Oneview Healthcare PLC

Thank you for standing by and welcome to the OneView Healthcare PLC preliminary FY24 results presentation call. All participants are in a listen-only mode. There will be a presentation followed by a question and answer session. If you would like to ask a question, you need to press the star key followed by the number 1 on your telephone keypad. If you would like to ask a question via the webcast, please enter it into the Ask a Question box and click Submit. I'll now like to hand the conference over to Mr. James Shitter, CEO. Please go ahead.

Thanks, Archie. Good morning, everyone. Good afternoon in the United States, and good evening for those joining in Dublin. First of all, just a usual reminder around the legal disclaimer, particularly with respect to forward-looking statements, and a reminder that we are a December year-end and our reporting currency is euros. In certain circumstances, we have provided a dollar conversion, so please be wary of that. And for those of you joining on the phone, I will try and reference page numbers as we work through the presentation. Just a reminder, OneView Healthcare's mission is to improve connected care experiences every day, and our vision is redefining care accessible, seamless, and reliable for all, and never has there been more of a requirement in the healthcare world we live in today. Joining me this evening for the first time is Dara Lyons, our new CFO. Dara joined five months ago. Absolutely thrilled to have him on the team. And Tony Pettit, our company secretary and chief of staff, is also joining from Dublin. So welcome to both of you. And as I said, I've been delighted to have Dara on the team and he's made an enormous impact to the business in the short time he's been with us. And you'll be hearing a little bit from Dara a little bit later this morning. The agenda is laid out here, which I think is pretty straightforward. So let's start with the year in review for 2024. Shouldn't be too many surprises here based on the full city we filed recently, but revenue for the year finished at $9.9 million revenue, which was up 5%. Impacted by two postponed customers was the result of corporate activity. One of our largest customers in the United States, acquired another health system of roughly the same size and stature, and that led to capital delays on their deployments, but we are very pleased to report that that customer has just sent us a purchase order for the next project that is underway with them. And secondly, the Children's Hospital of Ireland, which had been delayed, which again is now on track to be delivered in 2025. a deferral of some pretty significant revenues from last year that will land this year. Our recurring revenue finished up 9% at $7.2 million, $7.6 million in December, which would have been up 15% year over year. Gross margins, very pleased with a 67% gross margin, pretty much in keeping with last year. And importantly, thank you all the shareholders on this call who helped us to strengthen the balance sheet. We finished the year with... of cash. And as we foreshadowed, very nice growth in both our live beds and contracted bed numbers. We finished both of them up 23% year over year, which was in keeping with the previous guidance which suggested that 25% was a fairly sustainable growth rate for the business. In terms of eight major new logos in the United States during 2024, which is a record for the company in any 12-month period, we'll talk more about that in a second, but that includes three integrated delivery networks, which are the very large health systems that obviously are where we're focused. And we, as we previously announced, extended our value-added reseller partnership with Baxter for a further two years until mid-27, and expanded that to include the Canadian market, which is also very promising. In terms of product, it was a really important year for the business. We added three new products to effectively complete our vision for the connected patient room, including the digital whiteboard and the digital door sign, all of which round out the product portfolio. We've enjoyed commercial success with all three of those products in 2024, which is obviously very encouraging. And a little later in the presentation, Darren will speak to the upsell. opportunities that those products bring to us. So on slide 11, I just want to talk a little bit about the big picture and the history of the company, which dates back to our first founding in 2008. I joined the company in 2013. At that time, we were a 10-person startup. We enjoyed our first commercial success in 2014. And hopefully what this chart shows is that in the last two years, we've added 14 new customers, which is more than we added in the prior decade. So a very impactful change in customers in the last two years. Six new logos last year, eight new logos this year. And the drivers for that are really multifaceted. We've spoken to them at length in the past, but certainly the pandemic has renewed the value proposition for bedside technology in a meaningful way. The second is that we are conduit for the virtualization of care, which is the primary trend sweeping the United States right now. The momentum that the Baxter Partnership has added to the pipeline is non-trivial, and we'll talk more about that a little bit later. And importantly, operating margins for US hospitals have really bounced back into the positive for the first time in 2023 and 2024 and allowed them to loosen the purse strings for capital investment. Now, if we look at the breakdown of the logos that we secured in 2023, those six logos have 3,500 licensed beds, of which we apparently contracted with 1,900, so about a 54% contracted rate. The eight logos we signed this year, or 2024, have 11,700 licensed beds, of which we're apparently contracted with 3,858, or 33%. So let's look at why that is so important. The reason is our land and expand strategy. So throughout the history of the company, we have had a really impressive track record of being able to convert what begin as small deployments into major deployments. So we've shared a couple of examples here of five anonymized customers. If we look at customer B, for example, we initially signed a contract for 925 beds. We have subsequently delivered a further 1,200 beds, and then our contractor delivered a further 3,000 beds. So what began as a 925-bed contract is going to end up delivering close to 5,000 beds. Marie, this is very typical where we begin with a proof of