Year-end Report 2019 Redsense Medical AB (publ)
FULL YEAR, 1 JANUARY – 31 DECEMBER 2019
The Group
• Total operating income for the financial year amounted to kSEK 13,863 (8,702).
• Net sales for the financial year amounted to kSEK 13,265 (7,006).
• Operating result (EBIT) amounted to kSEK -3,742 (-6,829).
• Total equity amounted to kSEK 8,694 at the end of the period (4,288).
• Cash and cash equivalents amounted to kSEK 8,645 at the end of the period (3,439).
The Parent Company
• Total operating income for the financial year amounted to kSEK 10,228 (6,734).
• Operating result (EBIT) amounted to kSEK -4,002 (-4,712).
• Total equity amounted to kSEK 51,258 at the end of the period.
• Cash and cash equivalents amounted to kSEK 5,845 at the end of the period.
FOURTH QUARTER, 1 OCTOBER - 31 DECEMBER 2019
The Group
• Net sales for the fourth quarter amounted to kSEK 3,967 (1,767).
• Operating result (EBIT) amounted to kSEK -973 (-2,728).
The Parent Company
• Net sales for the fourth quarter amounted to kSEK 2,907 (1,002).
• Operating result (EBIT) amounted to kSEK -1,100 (-2,184).
RESULT AND POSITION
The Group’s result for the financial year 2019 amounted to kSEK -4,016 before taxes, or SEK -0.33 per share. The number of
shares outstanding was 12,174,914 as of 31 December 2019. Cash and cash equivalents at the end of the period amounted to
kSEK 8,645.
Proposed appropriations of profit or loss
The Board of Directors and Chief Executive Officer proposes that no dividend shall be paid for the financial year 1 January to 31
December 2019.
SIGNIFICANT EVENTS 1 JANUARY - 31 MARCH 2019
• PCT approval of the Redsense Catheter Patch, detecting blood leakage from the central bloodline.
• Offset of loans raised in connection with directed new share issue.
• Announced the development of a prototype for Redsense’s novel smart wound care technology, where blood and exudate is
measured optically with a thin sensor layer.
• Patent approval in Sweden for the smart wound care technology.
• Major US dialysis provider successfully completed evaluation of the Redsense blood leakage alarm.
SIGNIFICANT EVENTS 1 APRIL - 30 JUNE 2019
• Collaboration agreement with Physidia, a French dialysis company focusing on the home hemodialysis market – Physidia
commits to integrate Redsense, enabling automatic stop when blood leakage is detected.
• Dr. Maria Alquist elected to the Board of Directors.
• Changed list for trading to Spotlight Stock Market.
• Patent approval in Canada for the blood leakage alarm.
• Article published in Hemodialysis International in collaboration with the University Health Network in Toronto.
SIGNIFICANT EVENTS 1 JULY - 30 SEPTEMBER 2019
• PCT application based on Swedish patent for smart bandage submitted.
• Orders exceeding MSEK 4 in value obtained from the USA in July and August.
• Submitted patent application for new technology derived from the existing smart bandage and stand-alone, applicable in
different industries.
• Targeted share issue of 8,5 MSEK to accelerate expansion, meet increased demand, as well as develop and commercialize
previously evaluated blood clamp prototype.
• Increased use of Redsense among top dialysis providers in the USA.
• Initiative to facilitate reporting of venous needle dislodgement presented together with European Nurses Association.
SIGNIFICANT EVENTS 1 OCTOBER - 31 DECEMBER 2019
• Received kSEK 500 funding from Vinnova to develop AI-driven wound monitoring software.
• Received international patent opinion regarding the Company’s first smart wound care invention, with all claims found to be
novel and have “inventive step”.
• Redsense offsets loan raised in connection with directed share issue.
• Ann-Marie Eriksson recruited as the Company’s new Chief Technology Officer, responsible for R&D, quality systems and
securing supply chain input.
• Supply chain optimizations to increase production capacity, improve efficiency and improve response time.
SIGNIFICANT EVENTS AFTER THE PERIOD
• Offset of loans raised in connection with directed new share issue.
• Influx of new orders to a combined value of more than MSEK 1.5 during the first days of January.
COMMENTS FROM OUR CEO
A near-explosive growth in sales
As we close the book on 2019, the strong level of sales and the significant build-up of commercial momentum feels like the most characteristic feature of the year. The pace has continued to increase throughout the year, and we have marked new record levels quarter by quarter; our sales during the last two quarters doubled compared to the corresponding period the preceding year, and sales for the fourth quarter increased by no less than 150 percent compared to Q4 2018.
