Thank you for standing by, and welcome to the Pro Medicus Limited Half-Year Results Briefing. All participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. If you wish to ask a question via the phones, you will need to press the star key followed by the number one on your telephone keypad. If you wish to ask a question via the webcast, please enter it into the Ask a Question box and click Submit. I would now like to hand the conference over to Dr. Sam Hupert, CEO. Please go ahead. Thank you. Good morning, everybody. Thanks for joining us for this half-year presentation. For those who are not familiar with us, we're a healthcare company specialized in or an IT company specializing in healthcare IT. We have three jurisdictions: Melbourne, Australia, our corporate office, and where we do development for our RIS product. Our headquarters in Europe, in Berlin, where we do R&D for the Visage product and the U.S., which is our largest market. We have two products: the RIS, which is mainly Australian-based, although we do have some clients in Canada, and the Visage 7 product, which is a clinical product used by radiologists and clinicians to look up images and make diagnoses, which is the product we sell, globally and but particularly in the U.S. In terms of the first half results, I think summary, it was another record half for us. Everything went in the right direction. We had four large contract wins with a cumulative contract value of greater than $200 million at the minimums, which is our biggest quarter half of sales to date. We completed four major implementations in the half. Our major conference in RSNA, the 2023 conference in November/December of last year was our busiest day. We made material progres with other ologies and AI, and so we believe this first half forms the base for a stronger second half, and beyond, as I'll discuss a little later. In terms of all the figures, I won't go through each one, but I think material improvements in revenue, profit after tax, and underlying profit, cash reserves grew. Usually they grow a little bit more in the second half than the first, but there's still a good uplift. Because of that and the fact that we don't have any debt, we announced an interim dividend of AUD 0.18, which is up 38.5%. In terms of the revenue splits, a lot of you, if you've been following us for a while, know the graph. The pink bar is recurring transaction revenue, which grew materially, and we believe pretty sure will grow even further in the second half, and I'll discuss that in a minute. The blue bars are also recurring, but more support contracts from the older style of licenses that we had. The green is professional services, and the yellow is data migrations. Because we are selling a fair amount of full stack, all three products that include the archive, the migration column is continually growing. In terms of the highlights, as I mentioned, four very key implementations. We came out of the gate fairly early in July with Memorial Sloan Kettering, one of the two top cancer centers in the U.S. and one of the top, globally. Then in September, our biggest contract to date with Baylor Scott & White, the largest not-for-profit, in Texas. It's a 10-year contract with AUD 140 million at minimums. Followed the next month by South Shore, a regional IDN in the southern part of Massachusetts, and then towards the end of the year with Oregon Health & Science, T ier 1 academic in the state of Oregon. Then, of course, RSNA, as I mentioned before, our busiest to date. We had the biggest presence, the biggest number of attendees to the stand, and again, that resulted in a very positive flow of new leads. We completed four implementations, which are particularly important for us, with the four new sales coming up so we could clear the decks, and get ready to start implementing them in the second half. In terms of the transaction model, most of you know this. It is a per-click model. It is underpinned by a minimum commitment on a take-or-pay basis, usually about 80% of their previous 12-month volumes at the time of writing the contract. We now have increased our forward revenue with the contracts we've had to, a minimum of AUD 608 million over five years, which has been a material uplift, largely due to the four new sales. We do see upside as the client examinations grow, so we believe that that AUD 608 million i s an absolute minimum for the period. We have a lot of operating leverage. We have a highly scalable offering. It's a software-only model. We don't provide hardware. Training and installation is charged as professional services. So again, that's quite a high margin business as well. We have a contained cost base, so our margin continues to grow as our footprint increases. The client base, we have maintained the position of nine out of the top 20 hospitals. This used to be ranked in how high in the order they were, but it's now ranked alphabetically. I think our next nearest competitor has three, or maybe four, so it's, we do have the lion's share of the top 20. Something no one has been able to achieve in a 10-year time window. We don't just do academics. We do so-called IDNs or integrated delivery networks. These are large hospital networks and medium-sized hospital networks. The key difference being they don't have a university or teaching hospital, as part of the network. They are often very large, sometimes larger than the academic centers, and we had a number with Mercy, Sutter Health, Intermountain, and MedStar previously. But if you've followed us over the last 18 months-24 months, we've had an increasing number of IDNs become clients such as Novant and Ochsner, Allina, and recently, some of the ones in the last few months that have increased our penetration. So we've had six sales to IDNs in the last 18 months, all six opportunities to be cloud-deployed. So we are having and seeing an increased network effect in this segment, which is the largest segment of the market in the U.S.. Visage RIS, this was our core product. That continues to develop. The new versions coming out. We have a number of long-term contracts. The two biggest with Lumus were previously Primary Health Care, and I-MED the largest radiology group in the country. The Lumus rollouts are complete. There's some upside via organic M&A, and we are fielding interest in new opportunities, particularly as the market starts to reconsolidate, and some of the radiologists coming out forming new groups, that will look at both our RIS and the Visage PACS. In terms of Visage PACS or Visage 7, we continually benchmark ourselves against the industry, and we're highly confident that we are still number one in terms of speed, functionality, and scalability, the three key pillars, that determine the success, and capability of a product