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5 Quick Things You Need to Know About Clearbridge Health

SmallCap Asia

By James Yeo

Clearbridge Health, a medical technology investor formerly known as Clearbridge Accelerator, has recently launched its IPO on the Catalist board.

Unfortunately, no shares are offered to the public; but the shares were up for trading on 18 December 2017.

Here are 5 quick things that you should know about the company:

1. Clearbridge Health Profile & IPO Details

The Company is a healthcare company with a focus on delivery of precision medicine in Asia and its vision is to empower clinicians and healthcare professionals to make more reliable and accurate diagnoses. Its business comprises of:

  • provision of laboratory testing services
  • ownership and operation of medical clinics/ centers; and
  • strategic equity participation in precision medical technology firms.

And as for what is precision medicine, the company has given a description in the picture below:

precision medicine

A total of 88 million shares are offered at a price of S$0.28 a piece. All the shares are for placements to certain investors.

You can find the IPO prospectus here.

2. Use of Proceeds

 A big part (56.8%) of the net proceeds will be earmarked for expansion of medical clinics and laboratory testing services.

What kind of worries me is that 30.3 percent is catered for working capital purposes, which means the company is expecting to continue making losses, at least in the short term.

The proportion is depicted below for your easy reference.

use of proceeds

3. Financial Health

 

financials

I got quite a rude awakening looking at its financials. The revenue has never crossed the magical $1 million mark in the past few years (maybe since inception). The company has been nursing losses for the majority of its years too.

nav

Furthermore, the IPO price of $0.28 is even 2.45 times of the net asset value per share of 11.43 cents!

4. Dividend Policy & Future Plans

 

business plan

The company do not have a fixed dividend policy and unlikely to give dividends given the negative earnings. In terms of growth prospects, the company aims to do the following (check picture for more details):

  • Build up logistics capabilities in line with business growth
  • Expansion of Laboratory testing services
  • Collaborate with partners in Asia such as Indonesia, Myanmar, India etc. to open more medical clinics
  • Acquire medical center in the Philippines

5. Management Team

Clearbridge Health is helmed by Jeremy Yee, the former CEO of Singapore-listed Cordlife Group. He joined Clearbridge in May and set up two clinics in Singapore and Hong Kong.

According to Mr. Yee, “More than 2,000 specimens have flowed through Sam Lab since it was set up in 2009”.

He also added, “These are all patients that we can get back to them and talk about further health screenings. Among other tests, Sam Lab also offers circulating tumour cells (CTC) CellSearch test for the prognosis of breast, prostate and colorectal cancer patients.”

Mr. Yee emphasised that Clearbridge has low debt and a $9.8 million cash pile as at 30 June, before the IPO fees.

 Conclusion

To sum up, Clearbridge Health Limited is somewhat similar to Singapore O&G and Singapore Medical Group where they aim to beef up their businesses through the opening of clinics.

However, Clearbridge health has not proved its earnings capability and I am also not sure whether this ‘precision medicine’ will gain traction going forward.

In my opinion, I am not familiar with the MedTech space and will likely go for something else within my circle of competence. Maybe health professionals can give a comment on this stock and its prospects? Cheers!

This article is  republished with permission from SmallCapAsia. The original article can be found here.