Member Info for HarChris

I must admit I have been very surprised by the sheer contrast in sales between us and Yourgene. I know we benefitted from first mover advantage, I know we supply the government and have a larger overseas presence but the difference has taken me by surprise. Ncyt full year revenues were £277m whilst Yourgene are looking at revenue of between £18m and £20m, between March 2020 and March 2021. Our actual revenue for the exact same period is likely to be closer to £400m...

However passionate you are about this Jungla I don't get the impression it's something Graham and the board have any interest in, after all share price mgmt does not appear to be top of their agenda. The SP is where it is for a number of reasons that will be quickly addressed if things are going as well behind the scenes as we are hoping. I would imagine most companies that engage in buy backs are larger firms with a stagnant share price over an extended period of time, not just a six week decline.

They can make money by driving up the share price too, I hope that try that tactic soon!

A very, very important factor which isn't being discussed is the threat of a market crash in the not too distant future. It is predicted by many venerable analysts to happen within the next 12 months with these bouts of stimulus keeping economies afloat currently. What sort of businesses come unstuck in recessions? Debt-laden ones. What sort of companies are considered recession proof? Those with cash to fall back on, those with a strong balance sheet...

Our cash is growing by the day to be fair and I certainly have never come across a company with one third of the mcap sitting in a big pile. That's probably the situation at novacyt HQ by the end of the month and by the summer (ignoring the obvious that we'll have made an acquisition or two by then) could be talking 40% of the mcap.

Jungla, more or less yeah but that wasn't what I meant re many companies having a large cash pile. I don't have the facts to hand but there are certainly many blue chips with a cash pile around a tenth of their mcap, so not a fifth like us but still pretty substantial. As for the SP Angel broker note I don't think it's much use to be honest.

For example, if you follow your own logic on p/e ratios it's going to cost £100m to buy a company that generates £10m profit a year unless some serious wheeling and dealing is done.

Jungla, the main reason is we're looking at forward p/e, we're just guessing at what future profits are going to look like. In the future, whether we're making £10m, £30m, £70m or £150m, we won't have a massive cash pile, it will have been reinvested.

Anyway loads of companies (not our size) have massive cash piles, it doesn't come into P/e ratios. The truth is there are better metrics than p/e ratios for firms in our situation.

Hydr, I think that's all Oddo have done with their valuation and to be fair it makes sense. Also EBITDA is not what is used for p/e, that's profit after tax. So our current share price is the equivalent of making £40m a year profit after tax in the future at a p/e of 12.

For the share price to grow from here the market needs reason to believe either a) profits long term will be greater than £40m following all the reinvestment and new diagnostics environment and/or b) start to look at this as a dynamic growth stock with incredible margins deserving of a p/e anything from 25 to 50.

I think at least one of those two can be achieved but if both are achieved this will become a midcap stock (valued at £2b+) without a doubt.

I also agree with that and I think the SP has suffered for Graham's honesty and lack of 'playing the game'. Nothing has changed PR-wise really apart from the change in frequency of trading updates. Last year the SP rose significantly thanks to two DHSC contracts, the company never put out unnecessary rns', just operational updates and major contract wins.

In other words Graham has always been honest and never 'played the game', it's just this time around the result is different and has led to a flight from investors. Once meaningful news is released and the long term prospects for the company become clearer there's no reason why traders and investors won't return...

Imo and it is just my opinion, the company is currently being viewed as a covid stock and that's put the breaks on the SP. I don't think a short, sharp reversal is going to happen now, I think the recovery to new highs and beyond will look more like ORPH 12 month trading history https://www.google.com/search?q=orph+shares&oq=orph+shares&aqs=chrome.0.69i59j0i20i131i263i433j0l3j69i60l3.1864j1j7&sourceid=chrome&ie=UTF-8

I think new contracts will be revealed soon and will start to answer some of the unknown such as what will testing look like once the pandemic is brought under control somewhat and what share will novacyt have? Will airport testing be here long term or is that just something for the short term? Care home testing will certainly be here longer term, will the Qs be used extensively in that setting?

And then more importantly what is the future for the company aside from covid? Decentralisation of testing will happen, will the Q machines be at the centre of that?

Was meant to be a reply to the new PR thread, soz.

No they don't need a new head of PR, we need confirmation of new contracts and an impressively detailed strategic plan for long term growth. The reason we are where we are is the board chose to wait until Q2 to reveal the strategic plan, leaving a longer period in which we are seen as nothing but a covid stock, all while the pandemic is slowly being brought under control with the phenomenal speed of the vaccine rollout (and with it reduced need for covid testing). It wasn't good for the SP but it was the right thing to do for the business.

I topped up again at COB Friday because we are getting very close to what we have been waiting for and I am certain in four weeks from now this will be looking like a very different proposition...

debarra I agree, whatever way you look at it testing at airports will certainly be in place at least for six months to a year.

I know that but that might not stay in place forever. Cyprus already are considering allowing those who have had two jabs in without being tested I am reliably informed.

Thinking about it more a share buy back would be excellent news for us. It would be taken as a sign that mgmt are saying 'the market is not valuing this fairly so we're going to take advantage of that and put some of this cash that's lying around to use'.

I don't know how much is common but I'm sure at £6.70 a share the could buy back as much as three million shares without affecting the long term plans here...

At some point they'll have enough money to buy back half the company!

When it comes to PCR airport testing I believe novacyt will have a major share of it, they moved quickly to ensure this. The big question is how long with that sort of testing be required for and whether for example those that have been vaccinated will need to have a negative test to travel or be free to travel without.

If airport testing does become the norm for at least a year from now then the revenue generated will be extraordinary!

Well it's 45% cheaper than six weeks ago...

I'm not sure it means much but I'm still mightily relieved to see it shoot up at the end of the day - positive move going into next week!