Nanalysis 2021 Q4 Conference Call Notes and My Commentary

The Numbers

The whole year of 2021 vs 2020 was at about 100% revenue growth from $8M CAD in 2020 to $16M CAD in 2021. For the quarter the results went from $2.7M CAD in 2020 to $5.1M CAD in 2021.

Takeaways

Sales of 60 mhz and 100 mhz machines not going to level out or slow down, and they will aggressively attempt to enter new markets. Nanalysis will pause mergers and acquisitions for the time being to digest recent acquisitions. They expect acquisitions to continue in 2023 as they get closer to entering the healthcare MRI space. In five years they think they will have more software people than hardware people, it is that important to their long term strategy.

Questions

Accounting treatment of Quad Systems?

My Commentary

I see the 100 mhz revenue being “artificially strong” in Q1 and Q2 as they will likely produce more 100 mhz units than they sell in those quarters. If the K-Prime revenue of $8M-$10M CAD is part of their $32M CAD target for 2022, then that only has them adding $6M-$8M of higher margin hardware revenue. That is a 40% to 50% increase, and will include some revenue from Quad Systems. That should be a slam dunk IMO.

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Lindsay Leeds

Lindsay Leeds

I am an IT guy by trade, with interests in investing and personal finance.