Singers Update14 Aug 2025 13:23
Singer Capital Markets - FY25 TU - Minor miss doesn't alter positive outlook
The TU released today highlighted continued positive progress on the operational aspects of the business, although dampened to a degree by a slight miss on the top-line. We are not unduly concerned at this point as the Company stated that the miss was due to timing of orders.
We trim FY25 revenue by 10% to £4.6m, reflecting the midpoint of management’s revised guidance, which subsequently means the FY25 y/e cash balance is now expected to be c. £4.8m.
We leave our outer year forecasts unchanged, noting the Group in FY26 will benefit from FY trading from BTS, the Superdrug launch of AxisBiotixTM, and potential royalty income from the Croda partnership.
We reiterate our BUY recommendation and PT of 29p.
Trading update – FY25 EBITDA in line
FY25 revenue is expected to increase by 283% (at the mid-point) to £4.5m-£4.8m, driven by FY trading from Dermatonics and eight months of trading from Bio-Tech Solutions (BTS), as well as growth of AxisBiotix.
Revenue is slightly below SCMe of £5.1m due to the timing of orders for Dermatonics and BTS, which subsequently occurred post year-end.
Positively however, adj. EBITDA loss is expected to improve significantly compared to FY24 (£2.2m loss) and fall between £0.2m-£0.4m in line with our expectations (SCMe £0.3m), reflecting better than expected margins.
YE cash is now expected to be £4.8m (SCMe, £5.2m), boosted by the £4.2m June placing to support the AxisBiotix™ launch in Superdrug.
Croda
We understand from management that Croda remain very upbeat about Zenakine’s commercial potential. At Croda’s H1, 25 results Consumer Care sales grew 7% driven by volume. Beauty actives grew 1% driven by strong sales in Asia but were offset by weaker US demand as consumers traded down from premium products.
SCM view & valuation
As stated above, we remain positive on the outlook for SBTX and continue to see significant commercial potential for the business model.
SkinBio’s focus areas will be re-enforced by leveraging strategic external partnerships, enhancing international reach and executing on acquisitions within market adjacencies. These initiatives combined should enable a significant growth trajectory in the coming years.
The key near term driver of value is the royalty stream from Zenakine but as commercial terms are not disclosed, this is difficult to forecast. The size of the market and the speed in which the royalty ramps are key issues.
The roll-out of AxisBiotix with Superdrug is also an important driver of revenue and sentiment. Given the early stage of these initiatives, we have taken a conservative approach on our assumptions.
We value SkinBiotix using a sum of the parts method, driven by emerging revenue streams plus the acquired businesses. This yields our PT of 29p.
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