Science In Sport Share Discussion Threads

[battlebus2] 22/3/2016 07:58

Yes! They have explained why....

[amoore70] 22/3/2016 07:57

Don't see how you think it's a set of positive results. Very disappointing is how I read it. Was hoping to get out of this share soon but don't see these results are going to do much for the share price

[buywell3] 22/3/2016 07:48

So a bigger loss is ok then ?

Try reading this set epic SBS

22/03/2016 07:00 UKREG Source BioScience PLC Final Results

[battlebus2] 22/3/2016 07:33

On first read, it looks a very positive set of results and as GHF says it's all coming together nicely.

[buffythebuffoon] 21/3/2016 09:27

Hi GHF,

I have the highest regard for your growth share finding ability. I would just like to make a quick point about bodybuilders if I may. Anybody who has the slightest ambition to take part in a bodybuilding contest is aware that it is vitally important to achieve an ultra low body fat index. In support of this, a short anecdote if I may ...

Many years ago I trained a guy who took part in bodybuilding contests (a 'natural' bodybuilder - a term that hadn't yet been used). He had such low body fat, that shortly after competing he would unwrap a pat of butter (if that's the right noun) and eat it. I know it's sounds gross, but the craving for fat was so great, it didn't feel that way to him.

So..... bodybuilders do want 'lean muscle'!

Regards,

Buffy

[battlebus2] 20/3/2016 17:34

Probs works for a competitor lol.

[yump] 20/3/2016 16:53

Any username with 'buywell' in it, or similar crass schoolboy attempts to look credible is best ignored. Quite what the purpose of the post is goodness only knows.

Probably someone who craves power to influence at work, who has none.

[battlebus2] 20/3/2016 16:46

Well spotted GHF.

[glasshalfull] 20/3/2016 15:42

Those of you on Twitter may appreciate the photo I took of a professional footballer using SIS gel during the Tyne & Wear derby this afternoon.

Twitter - glasshalfull1

Regards,
GHF

[battlebus2] 18/3/2016 13:15

Nibbled a few here ahead of results on the 22nd......

[buywell3] 18/3/2016 10:57

The chart looks dire and SIS is down around 20% since I posted







buywell3 9 Aug'15 - 08:46 - 139 of 168 0 0 edit

It's quiet cos it's loss making , the products are being heavily discounted and now this



Location Location Location ... is key to buying propertty

Research Research Research ..... is key to share buying

I am assuming most holders here don't do any so I thought I would help










I think you guys need to look at the recent data and adverse press comment regarding protein based supplements and eating/metal/other disorders now affecting men in particular


Note the damage to kidney and liver comment in this piece to day




One would imagine this won't help sales much

Just a few of the protein products made



If you look at the range of protein based supplement products that provexis are making , then over 50% come into this category

Many are already being heavily discounted






I assume you guys do a bit of research , so many of you will know of the problems and health issues concerning the use of carnitine



''
There is no scientific data to support the bloated claims about l-carnitine’s fat-burning capacity, or its mythical ability to spur peak athletic performance.


On the contrary, l-carnitine supplements have potential side effects such as nausea and vomiting, cramps, and diarrhea. Carnitine supplements can even wreck your social life, because taking 3 grams a day can produce a fishy body odor.

People with kidney disease or seizure disorders should exercise particular caution with carnitine supplements or energy drinks that contain it, like Monster Energy or 5-hour Energy. That’s because carnitine can cause muscle weakness in people with kidney disease, and seizures in people who have a seizure disorder. ''


One would imagine this might be another area the press will pick up at some point




''Healthy children and adults do not need to consume carnitine from food or supplements, as the liver and kidneys produce sufficient amounts from the amino acids lysine and methionine to meet daily needs [1-3]. The Food and Nutrition Board (FNB) of the National Academies (formerly National Academy of Sciences) reviewed studies on the functions of carnitine in 1989 and concluded it was not an essential nutrient [3]. The FNB has not established Dietary Reference Intakes (DRIs)—including a recommended dietary allowance (RDA)—for carnitine [4].''


The use of carnitine in supplements is a waste of time

''Athletic performance

Some athletes take carnitine to improve performance. However, twenty years of research finds no consistent evidence that carnitine supplements can improve exercise or physical performance in healthy subjects—at doses ranging from 2–6 grams/day administered for 1 to 28 days [9-11]. (The total body content of carnitine is about 20 grams in a man weighing 155 pounds, almost all of it in the skeletal muscle [11].) For example, carnitine supplements do not appear to increase the body's use of oxygen or improve metabolic status when exercising, nor do they necessarily increase the amount of carnitine in muscle [10].''


