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It doesn't matter too much whose test we make, with a worst case scenario of manufacturing someone elses antigen LFT with poor margins, we would roughly have an average margin of £1 per test, at 2m / week tests 104m tests / year, that is £104 in profit, more than our current mcap, which would value the company at £300m+.
Things get more interesting if the Mologic LFT antigen becomes a huge success as the margin on those are £2.50 profit / test for the company, bringing up the average profit margin / test closer to the £2 mark, which would result in over £200m profit / year with production at 2m tests / week.
There is another contract for LFT image recognition technology awarded to Novarum DX which is a subsiduary of BBI solutions and we all know who they are and how aggressively they have been hiring recently. It is very interesting seeing this all coming together. This contract has the same overview as the one awarded to healthy.io:
"DHSC is planning to deploy a lateral flow antigen testing service, enabling members of the public to carry out COVID-19 testing in their own homes"
Novarium DX link: https://bbisolutions.com/services/novarum-smartphone-reader.html
bidstats contract: https://bidstats.uk/tenders/2020/W50/740622567
commercial agreement: https://atamis-1928.cloudforce.com/sfc/p/#0O000000rwim/a/4J000000kEli/wfH4IxLYl7V2GHejesa0Dzt0.JVh2sxOcFahVSyw7sE
@Gazza, really interesting find. Digging a little deeper:
"DHSC is planning to deploy a lateral flow antigen testing service, enabling members of the public to carry out COVID-19 testing in their own homes"
With government going down the home testing route, the scale of LFTs required is going to be immense, every week that goes by it looks more and more likely that we will sell all we can manufacture, even when producing at 2m+ LFTs / week. Collin has also positioned us well to adapt to demand by having a diversified portfolio of tests with both antigen and antibody LFTs.
Page of interest: https://imgur.com/a/k41V8A7
Full commercial agreement: https://atamis-1928.cloudforce.com/sfc/p/#0O000000rwim/a/4J000000kElD/c5NJbsOa07upkW3oz_.LLjzaXYam_IaSs4ssWSR_jjA
Resurrected this thread from yesterday to highlight just how quickly sentiment can change, suddenly there is a lot more optimism in the air. Today we are showing possibility of breaking out from the 2 month bear trend we have been in, which could be the start of a new up trend for ODX going into the new year, with all the positive newsflow expected.
Here are chart of this current downtrend and the previous 2 month downtrend in May/June with year:
charts: https://imgur.com/a/ktQBUop
RT-LAMP was the biggest competitor to Mologic's antigen LFT in the Heathrow trials and it is interesting that they are saying RT-LAMP results will take twice the time at 90 mins and cost 60% more that the antigen LFT.
I can see a 45 min wait for results working a lot better in an airport than 90 mins. Where do you wait for the 90 mins, at the checkin desk? Flying already takes long enough, will they ask you to arrive an extra hour earlier, because that will not be popular.
@ Korda Interesting information in the FAQs:
-------------------------------
"How long do results take:
Please be aware that all times are a guideline and in some circumstances could take longer.
RT-PCR - 36 Hours
RT-LAMP - 90 Minutes
Antigen - 45 Minutes
Antibody - 45 Minutes"
--------------------------------------
"
A LAMP test is 79 GBP per person
A PCR test is 99 GBP per person
An Antigen test is 50 GBP per person
An Antibody test is 40 GBP per person
Payment will be collected at the registration desk by debit/credit card or Apple Pay. Payment in cash will not be accepted. For more information on which payment types we accept please see below. "
We have been in a 2 month bear trend having been hammered all the way down over 65% from our £1.10 highs. We went through the exact same from May 91p to the 33p low in June, only to rise up 100% when we broke the 2 month downtrend.
It sure has been a long slog here and we might yet fall a little lower, but this 2 month downtrend is coming to an end soon, there is no doubt about it. And when ODX breaks out from this downtrend, things will get exciting here real fast. Capacity increasing, increasing headcount, vaccine roll out, Brexit driving British manufacturing, increasing LFT adoption. What is not to like going forward? Try to see past the 2 month downtrend and what lies on the other side of it!
The question to ask is why Abingdon are raising £22.0 million, when they are already targeting 250k Abc-19 tests / week in January, without this cash. Even half of their £22 million raise will pay for a huge amount of capacity ramp up, suggesting that they anticipate huge demand coming soon.