United States is leading the way
Our current sales growth is primarily driven by the US home hemodialysis market. To a large extent, this can be attributed to the surge in nocturnal home hemodialysis treatments. In turn, this is facilitated by the US government’s focus on the matter, with larger US dialysis providers following suit and communicating the intention to step up their home dialysis operations. We are convinced that this trend will continue, as it provides a number of benefits for the patients as well as cost savings for society. Furthermore, there is still a vast market potential waiting to be unleashed when doctors and caregivers embrace the advantages fully.
Demand from caregivers is rising rapidly as well; awareness is spreading that Redsense provides a cost-efficient life insurance as well as a mean to free resources for more qualified care tasks.
Europe coming into place
In the European market, the sales and marketing structure is steadily falling into place, and we are strengthening our partnerships with distributors and healthcare providers. Sales from the Netherlands and the UK are increasing, and our distributors are promoting and evaluating needs across the continent.
A very important development is that we have obtained a new PAS 63023 integration. We have entered into a cooperation agreement with the French home hemodialysis machine manufacturer Physidia, which will become the second monitor manufacturer to include a direct connection to Redsense in accordance with the standard.
We have also announced a new project with the EDTNA to create a tool for nurses and other care-givers, making it easy to report VND events
Novel wound care progresses
Work on the new smart wound care technology platform is continuing effortlessly. Promising lower costs of care and more individual treatment, this product specifically puts the advanced wound care and burn wound care markets within the Company’s reach. A prototype with fully functional optical measuring has been developed and tested during the year.
We aimed from the start to create a strong patent protection in parallel with the development effort, and received patent approval in Sweden during Q1. Based on this, a PCT application for the Smart Bandage was submitted in August, and in Q3, we received the written patentability opinion with all claims found to be novel and non-obvious. The invention was also deemed industrially applicable – thus an entirely positive result. We will proceed to nationalize the PCT application in regions of interest.
There has been significant interest in the technology from major international players in the wound care segment, and we are engaging in discussions with them while we continously look at how to develop the method and device into new technology areas. We have received a grant from Vinnova, Sweden’s government agency for innovation, to develop an AI-driven wound monitoring software to process sensor data.
Meticulously preparing for further growth
In early May, the share was re-listed on the Spotlight Stock Market. The rationale for this decision was that it allows us to better allocate resources to where they matter most - the company’s growth.
In January, Ann-Marie Eriksson joined the Redsense team in the role as new Chief Technology Officer. She will lead the R&D projects, a pivotal task as the smart wound care platform is developed into a comprehensive solution. She will also manage the quality systems, and will be a great asset in our preparations to meet the upcoming European regulatory requirements that will enter into force in mid 2020.
The higher-than-projected orders have put quite some stress on our supply chain, and we have responded with a set of measures to strengthen it. Sensor production has been streamlined, resulting in a doubling of capacity, and other optimizations will allow us to quickly scale up production capacity to cover peak demand.
Future outlook
At this point, we are looking to the future with great optimism and confidence. Demand is looking solid moving forward, and we are proactively strengthening our supply chain to keep up, in an ongoing effort. Meanwhile, we are proceeding to pursue our patent strategy, develop the technology, and strengthen the integration with hemodialysis providers. We are also looking forward to the international patent opinion regarding our second invention, due in March. We have come a long way towards establishing the Redsense alarm system as a standard protection measure in hemodialysis care.
For more information, please contact:
Patrik Byhmer, CEO Redsense Medical AB (publ)
Phone: +4670-357 21 64
patrik.byhmer@redsensemedical.com
ABOUT REDSENSE MEDICAL
Redsense Medical is a corporate group with operations mainly in Europe and the United States. The company has developed the Redsense System, an innovationused for monitoring and alarm in the case of blood leakage in connection with a hemodialysis treatment. Redsense Medical solves one of the most serious remaining safety problems within hemodialysis – to quickly detect Venous Needle Dislodgement and catheter leakage to minimize blood leakage. The system consists of a patented fiber optic sensor, designed for either venous needle or central venous catheter, which is connected to an alarm unit. From the very start, the development of the company's technology has been based on the demands and safety requirements of healthcare providers in the dialysis sector.
This information is insider information that Redsense Medical AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication through the agency of the contact person set out above, on 25 February 2020.