Tecan Conference Call Notes – Paramit, vPoke: Proprietary Computer Directed Assembly, Growth Margin Driver, Life Sciences, Medical Mechatronics – Growth Rates, Revenue Share

vPoke – Proprietary Computer Directed Assembly

Q: Relating to the vPoke assembly software […]. How much of a growth margin driver could that be for the can stand alone business if applied to the components business […]

CEO:So we're actually quite excited about vPoke. [...] vPoke is technology infrastructure that has been created by Paramit over the past three decades. And it's been very successfully deployed by them in that area that demands manufacturing environment of low to mid volume and high mix with the combination of high quality outputs, a very low number of defects in production but also at the end of the testing and and in the field. So this is I think a key market recognition and differentiation by Paramit in their manufacturing environments. And this system is actually being deployed both identically in Morgan Hill and in Penang, Malaysia. So of course, when we think about our own production environment, I would dare to say that we're also pretty good in terms of our quality output and our our quality insurance systems which is I think also 11 reason why we are quite successful in the clinic markets that we're serving. However vPoke, I would say from our perspective and my personal experience now takes it to the next level, allowing also to deploy these manufacturing environments in a far more modular system that is ideally suited also for similar products. Like we would use them in our component system, development and production, but also in our sub building block modules and even to some extent on the larger platforms. So the big attraction of vPoke to me is it is entirely scalable and transferrable also from side to side one product are properly implemented and then it becomes more or less operator independent. So the the qualification of the operator, two years, very high quality output through people can be substantially lower than what traditional manufacturing regimes would require too. So I think there's a lot of things that we have in mind right now to deploy vPoke environment in our own facilities. But of course also using the existing infrastructure in in Morgan Hill and Penang for selective production of uh additional products and new programs that will come into our framework. So I think overall, I think very good system and and also the basis of uh, of course for the profitable growth of Paramit over the past three decades.

Conf Call (1/3)

Paramit Growth and Covid-19 Impact

CFO: Paramit has been affected by COVID negatively 2020, but prior to that they had a solid growth over the last few years. And we can also see the pick up in 2021 with prospects beyond being around or revolve market expectations.

Life Sciences, Medical Mechatronics – Growth Rates, Revenue Share

Q: If we look at the split of 70% medical side, um, is there a difference in the growth rates in the margin between the life science and the medical side and could you maybe talk a bit to the synergies that you that you expect to get out of the combination? Because I am a bit surprised at the big share of the medical mechatronics share of the revenues. I’m just trying to understand if you could give us a bit of an example of where you see synergies that you could take out. Thank you.

CEO: When we look at it also the history of Paramit, they have been in both segments quite successful and adding constantly new programs and new partners both from a medical device standpoint, but also from a life science standpoint and probably similar to what we see when I look at Tecan and life sciences segment, probably the most dynamic right now. Also for for Paramit, the area is genomics overall. So I think they have already and are to continue to drive this Caleb and hen some of the programs that that look at innovative genomic solutions, probably a big kind of focus area, but also on the on the medical device, on medical mechatronic side. The pipeline of programs is very robust and also the inbound demand for new programs coming their way is quite substantial. And of course with their recent edition of more engineering capabilities in the field of energy transfer. They've already now started a very comprehensive program to exploit that in terms of new lead generation, new program generation, as well as capturing more of the life sciences revenues of such a kind of multi-year interaction with key accounts. So in that sense, I think we are equally excited about the two segments, where of course life science is more complementary and the medtech is more additive to what we do today, but they're all in there own rights very dynamic and very healthily growing businesses for Paramit.

Sygneries, vPoke, Production Capabilities, Combination of Growth Companies

CEO: On the synergy side, I mean of course there's a multiple aspects that we're looking at and as I said before we're quite excited about vPoke and also their production capabilities. They are probably a bit more vertically integrated than Tecan is today. So I think just from the scale and access to materials, building blocks, modules, components, there's a lot we can think of to now use Paramit in our future growth to complement our production profiles that we that we already have in Tecan. So I think I think overall I would think about it like this is a clear combination of two growth companies. So you're not necessarily looking at it to reduce necessarily footprint, but it's more about scaling growth and then leveraging very nicely tuned operations and manufacturing footprint. Particularly also with the ability to transfer programs once they matured from the the parent Morgan Hill facilities potentially into the even more cost advantageous Penang, Malaysia environment. So I think there's a couple of things that probably I wouldn't like to get into too much detail yet, but there's of course a lot of programs if you're looking at whether that would leverage that capability and as I said, particularly with the focus on the regulated aspects of the production growth that we're looking at in our own strategic framework. 

Using Python to transcribe Conf Calls, Webcasts

The above audio was uploaded to an S3 Amazon Bucket, then was fed via a Python script to Amazon Transcribe service which resulted in a raw transcript. That raw transcript was then used for the quotes above. By default Amazon Transcribe does not seperate speakers, has difficulty with abbreviations or names. Example: Transcribed chicken instead of Tecan. Without human correction, such a conf call is not really transcribeable, imho. Another example: vPoke = we poke.

For more on transcription see this article: Link

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