The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
This Linkedin post a couple of days ago is also worth reading; https://www.linkedin.com/pulse/congratulations-kooth-ambassador-lane-johnson-his-nomination-5gqqc/
"Over the coming weeks, I’ll be sharing more about the work Kooth is doing in Pennsylvania and beyond. The response to Kooth’s services has been incredible - from parents, teens, educators, and government representatives. But, for now, I’ll say this: Lane Johnson’s influence is just beginning. "
Combine that with a 1 in 10 usage rate reported in the half year results and things look very bright indeed here
The final parts of the Penn budget were signed off overnight, which as per the October investor meet company Q&A should result in the finalisation of our Penn contract in Q4...
https://www.penncapital-star.com/government-politics/shapiro-signs-final-budget-bill-after-late-night-votes-in-the-pa-legislature/
https://local21news.com/news/local/pennsylvania-budget-fiscal-code-education-code-governor-josh-shapiro-speaker-joanna-mcclinton-senator-pittman-education-improvement-tax-credit-criminal-justice-reform-child-tax-credit-december-14-2023
Watch from 5hr 27 mins onwards of this Kansas legislative research department meeting on 6th October;
https://www.youtube.com/watch?v=mP5hZSgppCo
Verbal confirmation that Kooth have partnered with Aetna in Kansas and are working through app implementation for a state wide rollout...
Also, may have been a slip of the tongue but Erin Davis (Kooth VP Government Relations) refers to 'Kooth Therapeutics', which I've never heard mentioned before.
'Kooth is the gold standard model of care for personalised, proactive and accessible digital support'
@Nortel, agree on public bodies being frustrating, however once you are integrated the competitive moat is huge so it will be worth it!
Kansas appears to be the perfect setup; Kooth are working with a huge Medicaid company which will provider many advantages, one of the most important being credibility in front of government. The questions asked by legislature were very positive, there appears to be a genuine desire to find solutions.
As I posted a few days ago, Aetna are present in 17 US states so a rollout beyond Kansas would seem inevitable post a successful implementation (and may already be happening).
Another bit of research that's worth mentioning is regarding Medicaid, as per this line of the placing proceeds RNS from July;
"piloting Kooth with Medicaid to support youth in low-income families;"
Linking back to this post from October; https://www.linkedin.com/posts/janesbrown_such-a-pleasure-to-offer-novel-digital-solutions-activity-7118186301169831936-IKVg?
Jane Brown works for Aetna Better Health, which is part of $100b market cap CVS Health, listed on NYSE
They work across 17 US states proving Medicaid services; https://www.aetnabetterhealth.com
Each health insurance plan provides access to certain services, which are listed here; https://www.aetnabetterhealth.com/illinois-medicaid/whats-covered.html
Piloting Kooth with Medicaid via what I believe is Aetna / CVS provides the first step towards potential integration of digital mental health support across some or all of those 17 states.
They already have offices in Chicago, Kansas & Pennsylvania, so it certainly looks like they are setting up for big things...
Hi Uh-oh, if you go onto investor meet company and listen / watch the last 2 presentations then you'll get a far better idea of where they sit. However, they confirmed in the October meeting that the California contract is self funding - they are receiving ~£12m up front this year to cover hiring, product R&D spend etc. Once the contract formally commences they'll almost certainly be paid in advance so cash should never be an issue.
FYI there was a CYBHI public webinar on Thursday evening which confirmed everything is on track, a recording is here; https://cybhi.chhs.ca.gov/event/public-webinar-december/
This is the portal at present; https://calhopeyouth.org/ , obviously we can't download the app as it's only available in those 2 counties pending full roll out in Jan. However, the fact it's been live since late August significantly de-risks things IMO. Kooth US headcount on Linkedin is now up to 114 from around 15 earlier this year, so hiring appears to be going very well indeed.
The £10m raised in July + the additional £6m they held prior is for supporting US growth ex. Cali & Penn. I.e. Medicaid system work, new research studies, lobbying etc. Mid teen EBITDA margins (no debt) and FCF by the end of next year and a hint at dividends beyond that (not sure that's necessary at this stage), tell you where this could head should things go as hoped.
Hi Nortel,
Glad to see some activity on here & others on the same page re. valuation / drift. On Pennsylvania, it's all waiting on the school codes budget being signed off, the schools mental health budget is all tied up in a larger bill which came oh so close to being signed off 3 weeks ago but was amended at the last minute by Democrats. This is the bill in question;
https://www.legis.state.pa.us/cfdocs/billinfo/bill_history.cfm?syear=2023&sind=0&body=H&type=B&bn=301
Media coverage; https://www.penncapital-star.com/education/fight-over-tax-money-for-private-school-tuition-snags-education-funding-bill-again/
The funding confirmation is on page 73 of the bill itself and confirms that each Penn school district can apply to receive $100k funding support (there are 500 states, so $50m total, unknown what the Kooth expansion will cover, pilot was 30 states @$100k / $3m total);
https://www.legis.state.pa.us/cfdocs/legis/PN/Public/btCheck.cfm?txtType=HTM&sessYr=2023&sessInd=0&billBody=H&billTyp=B&billNbr=0301&pn=2326
Senate is back in session this week so fingers crossed they can get it done this time...
I too think a NASDAQ or NYSE listing will follow at some stage, primarily because they'll need to reward their US employees with stock options in USD. If they can nail Cali, Penn + a couple of additional states & get on board with Medicaid policies then I think they'll be ready to push the button.
The buyer likely doesn't know who the seller is / how many shares they have & yes they'll be dealing via one of the market makers (looks like Berenberg as they are the only MM at 160p). The seller may want to see how desperate the buyer is & if they are too keen they will raise their price? It's cat and mouse, but good progress is being made on a daily basis.
