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.." ORPH in the Underwhelmed?.."
'ORPH 'n us in the underwhelmed', surely , Shirley ? '
;->
Agree with comments from Friday. With a large non-cov contract about to drop and Ph1 of the characterisation complete - the trajectory is nailed on with Orph. I also have a sneaky suspicion that having been caught on the back foot with past results being misunderstood in the market that CF will have ensured there is clarity over this set, and I also think he will have (if possible) aimed to have further RNS's lined up for later in the week / next to catch out anyone who mistakenly plays this down / bails at the wrong time. Just a hunch based on a comment he made in passing on Friday.
No looking back!
So basically it's... ORPH in the Underwhelmed?
I'll get me coat
Exactly, CF has a shared interest with PI’s seeing as he owns more shares than all the previous board members put together. Very few companies including FTSE companies have a CEO, that actually pay for their own share purchases.
Moniman, agree. I have never been in an AIM share where I have seen so much of the potential delivered in such a short period of time. He has also created a liquid stock that should anyone believe the pace is to slow it is very easy to sell and then buy back again, he was even encouraging that in Summer 2020 he is that transparent. Very little moaning for me on this share, meanwhile the rest of my PF…..
I agree totally.. Maybe some would like Kim and Trevor back in charge with nothing but empty promises instead of slightly delayed ones?? CF is a miracle maker compared to the previous bunch of fools in charge!!
Too many people say Cathal waffles, has too many unfulfilled comments etc., yet when the guy keeps his cards close to his chest, the results are going to be poor. Come on guys n gals.
G100, totally agree, the market seems to be asleep with the facts you point out. I have been in and out of ORPH since the 5.9p days (mostly in…) and I even posted at those levels there was a chance to increase revenue per contract given the possible demand going forward. To see this level of growth is fantastic.
Working with the government is always going to be protracted, so the £10m plus contracts may still be 3-6 months away, but for anyone who has not had a chance to listen to the below, I would strongly recommend it.
hTTps://youtu.be/a5r4YHTZ
Just can’t believe our current MCAP relative to what we can offer a global market. Personally not expecting too much from the H1 results, although I would hope Cathal kitchen sinked the last lot, to at least show the market the positive trajectory we are on.
If OO now have double the capacity (we already know that) and the challenge study rates have doubled (fairly sure of that), we’re running close to 100% compared to historic 30% occupancy, not including the Venn side of the business, then we must be making a fortune..full year turnover is going to be towards the top end of predictions one would have thought?
Whether the numbers are lower end of expectations or not, key piece for me is evidence of ongoing uplift in contract values - lot of talk about Covid challenge studies, but that’ll come in due course, best to take a conservative view on timings with that…but the contract piece gets little coverage…but it’s got huge implications. Last year these were tracking at £4mn a study, the RSV study with SAB in March this year jumped to £7.5mn, the Asthma announcement last month showed £8.1mn, the one on Monday… if in the same ballpark, further supports the trend of being able to double the revenues from existing facilities…and also has the benefit of flowing straight through to profit.
Aside from Royal Free coming on line next FY and search for additional capacity to support the pipeline, just the existing facilities should see profits jump significantly next year as these new increased contracts wash their way through.
Thanks Extrader, much appreciated. Slightly nervous about Monday’s results but glad to have a bit of a warning that revenues may be lower than expected.
I also got the impression that he implied revenues would be lower than expected however he stressed that we would still be profofitable. He didn’t however clarify if this was EBIDTA or after tax.
Big indicator for me is whether the cash pile is growing or still shrinking..
If the "not quite as much as we'd hoped" comment relates to the Covid trial delay then I'm not too stressed (though I'd hope there is a clear explanation of this in the RNS). Government and approval delays can't really be influenced - and we'll be getting paid more again for developing the Delta strain.
Also, the mood music seems to be faster approvals in the future...
Big thanks for the notes extrader!
Hi Extrader
Thanks for the notes, bit taken back by the - 'not quite as much as we'd hoped'; hoping he means beat on top line but costs eat into the profits….so profits ‘not quite as much as we’d hoped’….or some other narrative that he can put a positive light on..
F---Me! "not quite as much as we'd hoped" - from the guy who always over-promises and under-delivers. Not looking forward to Monday!
Oops ! Awful typo :
Totally agree comments re : Steve Thompson MBE - an inspirational story and the epitome of 'reliance', the theme for the Menphys charity event.....RESILIENCE.....that's RESILIENCE.....
Sorry, Steve !
Jinx :)
Thank you very much for sharing, extrader, excellent notes!
Great notes, thanks extrader, much appreciated.
Cont/......
POLB
Good presentation, essentially repeating what he said on Thursday.
