Volpara (ASX:VHT) share price falls on half-year results

The Volpara Health Technologies Ltd (ASX: VHT) share price is falling today after the company announced its half-yearly results for FY21.

| More on:
falling healthcare asx share represented by doctor with head in hands

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Volpara Health Technologies Ltd (ASX: VHT) share price is falling today after the company announced its half-yearly results for FY21. At the time of writing, the Volpara share price is down 2.8% to $1.39.

Let's take a closer look to see what's moving the Volpara share price today.

What's driving the Volpara share price lower?

It seems, despite reporting a decent result for its FY21 half-year performance, the company's performance has failed to meet investors' expectations, if the falling Volpara share price is anything to go by. 

For the period ending 30 September, Volpara received total revenue of NZ$9.5 million, up 38% on the prior corresponding period (pcp). This was underpinned by a 71% increase in its subscription revenue of NZ$8.8 million.

Annual recurring revenue (ARR) grew to NZ$19.9 million compared to the NZ$15.7 million recorded at the half-year of FY20.

Average revenue per user (ARPU) also lifted to US$1.16, up 26% over the comparable period.

Net operating cash outflow came to NZ$7.8 million, a slight improvement from the NZ$7.9 million that was recorded in the first half of FY20. COVID-19 brought some challenges to the business, affecting sales and marketing techniques which involved face-to-face contact and trade shows. As a result, the company decided to move further into the digital marketing space, and is starting to see results.

Overall, the group stood at a net loss of NZ$8.9 million, however this is an 11% upturn on the pcp.

The company revealed a holding cash balance of NZ$64.3 million at the end of the period. The jump from its NZ$31.4 million achieved at the end of FY20 was due to a recent capital raising of NZ$29.5 million.

Furthermore, the cash balance includes a NZ$2.6 million low-interest loan received as a COVID-19 relief package from the United States government.

Management commentary

Volpara CEO, Dr Ralph Highnam, commented on the group's achievement for the first-half of the year. He said:

In the face of this unprecedented challenge, we proactively modified our strategic approach on several fronts. We shifted to digital marketing, reshaped our US commercial team, and began investigating ways to address women directly to drive demand. We are focusing on R&D to generate improved products and services. And we have developed a new sales model to lower the cost of customer acquisitions.

Fortunately, we have a healthy balance sheet, and with vaccines seemingly on the horizon, the environment should correct itself in due course.

FY21 outlook

Looking towards the remaining part of the FY21, Volpara advised that it is on track to meet its expectations for the full-year. No guidance amount was given in the report however.

ARR is anticipated to grow in the coming months, but may be at a slower rate as COVID-19 is affecting its US market.

ARPU is also expected to rise despite the chance of the company losing contracts with a number of clinics. This is due to Volpara targeting MRS System customers to upgrade to its software-as-a-service (SaaS) platform. SaaS is viewed by Volpara as being much more meaningful to revenue than ARPU.

Volpara share price summary

The Volpara share price has lost ground over the past six months, falling by 6%. In comparison, the All Ordinaries Index (ASX: XAO) has moved more than 20% higher over the same time frame.

Whether or not the Volpara share price can reach its former glory when it was trading around the $2 mark remains to be seen. It will be interesting to watch the company's developments before reporting its full year-result in May next year.

Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of VOLPARA FPO NZ. The Motley Fool Australia has recommended VOLPARA FPO NZ. 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.

More on Share Market News

A piggy bank on the cloud in the blue sky symbolising a record high share price.
52-Week Highs

12 ASX 200 shares that smashed historical peak prices today

Twelve ASX 200 shares rose to new multi-year peaks in an otherwise quiet day of trading.

Read more »

A woman's hand draws a stylised 'Top Ten' on a projected surface.
Share Gainers

Here are the top 10 ASX 200 shares today

Investors saw another day of mild gains for the stock market this Thursday.

Read more »

Two boats on the water with crates with the words trade war in the middle.
Share Market News

Trump's tariffs blocked by trade court: Which ASX 200 stocks could benefit the most?

These 3 ASX 200 stocks have heavy tariffs exposure.

Read more »

A man in his 30s holds his laptop and operates it with his other hand as he has a look of pleasant surprise on his face as though he is learning something new or finding hidden value in something on the screen.
Broker Notes

How this undervalued ASX All Ords share could rocket 80% in a year

A leading fund manager expects a big turnaround for this beaten-down ASX All Ords stock.

Read more »

Man looking happy and excited as he looks at his mobile phone.
Share Gainers

Why Champion Iron, Clarity Pharmaceuticals, St Barbara, and Woodside shares are charging higher today

These shares are having a good session today. But why are investors buying them?

Read more »

Frustrated stock trader screaming while looking at mobile phone, symbolising a falling share price.
Share Fallers

Why ALS, Black Cat, Boss Energy, and Soul Patts shares are falling today

These shares are falling on Thursday. Let's find out why.

Read more »

A car dealer stands amid a selection of cars parked in a showroom.
Broker Notes

Up 77% in a year, guess how much more upside Macquarie tips for Eagers Automotive shares

Macquarie released its latest analysis on Eagers Automotive fast rising shares this morning.

Read more »

Boy looks quizzical standing in front of a graph.
Share Market News

Big ASX 200 news! Stock market whipsaws as Trump's tariffs struck down

Markets initially surged on news that Trump's tariffs are out.

Read more »