Member Info for Soder

I mean, it’s really simple. Chad is upside. Just look at the existing biz on its own.

996.4m shares out and at 15p that would be mkt cap of 150m. Last reported net debt 380m.

That gives enterprise value of 529m.

Let’s annualised the reported 10m revenues of 192.5m to get full year of 231m. Take midpoint of opex guidance at 60m. That gives ebitda of 170m. I would say that conservative.

So at 15p the EV EBITDA multiple would be 529/170=3.1x.

If you want to sell at 15p let me know and I will sell my house, car, wife, kids, mother to buy as much as you have.

Even at the 19p closing price it’s 3.3x.

What should this biz trade at? The core Nigeria gas biz is pretty much utility now. Let’s be conservative and say 4.5 times. That would be share price 40p. Let’s say 6x which would be share price 65p.

And that excludes this new deal and the new gas sales contract.

15p? Mine. Size. Pay on.

Yeh. This afternoon the chair of the fed just decided that inflation isn’t transitory after all and stocks puked as they will probably taper sooner and follow with rate hikes. Powell really is a very average fed chair. Decided to announce that with December liquidity and omicron concerns.

Company says it’s covid anti viral has less effectiveness against omicron variant

So that both vaccines and antibody drugs less effective. Move along nothing to see here.

The stock is trading at a level in expectation of heavy dilution anyway.

Starbright. You only sequence positive cases. How do you know you have a positive result and then sequence it if you have not done a PCR test and have a sample in the lab to sequence?

Starbright, you track the variant from genomic sequencing not really from the pcr test. Ncyt do have a test that can tell you which variant you have but they won’t have this for omicron yet.

Troublesome. No I meant daddy.

You can find all the testing data for U.K. here.

Focus on the second section “lab based testing by capacity and type”. Click daily data.

You can see we did 499k pcr tests on U.K. on 25th.

this is only government testing across the 4 pillars so any private testing for travel, work (eg oil rigs, television etc) is on top of this.

As you can see, it’s peak testing.

https://coronavirus.data.gov.uk/details/testing?areaType=overview&areaName=United%20Kingdom

Should also add…

1. This is AIM. Herding and sentiment can drive prices hugely below and above intrinsic value
2. This is Novacyt. The daddy of all herding and sentiment shares.

We got killed on the way down way way way beyond any rationale fundamental valuation metric. And most likely now sentiment has changed we will flip that as per 12 months ago.

On that basis do I think £10 plus is unrealistic? No I don’t. Get rich quick dream chasers all herding in the bid here can see a meaningful pop into Xmas.

This is how I am thing about it. And this is very high level and excludes dhsc dispute which would obviously add a kicker.

We are looking at elevated pcr testing until the spring now. So that gives ncyt another 4-5 months of 7-8m as a conservative case which will be 35-40m of revs.

However, I think the key thing here is that the mkt will now see that these covid pcr revs will not fall away next year and we will now unfortunately have covid with us for decades and we will need to test people for it for a long long long time. As such, we should start to get a valuation multiple assigned to these revenues and earnings that reflects their terminal nature. They will not disappear in 2022. They will not disappear in 2023 or beyond.

I genuinely think that 100m cash at year end is relastic given the performance since last update and also fact we wrote down inventory so much. Any sales of that inventory will have a direct flow through to cash. So let’s take 100m as our starting point for cash and as such net debt is negative 100m.

Assuming 40m ebitda guidance is hit for this year that translates as follows.

At sp £6. Enterprise value = (70.5 * 6) - 100 =323m
Thus ev/ ebitda is 323/40=8x
That is way way way way below the sector averages. And that valuation assumes our ebitda next year will probably half to 20m.

To get to 20m ebitda for next year we prob now just need 4-5 months of elevated testing in 2022. And I think the market will price that in as a relative certainty now given pcr for travel and likely increased nhs volumes.

Even at £8 a share we are only 11.6x ev ebitda for this year which is also cheap versus sector companies at 15-20x plus.

Let’s take a conservative scenarios of 30m ebitda next year (we maybe 70m TOTAL sales for 2023). Apply the 15x bottom end sector multiple of 15x to that and you get an EV of 450m and assuming 100m an implied equity value of 550m. Divide that by 70.5m shares outstanding and you get a sp of £7.8.

So approx 8 is my conservative eating for relative near term.

But, I think you will see some news flow on dhsc, other countries stepping up testing and pcr for travel and that 30m ebitda for next year will get blown away quite quickly.

Would just using this equipment for commercial operations outside of manufacturing for government not be classed as state aid and also give rise to competition lawsuits from other manufacturers that have not had the benefit of the government giving them their machines?

Even if they wanted to just buy or rent those machines the government would need to run a competive process to be see as getting best value for tax payers and not providing a single company with an unfair advantage.

That is all.

Come back with those percentages tomorrow morning at about 8.30 am troublesome. That stock will get destroyed tomorrow.

It will be lucky to hold 10p tomorrow never mind 29. Where is the investment case now?

I’m not in it but listed to the call. F me. That biz is finished. Will be single figures tomorrow. Given up on covid. Burning cash. Having to slash costs. Prob will need a cap raise.

People invested there are puking.

This is just noise anyway. Give it till March next year. You will a ton of money from here. Cash cash cash cash.

Everything I see says is tolmout is nearing the finish line.

24th? Nice of them to rns when tests were removed causing the sp to tank but not when it gets approved.

We also wrong down the value of the stock.

In short. We have taken the pain.

It’s all stripped from financials already. We have not been paid. Surely any resolution at this valuation can only be positive.

I haven't got the time to go through them all to see if any are relevant. Some definitely aren’t as it’s just a general search for term “pcr” but most are for reagents and tests.

TED is the central portal for issuing tender notices for the European Union.

Basically I just typed “pcr” in the search and on refine selected all notices. Look at the dates. Looks like a **** show scramble for for pcr supplies in a ton of countries looking for supplies I think.

https://ted.europa.eu/TED/search/searchResult.do