When Will Intelligent Ultrasound Group plc (LON:IUG) Become Profitable?

Intelligent Ultrasound Group plc (LON:IUG) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Intelligent Ultrasound Group plc, through its subsidiaries, develops, markets, and distributes medical training simulators and clinical ultrasound software in the United Kingdom, North America, and internationally. The UK£42m market-cap company announced a latest loss of UK£3.0m on 31 December 2022 for its most recent financial year result. The most pressing concern for investors is Intelligent Ultrasound Group's path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.

See our latest analysis for Intelligent Ultrasound Group

Expectations from some of the British Healthcare Services analysts is that Intelligent Ultrasound Group is on the verge of breakeven. They anticipate the company to incur a final loss in 2023, before generating positive profits of UK£416k in 2024. Therefore, the company is expected to breakeven just over a year from now. How fast will the company have to grow each year in order to reach the breakeven point by 2024? Working backwards from analyst estimates, it turns out that they expect the company to grow 81% year-on-year, on average, which signals high confidence from analysts. Should the business grow at a slower rate, it will become profitable at a later date than expected.

We're not going to go through company-specific developments for Intelligent Ultrasound Group given that this is a high-level summary, however, bear in mind that typically a healthcare tech company has lumpy cash flows which are contingent on the product and stage of development the company is in. This means, large upcoming growth rates are not abnormal as the company is beginning to reap the benefits of earlier investments.

Before we wrap up, there’s one aspect worth mentioning. Intelligent Ultrasound Group currently has no debt on its balance sheet, which is quite unusual for a cash-burning healthcare tech company, which usually has a high level of debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Intelligent Ultrasound Group, so if you are interested in understanding the company at a deeper level, take a look at Intelligent Ultrasound Group's company page on Simply Wall St. We've also put together a list of key aspects you should further research:

1. Historical Track Record: What has Intelligent Ultrasound Group's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Intelligent Ultrasound Group's board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.