The PolyNovo Ltd (ASX:PNV) share price is trading higher today following an announcement from the company.
What did PolyNovo announce?
Earlier today PolyNovo released a trading update to the market regarding the company's earnings and sales run rate. PolyNovo announced that revenues for FY19 are likely to be in line with broker consensus with total revenue from product sales expected to be around $9.4 million.
PolyNovo's trading update also indicated that the company's sales run rate will be significantly above FY19. The company reported that sales for the three months ending on 30 June 2019 were $3.9 million, indicating an annual run rate without growth of $15.6 million.
Although there were no sales from South Africa, Israel and the EU in FY19, PolyNovo's CEO Mr. Paul Brennan was happy with the company's sales performance in the US, Australia and New Zealand.
Outlook for PolyNovo
PolyNovo is an Australian-based medical technology company that designs, develops and manufactures dermal regeneration solutions. The company is based around CSIRO medical technology that helps burnt and damaged skin recover.
PolyNovo's flagship NovoSorb Biodegradeable Temporising Matrix (BTM) product is a bi-resorbable polymer that comes in many formats and provides a dermal scaffold for the regeneration of dermis that is lost through surgery or burns. NovoSorb also aims to target multiple medical issues which include diabetes, hernia and breast repair.
The PolyNovo share price has been one of the best performers on the ASX in 2019, up more than 190% for the year. Earlier this year, PolyNovo reported that NovoSorb BTM had generated sales of $3.75 million, a 319% increase from the prior corresponding period. Following the appointment of Mr. Paul Brennan as CEO, PolyNovo has expanded its business to the US, Israel and South Africa.
Earlier last month analysts at Macquarie issued a note on PolyNovo, estimating that the revenue for the company will grow to $39.4 million by 2021. Although Macquarie noted that there are inherent risks in medical start-ups, analysts placed PolyNovo at the 'lower risk' end of the curve.
At the time of writing, the PolyNovo share price was up 6% for the day, hitting a high of $1.70 following the announcement.
