Hemodynamic monitoring company Lidco said Monday it expected full-year revenues would be flat compared with last year blaming order delays and longer cycles as it transitioned its UK customers to its High Usage Programme. 'Based on current trading, the Board now expects LiDCO product revenues for 2018-19 to be similar to the last financial year,' the company said. Following the previously announced termination of the Argon distribution contract and subsequent signing of new third party opportunities, the Board expected that third party sales were likely to be in the region of £1.0m this financial year, down from £1.4m reported last year. At the end of November 2018, the company had £1.3m of annualised HUP contracts globally, well above the £0.3m a year earlier, and revenue recognition spread over the term of the contract rather than recognised at the time of transaction, the company added. In the UK, LiDCO sought to convert its largest customers to the HUP business model. The decision to actively convert UK customers to the SaaS business model would have a transitional impact on sales revenue recognition within this financial year as revenues, which would normally have been booked this year, would be deferred. In the US, the board said it believes its disruptive HUP model would continue to gain traction and anticipated that its US operations would become cash flow break-even during the course of the coming financial year. 'Having just returned from visiting a number of prospective HUP customers in the US, I remain very positive with our prospects for penetrating this market. In addition, we are making good progress with converting customers to our HUP model in the UK, said Matt Sassone, Chief Executive Officer of LiDCO. 'As a result, I am convinced that we will continue to grow a strong foundation of contracted HUP recurring revenues. We will continue to keep costs and cash flows under control as we transform the business to a Software as a Service model which will be a much more predictable business.' At 10:06am: (LON:LID) LiDCO Group PLC share price was -0.4p at 4.25p
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