TRUSCREEN INTERIM RESULTS TO 30 SEPTEMBER 2017

NZX and Media Release 14 December 2017 TRUSCREEN INTERIM RESULTS TO 30 SEPTEMBER 2017 Cervical cancer technology company, TruScreen Limited (NZAX:TRU) has released its 2018 interim results for the six months to 30 September 2017. The company has continued to build its global footprint with a number of new distribution agreements signed in the first half of the year and positive progress being made in discussions to utilise TruScreen2 in public screening programmes. Commercial performance was hampered in the first half due to delays in gaining CFDA approval for the TruScreen2 device in China. This has now been received and benefits are expected in the final quarter of FY18 and onwards as initial orders for the TruScreen2 device are exported to China and commercialisation moves ahead in other new markets. A corresponding increase in sales of the Single Use Sensors is expected as more devices enter the market. Total revenue was $572,101 made up of sales of $225,896 (HY17: $361,443) and other income of $346,205, primarily from grants for Research & Development. Sales were down on the previous first half year (although in line with the second half of FY17) due to ongoing product improvements and validation thereof and the delays in obtaining Chinese CFDA approval. In line with this, net operating cashflow decreased slightly to $(1.77) million (HY17: $(747,100)). Inventory costs rose as expected, due to increased production of TruScreen2 in advance of receiving CFDA approval and in anticipation of growing demand from new markets. In May 2017 the company successfully completed an $897,000 Share Purchase Plan as part of a larger capital raising which included a private placement of $4.09m in March 2018. This contributed to cash and cash equivalents of $2.63 million as at 30 September 2017, and was the primary driver for the increased foreign exchange impact, following translation from New Zealand into Australian dollars. TruScreen reported a Net Loss of $1.76 million for the six months, slightly up on the previous first half year of $1.68 million. Operational Review In the past two years, TruScreen has made significant progress with a number of major achievements including an expanded global market presence, development and CE mark certification of the new TruScreen2 device and, most recently, CFDA approval for TruScreen2 in China. TruScreen has signed distribution agreements covering 24 countries, with a combined screening population of approximately 1 billion women and is continuing to negotiate new agreements. The focus remains firmly on the larger of these markets - China, India, Russia and Mexico - and capitalising on the work done over the past two years to gain acceptance of TruScreen in these countries. Acceptance and adoption can take time and is often dependent on the decisions and speed of progress of third parties, such as regulatory bodies or government departments, and this timing can be hard to predict. In particular, evaluations of the TruScreen product for use in public screening programmes can take many years and involve multiple in-market trials, however, each could produce significant revenue in the future. China remains the primary opportunity for the company and the current focus is on encouraging the selection of TruScreen technology for large screening programs, as well as increasing adoption in large provincial hospitals. A major new sub-distribution agreement was signed in the first half to manage government sales channels in China. The goal is to have TruScreen recommended for use in major central government screening programs and to be included in the list of basic medical equipment for the over 30,000 community healthcare centres throughout rural China. After China, India is potentially the world's largest screening market with close to 300 million women of screening age and the Indian government is looking to set up public screening programmes. TruScreen is currently going through the validation process for inclusion in these programmes. In Mexico, the evaluation of TruScreen by the Ministry of Health as a screening protocol has commenced and subsequent approval will allow government hospital purchases. In addition, the company is tendering for a major national health secretariat program to supply primary screening to the Central Government in Mexico and has also commenced sales to hospitals controlled by the largest public health insurer in Mexico, ISSSTE. TruScreen has been approved for reimbursement by a major health insurer in Jordan. Whilst Jordan is not a major market, the attaining of this insurance rebate is noteworthy in that it is the first of its kind globally for TruScreen. This is an important step in breaking down the pricing barriers that traditional cytology tests enjoy in larger markets. The clinical performance evaluation of TruScreen2 at the Royal Hospital for Women in Sydney is progressing well. Initial results have confirmed TruScreen's advantages over the Pap smear in developing countries and indicate that TruScreen2 will be a substantially more accurate screening method than cytology in those target markets. The Board was refreshed during the half year period, with world renowned Professor Ron Jones replacing director Tim Preston as an independent director. Outlook There is growing awareness and demand from low resource countries for screening programmes and the global market for cervical cancer screening is forecast to exceed US$22 billion per year in the next three years . The opportunities for TruScreen look promising and the company is well positioned to continue to advance the commercial agenda for its product. With the outlook of increasing sales following the receipt of the CFDA approval the company is looking to increase its manufacturing capabilities both locally and overseas in certain key markets. -ENDS- For more information visit www.truscreen.com or contact Martin Dillon, TruScreen Chief Executive Officer, eMail: martindillon@truscreen.com About TruScreen: TruScreen's real time cervical cancer technology utilises a digital wand which is placed on the surface of the cervix to measure electrical and optical signals from the surrounding tissue. A sophisticated proprietary algorithm framework distinguishes between normal and abnormal (cancerous and precancerous) tissue to identify precancerous change, or cervical intraepithelial neoplasia (CIN). A Single Use Sensor (SUS) is used for each patient to protect against cross-infection. End CA:00311907 For:TRU Type:HALFYR Time:2017-12-14 08:30:46