in the market. We see the massive data explosion continuing, assisting us simply because the old technologies can't deal with these ever-increasing datasets, where the gigabyte is the new megabyte, and it's not uncommon to have single exams in the 5 GB-plus anymore, some punching up to 8 GB or 9 GB per test. So why doesn't the old technology work? It basically relies on compressing the file as much as is possible without losing any fidelity and sending that file down the network to a heavily configured workstation that then unpacks that file and does all the image manipulation, rendering 3D locally. And the problem with that is the files are just getting too big for that to be done on a demand or timely manner. Our technology's very different. We rely on, we have rather, our own proprietary streaming technology that we developed in-house many, many years ago. It allows us to, in near real-time, compute the 3D models, do the rendering, and just stream the pixels to the radiologists. So in most instances, in 99.9%-something of time, we're actually able to provide full diagnostic capability remotely sub-one second. The solution is actually a whole ecosystem of product. It's all based on the core Visage offering, the Visage 7 offering. This could be either on-premise, but of late in the last three years, it has all been cloud-based. It, it is the same product that streams data not only to radiologists but all referring physicians throughout the organization. It does all modalities, all imaging tests. And for those that, that, are part of that ecosystem, particularly the academics, we do have the AI Accelerator, which is, again, all part of the same streaming platform, which is very, very expandable. As I'll talk a little later, the Visage Ease, which is the remote capability, now with the new Apple Vision Pro being supported. In terms of the recent sales, the first one, Memorial Sloan Kettering, it was a 7-year, $24 million contract. It is currently in the process of being implemented. The rollout is scheduled to be completed mid-second half of financial year. We're increasing our footprint in the T1 academic space with this client in the Upper East Side of New York. The next big sale, our biggest to date, as I mentioned, was Baylor Scott & White. It is for full stack, viewer worklist and archive. It is the largest not-for-profit system in North Texas. The rollout in terms of data migrations has commenced, and we believe that the first sites will go live towards the middle of this calendar year, and so we will start to see some material revenue into the first half of FY 2025. South Shore, a $16 million transaction, a regional IDN based in southern Massachusetts. Again, we believe that this implementation will be completed and deployed and completed towards the end of this financial year in the next few months. And then finally, OHSU, academic in the state of Oregon. This one will actually be done towards the second half of the calendar year. So again, we'll start contributing revenue in the beginning of FY 2025 for us. So four very material contracts. All of the revenue from these contracts are still ahead of us, and we believe that cumulatively, they will provide a very material step up in terms of transaction numbers, particularly going into the beginning of FY 2025 and beyond. It's one thing to sell. It's another thing to install. We continue with our fast-track implementation. As I mentioned, we had four material implementations in the first half, and a full roster for the second half. We're able to implement with a mixture of on-site and remote well under a quarter of the time, sometimes well under a tenth of the time of industry norm. So huge savings for clients, and it allows us to maximize the utilization of our implementation teams by having them go on-site, do the work within a week or two, come back, then refresh, and be ready for the next implementation. So, it has a number of advantages not only for us but also for the client. The ROI, in other words, why would people buy us? We are known to be the most expensive in the market. I think we continue to improve our value proposition, as the more we do, the more we prove it. And I think it's really in two areas. There's the financial ROI in terms of infrastructure, equipment, and especially radiologist efficiency, where we believe we increase efficiency orders of magnitude larger than our more than our nearest competitors. But then there's also the clinical component. We allow radiologists to do things they otherwise could do but would take too long, so don't do it, or give them new capabilities, so provide a better platform for diagnosis. So we do move the needle clinically. There have been some examples I've shown before, some interesting work we did with Mariam Aboian, who is a top pediatric neuroradiologist previously at Yale, now at another client in the Children's Hospital of Pennsylvania, some groundbreaking work in segmenting tumors in children. We're going to be using a lot of that technology under the bonnet as we go forward with new versions of Visage. Something completely different, a project with NYU Langone, where we have a research agreement where the chair of radiology felt patients were not close enough to their diagnosis. They never saw the radiologist. They couldn't quite understand, you know, what they saw on the images, even if they were made available. So this concept of video reports where radiologists can dictate and film a short 30-second to 1-minute synopsis of the case and diagnosis that is made available to the patient electronically is; they're found to have excellent patient engagement and a lot of very strong good buy-in from the referring clinicians. The other key thing that we work on has become endemic in the industry, that is, burnout. There's a global acute shortage of radiologists. The fact that we can increase productivity between 20% and up to 45%+ depending on the situation certainly addresses this. It's been a key selling feature, and one that we think gives us a strategic advantage in the market as compared to others. Our growth strategy, again, we have multiple irons in the fire. I think all of these are currently in play. We are expanding our footprint, quite rapidly, as witnessed by our busiest sales half in the first half. We are getting above-average, industry-average growth from all of our existing clients, so they're growing greater than, greater than the mean, which also helps us. Some of that is just through efficiency. Some is through M&A, and we see that continuing. We are bringing new products to the market, and we are looking at new geographies, particularly with the adoption of cloud becoming a little bit more prevalent outside the U.S., which we think will be a positive for us. Pipeline, my