Precipio’s Q4-2023 Cash Burn From Operations (unaudited) drops below $100K for the full quarter
January 23 2024 - 10:00AM
Specialty cancer diagnostics company Precipio, Inc. (NASDAQ: PRPO)
announces that continued revenue growth generated cash levels that
bring the company closer to breakeven. Cash Burn From Operations
(CBFO) declined by over 90% from the previous quarter, from
approximately $1M/quarter in Q3-2023 to below $100k/quarter in the
following recent quarter Q4-2023.
Precipio’s end of
quarter cash balance changed from approximately $1.5M at the end of
Q3-2024, to approximately $1.4M as of Dec 31, 2023. This was
achieved without any significant increase in AP.
While management is
pleased with this accomplishment which continues to move the
company forward towards breakeven, it cautions that Q1-2024 may not
demonstrate the same results, for several reasons.
First, the pathology
business typically experiences a seasonal decline during the
year-end holidays, which would impact revenue and cash receipts
going into the start of Q1-2024. Basic human psychology has taught
us that people tend to prefer to put off “bad news” (such as being
diagnosed with cancer) until after the holidays. Subsequently, new
patient visits to our customers decline, and with it drops the
biopsy volume received in our laboratory.
Second, many insurance
plans reset at the start of the calendar year. This means that
patients must first meet their deductibles before insurance
payments begin to kick in. While historically we have not seen an
adverse impact in overall cash collection rates, we have
experienced a lag of 30-60 days in the receipt of payments from
some insurance carriers, which will impact cash receipts in Q1 of
2024.
Notwithstanding the
above mentioned “seasonal” effects, the Q4-2023 CBFO results
demonstrate the company’s ability to approach cash flow breakeven.
With the high variable margins generated by product sales,
management believes that achieving incremental growth to close the
remaining gap is very much attainable.
“Seeing the results of
our business impact cash flow in this way is extremely promising,
and further validates our business model. I’m proud of my team for
their continued hard work in business development and providing
high quality service to our customers; but also in achieving
increased operating efficiencies, which are resulting in the
successful conversion of the business operations into cash,” said
Ilan Danieli, Precipio’s CEO, “Results like these strengthen our
confidence in our company’s ability to reach financial
independence, and continue to grow and invest in our business to
capture significant market share.”
About Precipio
Precipio is a healthcare biotechnology company
focused on cancer diagnostics. Our mission is to address the
pervasive problem of cancer misdiagnoses by developing solutions in
the form of diagnostic products and services. Our products and
services deliver higher accuracy, improved laboratory workflow, and
ultimately deliver better patient outcomes which reduce healthcare
expenses. Precipio develops innovative technologies in our clinical
laboratory where we design, test, validate, and run these products
intended to improve diagnostic outcomes. Precipio then
commercializes its technologies as proprietary products that serve
the global laboratory community and further scales Precipio’s reach
to eradicate misdiagnosis. For more information, please
visit www.precipiodx.com.
Please follow us on LinkedIn, X@PrecipioDx and
on Facebook.
Forward-Looking Statements
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statements” within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
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Inquiries:
investors@precipiodx.com
+1-203-787-7888 Ext. 523
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