Kromek Secures Lucrative Agreements with Siemens Healthineers
Why we think this is very good
These agreements with Siemens Healthineers represent a significant opportunity for Kromek. The $37.5 million in revenue from the Enablement Agreement, combined with the ongoing Supply Agreement, provide substantial financial benefits that are expected to make Kromek profitable in the current financial year, well ahead of market expectations. The agreements also strengthen Kromek's balance sheet and reduce debt, enhancing the company's operational capabilities. Overall, these agreements demonstrate Kromek's technological leadership and the strong demand for its CZT-based detector solutions, positioning the company for further growth and sustainable profitability.
Key Points
- Kromek signs multi-year agreements with Siemens Healthineers
- $37.5 million revenue from Enablement Agreement over 4 years, with $25 million in the current year
- Supply Agreement expected to contribute materially to Advanced Imaging revenue from year 2
- Kromek expected to become profitable in the current financial year, with profit significantly ahead of market expectations
- Agreements strengthen Kromek's balance sheet and reduce debt
Summary
Kromek Group plc has entered into multi-year agreements with Siemens Healthineers to provide know-how, IP licensing, and CZT detector tile supply. The Enablement Agreement is worth $37.5 million over 4 years, with the first $25 million installment to be received this year. The Supply Agreement is also expected to contribute materially to Kromek's Advanced Imaging revenue from the second year onwards. As a result, Kromek expects to become profitable in the current financial year, with profit significantly ahead of market expectations. The agreements strengthen Kromek's balance sheet and reduce debt, enhancing the company's operational capabilities.