Member Info for Hydr31

I’m not sure if that’s how frameworks work. Being on it is great, it means we have passed qualification to be a supplier. But we still need to be chosen by the users. If another company appears more favourable on a price basis or ease of use basis, then potentially we are not getting the job. That’s certainly how frameworks work in water treatment. For years we had one company on the framework that was winning all the business by going in at a reduced price... they were running at a loss to build out revenue . they and we’re pretty rubbish at doing the job and eventually they got bought out and directors paid off. Drove me nuts as the government was happy to buy rubbish because it was cheapest and I had a good product but we wouldn’t run at a loss to get the sale. Hopefully the company can start RNS’s some sales updates.

Wilson I’ve invested my money and more importantly my time. My time remains invested but my monies I’m withholding for now. If the company wants my monies they need to work harder

No offence B2 for that to happen we need to , sort out the dispute and replace the extension with something of similar size 100-150 million a year. That’s just to get back to £8. Getting to £15 Feels like wild speculation at the moment. Covid revenues are expected to tail off and I can imagine we are a bit disorganised and inexperienced at competing, than some of the more established companies. I say that because it must be hard to hire that many people, train them, keep track of progress. Glassdoor also has a few staff reviews now that suggest they are having teething issues. And seeing randox and source bio muscling in on our patch makes me think they were better primed for the sale.

Steve V thanks for that, yes I agree it could be the start of something big but when and how it gets there has become unclear. Do you see a pathway back to £15? How do you see that happening?

I think sentiment feeds into ‘valuation’ a lot. Stocks can go to the moon on speculation and then they can drop relentlessly and always further than you think they should.

I’m open to bullish valuations but it needs to be more than speculation for me. I got in at £1.70. Back then we were getting an RNS every few weeks on sales updates and production/expansion updates. You could literally see the growth and it wasn’t speculation, it was happening. Now we have silence and negative sentiment, we’re definitely not in the same place now and the company have the power to change that. If they are selling their butts off we should start hearing about contracts and production updates for new tests.

I recently read minervi and his description of the 4 stages of a stock has been really useful for trying to understand when to invest. In my view we are in stage 4. At some point it will find a bottom (may have already) but might have further to drop and then it will enter stage 1 and trade sideways. That will last until the sentiment changes. The good news is that at some point it enters stage 2 and rallies again. So I’m not expecting £8 tomorrow. I think it will take some time and I’m trying to work out how long that is likely to be and whether I want to wait for it or maybe just keep it on my watch list to come back too. In stage 4 investing is dangerous ( at least in short term) as you just don’t know if your at the bottom or if it’s going to slide again.

Wilson- if it wasn’t for the ramping of porky and ggg I might have sold some at £12. But I was so convinced it was going higher so ultimately the uber positive sentiment got me burnt. We’ve got to have a balanced view. Anyway have a good weekend.

Steve v. I have tried so many different valuations and I have no idea how to value this. I started with pe last year but quickly realised that wasn’t suitable as it’s only looking at current and forward values and actually future revenues in 2022 and beyond were expected to be lower than 2020 and 2021. Then I saw a piworld interview where one of the interviewees (forget his name was suggesting 1.5 times cash) I initially took that to mean 1.5 times future cash. In 2024 sp angel were forecasting £442m cash which would have been £9.47 a share on that metric. That made sense to me as it was a sort of discounted valuation on the basis that phase 2 looked very likely at the time but so many unknowns.

Off course now there is negative sentiment and those cash figures aren’t looking so solid you can apply a negative logic, quarter 4 is affected so might have us sat on about 70 million cash at year end, plus another 40 or so at end of quarter 1. If all our other revenues are Covid are they now reducing each month? If so perhaps we don’t get a further 90 million in revenue. So a pessimistic cash at year end in the region of £180million x 1.5 = 270 million market cap = £3.85 share price. This is why I feel we need to know more about the revenues split. Covid revenues will drop and even though we all know this, I believe it’s still going to play havoc with the sp unless we can be made a lot more confident that other revenues are growing and forecasts will be met despite Covid dropping off. To be honest the sooner Covid doesn’t matter anymore and we’re talking about new oncology the revenues the better for the sp as it doesn’t matter how many amazing Covid tests we bring out, the market is flooded and the need diminishing.

