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Adelaide x-ray firm misses target

Business

Adelaide-based technology company Micro-X has reported disappointing sales figures for its flagship lightweight, medical x-ray machine, but ongoing interest in the defence and security applications of its other products overseas.

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Micro-X designs and manufactures lightweight mobile x-ray machines, scanners and imagers for medical and security applications at the Tonsley Innovation District in Adelaide.

In a statement to the Australian Stock Exchange this morning, the company said it was unhappy with sales figures for its star mobile medical x-ray machine – DRX Revolution Nano – by its exclusive distributor, Carestream Health.

“While the Company has made good overall progress in line with our development plans we are highly dissatisfied with our Nano sales,” said managing director Peter Rowland.

“Even with Nano’s exceptional in-service reliability and very positive customer feedback, the sales forecasts provided to us by Carestream have not been met.

“We are not sitting idly by and my team and I have been working closely with the highest levels of Carestream management to better understand the reasons and address why customers have not been buying the Nano from Carestream in the quantities expected and modelled from their previous mobile x-ray product experience.”

On its promotional website, Carestream spruiks Nano’s features as including “the tiny size of a chipmunk, to a grasshopper’s articulating arms, from a cheetah’s speed and agility, to the wide field of vision of the owl, and even the tusks of an elephant”.

The units are manufactured using carbon nanotubes, making the Nano several times lighter and more compact than traditional x-ray machines.

Micro-X said it would be implementing “activities and new initiatives” to improve Nano sales – its key goal for 2020 – which would be announced in due course, subject to commercial sensitivities.

The local company had one win for the product over the quarter, however.

Clinicians in an Australian health facility began to use one for first time – at the Alfred Hospital in Melbourne, in November.

Overall, the company earned a total of $784,000 from customers in the three months ending December 31.

That figure includes $384,000 in Nano sales and $400,000 in requested software upgrades for the units.

The final three months of 2019 also saw an extension of the company’s contract with the UK Government to develop a backscatter imager, capable of detecting small amounts of explosive materials within electronics, inside passengers’ carry-on luggage.

And the company’s Rover mobile x-ray machines, which it is developing for deployment in conflict zones, are continuing to attract the attention of the United States military.

Micro-X officials met with US Defence Health Agency officials at Fort Detrick, near Washington DC, during the quarter.

The officials, according to today’s statement, “assessed the ruggedisation modifications and ergonomic performance” of the machines, and flagged the agency’s intention to order a small batch of Rover units – as soon as the product is approved for sale by the US Food and Drug Administration (FDA).

“I am pleased to report that the US military have again expressed their strong interest in purchasing a number of Rovers just as soon as we can achieve our 510k approval (from the FDA),” said Rowland.

Micro-X has $13 million in loans – including $3 million from the South Australian Government – and $12.36 million worth of cash in the bank, expected to fund the company into 2021.

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