Photocure ASA ((NO:PHO)) has held its Q3 earnings call. Read on for the main highlights of the call.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
Photocure ASA’s recent earnings call conveyed a generally positive sentiment, underscored by robust product growth, strategic market expansions, and commendable financial performance. Despite encountering challenges in the Flex segment and adverse foreign exchange impacts, the company remains well-positioned for future growth, bolstered by innovative partnerships and a strong cash flow position.
Strong Product Growth
Photocure experienced a notable 12% product growth globally, with North America leading the charge with a 14% unit growth and a 12% increase in product revenue. The expansion of the Saphira Blue Light equipment base was marked by 7 new tower placements and 7 upgrades in the U.S., highlighting the company’s successful market penetration.
Significant European Market Expansion
The European market witnessed an 11% revenue increase, driven by substantial growth in the Nordics and DACH regions, primarily due to Olympus upgrades of the Visera III system. The number of active accounts surged by 23% year-over-year, reaching 373 accounts, indicating strong market engagement and expansion.
Positive Financial Metrics
Photocure reported a positive EBITDA of NOK 10.2 million, marking the 10th consecutive quarter of positive EBITDA. The company’s financial health is further solidified by a robust balance sheet, boasting NOK 247.8 million in cash and no term debt, reflecting its financial stability and operational efficiency.
Strategic Partnerships and Innovations
A strategic partnership with Intelligent Scopes Corporation was announced to develop AI software for real-time tumor detection using Blue Light Cystoscopy. The ENABLE clinical study has been initiated in both the U.S. and Europe, underscoring Photocure’s commitment to innovation and enhancing diagnostic accuracy.
Operational Leverage and Cash Flow
Photocure achieved improved operating leverage with year-to-date cash flow from operations standing positive at NOK 26.4 million. Excluding the share buyback program, the company maintained a positive net cash flow of NOK 16.5 million year-to-date, demonstrating effective financial management.
Challenges with Flex Segment
The Flex segment faced a significant decline of about 52% compared to the previous year, now accounting for less than 5% of total sales. This decline is anticipated to persist as the company transitions to newer technologies, reflecting a strategic shift in focus.
Foreign Exchange Impact
Foreign exchange fluctuations negatively impacted revenue by approximately NOK 3.4 million and EBITDA by about NOK 0.5 million. These challenges highlight the ongoing volatility in global currency markets affecting Photocure’s financial outcomes.
Government Shutdown Delays
Potential delays in FDA submissions for new scope manufacturers due to the U.S. government shutdown could impact the timeline for market entry. This presents a regulatory hurdle that could affect Photocure’s strategic plans.
Forward-Looking Guidance
In the third quarter of 2025, Photocure reported a 12% increase in global product revenue, reaching NOK 134 million, with a 14% growth in unit sales in North America, despite foreign exchange impacts. The company achieved a positive EBITDA of NOK 10.2 million, marking the tenth consecutive quarter of positive EBITDA. Strategic initiatives, including the collaboration with Intelligent Scopes Corporation for AI development in Blue Light Cystoscopy, are expected to enhance detection accuracy and support future growth. Photocure maintains a strong balance sheet with NOK 247.8 million in cash and no term debt, positioning itself for long-term success in the bladder cancer diagnostic space.
In conclusion, Photocure ASA’s earnings call reflects a positive outlook, driven by strong product growth, strategic market expansions, and solid financial performance. Despite challenges in the Flex segment and foreign exchange impacts, the company’s innovative partnerships and robust cash flow position it well for future growth and success in the diagnostic space.