commentary in the interview, pipeline is robust. Even though we've had a bigger sales half in the company's history, that's been replenished with new opportunities, importantly of different sizes and across different segments of the market. So we are starting to spread our wings across a much larger type of user base, not only academics and IDNs but also in the corporate space. We believe that we are unique in that the one product can address the largest percentage of the market, which we now deem to be in excess of 80% of the total addressable market. The product set, the Viewer was our core product, joined by the archive a number of years ago. The archive has been very strategic for us, particularly as clients look to transition to cloud. Our archive is fully, fully cloud-based. It's highly optimized for cloud and cloud storage, and provides a very, very cost-effective performance solution. So that's why we are seeing more and more of our sales, particularly the recent ones with full stack, where they do tag not just the Viewer but the archive, and the next product, the workflow, which is the list that the radiologists use that tells them which cases to read. This is our most recent product but one that we have started to get very good penetration, not only just in new opportunities, but we're also backselling it to a number of existing clients because it is a best-in-breed product. As I mentioned, cloud, we think we're highly differentiated here because we're one of the only, one of the true cloud-native, if not only cloud-native or cloud-engineered products in the market. Over the last three years in the U.S., we have only had cloud or done performed cloud implementations, so not a single on-premise one. We think the market has definitely shifted in a very big way towards cloud, and the fact that we have not only a large user base but a proven capability in cloud has been a very important strategic plus for us. The One Viewer product, many of you would have seen our first foray into this, which was cardiology and particularly on cardiac ultrasound. We did showcase a broad suite of cardiac ultrasound capability at RSNA 2023 in December, December last, November, December last year. It was incredibly well-received, and we are looking to now seed that product commercially into the market. We have a number of key clients that are using part of this capability to, you know, bench-test it, and the feedback has been very positive to date. AI, it's a hot topic in every industry, but in healthcare in particular and in healthcare imaging, which is ideally suited to AI. We do see a large number of use cases, so it could be embedded in software or imaging equipment. It has originally been used to prioritize cases, read through a whole lot of head CTs, and put those where the AI believes that there's some pathology or at the top of the list because they're the most important to read quickly. We are seeing areas where large-scale screening is using AIs and adjuncts because there's just not enough radiologists to go round. We think the biggest area will be the second set of eyes or an AI diagnosis, where we are seeing a number of use cases starting to open up, some of them with possible reimbursements in the future, which I think will certainly accelerate the adoption of some of these technologies. And then new diagnostic tools, so tools where you, the human, cannot see the result. And one of these is the FFR-CT cardiac CT that can measure the pressure gradient in a coronary artery, on both sides of the blockage, the gradient of pressure, the larger the problem. And in future, there's always the possibility of automated diagnosis, using AI in certain cases. We do believe our platform is very well-suited. We do believe that, because we have GPU technology, we have an open AI interface, APIs that we are well-placed for when AI becomes even more mainstream to become a major player in this market. I'll just for the sake of time, I'll go just to the new, new kid on the block, our Visage Ease VP for Apple Vision Pro. Many of you will have heard that Apple released its new set of spatial imaging headsets called the Apple Vision Pro. As one commentator mentioned on the internet, it's like going from the Flintstones to the Jacksons. So key thing for us is we were one of the first. We've been working on this project for quite a number of months. We've been able to port part of our Visage Ease product, which is used on iPhones and iPads, to the Vision Pro operating system so that it is a native application for the Apple Vision Pro at launch. So it was launched on the 5th of February, our cinematic rendering engine natively embedded. So it's ideally suited in terms of our rendering and our streaming. The device, for those who haven't seen it, supports visual screens of more than 4K resolution per eye. It has true immersive spatial experiences for diagnostic imaging. We believe it will be a very interesting platform for AI integration. So immersive imaging and AI, we think, are very interesting technologies that can work incredibly well together. One of our clients, UC San Diego, was our launch client for this product, and other key Visage clients are now in the position of looking to pilot the technology, which, as I mentioned, was released on 5th. I think one of the key things about it is not only will it extend where medical imaging goes, particularly longer term, as in multiple versions of the Visage for the Apple Vision Pro release, it also, I think, underpins our belief that our technology is months ahead of the competitors, if not more, simply because we are now able to take full advantage of these very new and exciting technologies on release. And part of that, a large part of that, is purely the platform and how it's configured. Finally, RSNA 2023, it was our biggest ever, our biggest stand. We had a 64-foot screen, if you can see it at the top, so we certainly were very visible. We had the largest number of visitors to the booth and as a percentage of those visitors, the highest percentage of new opportunities that we have had, certainly over the last few years. So all very positive, very good feedback, high percentage of new opportunities, as well as a very good attendance from existing clients looking to see what's new coming out. So, we were exceptionally pleased with the net effect of that. So in summary, most successful half in our history, our North American footprint grew very strongly with those four big sales in the half. The full-stack solution certainly is paying major dividends for us. Our implementation capability, both remote and on-site, is proving to be a boon in as much as we can do more implementations than was possible maybe even two years ago. Cloud has been a huge strategic advantage for us. We