Regarding any health benefits from taking supplements with carnitine

''research, however, has raised concerns about the cardiovascular effects of chronic exposure to carnitine. A 2013 study that included both rodents and 2,595 humans undergoing elective cardiac evaluation found that L-carnitine is metabolized by intestinal microbiotia to trimethylamine-N-oxide (TMAO), a proatherogenic substance that is associated with cardiovascular disease risk [24]. Due to differences in intestinal bacteria composition, omnivorous study participants produced more TMAO than vegans or vegetarians following consumption of L-cartinine. The study also found dose-dependent associations between fasting plasma L-carnitine concentration and risk of coronary artery disease, peripheral artery disease, and overall cardiovascular disease, but only among participants with concurrently high TMAO levels. The researchers noted that these findings could partly explain the link between high levels of consumption of red meat (a rich source of carnitine) and increased cardiovascular disease risk. More research is needed to fully understand the effects of carnitine on cardiovascular health.''

'' Are there health risks from too much carnitine?

At doses of approximately 3 g/day, carnitine supplements can cause nausea, vomiting, abdominal cramps, diarrhea, and a "fishy" body odor [1-2]. Rarer side effects include muscle weakness in uremic patients and seizures in those with seizure disorders.

Some research indicates that intestinal bacteria metabolize carnitine to form a substance called TMAO that might increase the risk of cardiovascular disease [24]. This effect appears to be more pronounced in people who consume meat than in vegans or vegetarians. The implications of these findings are not well understood and require more research.''

''People with the following conditions should talk to their provider before taking carnitine:

Peripheral vascular disease
High blood pressure
Liver disease from alcoholism (cirrhosis)
Diabetes
Kidney disease
History of seizures''


Do any SiS products use it ?

[amoore70] 15/3/2016 13:00

Glasshalfull
15 Mar'16 - 10:40 - 157 of 167 0 0


amoore70 - Development of the brand IMHO per my undernoted post from July 2015. That's my views FWIW.

What about your own?

I bought in as I like the brand as I use their products myself. Have been disappointed though as thought they would be making money by now. So wondered if I had got it wrong as it is a crowded market place. Continue to hold though.

[glasshalfull] 15/3/2016 12:21

Nothing to apologise for PJ ... I'll ping an email over to you.

Remember, SIS are focused on an entirely different market to those gym bound looking for muscle mass like your good self!!!

They have targeted the elite athletes and increasing numbers of "weekend warriors" through growth in endurance activities. Especially the growth in cycling over the last few years. Increased brand awareness and selling products from stores such as Halfords to Tesco has opened them up to a more mainstream customer base. Even their protein products are for lean muscle mass growth & maintenance rather than the bodybuilding.

Regards,
GHF

[yump] 15/3/2016 12:13

Well I don't think science is going to kill off snake oil sales anytime soon ;-)
(not implying anything about SIS with that comment)

[battlebus2] 15/3/2016 11:41

Thanks GHF, still weighing this one up..

[glasshalfull] 15/3/2016 11:33

Every time I update I see another post...1st time here.

Yump - In a word, Yes! LOL.

Think they'll build brand and sales substantially over next few years and I'd imagine they'll be a number of suitors wishing to add their brand /endurance niche into a portfolio.

Time will tell.

Regards,
GHF

[glasshalfull] 15/3/2016 11:29

Writing above post & just observed some traffic on this thread. Wonders will never cease! LOL.

Battlebus - As you'll have observed from my latest points, I'm bullish here.

Yump - Thanks again for casting an eye over these. I've been using their products for a number of years now. Triathlon days are behind me but use mainly for running, but also for cycling & endurance walks. Their REGO recovery range is excellent for recovery after 20-30 mile walk IMHO, especially when you've to go again the next day.

I would have liked to see them achieve profitability earlier but following engagement with main shareholders decision made to go for top line growth & International expansion. Sales are forecast to rise to £12m in the current year and £15m next with loss of £700k and £500k respectively & I'm sure we'll here more next week with release of 2015 results.

Regards,
GHF

[yump] 15/3/2016 11:19

So you're in for the takeover ?

