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SomnoMed Limited Breaks Sales Records

SomnoMed (ASX:SOM) has broken sales records in North America, Europe and APAC/Japan, recording a year on year growth for the June 2015 quarter of 21.2% for its Continuous Open Airway Therapy.

As significantly, SOM will likely exceed revenue guidance of $32.5 million for the full financial year.

Total unit sales for 2014/15 were 51,355 reflecting a growth of 18.2% for the year.

SOM's markets saw sales of its medical oral appliance therapy for obstructive sleep apnea reach 14,517 units, the highest quarterly unit sales in the history of SomnoMed.

Quarterly sales of its Continuous Open Airway Therapy (COAT) in North America exceeded 8,000 units while Europe sold over 5,000 units and the combined APAC/Japan region sold over 1,400 units.

SomnoMed executive chairman Dr. Peter Neustadt said:

"The growth in Q4 was led by the North American region recording a year on year unit sales growth of 26.4%. After the severe weather affected sales in Q3, especially to our licensees, Q4 showed a rebound with sales to our licensees growing by over 50%.

At the same time the US direct unit sales grew by 18.7% in Q4, recording excellent growth of 23.7% for the financial year 2014/15."

"Total unit sales for 2014/15 were 51,355 reflecting a growth of 18.2% for the year. We are very happy with the results achieved in Q4 and the new records set in all regions.

The weather in January and February caused an unusually low result in Q3, which cost the company sales of around 2,000 to 3,000 units or 5-7% growth in 2014/15. The good results achieved in the financial year came as a result of the success of new products introduced in the US market during the year and the geographic expansion in Europe.

Excellent growth was also recorded in Japan and in South Korea," commented Dr. Neustadt.

"Throughout the year and consistent with our strategy, our marketing and sales forces continued to expand and we continued our strong focus on activities in the medical referral channel."

Neustadt said that heading into the new financial year the trends are good in all regions.

He was confident that the recent FDA approval of the SomnoDent® devices fitted with DentiTrac® Micro-Recorders, which enables advanced compliance recording, should allow SOM to further strengthen COAT™ prescribing behaviour of the Sleep Physicians in North America, Europe and the APAC region.

Offering COAT™ as a more comfortable and effective alternative treatment to CPAP, together with compliance control, should allow us to continue with our history of strong growth in the 2015/16 financial year and beyond," said Dr. Neustadt.

SomnoMed had a cash position of $8.3 million at the end of June 2015, after expenditure during the quarter of $300,000 on digitalization equipment.

Analysis

In short, an outstanding result, given the severe weather affected sales in Q3, especially to licensees, Q4 showed a rebound with sales to licensees growing by over 50%.

Demand continues to be heavy and growing for SOM's COAT. There is plenty of scope for increased penetration in the U.S.A.

FDA approval of the SomnoDent® devices fitted with DentiTrac® Micro-Recorders, which enables advanced compliance recording, should allow SOM to further strengthen COAT™ prescribing behaviour of the Sleep Physicians in North America, Europe and the APAC region.

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