Good morning, and thank you for joining us for the presentation of ImExHS full year 2021 results. I am Dr. Germán Arango, CEO of ImExHS, and with me on the call is our CFO, Reena Minhas in Sydney, Australia, and our chairman, Douglas Flynn in Bogotá, Colombia. Turning to the agenda on slide two of the presentation. I will start with an overview of ImExHS and the highlights of our FY 2021 results. Reena will then cover the financials in more detail. I will follow with our strategy and outlook before opening it up for questions. Slide four provides you with a summary of who we are. ImExHS was founded 10 years ago in Bogotá, Colombia, with the aim to democratize access to medical expertise through technology and services. The company consists of two businesses, medical imaging software and radiology services.
The next slide five, shows our expanding global footprint. We have grown to be a leading radiology software and services provider in Latin America, and are expanding overseas to markets such as the U.S. and Australia. Our software is used by over 2,400 radiologists across 15 countries and is developed by 37 engineers based in Colombia. Our services business has over 100 in-house radiologists with 33 radiology centers in Colombia and teleradiology for customers in Spain and Mexico. On slide seven, we outline our operational highlights for the year. Aquila in the Cloud, our standardized radiology software solution, is showing strong growth and facilitating our expansion overseas. Our recent partnership with Neusoft Medical should help this international expansion.
Our ImExHS Cloud solution was launched in December, and Neusoft will be one of the first strategic partners to be selling this innovative offering. RIMAB is now fully integrated into our operations and played a strong part in winning the contract with Colombia's National Police Central Hospital, worth 1.1 million in annualized recurring revenue. Lastly, in January, we announced our entry into the Thai market with FDA registration, a highly regarded local distributor, Berli Jucker Public Company Limited, and our first Aquila in the Cloud order in Thailand. Turning to our financial highlights on slide eight. We have achieved good growth across our key financial metrics in FY 2021, both on a reported and a constant currency basis. Revenue of 13.4 million was in line with guidance and was 23% higher compared to the prior year and up 34% on a constant currency basis.
90% of this revenue was recurring, and 3.1 million relate to RIMAB acquired in Q4. Annualized recurring revenue was 20.4 million, up 102% versus the prior year and 121% higher on a constant currency basis. The balance includes ARR from RIMAB and from the new contract with Colombia's police hospital. Our underlying EBITDA loss of 1.4 million increased by 700K compared to last year's number due to continued investment in operations. We are investing in sales and marketing to expand into new geographies such as the U.S. with our innovative radiology solution, Aquila in the Cloud. With a cash balance of 4.2 million at the end of December, ImExHS is in a sound financial position. Slide nine shows the revenue and ARR split between our two businesses, software and services.
Starting in FY 2022, we plan to show you EBITDA on a segmented basis. Slide 10 provides you with an update on Aquila Enterprise, our customized solution for radiology targeted to high-end customers. Currently, most of our software revenue and ARR comes from this product offering. During the year, the pandemic impacted the decision-making amongst larger operators and the timing of large contract wins. However, we see a strong increase in imaging volumes, up over 21% year-on-year, and are experiencing renewed interest from larger customers post the COVID recovery. This was evidenced by our large contract win with Colombia's National Police Central Hospital announced in December. Turning to slide 11, Aquila in the Cloud continues to generate strong interest, especially outside Colombia.
Launched in May 2020, it has allowed us to effectively expand our geographic footprint and tap into under-penetrated markets. Our standardized radiology solution has contributed ARR of 2.5 million across 11 countries, and we have made significant progress improving the implementation process with 73 of 111 contracts implemented, including 64 billing, with 5 more billing during early 2022. Slide 12 outlines our radiology services business, which is fully integrated with RIMAB. Over time, we expect radiology services and software to become increasingly intertwined and extremely reliant that AI will be the vehicle for enhancing that connection. Our services revenue growth was stronger in the final quarter due to pent-up demand from COVID, leading to higher volumes and new contracts. We expect this business to maintain this momentum trend in the year ahead.
The last slide before turning it over to Reena Minhas is slide 13 on artificial intelligence or AI. Developing AI capabilities is a way for ImExHS to remain competitive and is a key element to developing our software for the future. Access to a growing radiology database from our services business gives our software business fast and powerful access for AI training and testing. A number of stored images that we use to develop AI capabilities has now reached over 1.5 billion. I will now hand over to Reena Minhas, our CFO, to cover the financials in more detail.
Thanks, Germán. I will now run through the FY 2021 financial performance of the company, starting on page 15. We finished the year with annualized recurring revenue of 20.4 million, which was 102% up versus prior year and 121% higher on a constant currency basis, reflecting the acquisition of RIMAB, 2.5 million of ARR from our Aquila in the Cloud product offering, and 1.1 million from the new contract with Colombia's National Police Central Hospital. The chart presented shows ARR, which is currently billing, as well as ARR, which is yet to commence billing in the boxes at the top. Turning to page 16, FY 2021 revenue of 13.4 million was up 23% versus PCP and 34% on a constant currency basis and was in line with guidance.