[glasshalfull] 15/3/2016 11:18

Since my July 2015 post they successfully raised £8.7m @59p as they go for growth.

Few points highlighting company developments,

* Operating in a growing market - Sports nutrition grew @ 16% in 2014 (£360m) & CAGR 8% with £527m by 2019.
* SIS strong in endurance market (which is growing thanks to popularity in cycling, triathlons, running, etc) & has extended its product range into protein market (currently 2/3rd's of sport nutrition market)
* Now has 3,000 distribution points in the UK which supports opportunity to appeal to mainstream consumers.
* Fundraise allows them to target Australian market which is larger than UK & rated 2nd largest in the world. SIS have already established a market for their products over last 2/3 years.
* US - Opportunity following fund raise for measured approach into worlds largest market.
* SIS.com website recently enhanced and driving growth & margins (+89% in H1)
* Sponsorship & supplier to Team Sky in 2016 - Already developed some products (Team Sky 4hr fuel pack) & selling SIS/Team Sky water bottles in their colours. Reckon this is a win-win both in enhancing credibility of brand & delivering selling opportunities.
* Twitter followers now @ 37.8k (was 24k this time last year) again highlighting growth in brand awareness.
* Trustpilot reviews - Strong score of 9.2 out of 10 ... following 1,619 reviews.

I've already mentioned potential takeover valuations.

Here's a few in recent years that suggest 4x EV/Sales isn't so fanciful.

Glaxo paid £162m for Maxinutrition (4.2x Sales)
Hut Group paid £59m for myprotein (3.7x Sales)
Grovepoint paid £35m for Grenade (5.6x Sales)


Kind regards,
GHF

[yump] 15/3/2016 11:17

GHF

Be interested in your thoughts on when it might break into a reasonable pre-tax profit, given that also the placing added a chunk of shares.

I'm in two minds here. Mainly over the issue of whether you can build a big global brand in this area and at some point generate significant profits, or whether it will require a constant high marketing spend.

From day to day I see offers on supplements from SIS and competitors coming into my inbox. Its a crowded marketplace, but obviously profitable, otherwise there wouldn't be so many brands and the commissions for affiliates wouldn't be at the levels they are.

Without actually seeing the surveys, I would take customer loyalty statements with a pinch of salt, for the simple reason that many of the retailers in sport that I promote, regard people on their database as THEIR (loyal) customers, when in fact shopping around has never been at higher levels.

Trust in the product might be a big positive. If that is actually an issue with potential customers, that might represent the biggest opportunity.

fwiw my gut feeling is that this will be like a management game, where you can accelerate sales well while you're spending the right amount on marketing, then you cut back the marketing and have a couple of record periods of profit, then you find you sales drop off rapidly.

ie. there will be a honeymoon period.

That's about as far as I've got.

I cycle with quite a few mates. We all use energy bars/gels. We've all been in the food industry and somewhat cynical, given the ingredients are not much different from those in a 20p bar of something (5 for a £1 in poundland). Gel obviously easier to use though.

So we compare the size of the bar and the taste. ZipVit are the biggest and tastiest, so we use them. In a very unscientific way !!

Most people won't look at the ingredients - they'll see Hoy or someone promoting it and think it must be good. Bit like buying a shiny new bike with a celeb name on it, even though not the best bike at that price.

[battlebus2] 15/3/2016 10:45

Would you rate these a buy at the current level GHF?? No advice intended and all that......

[glasshalfull] 15/3/2016 10:40

EDIT - post edited to include summary of developments since July 2015 & my current investment rationale.

Share Price 52.5p - fallen back from the 60-70p band July-Sept 2015. Also below the 59p raise in October 2015.

----
July 2015

Concur with above posts, SIS is developing very well indeed. Both management & employees deserve a great deal of credit for this yet unheralded growth story.

Also surprised at the lack of posts on the thread as I thought the publicity generated from Bradley Wiggins hour attempt (& record) where SIS were offering 300,000 free gels, would have resulted in some posts or interest over here. In the end the company were overwhelmed with the unprecedented demand.



So, the trading update indicated H1 2015 revenue +19% or +£800k on H1 2014, when they were up against strong comparators having geared up for the Yorkshire leg of the Tour de France the previous year (signed up distributors early 2014).