think we continue our unparalleled value proposition. Our pipeline is growing strongly across a very broad range of opportunities. We believe we're well-positioned to leverage AI, and we think that another, another key step that will play out in the future is obviously the release, the, the launch of Visage Ease VP for Apple Vision Pro. On that, I'm going to finish the presentation, and certainly we're looking to take any questions. Thank you. If you wish to ask a question via the phones, you will need to press the star key followed by the number one on your telephone keypad. In the interest of time, we do ask phone participants to limit themselves to asking two questions. If you would like to ask further questions, please rejoin the queue. If you would like to ask a webcast question, please type it into the Ask a Question box. Your first phone question comes from Garry Sherriff from Royal Bank of Canada. Please go ahead. Pardon me. Garry, your line is now live. Good morning. Sorry, Sam and Clayton. Two quick questions. One on the core Visage pipeline and the second one on sales outside of radiology. In terms of the Visage pipeline, can you maybe just give us a sense? Are there any deals as big as Baylor Scott & White in the current pipeline? In terms of your RFPs, can you maybe just give us a sense on the number or percentage of RFPs that you've been shortlisted for? That's probably the first question. Yeah. Well, we certainly have got them across a broad spectrum, and the spectrum can be looked at through two prisms. One is market segment, so they're across all market segments. The second is size. So without specifically referring to Baylor, there are a number of material ones in there as well as quite a good smattering of medium-sized ones. So, you know, I think the important thing is to us, it indicates that our TAM is really much bigger than people realized initially because people thought with our price point, our technology, only the really big guys would take it. And we've shown that that's not the case. They thought maybe only the academics would take it, and I think we've shown that's not the case. So big spread, both in terms of market and also size. Understood. And then, and then those RFPs or number or percentage in that pipeline that you've been shortlisted for, roughly? Yeah. We don't give that number out, but, you know, the fact that the pipeline continues to grow, and obviously some of these opportunities, as, as you know, could take two years. So they're at various stages. I think we have seen an increase in frequency of inbound over the last 18 months. I think a few reasons for that. I think cloud is a big one, dataset sizes. Maybe some of the organizations have gone through their transition to Electronic Health Record, and now, imaging is next because it's a key part of it. But certainly, there's been an increased cadence of new RFPs. Thanks, Sam. And in terms of those sales to cardiology, so I guess the timing appears a little bit behind your expectations over the last, call it, 18 months. Has there been any impediments or holdups to launch and commercialize the cardiology sales? I mean, what's the latest plans and timing, I guess, on revenue contribution? I know you've clearly been outlined or you've outlined demonstrations at RSNA, and you also talked about the investment that you made with Elucid. But just trying to get a sense on impediments or holdups in terms of commercialization and maybe the latest timing on revenue contribution from cardiology sales. Look, we think it's imminent. We are, and you mentioned the Elucid investment. We are looking at multiple planks to that strategy, of which Elucid is another plank. So there's a fair bit of work going on in and around all of this. It's not just the cardiac ultrasound. There are other bits and pieces that, hopefully will, you know, come to the fore as we continue. So we do think it's imminent. We do have more people actually using it, existing clients, testing it in different environments, which is a positive for us. So while I don't have an exact date, I don't want anyone to think that this thing has stalled in any way, shape, or form, and it hasn't. It's just taking a little too long. But I think other things are happening in and around it as well. Very clear. Thanks, Sam. Thank you. Your next question comes from Josh Kannourakis from Barrenjoey. Please go ahead. Hi, Sam and Clayton. Thanks for taking my call. First question just around some of the volume growth that you're seeing in the business and I guess the outlook for some of the organic growth around your clients as well. Could you give us a little bit more detail around that? Yeah. We're definitely seeing the exam volumes increase. And, you know, Sam mentioned that, during his presentation, we are seeing that it's higher than industry standards. Exam revenue went up around 9%, but we obviously had some implementations through that period, but more to the back end. We think that will increase again into the second half as we roll out Memorial Sloan Kettering, Baylor Scott & White, South Shore Health, etc. But the organic growth we're seeing through our existing client base is growing higher than industry standards, which is around 3%-3.5%. So that is pleasing to know. In terms of acquisition, we have seen some of our existing customers take on new hospital groups, and we get some of that uplift. Some of it is, you know, 12 months-18 months after they make the acquisition because they generally need to get in their electronic medical record and other software. But then we start seeing that exam growth come through. So we are seeing it, and pleasingly, with our exam volume operational model, we can see that come through to revenue pretty quickly. Yeah. And the only thing I'll say, Josh, is if anything - and this is maybe a bit anecdotal - we think that our clients not only are continuing to grow quicker. So there was this gap originally, this uplift. But, you know, it's not very rare a week or a month where we don't get that, you know, NYU's just opened a massive new center in Long Island or, you know, another. Clients just annexed two hospitals or it seems that the rate of increase, if anything, is going up. Now, there are obviously multiple reasons for that. We think one of them is that our technology's an enabler. So, you know, the rate of increase of the organically within these groups, we think is actually growing, rather than just being a one-off and then staying static. Got it. No, that's very helpful. Secondly, just around the pipeline, you obviously mentioned so we've got the U.S.. If we sort of go into some of the subdivisions of their, you know, the sort of outpatient, clinic providers and the like are a big part of that, both here and also, I guess, in Australia