Member Info for Hemo

We will see flipper, it could be positive, it might not. It has certainly put short term pressure on the share price but we are all in it for the long run. You are confused about the cash surplus of £3.1m because you are omitting admin costs of £2.1m that bring the ‘cash surplus’ down to £1m. I am interested why revenue growth stalled at £3.6m in 2018 at Elucigene and feel they should have explained that. Having said that a multiple of 2.5 times revenue seems low and could reflect the fact the company has lost its way a bit and needs the focus and skills of the YGEN team. Time will tell.

Good to see we will probably have enough cash now to see us through, although at the expense of some heavy dilution. A couple of early points and I hate to be negative. Elucigene revenue growth stalled in 2018 versus 2017 and profits fell so it would be nice to know why that was. Of course multiple paid was low to reflect that but would be nice to know there are no underlying issues there. I would also have liked to see Lyn Rees buy more shares than £25k worth, seems a token gesture to me. At least Bill Chang is investing hard. Let’s see what the market does tomorrow.

Just read the finncap note and although they are perhaps in the dog house they are still our broker so their forecasts must be worth something. It seems that as things currently stand we don’t need to raise any more funds whether by share issue or debt facilities so I am struggling to understand the share price reaction to the trading update. The market has misjudged this in my humble opinion and I feel even more confident now. The market will work it out.

Just love putting the blame on lower cash on Brexit! Priceless! Do they indicate further funds will need to be raised in 19/20?

We had a cash outflow of c£2m in the last six months. It seems operating cash burn is improving so with c.£1.3m in the bank it could last 3-4 months. The disappointment for me is there was no confirmation these funds will be enough to see us through. If it isn’t I would have liked us to raise funds at the same time as the trading update because it just creates uncertainty and a drop in the share price. I am confident but I still think the Board is making schoolboy errors.

Revenues ahead of Hardman but cash lower than expected at 1.25m vs 1.55m.

I think we should have one by 15th April. It’s possible and consistent with the half year. Anything above £9m sales will be positive for me. GLA

Agreed. Can’t understand it. All headwinds have fallen away, we should soar now. Only long term issues I can see are an improved test from a rival or a new technology but that is some way off it seems and we should therefore enjoy the ride now.

I hope you’re being sarcastic. Only the educated among us can use sarcasm.

Let’s hope they refuse to pay for the reports.

If he is moaning it’s a good thing because his opinion is worthless!

Yes agreed so much positive news this week, must be some profit-taking. Revised Hardman report was also more positive today although it smacks a little of incompetence that they couldn’t get it right in the first place. Only worry is the steep drop in R & D expenditure because surely we need that to keep ahead of the pack but it is great that further placings seem unlikely because of lower net debt at end of FY2020, exercise of more TF warrants and/or bank finance, and we will be EBITDA positive in FY2020. I don’t have enormous confidence in the Hardman report though because of their errors and also the fact they are including the £1m litigation settlement to Illumina in FY2020 (paid in FY 2019) and they exclude the research income we are likely to have in the coming years. Sales forecasts look a little light generally to me.

Meant fundraising not placing

I am hoping they will give us sales figures to 31 March 2019 in the trading update that I expect in April or May. They should be able to!

Would be interesting to know how long the ‘initial period’ is that the share price must sustain a rise of 50% above the exercise price of each warrant tranche.

Thanks both, wise advice. I have quite a lot invested here so will probably wait for the funding RNS. This was clearly a shock to the BOD but the price has been decimated and there will probably be a more favorable entry point again after the placing. Good luck to all.

Ivy Sheltie Ian B Would you buy more at these prices? I know you are not share advisors but would be good to know! Thanks Hemo

If the share price rises above 18p for a sustained period we may not need to seek external funds because TF could provide the money by exercising the warrants they have at 11p, which would give us the £4m that will see us through FY2020. This deal is fantastic news on every level and means the Board can focus now on growing the business. Only issues I can see now are a superior product or a new technology that will replace NIPT but I think that is some way off. Great news for all LTHs, let’s hope we see the next leg up in the share price soon.

What did they spend $2.3m between 32/12/18 and today? That is an awful lot of money when nothing much is going on as they awaited the FDA decision? They should be able to bring cash burn right down so we have at least 3 months. Hercules has no security over our IP.

Investor presentation says no clinically significant differences between Iclaprim and vancomycin in raised liver enzymes so they must have a lot of data on liver toxicity?

But why did we not include enough data on that in the first place?

Hope must be we just have to repackage the data rather than undergo further clinical trials to give the FDA the additional information they need.

Everything hinges on this but I still can’t bring myself to average down yet.

Does anyone know when the loan is due for repayment?

We need further clarification from the Board urgently.

Interesting we could meet the FDA in 30-45 days because it seems to have taken 4 months for Antares, which is encouraging.

If we resubmit and it’s a class 1 resubmission they have to respond within 2 months so I guess the question will be how and when we can provide the additional data and whether it’s a class 1 or class 2 resubmission.

What are the traders’ advice on how to play this one in the short term?!!