Hi Wilson, I’m sorry I know it’s rubbish when you are holding and someone is saying something negative about the stock. But I’m on here to discuss stocks and learn from others and that means being open minded to the risks too. I was super bullish and felt sick when the price dropped again. I am much happier sat on side protecting my capital for now. I am one man, my comments cannot be responsible for the share price sliding, the company is doing a perfectly good job of doing that. Likewise the market wasn’t buying porkies £54 a share.( wish it was). I would consider buying back in if this was down at negative sentiment cash value OR if the company started giving us some more updates on sales growth. I need to see the sentiment change before I risk taking a position again. At the moment all I can see is speculation and quite frankly desperation with all the t/o ramping and still the company remains silent. People were saying it was cash value at £8 and here we are. So please don’t get annoyed with my negative comments, I’m not shorting, I just want honest discussion, positives and negatives. I’d rather protect my capital for now and if it means I miss the take off and lose out on 10-20% that’s better than me being invested if the stock decides to take another 20-30% discount on the market cap, which in a falling stock, negative sentiment, no news flow.. can happen.

Blue light- what is the cash position now. And what is the cash position if quarter 4 has been materially effected... currently Dcsh are withholding payment from quarter 4 and we don’t know how much. So potentially current cash position could be significantly lower than 100 million. Say we do £150 million Rev this year then cash position will be between 150-200 million.... so that’s a 1.5 x cash valuation of £225 million- 300 million market cap. I get the bullish valuations and I was super bullish but the silence has unnerved me and now I’m considering the bearish possibilities... without news I can see this sliding.

Covid will never be beaten, but if it’s not resulting in mass hospitalisations, if it’s not shutting down the nhs, then we can cope with it. Just like we do the flu. I suspect the elderly will be getting an annual jab.

We need to move on from Covid and start building this company out now, sliding sentiment for Covid is only going to result in continued disappointments. Mullins needs to change the story now and start showing us the progress they are making in future proofing other revenue streams

To be fair we have to start moving out of lockdown at sometime. People have been very patient considering that the vast majority of people are unaffected. With every vaccine that is administered sentiment is changing. People are prepared to take the risks, particularly if they feel protected with a vaccine. So long as positive cases don’t result in hospitalisations and the nhs can cope then Covid is beat. It’s expected that Covid will be passed around every year for the foreseeable future, but so long as there are enough antibodies in the population to avoid mass hospitalisations and deaths then this is the target.

They need to move on from DHSC and tell us what else is coming in. Where are they up too with building the company out. When Covid is out of the picture in two to three years, where is the revenue coming from and what is it going to look like. Any order more than a £1million would be a material increase on the £12 million contract base we had prepandemic and should be shouted about

This is the big question for me. No doubt Ncyt have done well, produced a load of cash that they can now spend building out the company but for £4.00 to start looking like excellent value again we need to see that the base contracts are around £40million a year and growing.

Pre pandemic we were doing about £10 million a year and assuming cash is spent wisely we might be able to aquire another 10-20 million of revenues. So Covid aside we need another 10 million of revenues. To get to £8 share price we need to see the pathway to secure annual revenues of £80 million and growing. This is why I can’t understand why we aren’t RNS the smaller £1 million contracts. The DHSC contract is effectively a one off and needs to be taken out of the valuation. Which means the valuation of this share is really about how fast we can grow that secure contractual base. Even small increments to that contract base will have a material effect on the future share price because that’s the important bit... when Covid is put to bed, what will the company be turning over. That’s the bit that we can’t see.

Chart looks like it’s already broken north of the wedge. Why would it break lower now. If the results are in line with growth expectations then we are on our way to £4billion sales. Warehouses in place, Debenhams website up and running and showcasing the platform. This has got to be ready for a run up to £4 plus now...