as well. That's pretty much been dominated by Intelerad. I'm interested just in any feedback you've got on what you're seeing, in those end markets. And obviously, there's a bit of noise before the end of last year, Sam, I think, which we talked on around that, AWS-related announcement, with Rad Partners, but more, more so keen to just understand what you're seeing in those end markets and whether you're seeing any change in sentiment around, you know, your, your sort of opportunity there. Yeah. It was an area, as we mentioned till recently, where as Sean himself said, was in debt freeze. A lot of these private groups were looking to sell into corporates. There was almost like a frenzy of who's buying who, which is now abated. I think we have started to see an opening up of opportunity in those markets. I think, now I'm not talking against another competitor, but the compression send model is starting to crack. And even for remote reading where they have to send all the files, it's becoming, you know, harder and harder to do. So, you know, we've made some inroads into that market. You know, I think we'll make more. I think our products are dearly suited. And in time, I think people will understand that the key thing for those remote reading groups is radiologist efficiency because that's exactly what they do. It's just radiologists reading. They don't own equipment, etc. So the more they can do for radiologists, the better off they'll be. Excuse me. I think we see opportunity there. Fantastic. Thanks, Sam and Clayton. Appreciate your time. Thank you. Your next question comes from Mathieu Chevrier from Citi. Please go ahead. Yeah. Good morning. Thanks for taking my question. My first one was just around your commentary, regarding the TAM. I was just wondering if you could give us a few insights into your or numbers about how you think about it and the 80% you mentioned. Yeah. So there is a figure that, you know, we've been able to triangulate. I think some others have done similar exercise because unlike here in Australia where the government tells you how many tests are done, in the U.S., it comes from multiple data sources. We think there's around 600 million-650 million diagnostic imaging exams done and growing at roughly around 3% a year. Then we looked at all the various markets in terms of academic medical centers, IDNs, and the corporate market we just talked about and said, "Well, is the product suitable? Can it work across all these markets as one product?" I think our answer is absolutely. We're 100% sure of that. Then the question was really a commercial one. When is a deal too small? I think two things have lowered the bar there significantly for us. One is cloud because if they had to go through a hardware purchase cycle, it'd just take too long. The other one is full stack because that increases the total contract value. So we then did an analysis of, you know, the markets and all the data we could get. And we believe it's 80% plus in terms of addressability through either commercial or product prisms. Got it. That's clear. And then another one on, you know, KLAS does these rankings. And you noticed that a competitor of yours has taken the number one in terms of universal viewer. I was just curious to get your thoughts on that. Yeah. So KLAS, KLAS is an organization unto itself, if I can put it that way. We tend not to use their reports. We feel the market should actually make its own decision based on product. So last year when we were included, it was actually a bit of a surprise because we didn't do anything with KLAS for that. It was just the interview of various clients. So, we don't put too much stock into whether we're one or two. I think the fact that we're gaining market share and rapidly gaining against competitors, I think to us is more important. I think we've also been categorized in a category under universal viewer that we actually think we could be in a different area because we're obviously doing PACS replacements, that possibly the category that we're ranked in for a starting point is not the correct one. We are replacing people's PACS, so should be included in the PACS category. But as Sam mentioned, they're sort of an entity unto their own. So, they come out. We don't really deal with them much, so. Got it. Thank you. I'll jump back in with you. Thanks. Thank you. Your next question comes from Andrew Paine from CLSA. Please go ahead. Yep. Morning, everyone. Thanks for taking my question. You, you mentioned that you increase staff numbers to support new contracts. Just wondering if this step up will suffice, should you bring in more high-value contracts? And does this cover some of the starting to AI and its adjacencies, essentially just trying to gauge the ramp up over the next few years in this area? Yeah. Well, it's really all of the above. So we, we have budgets for increased count of new head. We don't specifically hire for an implementation. So we, we didn't hire five people just for Baylor. Yeah. It's purely as we find them and looking forward. You know, it takes a while to train people to bring them, you know, for them to understand the application. So it's not a thing where you can hire someone today and immediately have them up to speed tomorrow. So this was all planned. It wasn't just for Baylor. It was Baylor plus other opportunities. And those opportunities are across every segment of the market and every application that we're looking at. So, you know, if we do start which we plan to commercialize in cardiology, obviously, there have to be people that help support that in amongst the general imaging. So it's for all the applications going forward. And as I said, a lot of it is to be ready for the future growth that we believe will be coming. Okay. So sorry. You don't think there's going to be those large step-ups in the future like that can kind of suffice for the next year or two? Or is this, you know, ongoing investment? Yeah. It's a stepwise ongoing investment that we've always done. You know, it's really just to say the cost base is going to keep going up but less than the revenue. That, that's basically what's been happening. And this is just a continuation of that process. We have bought on some people that specialize in areas, so someone that specializes in, you know, cardiology, as a focus. We bought that person on, you know, over a year ago. But they do general stuff as well. So it's all in anticipation of not just increased volume but increased diversity of our offering. Okay. That's, that's great. And then, just on AI, just, just trying to think, has, has there been any changes to your AI strategy? Just thinking about the, in-house AI development, versus external bolt-ons and, you know, essentially. Do you think that there's any M&A requirements