The increase is due to high recurring revenue, which was 90% of total revenue in FY 2021, an incremental RIMAB revenue of 1.2 million in the fourth quarter. The software and services split of revenue is 5 million and 8.4 million respectively. Operating expenses were up by 25%, reflecting increased investment in sales and marketing, costs of expanding into new markets, and one-off acquisition-related costs of 700,000. The underlying EBITDA loss, which excludes costs in relation to share-based payment expenses, foreign exchange movement, and transaction costs, was 1.4 million versus a prior year loss of 689,000, which reflects the continuing investment in growth.
Turning to the balance sheet on page 17, ImExHS is in a sound financial position with a closing cash balance of 4.2 million and net assets of 16.7 million at 31 December 2021. Balance sheet reflects the acquired assets and liabilities of RIMAB, which was acquired for $6.8 million, being the fair value of the consideration transferred at the acquisition date. The increase in intangibles reflects recognition of the goodwill of 5.3 million and $900,000 from customer contracts in relation to the acquisition. On page 18, net cash flow used in operating activities was 3 million, reflecting increased investment in sales and marketing and one-off transaction-related costs. Net cash flow used in investing activities includes capitalized development costs of 1.4 million and the payment for the RIMAB acquisition of 1.1 million.
I will now hand back to Germán to take you through strategy and outlook.
Thank you, Reena. Turning to slide 20, our global market opportunity. We operate in a large and growing market around the world. Although we have a small market share internationally, our software is world-class and well-received in key markets like the U.S. When I attended the RSNA conference in Chicago in November, I did not see a comparable product to Aquila in the Cloud, confirming its disruptive and innovative value proposition. Aquila in the Cloud and our network of 35 distributors in 17 countries are helping us to expand into new geogaphies. 75% of Aquila in the Cloud sales are from outside Colombia, most of which are sold through our partner network. Slide 21 outlines the market trends in the healthcare sector and our strategic priorities.
We are well-placed to benefit from industry tailwinds and expect growth to come from our land-and-expand strategy with multiple verticals including pathology and other -ologies, portals, AI, and advanced post-processing. Expanding into new geographies, particularly the U.S. market, by leveraging our partner network and Aquila in the Cloud offering. Our direct sales presence in Florida is being supplemented with new distributors throughout the U.S. We are focused on Florida and Texas to accelerate sales growth in our footprint. Investing in product and sales capability for our enterprise solution to accelerate growth with customized high-end solutions. Developing AI-enhanced teleradiology solutions and accelerating our AI verticals by using our database and testing environment to develop more AI tools and integrate additional third-party algorithms. Turning to our 2022 product roadmap on slide 22, we have a number of key priorities.
ImExHS AI, an essential element to connect our software platform with radiology services. A new version of Aquila that enhances the enterprise solution. ImExHS Cloud, and finally, a marketplace for customers to buy add-ons that can enhance the user experience. My last slide is slide 23, summarizing the outlook for FY 2022. We are looking to re-energize Aquila Enterprise with further investment in sales and marketing to win more large contracts, such as the one with the Colombia's Police Hospital. Aquila in the Cloud should start to make more of an impact on sales going forward now that we have substantially decreased implementation times. We also plan to increase its ARR with further expansion overseas. Radiology services, a standalone business post-integration with RIMAB, has more focus and scale and continues to experience strong growth due to the attractive value proposition for the Latin American market.
AI tools will continue to be a priority in software development and strengthen our software and services offerings. We are planning to develop more tools in FY 2022 and also train and integrate those from third parties. In terms of further global expansion, we expect to see benefits emerge from our recent partnership with Neusoft and our expansion into the Thai market. Looking at guidance, we are targeting an EBITDA breakeven run rate in FY 2022. We'll continue to invest in product development and sales. As the year progresses, we plan to update you with more tangible guidance. I will now hand back to the operator to open it up for questions.
The first question comes from Ian Wilkie from Morgans Financial. Please go ahead.
Hi, Germán. How you going? Look, just if you could just provide a little bit more color around the forward pipeline. I mean, the commentary was quite positive, particularly around the enterprise products. I mean, how many tenders are currently out there in the market? You know, if possible, some sort of gauge around broad timing, sort of, you know, first half weighted or second half weighted. What are your thoughts?
Hello, Ian, and thank you for the question. Well, first of all, the enterprise front is first priority for us from different angles. First of all, we have been putting a lot of efforts in enhancing our product offering. We are also doing intensive sales activities around this product vertical. We have been presenting proposals for several tenders that are in progress currently. One of those was won late in December, which was the Colombia's National Police Central Hospital. Like that tender, we are experiencing and seeing reactivation of several public potential deals that are fitting into this category of the enterprise customers across Latin America. We are experiencing very good traction in that front in Mexico as well.
The pipeline keeps growing. We have been able to keep adding new opportunities into that. Definitely, as I said, I can confirm that there has been a reactivation of that front with the most recent deal we have won late in December. The value proposition we have been able to create is putting us in a very good position for having a high success rate.