The pairs of trades going through are exchanges between a buyer & seller - so one trade is a buy & one is a sell.
I've just been through the trades and since the plunge on the 24th there have been a shade over 11m of these exchanges, so 5.5m buys and 5.5m sells. 1m of these have come this morning.
Any buying II is going to give the price a few days to settle before stepping in, however they seem to be very happy to now pick up chunks at £1.60.
It's a fairly straightforward picture from here, once the seller is exhausted the fairly incessant PI buying will result in the price recovering back to sensible levels between £2-2.50 in my view.
Oh so quiet here as there has been a gap between RNS'd news which inevitably causes a few under researched PI's to sell &hardly anyone seems to be in the habit of doing detailed research...
There should be a very positive 12 months ahead here, note that the next 3 sets of financial statements are set to show significant growth;
Full Year 2023 revenues of at least £34m vs £20m in FY22, giving growth of ~70%
H124 is when California kicks in, full year forecasts are for £67m, so if this is equally weighted then H1 will show YoY growth of ~180%.
Full year 2024 will then show a further 100% growth on FY23
Add Pennsylvania into the mix + at least 1 additional state + a potentially significant uplift in the UK with a labour government & £100m revenue could happen fairly quickly.
To be trading at just 1.5x FY24 revenue seems crazy, a re-rate to just 3x would see shares double in value and still be cheaper than most AIM listed SaaS companies, nevermind those listed in the USA.
Strong buy IMO and look forward to the next news that lands.
Happy that they've removed the financing overhang by raising at 5p, it's a small amount and won't make a jot of difference to the share price on the reveal of the claim quantum.
£30m market cap / 154m shares = 19.5p
£30m market cap / 170m shares = 17.6p
The realty is that if the claim is anywhere near mooted ($1b), then £30m = 3.75% of claim value. We currently sit at ~1% of such a claim value.
Utterly comical that any listed entity can drop in value due to a grand total of £2276 worth of sells. Still, we tick closer to the day when all will be revealed - should be quite spectacular when it arrives...
29/06 RNS for YE 31/03, borrowings £191m
"At the time of approving the financial statements the Group had an undrawn committed borrowing facility of £22.3m and to the extent to which further acquisitions require more than the committed facility they will only be done so following agreement of the lenders to the use of the accordion facility or once additional funding has been obtained."
Todays' RNS states borrowings at 30/09 were £229m
So presumably they've used £16m of the accordion facility?
As predicted a year ago, far too much debt & an addiction to acquisitions makes this a very unattractive company. In reality, if they stopped their buying spree I suspect top line revenue would fall & it would de-rate even further...
The below is exactly as I expected & a veiled profit warning;
"Adjusted EPS will continue to be impacted by an increase in borrowing costs associated with higher base rates and an increase in the UK corporation tax rate from 19% to 25%."
Fair value maybe 6-8x forecast PE of 44p, given the level of debt... so target price of £3?
Aha, you've been consistent negative here for months / years. You don't like them raising £50m above the 200DMA? I'd say it's very bullish & underpins the share price going forwards. As for the forward partners deal, paying less than 50% NAV in an all share deal is hardly high risk - if they had raised capital to buy forward then I'd be more inclined to agree.
Highly likely this will re-rate on further positive economic data & a calming of the macro environment. I suspect this time next year shares will trade at between £4-5.
Yep, the Forward deal is paid for with Grow shares & the £50m fundraise is to invest in the combined portfolios. They aren't raising to make the acquisition.
Https://www.professionalpensions.com/news/4148678/jeremy-hunt-unveil-pot-life-pension-reforms
Oh the face of it not great news for PBEE, as it negates their raison d'etre... whether it'll happen or not is another question entirely, as it will require some joined up thinking for a change. Either way, it likely creates a sentiment headwind here for the foreseeable.
Yep, they held 3.1m at 17/10 & the total of the 6 paired transactions on Wednesday was just shy of 6m, so 3m bought, 3m sold. I suspect their remaining ~150k shares had been sold on the open market between 17/10 and 15/11, resulting in the continued suppression of the share price at £4.50.
Re. Results being the catalyst, I agree - same thing has happened with Yougov - ABRDN tr-1 on 16/10 showing a 3% reduction in holdings, shares have since bounced more than 50%.
Yep, both shares battered by selling II's with no funds prepared to take a medium term view in order to bid them back up to anywhere near fair value. Market makers make the situation worse by dropping shares on a small amount of selling & then doing their utmost to hold them back when they are rising (i.e. why has it been impossible to buy 500 shares for the last 10 mins?)
Shares changed hands for £8.60 this time last year, £16 in Nov 21, £10 in Nov 20 & £6 in Nov 2019.
In 2019 turnover was £84m with post tax profit of £11.7m, vs forecast figures of £177m & £23.1m for FY23
Sub £5 with an improving economic environment makes zero sense.
Hmmmm.
Hotel Chocolat acquired by Mars for £3.75 vs £1.39 close last night. That suggests to me that TUNE could very well be in play, given the ridiculous discount to its historic valuation.
Also agree on trading conditions improving, an ahead of expectations update would be no surprise given the timing of product launches etc.
Ps. The Dec 2017 volume was due to a secondary placing, not on market trading.
HorisM, you don't have post some rubbish.
1. There has never been a day with >6m shares traded, on 1/12/17 only 13k shares changed hands...
2. The pairs of trades are buys and sells, one institutional investor buying from another. One sold 2.9m and the other bought 2.9m. It's a big event and it'll be interesting to see who the buyer is, but they've only got 5.5% of the company.
3. I presume you've flat out made up the rumour on Harman / Francisco Partners & Symphony? Posting misleading / false info is against LSE rules for obvious reasons. If not, what's your source?