Precipio’s end of quarter cash balance changed from approximately
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
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Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements regarding the targets set herein and related timing.
Except for historical information, statements about future volumes, sales, growth, costs, cost savings, margins, earnings, earnings per share, diluted earnings per share, cash flows, plans, objectives, expectations, growth or profitability are forward-looking statements based on management’s estimates, beliefs, assumptions and projections. Words such as “could,” “may,” “expects,” “anticipates,” “will,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “predicts,” and variations on such words, and similar expressions that reflect our current views with respect to future events and operational, economic and financial performance, are intended to identify such forward-looking statements. These forward-looking statements are only predictions based on management’s current expectations. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, the important factors discussed under the caption “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended
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