that you that you need to see in this space? Well, I believe we always viewed it as a multi-pronged strategy. One is we've got the platform, and that, that's a big part. But then the question was, where do the algorithms come from? Yes, some that we develop ourselves. Some we will develop with our academic partners. So there's, you know, there's processes, you know, afoot there. And then some that will be third-party. And the third-party doesn't, necessarily involve, an equity participation. But in the case of Elucid, we thought, this, this is an area that we see growing rapidly. We, we like their technology. They were in a Series C funding round, and we thought it would be a good investment. So it'll be all of the above, you know. And, and we're, we're looking at those opportunities as a group, you know, all the time. So we have people assessing all these things. Do we build? Do we partner? Do we use third-party? Okay. That's great. Thanks. Thank you. Your next question comes from Melissa Benson from Wilsons Advisory. Please go ahead. Morning, Sam and Clayton. My first question is just on competitive landscape. So if we think about RSNA last year, we saw that Philips launched kind of their new cloud-based enterprise imaging suite with Amazon. And I think the reason I bring that up is we haven't seen those legacy players really step up to the plate, if you like. So I guess just any thoughts you had on, I guess, that particular product but also what you're seeing competitively and if you think there's a bit of a shift where those legacy players are starting to at least attempt to compete on product offering again. Yeah. Interesting. To be frank, I think where our technology lead has actually increased. So we don't know of anybody. I mean, there's marketing announcements, and, you know, that's one thing. But certainly out in the field, if anything, we've seen the technology gap widen. And I think, with the release of, you know, Visage Ease VP for the Vision Pro, it's jumped a whole step again. So, no, we haven't noticed any increase in the competitive landscape in terms of product capability. I think if anything, the opposite. Okay. That's helpful. And the second question was circling back to the Elucid investment. You know, I think you mentioned, you know, they have very specific kind of cardiac CT algorithms and things like that but also that they're amenable to reimbursement. I mean, how important do you think having AI algorithms that have specific reimbursement attached is going to be to, I guess, commercializing some of these opportunities? I think, particularly for algorithms like this where the reimbursement is material, very material, it's very important because they're very expensive tests. They're not done on every single cardiac CT, but where there's an indication, it can save, not only the patient but the hospital a fair amount of downstream cost. So the cardiac CT will look at someone's coronary arteries. The two additional AI components will basically decide help decide whether that person needs angiography, which is very expensive and invasive, or not. So the reimbursement is quite material. And I think between the two, could be somewhere around $1,800-$2,000 per CT. So, in this specific space where it's very specialized, high dollar value, I think the reimbursement's incredibly important. If it's something a bit more that you need to do all day, every day, a bit like breast density, maybe at the other end of the dollar value of the test, yes, it'd be good to have a reimbursement, but I don't think that will stop people from using it if it didn't. That's understood. Thank you. Thank you. Your next question comes from Wei Sim from Jefferies. Please go ahead. Hi Sam. Hi Clayton. Thanks for taking my question. My first one is just regarding, you know, that TAM consideration, and the 80%. I begin to understand just, you know, how much price comes into considerations here. You know, as you kind of pointed out, it's been noted that, you know, relative to other solutions out there that Pro Medicus is materially more expensive. But, you know, how should we think about this, whether, you know, you're too expensive or the other systems are too cheap? And, you know, any other data points that you use to kind of like, you know, think about the pricing equation and how that plays into the TAM consideration? Thanks. Yeah. I think a key part of it all is our offering is auto-scaling or auto-sizing because we charge per test, because cloud is really charged for what you use. The small guys are no longer, you know, at disadvantage because in the old days, they had to buy hardware. You couldn't buy half or a third of the server. Certain software components that people would sell, they'd have to buy the whole thing but only use a quarter of it. With us, you don't do any of that. It's you, you only pay for what you use. The advantage in terms of benefit to the small guy is exactly the same. It's just, you know, they get the same efficiency. All right. So it's not over 5 million exams. It's over, you know, 800,000 exams, but they only pay for what they use. So I think, the, the auto fitting or auto-scaling component of the offering is incredibly, it's fundamental, for that end of the market. And as I said, they get the same percentage benefit, same thing. So that's why we're seeing a number of those smaller mid-sized RDMs like, you know, Lumus, Samaritan, Gundersen. Gundersen, South, South Shore. These were groups where people thought, "Oh, you know, they would never be able to buy, you know, Visage. That's only the Mayo Clinics of the world." But clearly, that's not correct. So, you know, I think the important part is the auto-scaling, auto-sizing, part of the equation. And these groups need the sophistication. Just because they're small, doesn't mean they're not sophisticated. So, you know, that's why we think our TAM is much bigger than the market most probably initially thought. Makes sense. And my second question is just on slide 18 of the deck, under the One Viewer. I've noticed that we've got ophthalmology there. I was just curious to see if there might be any progress on the development of other ologies outside of radiology and, well, the three listed above at this point in time. Thanks. I know. There is. So I think cardiology's like a first cousin to radiology. And a lot of its imaging method, nearly all of it, uses radiology modalities: ultrasound, CT, MRI, etc. The further you get away from that, it's more reflective light, photos, videos. Ophthalmology, dermatology are very good examples of that where they tend not to have X-ray type, or DICOM type images. So, yeah. And, and we're ideally suited to that. As a matter of fact, when we won LMU in Munich, our first use case was looking at videos of kind