Medtech Atomo Diagnostics had an unusual start to life as a listed company today, holding a virtual bell-ringing as it became the first company to list on the ASX since January.
But coronavirus concerns proved to be boon for the rapid blood test startup, which in the past month has turned its attention producing covid-19 test kits, and Atomo’s (ASX: AT1) share price doubled in opening trade.
The venture raised $30 million at $0.20 per share in an oversubscribed initial public offering that gave the company a market cap of $112 million and enterprise value of $80.31 million.
The company counts property billionaire Lang Walker among its top 3 investors, with a 10.39% stake in the business, alongside the Bill and Melinda Gates Foundation-backed social impact investor Global Health Investment Fund.
Atomo’s co-founder and Managing Director, John Kelly has a 1.31% stake in the company with 7.37 million shares, which today doubled in value to nearly $3 million.
“This is a hugely significant day in Atomo’s history,” Kelly said.
“We started the listing process to underpin the expansion of our global HIV business and enable us to commercialise other opportunities in the rapid blood test market, but through the offer period determined we were also uniquely positioned to make a major impact within the covid-19 environment.
“We are now well-capitalised and able to quickly move to meet the significant global demand for reliable rapid testing for covid-19 in the community.”
The Sydney-based healthtech received a $3.6 million (US$2.6 million) grant from the Bill and Melinda Gates Foundation to help it develop its HIV self-test in 2016. It’s since sold more than 1.2 HIV kits and with the success of its new covid-19, the business is forecast to nearly double its revenue in the first half of 2020 to $937,000, with gross profit quadrupling to $393,000 and gross profit margin more than doubling in H1 FY20 to 42%.
Atomo has accumulated tax losses of approximately $27 million and is forecast to post an EBITDA loss of $2.21 million in H1 FY20.
It was only in mid-March that Kelly announced the company was pivoting to covid-19 using the technology it developed to test for HIV and earlier this month signed a deal with French company NG Biotech for the purchase up to a total of 2.465 million devices this calendar year for sale in France and the United Kingdom.
Funds from Atomo’s IPO will be used to expand its manufacturing and distribution capacity.
Atomo Diagnostics chairman John Keith said the business was grateful for the investor support “given the extraordinary demands being made of economies, capital markets and public health systems”.
“Our simple vision of improving health outcomes globally continues to guide Atomo as we accelerate developing growth opportunities and delivering sustainable value to our customers, partners and shareholders,” he said.
Atomo shares closed at 39 cents on their first day of trade.
- Editor’s note: On April 17, Atomo’s second day of trade, the shares rose another 33% to close at 52 cents.