Q2 2021 Precipio Inc Earnings Call

Welcome to the precipitous shareholder second quarter 2021 shareholder update conference.

Call all participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing the star key followed by zero. Please also note that this event is being recorded.

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Now, let me hand, the call over to Ilan Daniela precipitous CEO.

Okay.

Thank you very much good afternoon, everyone and thanks for joining our Q2 2021 shareholder call.

On this call I'll provide a recap of our activity this quarter and some insights into what the future holds.

Brooks from now through year end.

Let's start with pathology services.

As you saw from our reported results we continue to grow our revenue mostly from pathology services with an increase of 65% year over year and 29% increase from Q1 to Q2 of this year.

Our reported revenue.

Revenue from pathology continued to grow due to Q2 key factors.

The first was the organic growth of new customers and increased business from our existing customers.

The second factor was the improvement to our collections, which reduces our allowance for doubtful accounts.

Cash coming in from pathology services depends.

Investment and insurance carriers and this is often quite the battle to say the least.

Through improved contracts with the payers alongside improved internal collection processes, we gradually managed to increase our collection rate from the 30% range years ago.

70 per cent range years ago into the eighties and now approaching 90.

On reinvent billable revenue.

It has a direct impact not only on reported revenue of course on cash to the bottom line.

Our <unk> sales team continued to face challenges from market reopens virtual period of time and are now facing a return to restrictions or even shutdowns.

This makes it more challenge.

90% for our sales team to call on new customers to build a relationship as well as maintain existing relationships with our current customers.

The good news is this is a challenge that the entire obscured spacing. So it's the tide that causes all shifts to rise together.

With a unique value proposition our team has in its toolkit.

Kit, which includes dedications of diagnostic accuracy.

We incorporated the incorporation of specialized academic expertise.

And our proprietary technologies, we believe that we still have a significant advantage over the competition.

With our expected growth of pathology revenues in addition to our growth of revenue streams.

James Green, we expect to exceed the $10 million run rate by the end of the year.

This will be an exciting milestone for us.

Turning now to the product side of our business.

As you saw in today's press release him screen is paving the way as a significant contributor to our company's growth.

The acceptance of our products by leading industry players such as Aon serves as recognition of precipitate was product and services and providing accurate diagnosis and earlier patient treatment, which ultimately impact patient care.

We anticipate that operations and revenues from AI will commence in Q4 of this year.

I can tell you that through my ongoing interaction with our R&D team. There is nothing more rewarding the known better technology that we've worked hard to develop and bring to market will now impact patients' lives.

We expect that this recognition and adoption by Aon and other players in the market will lead to continued growth of our business.

And of our company.

Our market analysis, there is still a work in profit process predicts the U S seems to be market to approach several hundred million dollars.

As we expand our hanes screen offering the continued growth of our product has a ripple effect on the company.

Last.

Quarter, we established our product support team and hired additional operational personnel. So that we can provide the necessary support expected by our customers.

Ensuring the proper resources to onboard our customers enables presidio to provide real time support as they run their in lab tests.

Okay.

As a laboratory that purchased a similar reagents services from outside vendors, we had presidio know the difference between average and top level support.

To achieve that level, our infrastructure and team are geared up to provide the highest level of support to our customers.

Performing molecular tests requires discipline.

Lynn regulatory rigor and trained staff we.

We recognize the importance of real time technical expertise and support.

And we're able to deliver the service through our team's speed portal that income.

<unk> product information support as well as tech needed technical service assistance and ease of ordering.

Listening haim screen to be the goal.

Standard of product supporting totals.

Going forward, we're also planning to create a production facility to gain speed run by an experienced production team to deliver quality of the product produced its consistency as well as inventory management, ensuring that our customers have access to quality products 365.

Five days a year.

We expect that Houston will be one of our key company corporate point for the foreseeable future.

Beyond the impact of this product on patient care and the ability of the service to enhance quality at the physician office, while performing an additional while providing an additional source of income.

These can also provide financial stability that will be critical for the companys growth and performance.

Contractual reagent rental agreement with the customer includes a four year commitment with monthly payments for the Haynesville reagents and equipment lease with.

This contractual agreement enables the company to receive a recurring revenue stream from customers.

And each new customer adds added serves another revenue building blocks.

We also believe that as our customers grow our business could potentially grow with them.

The overall demand will increase.

Practices add physicians, so they group they see more patients and their organic growth trickles down into increased.

Creation of him screen as part of their clinical service.

Finally, as our R&D team continues to work on developing new panels. The launch of each new panel is introduced to the existing customer base create further growth of Haynes game revenues.

These factors should create a very attractive business model.

For the company.

We aim as best possible to rapidly build our customer base and establish market leadership for products such as Ctrip.

Going forward, we plan to concentrate on the following.

Number one.

Maintain the high caliber of our clinical diagnostic labs to serve our pathology services customers.

You'd like maintaining our clinical lab technical expertise will enable presidio to develop a long lasting relationship with our commercial lab team screening customers.

Number two.

The focus on quality production fulfillment and inventory management for our products such as seems great.

Number three lastly.

And such resources and leverage our research and development expertise to continue to broaden our product offering.

In summary, we continue to grow both sides of our business and continue to see the cross pollination between the two businesses, our pathology services and our product we.

We have the resources to invest both in our technology.

<unk> facilities building the team to execute on our mission.

I'd like to end todays call with a story that we recently experienced in our company.

As a pathology lab, although we play a critical role in the battle against cancer like night of the patients were very much behind the scenes.

And ourselves and.

Visible to the patient and their family, who mostly interact with their oncologist.

In our lives we receive patient samples and are focused on working with blood tubes issue in slides.

Our job and we do it with pride.

But from time to time, we get a chance to meet someone who is impacted by the work we do and.

And that's a very special moment.

For us.

Our company experienced that.

A week ago, we celebrated <unk>, 10th birthday, which was partly belief and so we took an afternoon and had our traditional company picnic.

In the months, leading up to the picnic I was thinking of what I could do for my team I was especially surprised.

Unfortunately, the surprise.

Popped into my lap.

And our conversation with the shareholder call him. Mr. S would reach out to us I learned about the reason he invested in particular to begin with.

It was because his family had endured the tragic loss of one of their family members due to misdiagnosis.

I was so touched by Mr by the store.

Sorry, Mr Chairman, but I decided to make a bold request 19.

And inviting Mr S and his family to come to New Haven visit the lab and on the day of the party share their story with our team.

So last week on a beautiful Sunny day in Connecticut, as we stood in a circle and listen to Mr. After this family sure.

The story, there was not a dry eye in the crowd.

This was such a special moment and I can think of no better way to think of both of our teams and the amazing work they do and for Mr asked them their family for sharing their story with us Mr.

Mr. S. I know you on this call and listening so again on behalf of our entire team.

Thank you and your families are coming to our celebration Sanger start with US It was incredibly in fact impactful.

With that I'll wrap up today's call and say that we are really excited for today's news.

On development and the direction the company is going.

Hello, and thank you all for your support and have a great deal.

The conference has now concluded. Thank you for attending today's presentation you may now disconnect.

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Yes.

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