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Alcidion Group Ltd (ASX:ALC) announced its Q3 2025 earnings, highlighting a record-breaking total contract value (TCV) of $48.8 million and strong cash receipts of $13.1 million. The company’s positive operating cash flow of $2.5 million marks a significant improvement from the previous year’s negative cash flow. Alcidion’s stock price showed a notable increase of 10.53%, reflecting investor confidence in its financial performance and strategic outlook. According to InvestingPro data, the company maintains a "GREAT" overall financial health score of 3.14, with particularly strong performance in profit and growth metrics.
Key Takeaways
- Record Q3 TCV of $48.8 million, the largest in the company’s history.
- Strong cash position with $10.2 million and no debt.
- Positive operating cash flow of $2.5 million, a turnaround from last year’s -$1.4 million.
- Upgraded FY25 EBITDA guidance to exceed $3 million.
- Stock price increased by 10.53% following the earnings announcement.
Company Performance
Alcidion demonstrated robust performance in Q3 2025, driven by significant contract wins and improved cash flow. The company secured a landmark 10-year deal with North Cumbria worth $37.5 million and welcomed its first customer in Wales. These achievements underscore Alcidion’s strategic focus on expanding its footprint in the UK healthcare market, where it aims to tap into ongoing Electronic Patient Record (EPR) tender opportunities.
Financial Highlights
- Total Contract Value (TCV): $48.8 million (largest quarter ever)
- Cash Receipts: $13.1 million (strongest Q3 on record)
- Operating Cash Flow: $2.5 million (vs. -$1.4 million last year)
- Cash Position: $10.2 million with no debt
Outlook & Guidance
Alcidion has provided an optimistic outlook by upgrading its FY25 EBITDA guidance to exceed $3 million. The company anticipates a strong Q4 for cash collections and expects to maintain a full-year cash flow positive result. With $40.2 million in contracted or scheduled revenue for FY2025, Alcidion is well-positioned for future growth, particularly with potential expansions in new markets anticipated for FY26.
Executive Commentary
CEO Kate emphasized the company’s strong pipeline and market opportunities: "We are continuing to see opportunities come to market in England," she stated, highlighting the company’s strategic positioning. She also noted, "The pipeline is larger today than it was the last time I stood in front of you," reflecting confidence in future growth prospects.
Risks and Challenges
- Market competition from US health tech providers could impact future contracts.
- NHS England restructuring may present both opportunities and uncertainties.
- Potential challenges in expanding into new geographical markets.
- Economic pressures could affect healthcare spending and contract renewals.
- Maintaining low customer churn rate amidst competitive pressures.
Alcidion’s strategic initiatives and strong financial performance in Q3 2025 have set a positive tone for the company’s future, as reflected in the favorable market reaction. With a focus on innovation and market expansion, Alcidion aims to capitalize on emerging opportunities in the digital health sector.
Full transcript - Alcidion Group Ltd (ALC) Q3 2025:
Kate, CEO/Presenter, Alcidion: The land from which I’m presenting today, the Wurundjeri people of the Kulin nation, and the lands from which all of you are joining me as well. And I pay my respects to their elders past and present and extend my that respect to any indigenous persons who are joining us on the call today. I’m also joined on the call by our chief financial officer, Matt Jep. Welcome, Matt. The plan is I’ll take you through a brief presentation covering the key commercial and financial highlights of the quarter.
And, as is our usual practice, we will then follow that with q and a. All attendees will have an opportunity to ask questions at the conclusion of the presentation. If you would like to ask a question, if you could please use the q and a facility that’s at the bottom of your screen or the top, and we’ll aim to any answer as many as possible. We have had a couple come in ahead of the webinar, so we will also look to address those. Any questions that are similar in nature or that I’ve already covered during the body of the presentation, we won’t, do again in order to avoid repetition.
