Uscom’s Q3 Cash Falls to $1.34M as Revenue Climbs Amid Trade War
Uscom Limited reported a 14% rise in Q3 customer receipts to $0.73 million, even as cash reserves dropped 38% to $1.34 million, reflecting increased operating costs and global market pressures.
- Q3 revenue increased 14% to $0.73 million compared to prior quarter
- Cash on hand fell 38% to $1.34 million
- Operating cash outflow rose to $0.75 million driven by higher staff and marketing expenses
- Chinese regulatory approvals secured for BP+ and SpiroSonic devices
- New Beijing subsidiary established to support China expansion
Revenue Growth Amidst Global Challenges
Uscom Limited (ASX: UCM), a medical technology company specialising in non-invasive cardiovascular and pulmonary devices, has released its Appendix 4C quarterly cash flow report for the period ending 31 March 2025. The company recorded a 14% increase in receipts from customers, rising to $0.73 million from $0.64 million in the prior quarter, signaling resilience in sales despite ongoing global trade tensions.
However, this revenue growth contrasts with a significant 38% decline in cash on hand, which fell to $1.34 million from $2.17 million in the previous quarter. The increased cash burn is attributed to higher operating expenses, notably a 28% rise in staff costs to $0.68 million and a 10% increase in advertising and marketing spend to $0.33 million.
Operational and Strategic Developments
Executive Chairman Professor Rob Phillips highlighted the challenging global environment, citing the US global trade war as a key factor impacting markets and sales worldwide. Southeast Asia remains the only region meeting sales targets, underscoring the uneven recovery across geographies.
Despite these headwinds, Uscom achieved several operational milestones during the quarter. These include clinical advancements in maternal care, preeclampsia, and hypertension, as well as the consolidation of partnerships with major players Foxconn and SinoPharm. Notably, the company secured Chinese NMPA regulatory approvals for its BP+ central blood pressure monitor and SpiroSonic ultrasonic spirometry devices, critical steps for market expansion in China.
To capitalize on these approvals and support growth, Uscom established Beijing Uscom MedTech, a wholly owned subsidiary focused on product development, manufacturing, and distribution within China. This strategic move positions Uscom to leverage the vast Chinese healthcare market as geopolitical tensions stabilize.
Financial Position and Outlook
Operating cash outflows increased to $0.75 million, up from $0.42 million in the prior corresponding period, reflecting the company’s investment in growth initiatives. Uscom currently holds a $1 million unsecured loan facility from its Executive Chairman, bearing an 8% interest rate, which provides some financial flexibility.
Looking ahead, the company remains confident in its ability to improve cash flows in Q4, supported by ongoing sales momentum and expansion efforts. Uscom is actively engaging with investors to secure additional funding if necessary, aiming to sustain its commercial strategies and operational growth.
While the current cash runway is estimated at approximately 1.8 quarters, management’s proactive approach to scaling operations and securing regulatory approvals suggests a strategic positioning for a return to a stronger growth trajectory once global market conditions stabilize.
Bottom Line?
Uscom’s Q3 results reveal a company navigating global headwinds with strategic expansions and regulatory wins, but cash flow pressures warrant close monitoring.
Questions in the middle?
- How will Uscom manage cash flow sustainability beyond the next two quarters?
- What impact will geopolitical tensions have on Uscom’s China expansion plans?
- Can new partnerships with Foxconn and SinoPharm translate into significant revenue growth?
