ImExHS : 2021 Q4 Quarterly Activities Report and Appendix 4C

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31 January 2022

ASX ANNOUNCEMENT

2021 Q4 Activity Report and Appendix 4C

Highlights

• FY21 revenue of $13.4m1, up 23% vs pcp2; up 34% on a constant currency basis3 and in line with FY21 guidance
• Q4 FY21 revenue of $4.7m, up 11% vs pcp and up 24% on constant currency basis; up 90% vs pcp excluding one-off sales which were material in the prior year
• Annualised Recurring Revenue (ARR)4 of $20.4m1, up 102% vs pcp; up 121% on a constant currency basis which consisted of $13.3m1 from Radiology services and $7.1m1 from Software
• Aquila in the Cloud closed the year with ARR of $2.5m from 111 active contracts, up from $2.1m and 93 active contracts as at 30 September 2021
• Closing cash balance of $4.2m at 31 December 2021
• Entered into a global commercial partnership with Neusoft Medical an OEM and a global leader in clinical diagnosis and treatment solutions with a presence in 110 countries
• Contract signed and services commenced for the outsourcing of the radiology department of Colombia's National Police Central Hospital, which further validates the acquisition of RIMAB

IMEXHS Limited (ASX: IME) ("IMEXHS" or "the Company") today provides its quarterly cash flow and activities summary for the period ended 31 December 2021. IMEXHS is an innovative provider of cloud- based medical imaging software and radiology services across 15 countries.

IMEXHS CEO Dr German Arango said: "We are pleased to report FY21 revenue of $13.4m, in line with guidance that shows strong performance from our two businesses - medical software and radiology services. Annualised Recurring Revenue has increased by over 100% driven by new contracts for Aquila in the Cloud, strong growth in Aquila Enterprise imaging volumes and the acquisition of RIMAB in Q4. We have also improved the processes around implementing Aquila in the Cloud, which is leading to significant improvements in the time from signing deals to recognising revenue and collecting cash."

During December our technology and services were validated with a global partnership with Neusoft Medical and a win of a $1.1m ARR contract with Colombia's National Police Hospital. In the past month

1. Unaudited financial information
2. Previous corresponding period; includes RIMAB acquisition from 5 October 2021
3. Constant currency basis assumes FY21 results are converted at the average foreign exchange rate for FY20. This removes the impact of changes in currency rates and allows comparison of IMEXHS's underlying operating performance.
4. Represents the value of monthly recurring contract revenue multiplied by twelve. It provides a 12-month forward view on revenue assuming all contracts expiring within the next 12 months renew at the same rate and at constant exchange rates

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we have received Thailand's FDA registration for our imaging software suite, signed a new software distribution agreement with BJC Healthcare Company and signed our first Aquila in the Cloud contract in Thailand. Our mission to provide medical imaging that is accessible and affordable continues and we look forward to another strong year of growth in 2022.

December Quarter Financial Summary

Revenue

FY21 revenue of $13.4m was up 23% vs pcp, up 34% on a constant currency basis and in line with our revenue guidance of $13.2m to $13.9m. Included in our FY21 revenue is the Q4 incremental revenue contribution from RIMAB of $1.2m.

Q4 FY21 revenue of $4.7m was up 11% vs pcp. Recurring revenue of $4.5m was up 90% vs pcp (112% higher on a constant currency basis), representing 97% of total revenue in the December quarter.

Key operational metrics recorded significant growth in Q4 FY21 compared to Q4 FY20:

• Aquila (Aquila Enterprise and Aquila in the Cloud) was installed in 32 new sites, a 220% increase on Q4 FY20, a total of 386 installations worldwide by FY21 year-end
• Aquila solutions were actively used by 2,412 radiologists, a 15% increase on Q4 FY20
• IMEXHS's Enterprise Imaging Platform stored 1.36 petabytes of data in the cloud and processed over 147 million images for the quarter (over 2 million studies), a 10% increase on Q4 FY20, for a grand total of over 1.5 billion images since the inception of the Company
• Over 438,000 people entered IMEXHS's patient portal over 753,000 times for an average of 1.8x visits per user, which was a 75% increase on Q4 FY20

Annualised Recurring Revenue

ARR of $20.4m was up 102% vs pcp and 121% higher on a constant currency basis. This consisted of $13.3m from Radiology services and $7.1m from Software. The software ARR includes $2.5m from 111 active Aquila in the Cloud contracts (up from $2.1m and 93 active contracts at 30 September 2021).

Chart 1 shows the ARR that is currently billing as well as ARR which is yet to commence billing.

Chart 1: Strong sales momentum delivers ARR growth

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Q4 FY21 Cashflow Summary

At 31 December 2021, IMEXHS held cash and cash equivalents of $4.2m, compared with $6.2m at 30 September 2021.

Cash receipts for Q4 FY21 were $4.1m, with year-to-date receipts of $10.9m.

Net cash used in operating activities improved to $0.4m from $1.5m in Q3 due to improved working capital from the acquisition of RIMAB. However, growth continued to drive working capital requirements in the USA and LATAM.