But if we do run out of time and there’s any questions I’ve been able unable to answer, please, send it through to investor@lcidion.com, and we’ll seek to answer that as soon as possible. Just as a reminder to everyone, the webcast is being recorded, and it will be available later on today on our website for those who are keen to see a recording. Into the body of the presentation. As you’ll have seen from the release this morning, the q ’3 has continued to build on the momentum that we’ve established over the last few quarters. Of particular note and, you know, particularly to those on the call who have followed us for some time was the announcement that we signed the North Cumbria deal to deploy Mya Precision as their integrated patient as sorry.
As their enterprise electronic patient record platform. And I’ll touch on the details of that a little bit further in a moment for those who are not across those details. But really, North Cumbria is a significant validation for Alcidion and a well deserved, reward, I must say, the hard work that’s been put in by the Alcidion team across all, areas of business in both delivering on other, customer deployments to ensure that we had, you know, key referenceability that allows us to win very, very significant deals of this nature that are highly competitive in terms of the tender process we go through. Also, during the quarter, we’re able to secure our first contract in Wales with the Halda Health Board, and we see, this, we see the opportunity for several other, there are several other opportunities we see potential for in Wales, of a significant size, and of a similar size is what I meant, sorry, in respect of, the opportunities that Wales presents as a new country for us. And, you know, that will happen, hopefully, over the course of the next twelve to eighteen months.
During the quarter, we delivered strong operating cash flow and see ourselves very well positioned heading into the q the fourth quarter, which is historically our strongest period for cash collections. Following the continued strong trading that we have had in respect of, new opportunities and the size of all of those opportunities, we, have upgraded our EBITDA guidance for FY twenty five and expect to deliver EBITDA in excess of 3,000,000, which is a record result for the business. I’ll just unpack the financial highlights in a little bit more detail for you. During the quarter, we signed new sales with a combined total contract value of 48,800,000.0 for the quarter, which, with approximately 11.5 of that able to be recognized as revenue in f y twenty five and the rest being recognized in, subsequent years as recurring revenue. This represents our largest quarter for new TCV sales ever and further builds upon the 13,100,000.0 of new TCV that we signed in the second quarter.
Approximately 91% of those new contracted sales in Q3, relate to recurring product revenue with the balance related to services, entirely product implementation services. At the end of q three, we had about 40,200,000.0 of contracted revenue able to be recognized through the end of the financial year. Q three cash receipts for customers were 13,100,000.0 for the quarter, reflecting our strongest Q3 for cash receipts. Important to note that that does not include any contribution from North Cumbria, which we expect to come in as cash receipts in the fourth quarter. We delivered a positive operating cash flow for the quarter of 2,500,000 a material improvement on the same period last year, was negative $1,400,000 At the March 31, we have $10,200,000 of cash and no debt.
We’ve already covered a lot of this information, in the highlights in the prior slide, but it’s worthwhile just, pointing out a couple of key areas. On the left hand side graph, which is quarterly new sales, you can see a significant increase in new sales during the quarter predominantly driven by the signing of the North Cumbria contract as reflected in that bar. And then on the right hand side, the clear seasonality in our cash receipts and the material uplift we typically see in the second half of the year. We expect this trend to continue as we enter into the fourth quarter, particularly as we end in q three with a very strong debt as ledger of 17,700,000.0, and typically, we would collect the majority of that in a quarter. Just a a few of the key business, highlights for the quarter I’d like to detail in a little bit more.
We mentioned I mentioned at the start that we signed a couple of very key contracts, but we also signed and renewed several existing PCS PaaS customers throughout this quarter as well. In February, we announced our first customer in Wales, was Haldar University Health Board, and they’ll be using flow observations and the SmartPay modules from the Mya Precision suite. The contract was awarded after a competitive tender process. And, again, this provides that market validation of our patient flow flow solution, a product which we believe to be a clear leader across The UK and ANZ in respect of managing patient flow, which, as I’ve talked about before, is a is continues to be a very, very challenging problem for, customers, really, the world over in respect of that challenge around more demand for our health care services and beds than we have capacity to deliver. Wales itself presents an attractive market opportunity, for contracts of similar size, being in that 4 and a half to 5, to $6,000,000 range over five years.