of videos of operations for QA, and teaching purposes, nothing to do with, you know, radiology initially. So yeah, we, we think it's ideally suited. And, you know, we're looking at various opportunities of how the same platform can be used across the enterprise. Great. Thank you. I'll jump back into queue. Thank you. Your next question comes from Sarah Mann from MA Moelis Australia. Please go ahead. Morning, Sam and Clayton. First question for me is just with regards to kind of contract renewal. So clearly, you've had a good track record with being able to increase price. But just thinking about, I guess, some of the contracts that are coming up for renewal over the next three years, a lot of them are or I think almost all of them are on-prem. Just interested in how some of those customers might be thinking about potentially shifting to cloud given that that's clearly a hot topic of discussion at the moment. And, and, you know, if that kind of does progress, what that also might mean for transitioning to a broader product suite. Yeah. There's certainly this big move towards cloud in the industry. So I think it's fair to say that a reasonable percentage of existing on-prem clients will look to cloud transition as part of a broader transition of the entire enterprise. Not all, but I think it would be a material percentage. And once they do that, then that certainly opens up the question of archive because the way we store data in cloud is very different to on-premise. And I think a number of opportunities where people had viewer-only on-premise will transition over time to viewer-plus-archive-plus-potentially-worklist in the cloud. So definitely something that we see will happen. The timing really depends on a number of things, like when their hardware, you know, comes to end of life, when their contracts for archive are rolling off, etc. But I definitely think we'll see more and more make that transition to cloud. Well, I think renewals or the timing of renewals and the pricing discussion of, you know, going from one price to a new, new pricing because of renewals, they sometimes just want to get that out of the way and that negotiation done. And possibly with the view to say, you know, in the next five or six years of this new renewal contract length, we will be moving to cloud, but let's have that discussion afterwards. So get the renewal done with a view to move to cloud. And as Sam mentioned, then hopefully add on additional product from there. Got it. That makes sense. Thanks, guys. And then the other question was just a comment that you made about cloud opening up new geographies outside of the U.S. Yep. Just curious in terms of, I guess, how you're kind of approaching which geographies as priority. Like, clearly, you've got a presence in Germany. Is that kind of the main focus for now, or are there other key markets? And if there are other markets, will you need to add kind of excess extra staff to target them? Yeah. So, as I mentioned, Europe, we've talked about this a fair bit. There are a few things about Europe. One, health is government-funded almost across all the countries. So there's a large bureaucratic layer. The opportunities, each one is smaller. But we think that with cloud, it will be a bit of an icebreaker that'll open up these opportunities, because the big cloud vendors have not been able to work within Europe, because of privacy rulings. Whereas now, I think the U.S. government and the EU have come to an agreement how they can progress. You know, we think that there will be a movement to cloud in Europe. It's a few years behind the U.S., but definitely will be this movement. So with the two things happening, I think it takes away some of the impedance. Now, again, the cloud providers, they're massive. They're global. They're everywhere. And it'll be maybe think of it a bit more opportunistic, but there will be some opportunities where they will have a presence in a totally different geography where they're looking at a solution within healthcare. And we may be part of that solution because technically, there's no reason we couldn't be anywhere. It's just purely from a cost-to-sale point of view, we're not going to have people on the street in every single jurisdiction everywhere. So this would actually help us. So yeah, we're seeing very early blush of interest across multiple jurisdictions, largely generated by cloud providers being in those jurisdictions. Great. Thanks very much, guys. Thank you. We will now address your webcast questions. Your first webcast question comes from David Lowe from JPM organ, who asks, "Could you please comment on the trend in the average price per study over the last 12 months and the expectation for 2024? Will the price per click rise faster than inflation?" Yeah. I think we've shown in the past that on renewals, we've spoken about pricing's gone up 50%-60% over the last five or six years. So it's not an exact 10% per year, but we have been able to gain pricing increase and mainly through referenceability and additional product. That trend we expect to continue. And it has done over the last 12 months, but we expect that to continue into 2024. The other thing we've been able to do is with full-stack solution, we were initially sort of one and one and one equals a lower amount, but we've now been able to gain a higher price per click for all three components. So that adds up to a higher amount as well, which does, it, it is, moving quicker than inflation. So we do feel that our pricing is beating inflation on a yearly basis. But we, you know, we bear that in mind for each new contract. Thank you. Your next question is from David Bailey from Macquarie, who asks, cloud deployment has been a feature of all new contracts from late 2020. Can you provide an overview as to how Visage cloud PACS differ to other offerings? And are the benefits of cloud versus on-site deployment recognized or considered as part of RFP discussions? Yeah. I'll answer the second question first. 