Why has the 4D Medical share price popped 7% in a month?

4DMedical unveiled its XV Scanner, the world's first dedicated lung scanner, at Prince of Wales Hospital in Sydney in March.

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Key points
  • The 4DMedical share price is volatile on Tuesday morning 
  • The company's net loss after tax increased 15% from the prior year 
  • It also ended the year with a strong cash balance and no debt 

The 4DMedical Ltd (ASX: 4DX) share price is seeing some significant swings today, from gains of 2% to losses of more than 2% in morning trading.

4DMedical shares closed yesterday at 65 cents each and are currently at 63 cents a share, down 2.3% for the day, but still up 7% for the month.

This comes following Friday's release of the respiratory imaging technology company's full-year results for the 12 months ending 30 June (FY22). The 4DMedical share price closed up 4.7% on the day.

Here are the highlights:

Two doctors wearing white coats look closely at a medical imaging x-ray as the share prices of ASX 200 healthcare shares improve in FY23

Image source: Getty Images

4DMedical share price in the spotlight amid FY22 results

  • Total income of $13.4 million, up 132% from FY21
  • Revenues from ordinary activities of $1.1 million, increased 386% year on year
  • Net loss after tax of $24.6 million, a 15% increase from FY21
  • Cash reserve of $51.1 million and no debt as at 30 June 2022

What else happened during the year?

While income and revenues increased, so did the company's operating expenses, which rose 51% year on year to $37 million. 4DMedical said the increase was largely due to more spending on research and development and in support of commercialisation.

Other milestones during the year included the company signing a nationwide contract with I-MED, Australia's largest outsourced radiology provider.

The ASX medical tech share also progressed in the United States, where scanning commenced at its first US clinical pilot at Providence St. Joseph Hospital in California.

And in an FY22 highlight, 4DMedical unveiled its XV Scanner, the world's first dedicated lung scanner, at Prince of Wales Hospital in Sydney on 17 March. The scanner was delivered with the help of the Medical Research Future Fund (MRFF), with a $28.9 million contribution from the Australian government.

What did management say?

Commenting on the results, 4DMedical CEO Andreas Fouras said:

From a financial performance perspective, we have grown Software-as-a-Service (SaaS) revenue as well as hardware sales. While these gains have been from a low base, they clearly demonstrate that the Company is now very much in its commercialisation phase…

The 4DMedical team has been busy adding to our catalogue of pilot and clinical trial results, which are rapidly adding to the body of evidence that scans generated via 4DMedical's XV LVAS technology are a superior way of examining patients.

What's next?

4DMedical said it "has a significant cash runway of at least six quarters". The company has a cash balance of $51.1 million and has yet to receive the $15 million in MRFF funds.

Looking ahead, Fouras added:

Subsequent to the end of the reporting period, the US signed into law a broad expansion of healthcare benefits for millions of veterans suffering from respiratory diseases acquired while serving their country. This will include increased testing to identify these disorders, providing a significant opportunity for 4DMedical.

4DMedical share price snapshot

Despite the strong past month, the 4DMedical share price has struggled this year, down 53% since the opening bell on 4 January. By comparison, the All Ordinaries Index (ASX: XAO) is down 8% year-to-date.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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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