And as we deepen our referenceability in this new landscape in Wales, we hope to see, more interest in the Mya Precision platform in the months and years ahead. Shortly after Halda, we signed the, very significant contract for North Cumbria. Just to reiterate and remind everybody, 37 and a half million over ten years with opportunity to extend further modules into that customer. So they bought the majority of our modules, but have opportunities, for example, to take SmartPage and also have opportunities to take some of our partner modules, which, you know, we hope to see happening through into the next financial year. Following the contract signing, the implementation process at North Cumbria has already started.
And, you know, given the modular nature of the way in which we roll it out, which is a key feature of the Myo offering, we will expect North Cumbria to start to see tangible benefits quickly, and we’ll be able to report on those, as we have been able to report, during the last quarter on some of the very significant, benefits that South is seeing. And I I hope everyone’s had the opportunity to read some of the exciting feedback we’re getting from South Tees as they continue to roll out the Myo Precision platform more deeply across all their clinical areas. As I touched on, we also renewed several of our PCS PaaS customers in The UK. Again, it continues just to reiterate the importance and the value of that recurring revenue, the long term nature of the contracts, and the continued renewal of those contracts that we see, year on year. As many of you will seen have seen last week, we announced the appointment of professor Andrew Way as a nonexecutive director.
He will be replacing Victoria Weeks who will step down around the midyear, and I thank Victoria very much for her service. She will still be with us for a few months. But, as the chair of the audit and risk committee, Victoria has overseen the continued, depth and and quality in the governance, activities across LCDN, and we’re very grateful for the the input that she has had over the last three years. Andrew is a highly accomplished chief executive, most recently as the CEO of Alfred Health, which was a position he held for fifteen years. And during that time, he saw incredible, depth of deployment of digital capabilities into to the Alfred, including, the Mya Precision platform.
So it’s fabulous to have him on board with firsthand knowledge and experience of the day to day impact that our solutions can have on productivity. Prior to moving to Australia, Andrew, also worked in The UK where he had an extensive, career in the NHS, most recently before he came to Australia as the CEO of Royal Free NHS Trust. So as we continue, you know, to work in that market, it’s gonna be fantastic to have Andrew’s experience on the board across not only Australia, but also his experience, in The UK. Just turning now to outlook. As I said at the end of Q3, we have approximately $40,200,000 in contracted and scheduled renewal revenue able to be recognized in FY 2025.
Historically, Q4 is our highest quarter for customer receipts as I, said at the outset and we’d expect that trend to continue. It’s underpinned by a debtor ledger at the end of Q3 of $17,700,000 and that includes that does include the invoicing for North Cumbria, which we would expect to come through in the fourth quarter. That’s for the phase one, deployment and payment. Following some of these strong contract wins we’ve had through q two and q three, we’ve upgraded upgraded our guidance from expecting to be EBITDA positive to expecting that to be at least 3,000,000 and a full year cash flow positive result as well. We’re pleased with the continued interest in the in our solution across all of our markets, and we continue to see building, the pipeline building as opportunities in those markets, enter into procurement phases, or they enter into engagement with us.
Many of you know that the NHS has seen a lot of political activity in the last month, and we’re continuing, to keep an eye on that. But we even despite that decision for NHS England to be disbanded, which is going to take a couple of years, it’s by 2027. And keeping in note keeping in mind that most of the staff from NHS England will actually transition over to the Department of Health and Social Care. Despite all of that activity, we are continuing to see opportunities come to market in England, particularly around that electronic patient record or EPR program, which still has a number of trusts to go to market. So that is still happening.
So I remain optimistic about the opportunity for Alcidion in that market, both for those APR opportunities, but also, I think, you know, importantly turning our mind to the opportunity for optimization and enhancing the value of digital investments that they’ve made in England. You know, it is a world where reduced staff in England, and increased expectations on productivity are going to require further deployment of digital solutions to actually, you know, transition that from a, you know, a resource staff heavy environment in into one that is producing greater productivity for less people. So, you know, I I see the opportunity increasing. However, we are waiting to see what the ten year plan indicates in terms of where those priority areas are. Alcidion with a platform, digital health platform that is really focused on the use of data to support increasing efficiency in health care is really well positioned as we, you know, as we look to, those new opportunities that’ll be outlined for England from that ten year plan, in the coming months.
