Member Info for shandypants2

Yes, results will beat expectation - so PBT will be over £4m, BOD buying, new contracts, a healthy cash position and an expanding order book, what's not to like.

Most fund managers only buy in after formal results are announced (so they can see the balance sheet etc) so i'm fully expecting 400p to be hit when results are announced on 4th March.

FFS they have the peach pubs which was bought for over £16m and has proved to be the best performing of their brands, yet this company is now worth less than £2m.

I'm surprised say Young's who bought the city pub group which has similar pubs to Peach don't make a cheeky offer

Because they won't get bought out until they can demonstrate the product is profitable.

Also, if you've followed this company for more than 5 minutes back in 2020 when they tried to sign a collaboration agreement in the US non of the larger pharma companies showed any interest. The CEO at the time admitted that.

Personally i think this would be an ideal product for one of the larger IV providers to acquire. Combining it with IV infusions would reduce the number of hospital visits and almost act as a hedge for the IV company is/when accrufer starts encroaching into their space.

Sirius B - your numbers are too low.

STX has stated they aim to be breakeven by the end of 2025, so that could be in December alone.

In 2023 total costs were c$38m. Let's say $3m a month as they are meant to be reducing costs (although extra interest charges will kick in to partly offset this).

So let's say gross margin is 50% (it is nearer 45% but we can offset this with a bit of revenue from Europe) - so they need $6m total revenue a month. Based on the current NSP of $237 that equates to 25,316 prescriptions a month.

So by Q4 they need c 75k for these 3 months.

Therefore your 60k is 25% off.

Additionally, if sales don't grow sufficiently quickly they could run out of money before getting to breakeven and they also need to meet minimum revenue levels as part of the loan agreement.

Incidentally if the hadn't given 45% away to Viatris they would almost be at breakeven now.

The 5m free shares are paid if the CEO stays in office for 3 years - no other requirements. Buying £20k is better than nothing, but the guy is on c£500k p.a plus bonuses.

This is my post from Oct 2024 when i noticed Myers had started selling. Incidentally i was told in the replies that his holding was immaterial - over 10%!!!

Looking at the most recent accounts i note that a non exec Derek Myers resigned in May 2023 and is no longer on the BOD. He appears to have taken up a similar role soon after in an Australian company called Energy Action.

He is our largest shareholder - at the time of his departure i believe he owned 44.7m shares.

I am not suggesting there is anything untoward here, but it's a lot of shares to own in a company that you are no longer actively engaged with.

On the E Energy website it lists his current holding as 11.2% which equates to c43.3m shares.

So this would indicate that he has sold over 1m shares int he last year or so. Maybe this partly explains any pull back after a rise and the underwhelming SP.

CEO not ECO!!

I did raise this a few months back as i could see he had started selling a few.

Derek Myers was ECO of Beond who EAAS bought in Dec 2020 for £2.4m and c66m shares. Derek got his 44m shares as part of that deal. Also as part of the deal he became a non -exec.

I also noticed he resigned as a non exec is 2023 and took on a similar position at the same time in the Australian energy company.

Hopefully he won't be selling any more at this depressed SP but it could hamper any increase in the years to come

Unfortunately the BOD has for the last few years taken their money without investing in the company they work for.

I did ask in the recent investor meets presentation why as part of the cost saving the BOD hasn't done a salary sacrifice - taking shares instead of a % of salary. No surprise this question was overlooked.

Anyway, the risk/reward is now looking a lot better for STX.

With NSP rising and as of 31/12/24 c$16.5m in the bank i don't think they will run out of money in 2025, however, with the overall prescription decline in Q4 v Q3 i am less confident they will get to break even in 2025 as has been stated.

Q1 2025 numbers are massive IMHO to see if they are on track. c 50k prescriptions is a key (up from 41k in Q4 2024).

I hope so Sirius, but there may be an element of smoke and mirrors here to hide the fact that the number of prescriptions is down.

Firstly, 41K at $237 is $9.7m so not sure where the other $1.5m comes from - we did get a milestone payment but i think it was £250k.

But more importantly there is an upper limit on the price we can claim back from insurance companies. It was $250 per pack back in 2021, let's say the maximum price is say $290 now.

78% of sales at $290 and 22% at say a discount price of $30 gives us an average of $233 which is not far off the average NSP.

So i think the maximum the NSP will get to is c$250.

Therefore in future quarters we need prescription numbers to increase if revenues are also to grow.

I think it is positive that STX have 'grown' the NSP this quarter. It now needs to be maintained whilst increasing prescriptions

Well my initial positivity has declined as the prescription volumes have reduced from Q4 v Q3 although this has been offset by a higher NSP to an impressive $237.