concept. In that case, it was an 87-bed proof of concept, which is now expanded to be a contract for 1,536 beds. So that's a powerful testament to the importance of getting in the door. We are very confident that if we get in the door, we are going to be able to prove our value proposition very quickly. I would say that there is a strong... preference in the United States for proof of concept. The reason proof of concept is so important is that our backing integrations, which are really a unique selling proposition, are extremely complex and every customer has slightly different flavors of their electronic medical record, different integrations. They want to see those integrations live in a production environment before they commit across the enterprise. And I'm very happy to say that in the history of the company, we've never had and you haven't been able to fulfill. So I think it's a really strong message and of course what that leads to is customer satisfaction and we're sharing here the customer maturity profile of our 10 largest customers. You can see here dating back to 2014, we have a number of partnerships that are now spanning over a decade. The average customer duration across the portfolio is nearly seven years. I think that speaks to the value we're delivering and ultimately the quality of the product and our support model, which is something we're all extremely proud of. So the message is, if you can get in, it gives you the opportunity to expand, and once you've proven your worth, you are typically ending up with decade-long partnerships with very attractive gross margins. So in summary, it's a fantastic business. It's very hard to get in. It's also very difficult to be displaced. This little slide on slide 14 is a really good example of why the digital whiteboard is so important. You can see the image here of a manual whiteboard which still populates just about every hospital in Australia and the United States. The pandemic exposed the frailty of that model because nursing understood that they didn't have the time or the energy to update the whiteboard. So we are seeing demand for the whiteboard across existing customer base and almost every prospect we're talking to is asking for pricing for the whiteboard out of the gate. So I think that's been a fabulous investment by the team. So what's going on in the big picture? Again, I think for those who have been following the company for some time, I think there are some pretty important trends, some alarming statistics. One in four nurses in the United States is indicated they're going to leave the profession by 2027. Next year alone, the nursing shortage in the United States is estimated at 326,000 nurses. Estimates the global nursing shortage is going to reach 4.7 million nurses by 2030. And interestingly, in Australia, according to the Urban Institute, the number of Americans aged 65 and older is going to double in the next 40 years, hitting 80 million by 2040. So the demand for hospital care is growing and the supply of quality care teams is going in the other direction, which is a huge challenge. And that is leading to this trend in the virtualization of care, which we've talked about for so long. And we'll drill into that a little bit further in the presentation. But just a reminder of how our connected care experience impacts different stakeholder groups. Obviously, for patients and families, we are trying to empower the patient and their families to be more engaged in their own care by giving them tools that will provide calming and distraction content. For care teams, this is... How do we use the platform at the bedside to divert menial tasks away from nurses? This is something that's particularly important to Baxter, who are obviously a very significant player in the nurse school business, and the integrations that we've proven with Baxter are proving extremely as we move forward, and we'll go a little bit further into that later in the presentation. So this is a reminder of the connected care experience room where we have the digital whiteboard which can either be a standalone device in the room or we can host it on the TV or on the tablet. So we don't require an additional piece of hardware in the room. We've spoken at length about the benefits of MyStay Mobile. We know that hardware and capital budgets are not where we want to be in the hospital. We were thrilled to commercialize MyStay Mobile in 2024 with the Children's Hospital of Orange County, following on the back of NYU Langone's pilot and co-designer of that product. It's particularly relevant for new construction, where pretty much every new hospital we're selling is using the digital door sign to share precautions directly from the EMR. The other thing that's really Helping us is the data is providing a lot more data that is helping support the workflow issues I'm just talking about. So being able to track and monitor the time the patient makes a service request, the time saved by averting a nurse call event is driving, obviously, nurse satisfaction. nurse engagement and providing us with a framework that's making it increasingly easy to help the financial side of the equation, which is obviously crucial. Virtual care, as I mentioned earlier, and I've been saying this now for the past couple of years, really is what's driving demand for bedside technology. So we have invested very significantly in our virtual care API. We are vendor agnostic. We want to give Are hospitals the choice of which partner they want to work with? The telehealth space is a very crowded space and we have had great feedback. Almost all of our large enterprise customers are deploying one of those telehealth providers. One view is acting as the conduit for that delivery and that's exactly where we want to be. We're already in control of the television in the room. so we can allow the telehealth provider to remote in. We receive that message over the air, and we are providing the... effectively turning the television into a pane of glass that allows that telehealth consultation to take place on our platform. So I think that's been a hugely successful strategy for us. You can see the statistics here that nearly two-thirds of chief nursing officers in the United States believe virtual nursing will become integral to their care delivery model. and we are certainly seeing evidence of that in almost every conversation we're having in the US. And this is the connected patient room vision that Niall had set out years ago during the pandemic. We began