Before I open up to questions, I also just wanted to sort of, you know, touch on the current, you know, wider macro environment. You know, one of the interesting areas that’s highlighted as a result of sort of recent economic and tariff policies in The US US is that a large number of those health tech contracts that we see awarded, are actually, yeah, large US health tech companies, particularly in The UK market and some of the other markets that we’re, you know, interested in looking at. And we are hearing from several customers an increasing willingness to look at solutions outside of The US, health tech market. And, you know, it may be that Oxitin could be a benefactor of that shift in in sentiment over time. Obviously, you know, we’ll this will take some time to play out and unlikely to change existing procurements that are in play, but it could be a tailwind for Alcidion as as we look to the future opportunities.
I’m going to stop there and provide an opportunity for questions. Matt is gonna join us and let us know if we have received any questions to date.
Matt, CFO, Alcidion: Thank you, Kate. Yeah. We have received some questions, a couple before the call and a couple during the call. We’ve had a number of questions on the impact of NHS England, which I believe Kate has answered in the call. So I’ll move on to the next question we got before the meeting or before the call.
Sorry. So we would like could you provide clarification for cash receipts expectations in q four? Will this exceed f y twenty three and f y twenty four? So I think I will take this question, Kate. So q four has always been our strongest quarter for receipts.
Receipts were $18,600,000 in Q4 last year. And as Kate touched on just earlier, we end the March with 17,700,000 on the debt ledger. So with that in mind, we expect Q4 will be as strong or stronger in the current year. So some questions that have come in, and there’s there’s a few that are very similar. So the first one is in q three f y twenty four, you noted bids on 200 plus million in EPR tenders, including NCIC, with preferred vendors to be named by end of twenty four.
Have preferred vendors been named now? Can you provide an update on these bids? I
Kate, CEO/Presenter, Alcidion: am not sure that I indicated that it’ll be announced by the end of twenty twenty four, although I stand corrected if I did. They certainly we had, as I’ve talked about on these calls before, many of those tenders for APR bids have been had had been delayed, but are moving now. Obviously, we won North Cumbria. There are other bids, still going through their process. So, you know, I’m I’m comfortable with where we’re at the moment.
All bids once they’re decided sorry, are actually, you know, notified to the market in The UK, and I have pretty well kept people up to up to date on this on these calls as to how we’ve been progressing with those.
Matt, CFO, Alcidion: Thank you, Kate. The next question is for new TCV sales of 48,800,000.0, North Cumbria was 37 and a half, Hilda was 5.5, and the balance was 5.8. What did the balance of 5.8 comprise of? Were they all Silverlink renewals or were there other contracts as well?
Kate, CEO/Presenter, Alcidion: There would have been other contract renewals, other smaller contracts, other, you know, contracts that are not of a size that get announced to the market. So I can’t tell you off the top of my head how many total individual contracts made that up. PCS made up a large part of it, but there were also, patient track contract renewals, SmartPage contract renewals. This is a pretty heavy time of year for renewals in The UK in particular.
Matt, CFO, Alcidion: Thank you, Kate. The next question, is the uplift in contracted revenue, so to the 40,200,000.0 versus what was reported at the h one results attributable to more North Cumbria revenue recognition or other new contracts?
Kate, CEO/Presenter, Alcidion: Mostly other new contracts that have come through during that time. I think we’re still pretty well in line with what we expected to recognize from North Cumbria.
Matt, CFO, Alcidion: Thank you, Kate. Another question. Congratulations on this result. Appreciate it if you could discuss the following, recurring organic revenue growth projections, I. E.
Patient number growth or CPI linked fees? And the second part of that question is around the pipeline. I’ll I’ll ask that separately.
Kate, CEO/Presenter, Alcidion: I think that question is saying, you know, what is it what is it that drives any increase in the contracted recurring revenue? And for us, that, the majority of that is CPI. So there’s generally annual CPI increases across our recurring contracts, generally built into the contract. However, if the customer increases the scope, so they might want to buy additional modules or they may extend the beds that are covered by, those modules, and that is also a trigger for increasing the recurring revenue.