Look around, BBI are expanding and increasing headcount every week, Abingdon are raising hefty amounts of cash to fund increased capacity. Omega were ahead of the game raising early in the year and are ramping capacity and headcount at a blistering pace.
It all points towards one goal: All of these companies want as much capacity as possible going forward, these companies would not all be expanding so aggressively at risk, stop looking at the share price and look at the actions of these companies.
Take a look back to May 27th when the Omega share price hit the highs of 91p on the back of the sky interview, which signified the start of a 2 month downtrend that took us all the way down to 33p lows on the 15th July, a drop of 62%. There was a lot of pessimism at that point that is reminiscent of where we are at now.
The downtrend ended then and the downtrend we are in now will also end. Sentiment will change and the share price will swing, there are patient smart investors that see potential when sentiment hits rock bottom and load up.
Off the 33p low in July, 4 days later the share price was up 100% at 66p, which marked the start of a 2 and a half month up trend before hitting the highs of £1.10 on the 7th of October.
From this £1.10 high, we are now 2 months into a downtrend hitting lows of 42p, a drop of 64% off the highs. Does this sound familiar yet? There is no telling exactly when we will break out of this downtrend, but it is coming and when sentiment flips, it will flip in a big way here.
Diagnostics companies will face unprecedented demand for many years to come, even after vaccines are rolled out to the masses. People seem to be worrying that demand for diagnostics will dry up tomorrow, when realistically demand is only just getting started.
This article this morning is highly important. There are still some doubters that don't see the importance of antibody testing and question its importance alongside vaccinations. But this collaboration announced today with Roche and Moderna highlights that antibody testing will run alongside the vaccine in at least 2 ways; firstly to assess if an immune response has occurred in the individual and then periodically to see if the individual still has antibodies and if they need to have a further booster jab.
Roche: “This could play a role in assessing if, or when, an individual needs revaccination, or in helping to answer other clinically relevant questions,” Roche said in a statement.
link: https://uk.reuters.com/article/health-coronavirus-roche-moderna/roche-joins-moderna-to-include-antibody-test-in-covid-19-vaccine-trial-idUKKBN28J0J3
And there we go, 56.5p paid. Why the spread is 3p I have no idea.
Bid moved up to 56p, expecting to have a good week here. Very excited to hear further information about the Mologic LFT, how tech transfer is progressing and when we can expect the test to reach market. All happening very fast now.
Great article here:
"Headcount at its headquarters in Alva has now reached 122 people, up from 60 in May, with construction on a £1m manufacturing expansion due to complete by the end of this year. That will take capacity from 500,000 to two million tests per week by April, with a further 70 to 80 people expected to be hired in the coming months."
https://www.heraldscotland.com/business_hq/18910109.omega-expects-significantly-improved-second-half-posting-1-8m-loss/
Not sure which has been more stressful, the 91p to 33p in June or the recent fall, but every month capacity is increasing, rapid tests are being made available to more and more people and we are being steadily de-risked. Nice to see it breaking 52p now.
Brought more here today at 51.2, if this breaks 52p strongly today or this week, we will see a huge swing of sentiment. This stock has been hammered down way to far over the last month, but has so much going for it over the next month and into the new year. GLA
At these values Omega's value is underpinned by the food intolerance and CD4 testing divisions. Significant upside in the high capacity manufacture of covid LFTs going forward, private investors need to stop loosing their heads here.
Here is an interview with Paul Davis from Mologic, a great watch, highlights just how much talent and experience in the industry the man has.
https://www.youtube.com/watch?v=N2_6oOAo4_U&feature=emb_title
And this is the UK market alone, with the government recognition of test's high sensitivity and specificity, private sales abroad will generate further revenues with an increased profit margin thanks to the UK-RTC profit sharing mechanism set up for private orders.
It will be very exciting to hear about the 6 tests that have demonstrated sufficient sensitivity and specificity, from the Mologic presentation slides and Collin's InvestorMeetCompany presentation, the Mologic antigen LFT has shown significant promise, so it would be fantastic news if it was one of these tests.
Remember for each Mologic antigen LFT sold under Omega's Visitect brand, the company will generate revenues of £5 and gross profit of £2.50. With capacity increasing every month, that is hugely cash generative for the company.
Collin stated in the last Investor Meets Company presentation that “capacity for November has already been consumed with demand”, so we are already selling everything we can manufacture and increasing capacity as quickly as we can. Demand for the antibody test will last for a very long time and the margins we have at high capacities will produce some fantastic revenues.