Some snippets/ 'worth remembering':
- JS is 'emotionally intelligent' : picked up on the previous day's presentation criticism re lack of female representation on BoD and (partially) addressed it.
- nicely explained background to Poolbeg two stacks logo : like an old , repurposed power station , POLB would be looking to repurpose potential 'unwanted assets'.
- POLB (and ORPH) at a 'sweet spot' : how lucky (he didn't say 'of the Irish') to have acquired hVivo just before the pandemic ; and at a time when advances in AI are transformative for the pharma sector and POLB's business model;
- Infectious disease market spending : the 10x budget growth already mentioned; and the just announced US $ 65Bn spend includes grant-funding applications that POLB's target customers could access;
- pharma willingness to pay big money : they want strong IP; proven human safety; and something where a head start will kill the competition.
Referenced his co Inflazome : different business model [88% VC finance in 2016, MCap Euro 55M] sold 2020 for Euro 380m upfront + 'significant' downstream milestone payments : these would include 'payment by results' eg Ph 2 , Ph 3, and then - if commercialised' - ongoing royalties...
Roche were so keen they signed up on the strength of Ph 1 safety data and 1(one)patient 'proof of concept'.
- the PredictViral Biomarker Platform is of 'some interest' to the US military.
- the business model allows them to work with hVivo or not.
- strong IP for POLB-001 : EU patents granted, US pending.
- the USP of the HC data is not only range (300K samples) but also how comprehensive it is , esp as it includes Day-1 data : this means it can capture and identify severe disease much earlier (pre-symptomatic) .
Speedier diagnosis would be a 'category killer' : the current market leader, Tamiflu, only works at the early stages, if not diagnosed and stopped quickly enough, a 'cytokine storm' is pretty much inevitable.
Hope this covers it. Feedback/corrections welcome !
Apols if some of this is 'old news'.
E and OE, NAI, DYOR etc etc
My notes,
Totally agree comments re : Steve Thompson MBE - an inspirational story and the epitome of 'reliance', the theme for the Menphys charity event.
Hat tip to elrico and partners for making it possible. And for arranging a non-London centric event : there was a good 'local' turnout, although the winner of the 'furthest travelled' prize had come all the way up from the South coast....
'Respect' too, to CF and JS, for staying on for the entire Friday weekend evening (official end around 1130pm), rather than just do their own quick presentations and head for the door. Esp. as JS said (jokingly/ruefully) that he was a Leeds supporter and was missing Friday's big game against Newcastle...
ORPH
A somewhat more subdued CF than usual, taken to task by the very first Q re 'overpromise and under-deliver' , which he half-acknowledged and trotted out the 'perfect storm' defence, with the added distraction of POLB spin-off. This actually was a bit weak - if customers are lining up for ORPH services, the POLB side-show shouldn't interrupt contract flow (as it did for a while in H1).
Hard to know whether he's really chastened : several times made a point of saying 'in the next couple of months, errr, I mean over the coming months..'
Re H1 results, it sounds like they're going to be a bit curates-eggish :
- 'not quite as much as we'd hoped';
- CHIMs : Alpha characterisation Ph 1 now 'done', started on Delta, CHIM contracts will run into next year (well, doh !).
To be fair, CF said that part of the study start delay was the need to get what he called 'manslaughter insurance', which eventually had to be backstopped by HMG.
I can imagine pursed Civil Service lips at that one ;-<
CF pointed out that once there's a precedent [and the benefits seen] the resistance/delays should reduce.
The [likely underwhelming] RNS may be tempered by news of a new contract around the £ 8m mark.
The 'target' is for avge £ 5-6 m every month going forward.
Said revenue mix for 2022 was likely to be 30/70 Covid:nonCovid [does this square with others' understanding ? or is this the reality of delayed CHIM revenue recognition]
- DIM : 'near or around Xmas', we're trying to grow substantially...Having done the spadework on POLB, incl HMG tax negotiations, it should be easier / quicker to replicate.
- Imutex : 'nearly there ' then - after the familiar complaint re slowness - said something about 'going into public....[inaudible]'. Any ideas ?
- PrepBio : 'looking at small Nasdaq'.
- POLB : someone asked about the end of the lockup period and how to avoid a potential dump of sales cratering the share price?
CF first said that 9 months - 'up to '- seemed a reasonable balance; and then that -depending on business progress -if good, a sell-off would be less likely - possible permutations of 'phased release'; 'tender offer' to allow in a big investor; and/or progression to Nasdaq were all on the table.
Continued...
There is a short report on another popular BB. All on track with a hint of extra news on Monday.
I would have gone but am in Sunny Crete on vacation. Expecting an update from Elrico sometime later.
GLA