Matt, CFO, Alcidion: Thank you, Kate. There’s a question here, which I think I’ll probably take. Can you comment on the FX benefit on revenue and balance sheet items and its contribution to the FY ’25 earnings upgrade? So we, you know, we operate a business out of The UK. We have sterling bank accounts in in The UK, of course, and we receive and remit money in The UK in sterling.
So, like, while we do have an exposure, the upside on the revenue is offset by the downside on the costs largely. Similarly, in the balance sheet, it’s kinda naturally hedged with your debtors and creditors offsetting each other. So in in terms of the question, how much has that contributed to the upgrade? It’s it’s very little is the answer. So most of the other questions are around a pipeline.
I’ll ask this one first quickly, though. That’s a short one. When do we expect HuelData to go live?
Kate, CEO/Presenter, Alcidion: I think it is around August, September.
Matt, CFO, Alcidion: Yeah. Definitely before Christmas, isn’t it?
Kate, CEO/Presenter, Alcidion: Yes. Definitely.
Matt, CFO, Alcidion: Being an Australian company, do you think this helps secure Australian contracts?
Kate, CEO/Presenter, Alcidion: Unfortunately, no. I do not. It is very competitive, and, you know, they that there is nothing factored in at the moment. However, I am starting to see quite a change post the tariff situation on the macro at a macro level around sentiment on this in this particular area. So we may see some impact of it going forward, but historically, no.
I have not.
Matt, CFO, Alcidion: And before I get to the pipeline question, has there been any churn contract losses in the last quarter, and what have you learned from those losses?
Kate, CEO/Presenter, Alcidion: Look. Typically, have very low churn from our customers’ perspective. Although, I think if not last quarter, then it must it was fairly recent that Derby and Burton, people will know, chose, an APR provider that wasn’t us, and they were using our PatientTrack solution. So they have, they will be moving to the new EPR providers PatientTrack equivalent type module. And I think if they haven’t done it already, they’re they’re gonna be doing that in the next couple of months.
It’s a small amount overall, and and so there is that will happen, you know, in a very you know, rarely happens, but it’s worth pointing out that it does. It’s not never, but it’s fairly rare.
Matt, CFO, Alcidion: Thank you, Kate. So we have three more questions that are open. They’re all largely related to the sales pipeline, but I’ll I’ll just throw this one in there. So if you could kinda comment on on the pipeline and where we’re at with that. And are you more excited about Australian or UK opportunities at this stage?
Kate, CEO/Presenter, Alcidion: Well, I mean, I’m excited about them all to be fairly honest. I don’t probably favor any of anyone over the other. But, you know, I we are really well placed. We have got some incredibly strong validation out of our deployments in The UK and in Australia that our customers are happy to go into print about. So that helps us as we continue to build the Alcidion presence, the value of our, software, and demonstrate that we can do that quickly because we do it in this modular manner.
So, you know, the pipeline I what I can say to you, because I report on this fairly regularly, the pipeline is larger today than it was the last time I stood in front of you. The pipeline is made up of a range of opportunities, including EPR opportunities, flow opportunities, virtual care opportunities, SmartPage opportunities, opportunities that come from existing customers and from new, market of new customers. They that pipeline that I’m referring to all refers pretty well to Australia, New Zealand, and The UK. We will continue to look at opportunities potentially to move into new markets, and certainly, I think that’ll be a feature of f y twenty six to to focus on some new markets. But right now, the pipeline, is healthy.
The opportunity that is presented to us is there, and we’re looking forward to, to prosecuting that, in the next six to twelve months.
Matt, CFO, Alcidion: Thank you, Kate.
Kate, CEO/Presenter, Alcidion: And that looks like all the questions that we have for today. Thank you very much everyone for your time. I’d like to thank your the, the board and the staff of Alcidion for their continued work, and, of course, to thank you as shareholders for your continued support. Look forward to keeping you updated on a regular basis on our progress. Thanks.
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