Importantly the growth emanated from e-commerce & international markets. I use their products & impressed with the development in their own website this last year, delivery times and product quality. I've also qualified for their customer loyalty programme which offers greater discounts based on total overall spend (Silver, Gold & Platinum status in their Loyalty programme entitles the customer to a 5, 10 or 15% discount respectively, on each purchase). Importantly, growth in their own website will also result in greater margins.



As well as UK cycling stores around the UK, you may have noticed SIS products in Sainsbury, Waitrose and now Asda stores. Internationally they are also in 800+ Shimano stores around the world and new distributors have been appointed in other international territories.

Product range also continues to expand with electrolyte gels coming on stream...raspberry or lemon+mint anyone ???



& we also had the launch of whey protein products in the last 6months & I envisage their protein offering may well develop further in the coming year.

With the growth in e-commerce, greater number of channels and products I would hazard that we'll see growth levels accelerate in H2 2015. As an avid viewer of the Tour on ITV 4 this year, I've been struck with the SIS gel advert by Sir Chris Hoy continually these last 3-weeks, so clearly the company are continuing to invest strongly on the advertising & promotion of the brand.

How does this translate into valuation?

The company continue to invest in growth, so Cenkos have indicated a small loss at EBITDA level this year of £76k - so pretty much breakeven - before moving into profit in 2016 with £0.5m EBITDA forecast.

Market cap is now £18m with £2m net cash at end of 2014. With a strong & experienced management team in place (that developed Lucozade Sport) & considerable opportunities across the global sports nutrition markets, long term prospects are excellent. I recently read a broker comment that suggested M&A activity in sports nutrition has resulted in acquisition valuations of 4x+ revenue.

SIS are now one of the leading sports nutrition brands in the endurance sector (rather than the crowded muscle development sector) and with boom in cycling, marathons and ultra-running, triathlons, etc, then I don't believe it fanciful to consider that SIS could fit the criteria of a large competitor swooping for them to expand their endurance range...so 4x + revenue takeout may be relevant in their case.

Time for pure conjecture on my part.

With SIS revenues of £9.6m forecast in 2015, rising to £11m in 2016 (which I think will be beaten as explained above) this could lead to an acquisitor valuing the company in the ball-park of say £40-£55m, particularly with the endurance segment growing fast & based on my rationale in the last paragraph.

So, that leads to a valuation (based on M&A sector valuation remember) of a shareprice between 155p - 215p (give or take a couple of pence).

Needless to say, I've been a strong buyer of the shares prior to, and on confirmation of trading.

Please DYOR & remember my attempts at placing a value on the company are simple musings of what may be achievable on M&A activity.

Happy to read any other views. There's not much traffic to wade through on this thread...

----
March 2016

Since my July 2015 post they successfully raised £8.7m @59p as they go for growth.

Few points highlighting company developments,

* Operating in a growing market - Sports nutrition grew @ 16% in 2014 (£360m) & CAGR 8% with £527m by 2019.
* SIS strong in endurance market (which is growing thanks to popularity in cycling, triathlons, running, etc) & has extended its product range into protein market (currently 2/3rd's of sport nutrition market)
* Now has 3,000 distribution points in the UK which supports opportunity to appeal to mainstream consumers.
* Fundraise allows them to target Australian market which is larger than UK & rated 2nd largest in the world. SIS have already established a market for their products over last 2/3 years.
* US - Opportunity following fund raise for measured approach into worlds largest market.
* SIS.com website recently enhanced and driving growth & margins (+89% in H1)
* Sponsorship & supplier to Team Sky in 2016 - Already developed some products (Team Sky 4hr fuel pack) & selling SIS/Team Sky water bottles in their colours. Reckon this is a win-win both in enhancing credibility of brand & delivering selling opportunities.
* Twitter followers now @ 37.8k (was 24k this time last year) again highlighting growth in brand awareness.
* Trustpilot reviews - Strong score of 9.2 out of 10 ... following 1,619 reviews.

I've already mentioned potential takeover valuations.

Here's a few in recent years that suggest 4x EV/Sales isn't so fanciful.

Glaxo paid £162m for Maxinutrition (4.2x Sales)
Hut Group paid £59m for myprotein (3.7x Sales)
Grovepoint paid £35m for Grenade (5.6x Sales)

SIS trades currently on 1.3x EV/Sales for 2015.

2015 full year results will be released on 22nd March 2016 when we'll no doubt learn more.


Kind regards,
GHF

[amoore70] 15/3/2016 08:44

What is coming together nicely?