100% yes. But pretty much every RFP has a cloud option, or we're seeing more and more and more that just mandate cloud. So being cloud-capable is incredibly important. Now, there is cloud, cloud, and cloud, as they say. The difference between us and our competitors is we're 100% in the cloud and 100% optimized. So the way cloud uses storage and compute is totally different to on-premise. So it's not like we've just taken something and forklifted it into the cloud, which I believe others have done, or partially forklifted their operations into the cloud. So definitely very different, very different technology stack, and the fact that we can be complete 100% cloud with absolutely no hardware on-premise, even in the largest organization. I think I, I don't know of anyone else that can actually do that. They can only do parts, which to me is not really cloud. It's, it's like part cloud. Thank you. Your next question comes from Stella Wang, who asks, excluding the net currency loss this period and PCP, EBIT percentage actually increased again. Where can the company invest more in OpEx to support the accelerating growth? And she also asks, In KLAS 2024 report, Visage somehow slipped from one to two position behind Agfa, with scores declining from 90.2 last year to 84.9. Could you please help us understand this mismatch between lower score but clearly strong pipeline momentum? Thank you. Yeah. I think we answered the second part to that question on the KLAS. We think our opportunity and our strong pipeline is a mismatch to that, the ranking, but, but we've, we've commented about that. In terms of investment, we are investing more into headcount. You can see that in our employee salary lines and in terms of the expenses. Advertising, clearly we've increased that as well as our presence has grown through North America in many conferences, but obviously mainly in the RSNA conference in Chicago. We will be continuing to invest. We don't feel like we're missing out on opportunity, while we are accelerating growth. Headcount will increase. We'll keep investing in people. That's our main one. We don't have a capital expense where we need to redevelop any of the product, both the RIS product here in Australia, but also the Visage 7 platform. We, we think we're investing in that how we see fit and, and as more opportunities come, come to market. Thank you. Your next question is from Claude Walker, from A Rich Life, who asks, "Hi, Sam. The company seems very well positioned for the future. But what would you say is the number one risk or barrier that could stop Pro Medicus from profiting from the future implementation of AI diagnostic algorithms?" I think we, we are incredibly well positioned. It is a market that is emerging. I know there's a lot of press around it, but in reality, the market is really just starting. So we've, we've put a few irons in the fire. And I think one of the key ones is the platform itself, that it, it can natively show the output of AI. And that's what radiologists want. They don't want separate applications. That has been one of the reasons the market hasn't really taken off. They've all been separate. I think we're also well placed in assessing the actual, you know, what AI is out there and how to actually develop it ourselves as well as with our partners. We have a three-pronged strategy there: develop ourselves, our lab breast density, work with some of our academic partners and their project support. Clearly, we haven't discussed them in any great detail because they're still in development. Then there's third-party. You know, as I mentioned, the first one that's become public is Elucid. But we have been looking at a number of others where they have novel and well-suited AI and how we can integrate that into the platform because those companies trying to bring it in front of a radiologist by themselves has proven to be incredibly difficult. So we, we think we are incredibly well suited to benefit from the uplift in AI, as, as and when it when it does occur. Thank you. We have another question from David Lowe from JP Morgan, who asks, "Potential customers in the corporate space was mentioned on the call. Could you please elaborate on this customer strategy?" Yeah. The corporate space is made up of largely two, two bits. The biggest part are radiology reading groups. So in the U.S., the fee for a radiology exam or diagnostic imaging exam is two-part. One is called the technical fee. That's actually for taking the images, owning the equipment, the actual technologists, the radiographers that take the pictures. The second part is what they call the professional component, which is the actual radiologists reading the exams. They're two separate fees, even if the same group does them. There is this radiology reading group infrastructure in the US or groups that read, work for other parties, for hospitals, usually for large hospitals. That has been an area where we haven't focused on much in the past, but we're seeing some more green shoots in that area because people are realizing efficiencies that the one tool they have, because it's purely around radiologist productivity. We're starting to see a lot more interest in that area, which is a different market segment to maybe a hospital or IDN. Thank you. You have a follow-up question on the phone from Mathieu Chevrier from Citi. Mathieu, please go ahead. Yeah. Thank you. Just a quick follow-up on cardiology. Just curious to get your, your views on the TAM for that and, the potential pace of uptake, given that you have a, a reasonable install base in radiology now. Thank you. Cardiology's multiple things. So there's cardiology ultrasound, which was the mainstay in the past. I think cardiac CT is rapidly increasing, in terms of frequency. And there's even talk that it should become a screening test because the biggest cause of mortality in the world is, is, cardiac events. And this is a very on-the-rise technology, as is cardiac MRI. So the landscape moves a bit, but we think the TAM is roughly around 20%-25% of radiology. The clear thing around it is there are fewer tests but higher dollar value. Got it. And, and just on, the uptake that you may see from that product when it launches, given your install base in Visage? I think our main thing is to get one or two key clients using it and using them as a reference site. And, you know, we're in, in that process at the moment with, a number of clients using the applications that we've developed in slightly different ways, which is what we want so that we can have a, a broader, you know, user base and experience. And then it's a matter of really, you know, proving the value, its value, to the existing client base. But certainly, the, the thought process now is very different to what it used to be. In the past, it was always separate, siloed systems. And now it's the exact opposite. Can we get one system that covers multiple bases? Because just managing and securing systems is a big ask. So the fewer you have, the more cloud-based they are, the more secure they are. So that's, again, another thing driving. Understood. Thanks very much. Thank you. There are no further questions at this time. I'll now hand back to Dr. Hupert for closing remarks. Just wanted to thank everybody for participating today and the questions. If there are any other further questions from the analysts on the line, by all means, please feel free to contact us via email. And thank you, everybody, for joining us. Thank you. That does conclude our conference for today. Thank you for participating. You may now disconnect.