The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
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Edison Investment Research is terminating coverage on ABC Arbitrage (ABCA), paragon (PGN), Foresight Solar Fund (FSFL), Kendrion (KENDR), Lithium Power International (LPI), Triple Point Energy Transition (TENT), 4iG (4IG), e-therapeutics (ETX), Pharnext (ALPHA) and Shield Therapeutics (STX). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant.
Just look at the last two fundraises - £15.1m in December 2022 and then £5.1m + £16m ($20m) debt facility - and compare it with today's mcap. We know full well from the misses that another funding round is going to be needed and now they have debt to service and are well short of break even they aren't going to access further debt financing so it's got to come via equity.
Raising just £10m this time around will double the shares in issue, add an extra 50% for another £5m.
This isn't investable until (i) financing has been arranged and (ii) there's a clear improvement seen that gives confidence to profitability being achievable.
Thank you all for your responses.
Did anyone try to get management to do Q&A with the investors ?
Also what about AGM ? Are the resolutions being approved when everyone is so unhappy?
As time has gone on here, it simply gets harder to 'just' put this down to useless corporate mismanagement. Just too many things that simply do not make sense.
Some of my earlier comments here outline what I think is going to be the end game here now.
None of them lead to a positive result for the majority of shareholders.
More recently, I have wondered if we might see an ETX or C4DX type of outcome, although I think the odds remain greater that AOP will simply issue the company with another loan, on ruinous terms that essentially might as well mean a wipe out for ordinary shareholders.
To be announced whenever we get the next update. Which will be full of the same BS as all the other ones probably.
Or maybe at best eg a 1p all share cash offer. Why would they pay more than they need to?
Ultimately, if they were unhappy with the CEO and wider management team, they would have been in a position to do something about it a long time ago. Something to ponder.
But others may hold different opinions and that is fine too. GLA. Except the BOD.
Lwhl,
Fully agree, shocking management and I do wonder has it been taken this way deliberately. The silence is shocking.
All the promises followed by continual inaction and failure at every turn.
FDA approval was not cheap (any idea of the cost)....but this company will be stolen by AOP at a cheap price or put into administration & bought out in a pre packed deal.
All IMHO, dyor
Riz,
The leaders in this company have failed to tell us who the 3rd party is they blame for what is a shambles. How can your revise down your forecasts and still miss it by 40+% and blame someone else.
No director has bought at these low low prices but then again that could be viewed as a slap in the teeth to us holding at a much higher price. I have a few cronies who will by big into this if it starts to move. But the path must be a lot clearer and I don't think those in charge have the capabilities for clearing a path.
How much of the funding have they burnt through? No one knows as they tell us paupers very little.
Riz29: In addition to reviewing all the formal material of the past 12-18 months, which I presume you have already done, have a look and listen to all the interviews too. Plenty of stuff on the internet to this end.
Listen to all the promises and general positive patter.
Then compare it with what has actually been delivered. Well, as much as we can rely on what they claim has been achieved of course (misleading prescription numbers, ahem).
How enthusiastic the CEO has always been...except when it comes to putting his hand in his pocket and actually buying some shares himself.
You could be forgiven for thinking he was working pro bono, but instead, and I doubt many would argue, his remuneration is really very generous.
Indeed, it would be generous, even if he had taken the company to profitability, which should have been achieved by now.
More red flags than a beach in a storm. Whether by accident or design, this is a dog with fleas.
At best, a commercial car crash. Shareholder value destroyed, thanks to a useless management team.
Or at worst, one that has been deliberately taken in this direction.
Either way, one that should already be under regulatory investigation to establish which of these two scenarios applies - but this is AIM - and so we will probably never know.
But to each their own views naturally.
Thank you for your reply HarChris.
I understand that they missed their target and it must be hard for investors who have been sitting on this at much higher price.
At current price do you not think its a buy? Especially because they are still increasing their revenue, and by mid 2025 will be cash positive. I did a bit of calc, if the operating cost remain the same, we will likely to see around £10m loss approx. I don't know how accurate this is. But the losses are slowly coming down which makes is more compelling to buy. The other thing to consider is , will they need more cash? Based on the recent update they had £13m cash in Dec. This makes me think they don't need to raise straight away. Maybe in 6 months? Who knows... I guess we will find out week after next.
In summary Shield has underperformed against expectations time and time again.
The most recent equity raise and debt facility was to get STX to breakeven. For this to happen they needed to hit very punchy targets but not only did the most recent results show they are on the completely wrong path (28.6k prescriptions vs 55.5k target) but the previous quarters were revised down too.
So for example prescriptions in 2023 came in at 77k and if you just looked at the 206% growth rate you might think excellent! But this was the year when the full sales force were in place and trained up. Do you know what the original guidance for 2023 was? 140K, it was then downgraded to 100k-130k range and that was missed by a mile.
In order for that cash break even to be achieved before a cash call is needed STX are going to need to up their average net price per Rx in 2024 and beat the previous target of 330k prescriptions... how likely do you think that is compared with 77k in 2023? And at what cost do you think the cash call will come at if it isn't achieved now that the current mcap has fallen to just £11m?
Hi all - I am trying to research this . Can a long term holder be kind enough to give a summary of what’s happened and why has the price dropped so low ? I looked at the interim results - they don’t look so bad . So can’t figure out the reason for the drop