to fund operations and move close to break even.”

Looking ahead, the managing director appears optimistic on the company’s prospects in FY 2020.

“Our early success with the integrated product and service suite, demonstrates the value of our proposition. We enter FY2020 in a strong position, with a solid book of sold revenue. There is a significant opportunity ahead of us with the healthcare industry beginning to embrace digital transformation and our plan is to continue to invest for growth in the business to ensure we are positioned to take full advantage of this growing market,” she added.

Also rising strongly on the ASX today have been Link Administration Holdings Ltd (ASX: LNK) shares after it announced a major share buy back and Objective Corporation Limited (ASX: OCL) shares after it revealed a significant contract win with the City of Gold Coast.

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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Link Administration Holdings Ltd. The Motley Fool Australia has recommended Alcidion Group Ltd and Link Administration Holdings Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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