RE: Positive Mental Attitude30 Oct 2020 10:13
Perhaps watch the presentation.
The last time a virus was eradicated was smallpox. It took 2 years after the last case to declare it defeated.l We will have similar here, testing will go on long after we get on top of this. Vaccines may be required for a number of years which means antibody tests are required for a number of years. If immunity occurs, it wont happen simultaneously across the globe. Many countries will be lagging a long time behind. Low income countries are likely to be years behind, and we have products and distribution networks to target those markets.
Food tolerance test is awaiting china self test approval and we are targeting the US market where we need to find a new distributor. High margin products with high potential millions of units per year once self test approval is achieved and breading the US market.
CD4 test. The only point of care test of its kind. WHO approval, and has the backing and interest of several world aid organisations that are starting to include it in their budget next year.
2 new development tests already on the horizon to be worked over the next 24 months. Ties in with existing portfolio and distribution network.
The simple fact that Covid has exposed the shortfalls in diagnostics and will change the world with a clear shift to point of care testing.
In terms of valuation on an earnings multiplier, you don't have to have a 10 year order book to value a company 9/10 earnings. 1 years earnings at full capacity puts £260m free cash flows in the bank with no debt. Imagine 2/3 years of that. Even on 1 year, the company can invest in new products, new acquisitions, dividends or share buy backs or a number of other things. That free cash flow in reality if they generate it the way the business plan suggests will be worth more than 9x earnings on a company with zero debt and high free cash.
There is no magic calculator, it's just understanding of the commercials and what that profit generation is worth with free cash flow. It';s actually quite simple to substantiate if you think about it logically. This is how many businesses that have gone from small niche business to large substantial companies have achieved it over the years. Generate profit, reinvest and continue to grow. The Covid opportunity is vast in the short to medium term, but the longer term need for dsiagnostics is more evident than ever.
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