Cashflows from investing activities included the $1.1m cash payment for the acquisition of RIMAB and the company's continued investment in software development.

FY21 administration and corporate costs include $0.7m one-off payments in relation to transaction costs for the acquisition of RIMAB SAS announced on 26 July 2021 and completed on 5 October 2021.

Sales and Market Update

Aquila in the Cloud (AiC)

Aquila in the Cloud (AiC), the Company's standardised cloud-based radiology solution targeted at small and medium-sized customers, continued to generate significant interest in the market throughout Q4. The Company has 111 active AiC customers since the product launched in May 2020 with an ARR of $2.5m as at 31 December 2021, a 19% increase on Q3 FY21.

Hospital Central de la Policia

In December, IMEXHS was selected by Colombia's National Police for the outsourcing of its radiology department, replacing the 20-year incumbent provider. The new contract with Colombia's National Police will contribute circa $1.1m in ARR and will operate for six months with an automatic three- month renewal. Under the terms of the agreement, IMEXHS will provide Colombia's National Police with its Enterprise Imaging Solution which will integrate across all radiology functions in the hospital.

Strategic Partnerships

Neusoft Medical

On 2 December 2021, IMEXHS signed a global partnership agreement with Neusoft Medical, an OEM and global leader in clinical diagnostic and treatment solutions. This global partnership will combine the technology of IMEXHS with the broad geographic reach of Neusoft Medical. With 40,000 installations in more than 110 countries, Neusoft Medical offers advanced medical imaging solutions and high-quality care to patients and healthcare professionals around the world.

With this new partnership agreement, Neusoft will be one of IMEXHS's first strategic partners to offer the new IMEXHS Cloud product (refer to Product and Software Updates).

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Partners Program

During the quarter, the importance of the IMEXHS Partners Program was once again made evident with 87% of all AiC contracts originating from IMEXHS Partners. As at 31 December 2021, IMEXHS's Partners Program consisted of 35 distributors across 15 countries, including the Company's newest Partner, Neusoft Medical, which operates in 110 countries.

Radiology services

The fourth quarter revenue from radiology services was $3.1m (including RIMAB). Revenue growth came through new contract wins and increased volumes from existing customers.

The most relevant contract win was the new National Police Hospital contract which commenced at the end of the quarter, bringing more than $1.0m in new ARR, plus some other contracts with Gacheta and Clinica de los Trabajadores.

The main business model for radiology services is the outsourcing of imaging facilities, which represents a very attractive offer to hospitals in the LATAM region and allows our team to deliver a high-quality service through the integration of technology and highly trained Radiologists practice.

The Radiologist team now totals 109 and the number of reported imaging studies is more than 250,000 for the quarter, up 35% on pcp.

The success the business model is achieving comes from the unique proposition of a fully integrated technology platform with highly skilled radiologists, which is the ideal solution for an environment with shortages of both elements.

Product and Software Updates during Q4

Progress has been made during the quarter with new product and software releases as follows:

IMEXHS Cloud

In November 2021, IMEXHS launched its new cloud-based medical imaging platform, IMEXHS Cloud, which provides a simple and efficient access to our rich cloud portfolio of products, including Aquila, AI, advanced post processing and storage. At the same time, IMEXHS Cloud provides reliable backup solutions to local backup in deficient connectivity environments.

IMEXHS Cloud will initially have three main components:

1. IMEXHS PACS, a cloud-based image storage system powered by the latest cognitive algorithms from Azure (Microsoft cloud).
2. IMEXHS Viewer, a state-of-the-art image viewer, 100% Web (HTML5), multimodality, which is fully integrated with IMEXHS PACS and can be integrated with third-party PACS systems.

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3. IMEXHS Marketplace, an app store with extensions that can enhance the user experience (for radiologists and non-radiologists) while using the medical image management platform. Such extensions include AI algorithms, advanced visualization tools, voice recognition tools, and business intelligent services.

A complementary component to the IMEXHS Cloud offering is IMEXHS Box. IMEXHS Box is a specific use device (appliance) designed for customers who wish to have a smooth and controlled transition to the cloud. IMEXHS Box allows the user to keep image processing and storage local (OnPrem), while enabling extensions and add-ons provided from IMEXHS Cloud.

AQUILA v3.8.1

During the quarter, IMEXHS released new features and performed a number of improvements on its core product - AQUILA:

• Reading report edition
• Addendum format
• Date format
• E-forms
• Appointment items
• Integration with multimonitor support
• Upload DICOM studies from the worklist

Universal Viewer v6

During the quarter, IMEXHS released new features and performed a number of new features on its Universal Viewer:

• Technological Update: From Angular 8 to Angular 11 Addendum format
• Embedded Imex Viewer
• Walk-throughsfor Imex Viewer mobile version
• Manual co-registration between CT/PT
• Custom presets (WW/WL) for CT and RM modalities:
• Custom toolbar
• Free rotation
• DICOM overlay data support
• New Hanging Protocols
• New setting module
• Loading bar