that process by sharing virtual rounding, virtual visitation, virtual interpretation on the tablets. At a number of our customer sites today, we're now hosting pharmacy visits, for example, at NYU Langone, pharmacists are remote in the patient room and delivering what they call their meds for beds program where the patient's prescription medication is delivered to the room after the video consultation in every room at NYU, which is phenomenal. The adopting technologies we mentioned was using the television to facilitate those interactions. That's driving a lot of the work we're doing at ANOVA, at BJC, and at Mercy Health. And as Niall has pointed out for some time, it was only going to be a matter of time before AI-enabled virtual assistants and computer vision would be augmenting that capability, which is decided to launch last week. One new virtual patient assistant, which is called Ovi. And this has been a massive team effort. I really want to say a huge thank you to Niall, our Chief Product Officer, and Matthew Frank a product manager who conducted the market research. We did exhaustive market research with existing and prospective customers to understand the demand for this product and our engineering teams led by Des and Declan and particularly Alex Pollan who's been really involved in this have done a fabulous job getting this product ready. We were able to I had a health conference in Nashville last week and it will be on display again at HIMSS which is the largest health informatics conference in Vegas next week. I was fortunate enough to be able to demo this to a number of very high profile customers in the US last week, had fabulous feedback. Again, we can use, empower the patient to use the virtual patient assistant to take pressure off nursing. And this is the ability to ask the common questions around, you know, when am I going home? What meds am I on? It's going to allow the patient to control the television experience. It's going to allow them to order their meals through voice. So this is a huge leap forward for us. We've spent a lot of time making sure we put the appropriate AI governance framework in place. And again, I want to thank Declan Bright, who's been leading that initiative. We've really gone all in in terms of business automation of AI, but this is the first customer we're bringing to market. It is scheduled to be piloted at two academic teaching hospitals in the United States this year, and we're really looking forward to getting it in the hands of real patients and getting real feedback, so congratulations to all involved. So with that, I'm now going to pass over to Dara, who is going to go through the financial results in a little more detail.

Thanks James. So as James mentioned, our recurring revenue grew by 9% in 2024 to 7.2 million with the increase driven by the additional deployments we made during 2023 and 2024. Our total revenue then for 2024 was 9.9 million, which represents a 5% increase over 2023. And as James has mentioned, our 2024 revenue performance was significantly impacted by the postponement of two large customer deployment projects, one customer which was delayed due to some corporate transactional activity, and then the Children's Hospital in Ireland where construction delays has resulted in a later than planned opening date for that new hospital. We are confident, as James has said, that both projects will resume during 2025 and we will see that revenue coming through then. Our gross margin for 2024 then was slightly better than 23. at 67% as a result of a higher proportion of the higher margin recurring revenue in 2024 over 2023. Our subsidy that I lost then for the year was 8.8 million and that is being impacted by the two delayed projects just referred to and the advanced investment we made in resources to support the expected deployment activity we have in the US from our Baxter partnership and our direct sales pipeline. Moving on then to our financial and capital position on the next slide. At 31 December, we had 13.8 million of cash and that was having completed a capital raise during the fourth quarter of 2024, which was comprised of an oversubscribed $20 million share placement and an oversubscribed $3 million share purchase plan raise. Our aggregate net proceeds from the capital raising of €13.3 million, or $22 million, strengthens our balance sheet as we progress to deploy our contracted beds, grow our sales pipeline internally and through our relationship with Baxter, and to progress some important innovation initiatives, including progressing our AI strategy that James has just walked through, and making our deployment process more efficient through configuration tooling initiatives. Turning down to our commercial strategy on slide 26, our formula to build sustainable and growing revenue base is built on three important characteristics of our technology and business model. We are comfortable completing deployments across large enterprises. Our product is modular and we have a low customer churn. Taking the first of those characteristics on slide 27, We have a track record of deploying our software at scale across thousands of endpoints in large enterprise customers, and we are trusted to complete those deployments and technology integrations at that scale. This enables the first layer of our land and expand commercial strategy, which is included on slide 28. We can initiate a customer relationship with hundreds of beds and scale to thousands. as we deliver value and become a central part of the hospital's operating and technical workflows. The second layer then of that land and expand commercial strategy is related to product upsell. As I said, our technology is modular, so customers can choose what modalities they would like initially and then adopt additional products over time. And as we can see then on the next slide, slide 29, this gives us an additional 92% revenue upsell opportunity for customers that start with the Care Experience platform on TV and add additional products over time. So the services and value we bring to customers resulting in the low customer churn is the foundation for this dual expansion opportunity. Retaining customers then with growing revenue is the basis for sustained and accelerating revenue growth, which makes our success and focus on adding new customer logos all the more important and the basis for significant value creation potential for our shareholders over time. So I'll pass back to James who's going to talk through our operational execution.