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I have gone through the update and recent documents issued by YGEN again. Parking aside the fiasco that was on capital management, the fundamental story hasn't changed and in my view, only grown stronger.
I am most encouraged by Ranger Technology which is the key differentiation in NIPT testing, and of course then applicable across all blood DNA tests. The SAM is massive and in the billions.
BUT we all know the speed upon which large pharmas and labs move, partly due to the structural set up but also the compliance / regulatory process. We are in pretty much in VALIDATION phase and £2.2m tells me it is moving into the ADOPTION phase. Get a few large players adopting it, then it will be growth and recurring revenue.
The recent management changes / injections should hopefully realise the company's potential!
Yes, agree.
From FY22, international revenues were £5.6m, so a 70% growth will mean £9.5m in FY23. If this growth rate continues, and no reason why not with Ranger and NIPT labs adoptions, then international will be £16.2m in FY24.
Even on minimal 10% UK and Europe growth, they will be circa £3m and £6m, which brings total to circa £25m.
Cost reductions mean run rate of circa £11.5m costs, and with a margin of 55%, we should be EBITDA and cash flow positive in FY24. I am working on the basis we now have proper financial management!
Assuming we take their report at face value, the fact that we are not entertaining further dilutive impact that could come from the strategic investment is a good sign. This means we are fine cash wise and not desperate!
Re Taiwain, intriguing. If we offload that for £1-2m, why wouldn't someone just buy the lot which at current market cap is £8.5m! Puts into perspective our valuation.
I reckon we could be a takeover target before long and sadly will be opportunistically at 1-2p. Hope that will underpin our value and trigger competing bids.
Good luck all.
SpreadEx is a spread betting firm. The increase / decrease simply reflects retail investor holding. Don't think people should read too much into it.
Trading update this week is much more important.
Yep - announcement by FED to backstop all depositors both for SVB and NY Signature bank. That's if YGEN is impacted at all.
The key relationship with SVB is one of loan provider - so YGEN will be one of SVB's assets (loan book) to be sold off. Unless covenants breached, unlikely with the recent statements / financing, then it will just continue with SVB or another.
I wouldn't however be surprised if YGEN USA and Canada have business accounts held under SVB given that is where the loan facility originated from and for, but I can't imagine it to hold much money. Perhaps issues with processing payroll and payments etc like many companies.
The main bank for YGEN is Royal Bank of Scotland per their statutory accounts, where I would like to think the majority of funds are held.
Yourgene Nx NIPT Workflow install for Chang Gung Memorial Hospital (CGMH), the largest medical center in Taiwan!
Hi Bakky,
I think it's quite fascinating what they RNS or not!
Having said that, I do think this represents almost a "reset" / "new beginning". Expecting newsflow to start.
I am pleased to see Ambry oncology test live - Ambry a leader in this space and therefore, there will be demand.
And for the last time, as I called it a "reset", shafted by the placing in December. Remain optimistic with BUSINESS potential.
All the best.
Well, if NIPT can grow £3m, Genomic Services £1.5m, Ranger £1.5m.......cost cut by £2m. We could see a big swing for FY23/24. Still feel shafted by the low placing but trust BGF are no fools!
This should be a £100m market cap business.......
Surely news due any time now?
Well, in case missed, Julian Baines appointed as interim CEO.
Julian Baines, Chairman of IIG and Robert Naylor, CEO of IIG, have holdings of 5,000,000 ordinary shares and 33,497,789 ordinary shares in Yourgene respectively.
Julian also ex-CEO of BBI.
Given need to pivot away from non-Covid, and green shoots seen presumably via NIPT, wouldn't be surprised it is EKF making a play with YGEN.
Note they also changed adviser to Singer recently!
The plot thickens.
Yourgene Board of Directors,
After your disastrous financial management leading to a placing that valued the company at £2.1m (ie below even the continuously revised deferred consideration payments for Ranger!), please deliver us some significant progress now. Where are we with:
- Ambry Genetics cancer testing launch in UK?;
- Strategic divestment?
- Strategic partnership investment?
- New major contract for Ranger per article in December?
- Other commercial developments / progress?
Redeem yourselves! (if that is possible)
As annoyed as I am still re 2022 and placing, just get this company back to £100m market cap!
Yep, one thing that is true is that he never sold and in fact, continues to add. As I said, he told me so in the CMD. One must imagine he knows the future of company!
Does not make me less frustrated with what happened but it's reassuring there is a future. And I hope a takeout around £100m+ at some point.
By my quick calculations, he added circa 132m shares or £400k.
Well, at least one thing was right - Bill Chang never sold and in fact, continues to add!
I remain appalled by the low valuation in recent placing and why/how we got there, but that's now the past and with the placing out of the way, let's hope shareholder value will be rebuilt!
Looks like rollover to me.
Hi Bakky (and Twix),
I will do what I believe needs doing to limit/recoup my losses.
What will be interesting to see will be participation by existing institutions / major shareholders ie BGF, Amati, Steven Myers, Life Sciences etc. We already know Bill Chang is taking up quite a lot although he will be slightly diluted down. Note many said he sold down!
I don't think it is deceit, I just think it has been naivety and incompetence. I think they thought revenues, divestment and strategic investment would come sooner but the environment turned resulting in delays. In such event, I would have deferred investments, preserving cash to get us across the line. But it is spilled milk now.......they are getting a placing done, effectively a pseudo rights issue.
From my review, Lyn invested four times:
1,000,000 @ 7p (2022)
294,000 @ 17p (2020)
243,902 @ 10.25p (2019)
500,000 @ 10p (2018)
With his current participation of 83,333,333 @ 0.3p, I work out his average as being circa 5.2p.
I suspect he will want a return from it or limit losses!
Why will it be different this time?
- the experience alone!
- the signals are there;
- insistence of non-exec director by BGF.
I still think a multiple of sales (4-5x) or GM (8-10x) can be attained. Not the 10x sales or 20x GM but still healthy . The foundation are there so just need this funding to get across the line.
Good luck all.
Hello all, wishing you and yours a Happy New Year and a healthy, happy and successful 2023.
Have read through and digested the shocking RNSs and circular posted late December. The whole placing and placing price still baffles and hurts! Really should never have got to such a position.
Having said above, I am now resigned to the fact it has happened and will proceed as planned. I am also convinced the future is already mapped out. Post fundraise, broadly, institutions will own 70% of YGEN, directors 15% and retail the rest. Lyn, John, Adam will all have higher %'s than before ie lined up. The way I see it:
> We will get divestment news Jan / Feb;
> Full year 2022/23 will be within and at higher end of guidance;
> We will get several more commercial contract news;
> Strategic investment by end Q1 with warrants to take large chunk of company;
> Improved FY 2023/24 trading outlook: likely £24-26m with positive EBITDA, and growth continuing into 2024/25;
> Takeover between 3.5 - 4.5p.
The only assurance we have now is that institutions and directors have put in quite a bit. So, they know. Take that as the signal / comfort. Doesn't make what happened any less ugly.
All the best.
I think CFO needs to take responsibility.
CEO won't go. Just stumped up £250k and past investments too.
They have a plan to recoup their investments, and handsomely too, no doubt about that.
Just very annoyed it got here.