Genetic Technologies Limited (ASX:GTG, NASDAQ:GENE, OTC:GNTLF) today released a business update covering the company’s activities during the September quarter, including the effects of the company’s recent restructure that resulted in a significant reduction in operating costs.
During the quarter GTG, a global leader in guideline-driven genomics-based testing in health, wellness and serious diseases, executed on its strategic restructure with a focus on US B2B geneType and EasyDNA.
US B2B strategy poised for significant growth
With a strong focus on its US B2B strategy, the company says it is poised for significant growth, while its existing distribution partners are making “great strides” in building awareness among employer groups.
GTG’s US team is leveraging the current focus by health providers on patient wellness and personalised health by driving awareness of geneType risk assessment testing at an institutional and Business to Business (B2) level.
The company says it is well advanced with a number of groups in the US that will facilitate large volume demand for geneType.
EasyDNA platform progressing
GTG reports that progress on the launch of geneType on the EasyDNA platform will accelerate global access, providing availability of geneType in more than 40 countries worldwide.
Launching geneType on the EasyDNA Platform provides GTG with an important additional channel into the global market.
This channel is also supported by the company’s licensing strategy that will enable access to geneType in a wide range of countries that are currently serviced by EasyDNA providing further growth opportunities.
On track to breakeven
During the quarter GTG executed a “capital light” strategy, which resulted in a significant reduction in its cost of operations.
Net cash outflow for operating activities improved significantly as a result of the company’s restructure — down 56.4% from the prior quarter.
Monthly costs were reduced from $800,000 to $300,000 while high throughput capability for geneType was retained by outsourcing laboratory testing to its US partner Gene by Gene.
GTG reported cash receipts totalling $1.84 million during the quarter and held $1.62 million in cash and cash equivalents at the quarter end.
Cash receipts from customers for the quarter of $1.84 million, down 9.8% from the prior corresponding period.
Net cash flow for operating activities during the quarter were a net inflow of $0.42 million (inclusive of R&D refund) and a net outflow of $1.42 million (excluding R&D refund).
The company expects these savings, combined with the currently underway capital raise and a focus on growing geneType B2B and EasyDNA sales, should provide a solid foundation to move toward breakeven by late 2025.