Gasman. I know it’s hard to hear anything but positives when you hold a stock, but stocks go up as well as down and newbies should take a balanced view... there are many ramping the stock to high heaven which at this point I think is quite dangerous. At least I’m being honest. I have sold my holding. I am not shorting. I’ve held for over a year and a half and I am still emotionally connected to the stock because I’ve followed it for so long. I would love nothing more than for GM to release a multi million contract RNS tomorrow and I’d jump back in again but I don’t think that’s going to happen. If you know minervi... it looks like we are in stage 4, don’t expect it to ping back to £8 tomorrow. When it does rally it’s going to be met with overhead supply and traders/sellers who want to recoup losses. To overcome that it needs a positive change in fundamentals. Come on Graham.... make my day!!

You said it porky. Being cheap wins the day. Did anyone else see the article about randox reducing the price of pcr to £65 from £100. We may have the best test but i don’t think our government cares so long as they look like they are getting tests to the frontline. Will private business like Manchester airport care about having the best test OR the best margin. We were the first to market but now there is plenty of supply. I think this will be more bad news to come. Not only are revenues under pressure but margins will be too.

All the calculations on what the future may look like are being done using 2021 expected figures which are not indicative of long term revenues OR indeed margins . Start slashing the margin and see what happens to your earnings per share!!

Great day today but I don’t think the selling is over. This doesn’t feel like the no brainer it was a year ago and perhaps that is because we are now faced with the reality that the sales aren’t as high as we expected, the dhsc contract hasn’t delivered as we expected, competition is fierce and the vaccination programs are in full swing.

A massive undertaking is now required to turn this around. I run sales teams and it’s hard to take on one new employee and get them trained and supported to success. Generally I wouldn’t take on more than one new one rep at a time as otherwise I wouldn’t have the time to invest in them. Quite often candidates don’t work out at huge cost to the business. Novacyt are taking on teams of sales people. It must be a nightmare to get the right candidates and then know and trust what they are all up too.

Can anyone confirm if it’s true that any takeover offer would have to be at highest value of the previous 12 months? If it is true it makes all the takeover talk laughable. The idea that Mullis is purposely in cahoots to walk the price down and not disclose the full position in order to keep the price low doesn’t make sense if they have to pay £12.25 anyway. If I were going to place an offer I’d be waiting 6 months so the last twelve months is lower. Could buy it for £6 then and I’d also be able to see what future revenues are going to look like. With all the hiring that’s going on Novacyt must be quite chaotic behind the scenes. A hell of a challenge to grow that fast and keep control.

This needs earnings growth and by that we need to be able to see a pathway to stable ebitda growth from 70 million a year otherwise it’s going to continue being undervalued and continue being walked down towards cash valuation.

Anyone in property.... I believe it’s probably a good time to be buying offices? I bet they’ve bagged a bargain.

Even if you said Germany, USA and Middle East were our only other proper customers currently.... £12million a month is paltry with what is being spent on testing in those countries. I don’t know if this is a good thing as it means we have plenty of market to go at or if it exposes a flaw in our approach. Can you sell technical products in a highly competitive marketplace, effectively through distributors. Or do you need boots on the ground to win hearts and minds?

Looking back to the full year announcements I remember being quite disappointed with the revenue and making the assumption that over seas sales must be higher than we were expecting.... now we have a better idea of DHSC spend... £60 mill between April and October, £150 mill between October and December and £36 mill in quarter 1 (jan-March)

Based on this it would mean rest of world sales in 2020 are 277- 210 = 67 million. Average of £7 million a month between April and October. In quarter 1 we have 36 million or £12 million average. 70% growth

Given that the future share price is now going to be decided by the ability to grow these revenues out, what are peoples thoughts on that progress and is it sustainable. Whilst 70% growth in great, can’t help feel disappointed with the numbers. It’s the height of the pandemic and our supply to 140 countries is resulting in just £12 million a month. That’s about 10,000 tests per country per month. Pathetic really. We might have a great distribution network but it doesn’t sound like they are selling our products effectively.