Okay, great. Let me ask you, AitC I guess a little bit different, probably not as much of a tender process rather than just sort of inbound and getting your sales guys out there and hunting potential clients. Have you seen any more recent pickup, I guess, in the AitC contracts inbounds?
Yeah. In regards to Aquila in the Cloud, definitely as you correctly said, the purchase process is not through tenders. It's sales that we do with a low-risk go-to-market strategy based on the distributor partners. We have good traction across the network of partners currently in agreement with us. One of the elements we are attempting or what we are, like, including in order to accelerate the growth is bringing new distributors to create a larger proportion of opportunities and to accelerate the growth. Aquila in the Cloud has been very effective for the geographical expansion. It has been very efficient in getting into new markets, even in tough markets like in the U.S.
Now we have to go through an additional step, which is bringing larger channels like it happened with Neusoft, which is gonna be a good vehicle for us to expand the footprint and to deliver sales across different geographies. This should bring more traction on top of the existing traction. One of the key things we have in the Aquila in the Cloud front is that we have been able to improve and reduce our deployment times and implementation times. In fact, as we have shown, 73 from 111 deals have been already fully deployed, and most of those 69 are already billing, which is creating the real traction in terms of the proposal to revenue or to cash metrics.
Well, with the traction it already has and with the addition of new distributors and expanding our partners network, we expect the Aquila in the Cloud business model to keep growing in the way it's growing and to keep delivering successful numbers. On top of that, with the addition of digital sales and more or larger channels like Neusoft, we expect to have even better results.
Perfect. Thanks, Germán. I mean, I guess just to expand on the expectations for the growth outside of Colombia, and particularly with the Neusoft agreement and your move potentially into Thailand as well. Can you just sort of, I guess, maybe flesh out, if you can, a bit about, you know, where you see the growth coming? What are the main areas outside of the U.S.? Are you looking any other bits or, you know, is sort of the U.S. the main driver and then a little bit in Asia?
Yes. Yeah. Well, first of all, the current strategy for geographical expansion is based in bringing revenues from countries outside Colombia because we already have good traction here and good reputation. The most of the efforts are focused on countries different to Colombia. In particular, across Latin America, we are, as I said, experiencing very good traction. The most effective way to get into those new markets has been Aquila in the Cloud. We will keep investing in that front in order to keep receiving good results. Also we are planning to add more efforts in the enterprise front with bigger deals outside Colombia in the Latin American region, where we already have had good results, but we need to enhance that front.
The Neusoft agreement is something that is very disruptive. We have created a particular kind of business model with them. We have been training their network of partners, and each session we have been like training around 30 country managers from the brand. It's just to give you a sense of the magnitude of the sales structure they have. As soon as we complete this training process that is almost done, we expect to deliver numbers and results from that front. The timing for that should be short-term, and the possibility and the potential of this deal is to expand significantly, not only footprint, but sales numbers in Aquila in the Cloud.
On top of that, taking advantage of these business models that are very efficient in the geographic expansion, we have been able to approach markets like the Thailand market, the Thai market, that with a different type of technology and a different type of business model would be impossible from the distance. And it has been effectively created the whole structure for the Thai market, bringing a very high-quality partner, Berli Jucker, very well renowned company in Southeast Asia, and in particular in Thailand. We have been able already to deliver the first purchase order and actually the first bill from the deployment there.
The deployment process was fast and efficient, and there was a big level of satisfaction from the partner and from the final customer, which is a confirmation that this business model can be the ideal way to expand across borders, even into geographies that are not in the area where we have been delivering and getting the most traction. We are very confident in the geographic expansion and in the growth in sales from Aquila in the Cloud. We need to put more efforts in bringing bigger deals from the enterprise front outside Colombia, but this is something that is already considered in our short-term strategy and in the sales activities.
Great. Thanks. Thanks a lot. That's really interesting. I guess one for Reena. You provided a breakdown of the services and software by ARR, but what about segmental profitability? I mean, how should we think about each of those divisions, possibly as it currently stands today. I mean, I'm sort of well aware it would be quite difficult to retrospectively separate out all the costs between the existing eye care business and RIMAB. But any sort of guidelines, I guess, on each of those?
Yeah. I think we're just not providing that information at the moment because as you say, it is overly complicated by all the intercompany, you know, the transaction. It's a very difficult exercise to do. We just didn't feel confident with the numbers that we were giving out if we did that exercise. We will report you know, segment reporting from FY 2022, but just for FY 2021, it is very complicated with the transactions between the companies.
Okay. Possibly expecting it in the first half 2022 results as well? You're gonna be able to split everything out?
Yeah, I would expect that we are aiming for that. Yes.
Okay, perfect. Thank you. That's all the questions for me. Thanks, guys.
Thank you.
Thank you. Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. We'll now pause a moment to allow for any final questions. There are no further questions at this time. I'll now hand back to Dr. Arango for closing remarks.
Thank you very much. Thank you all for taking the time to join us. We are excited about the year ahead and look forward to updating you on our progress. Enjoy the rest of your day
That does conclude our conference for today. Thank you for participating. You may now disconnect.