The improvement in NSP is a pretty easy one to achieve - just reduce the number of cheap/free prescriptions you permit (and in the RNS it states this has been reduced from 37% to 22%). An easy way to achieve this is to reduce the commission the sales team get on these 'free' prescriptions, although they are still important for new clinicians to ensure they use/trial the product. However, it is a one off improvement and may lead to a reduction on overall prescriptions, and this is shown in Q4 numbers.

The drop in prescription numbers is a big concern IMO and i am surprised the RNS has been interpreted so positively.

Based on $237 NSP i think they need to get to 25k prescriptions a month (75k per quarter, 300k p.a) by year end to get to break even , assuming 50% gross margin.

The last 8 quarters are 10.1k, 14.9k, 23.3k, 28.6k, 28.8k, 36.4k, 43.5k, 41k.

As you can see this is the first quarter where prescriptions have reduced. To get to breakeven they need c20% quarterly increases. It's a big ask IMO.

Yep, looking at the cashflow in H1 although £25m was received, £8.2m was used to repay borrowing, and the H1 loss (was £4.5m) and other movements in working capital (including the trade receivables increased by £4.3m and payables were reduced by £5.7m) has operating cash down by over £11m. That left £6m at 30/6/24. As at 31/12/24 it is now c£2.3m. In H2 there were a few one off payments (the 2 listed in the presentation totalled c£1.5m) so i suspect the re-organisation costs accounted for the rest, which IMO is quite high. With a positive EBITDA in H2 i would have liked cash neutral for the period.

They have said they will be cash generative from now on, including H1 (which is usually the worst half) so let's see in 6 months.

They are talking about £40m rev and £5m EBITDA in a few years so i think that should conservatively value EAAS at double today's SP

Yep, he was a little vague in his response. He didn't refer to any initial payment and just said we won't know the total amount until Jan 2026 (so end of Sept this year plus 3 months).

He did say the revised estimate is now £5.5m in total so the £8 to £10m has been scaled back quite a bit.

However, on a market cap of less than £20m a 25% cash uplift would still be very well received (and seems to be overlooked by the market) this time next year.

I know this food van. Unfortunately getting evicted as he's ungraded his premises and it is no longer a van. Notice he rents the space via Space and People (no doubt as part of the National Rail contract)

https://www.bbc.co.uk/news/articles/cvgm4y1xjjjo

Solv (or is is STT?) "Mo has lost alot of credibility! 2025 Hvivo raw numbers are a huge miss".

Do you realise that 2025 numbers are an estimate for the year and we are still in January?

Some companies exceed their own estimations. Also Mo has never previously announced any 2025 estimates, the £67m was based on a broker forecast.

Let's see how the year progresses.

An excellent H2 and encouraging 2025 outlook bodes well. Slightly disappointed that the EBITDA wasn't higher and also the write offs are disappointing.

Cash position seems very low now considering they received £17m net in their bank account in Feb 2024 after the EMD sale (after paying off £8m debt).

Expecting the extra EMD payment any day so hopefully an extra £2m plus as it seems it is needed.

H1 2024 was pretty awful as it appears the combination of the EMD sale distracting the BOD (so they could earn their extra one off bonuses!) and the cashflow constraints, however, these now appear in the past.

Still think any govt announcement re say mandatory solar and charging points in commercial buildings including schools etc above a certain size could really boost the SP (which was double the current level this time 12 months ago)

Reduction in NAV looks sensible and i assume this partly explains the recent SP decline. At NAV 150p the current discount is still over 20% which is higher than the 'normal' 10% or so discount that this has had over the last few years.

With the current dividend now well over 8% this remains to look undervalued.

Going forward RPI and dividend cover increases provide further content.

I'll continue my strategy of topping up in the 120s and top slicing in the 140s as this has served me well over the last 5 or so years.

Despite the last 4 or so RNSs being very good and the company now profitable the SP action has been very disappointing. I can only assume someone is offloading in the background.

After the early Jan increase in revenues RNS the SP briefly hit 93p (i know as my limited top slice sell at 92p got triggered), however, since then we lost c20% in value.

Hopefully results in March will get this moving again. I'll be surprised if we don't see £1 in 2025. I've topped up again today

I think the negativity is a little over done.

The acquisition looks very sensible and based on 2024 revs should contribute maybe £15m of revs in 2025.

Based on that, the core HVO is contributing £60m. Yes this is slightly down on 2024 and i note one of the house brokers was estimating £67m, so clearly not good, however, things don't always go up in a straight line and the uncertainty created by the Trump govt must have some impact/delay decisions etc. IMHO this impact is c£7m in revenues.

HVO remains a profitable, cash generative company with a significant moat.

I know it's a positive day (yesterday) for HVO when i see the green ignore boxes in this thread.

When will he get a life?