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Reporting Season: Nanosonics Ltd (NAN.ASX)

Reporting Season: Nanosonics Ltd (NAN.ASX)

Edward Heng

Reporting Season: Nanosonics Ltd (NAN.ASX)

Overall, NAN missed expectations, with the weakness in earnings attributed to a low Q4 growth (driven by reduction in range of healthcare procedures and limited hospital access due to COVID-19).

R&D expenses also significantly increased (by 37%) from its product expansion strategy. Based on the composition of revenue growth in Q4, we observe that it is largely affected by reduction in units purchased by GE Healthcare and delay in capital sales to customer due to COVID-19 impacts. 

Maqro Adviser Video Commentary



Maqro Research Team Coverage

NAN expects Trophon capital sales to continue to be affected in North America due to limited hospital access. (this has been the experience to date in FY21). This could also impact capital equipment requirements of GE Healthcare (main North American distributor partner).



Key Metrics:

The overall revenue growth was impacted by a stagnant Q4 growth. Capital Revenue dropped significantly more in Q4 (by 34%), but overall revenue was supported by consumables/services revenue (which grew by 29% in Q4).

RegionInstalled BasePerentage IncreaseFirst 3 Quarters Increase Compared with First 3 Quarters of FY19
North America20,99013%"In line with expectations"
Europe and Middle East1,12027%37%
Asia Pacific1,6109%56%


Outlook Metrics:


  • No specific guidance for FY21.
  • Total operating expenses:
    • $75m – $78m.
  • H1FY21 – Trophon capital sales are impacted by limited hospital access, particularly in NA.
    • Flow on effect to Capital Equipment requirements of main NA distributor: GE Healthcare.
      • Delay of sales of Trophon to GE Healthcare due to delayed sales in Q4FY2020 (on ending inventory), coupled with hospital restrictions.
  • Risk of ultrasound procedures decreasing due to implementations of new restrictions – sales of consumables likely to be impacted (just like Q4FY2020) despite consumable sales recovering back to 80% of sales of Q1 – Q3.


  1. Increased investments in R&D, regional infrastructure and operational capability to support global operations.
  2. Continued growth in Trophon installed base across all regions.
  3. Growth in upgrades to Trophon EPR to Trophon 2.
  4. Japan to become important contributor to global installed base.
  5. Efforts to expand into China.

Nanosonics Ltd Conference Call Highlights

  1. Installation of bases is still continuing, but it is about 40% down on what they would have expected based on the FY20 Q1-Q3 results, as COVID makes it difficult for NAN to enter into all hospitals. NAN hasn’t seen a decline in interest, though the timeline for installation has been pushed out.
  2. NAN mentioned that part of the reason that they look at installed bases as a key metric is because hospitals might not necessarily have the capital to purchase from NAN but might instead lease from the company and thus give Nan access to these hospitals.
  3. They still believe that there is opportunity for upgrades but at the moment, given NAN’s restricted access to hospitals as it is, their focus is to install new bases in hospitals that they do get access to. NAN doesn’t expect for upgrades to be a major focus for at least H1FY21.


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