Surgical Innovations Share Discussion Threads

[lurki0] 10/3/2017 14:01

Perking up nicely.

NY Boy - agree. The new management clearly have aspirations to transform the profile and the profitability of the company. I think there's a good story developing here.

[ny boy] 10/3/2017 12:57

Buying ahead of the results next Tuesday, holding these long term.

[gbh2] 09/3/2017 09:39

Judging by the constant selling pressure I suspect any good news at results will be sold into.

[jmf69] 06/3/2017 14:19

Never seen the spread this tight

[bashor] 02/3/2017 15:32

Yes nice volume but I can't see anything significantly changing from the trading update

[jmf69] 02/3/2017 15:08

3 lots of 500k buys

[srichardson8] 02/3/2017 14:47

I usually like shares that go up before results it quite often signifies decent figures. Fingers crossed.

[jmf69] 02/3/2017 14:29

Nice rise on good volume today

[jmf69] 01/3/2017 07:46

Results on 14th March

[jmf69] 22/2/2017 06:15

For those that don't know, the liquiband fix8 glue gun is a sun device delivered as part of the oem business to Ams

[meijiman] 20/2/2017 19:52

Comments on Hayward Tyler rather amused me today.
It's looking in a spot of bother. Way over promised and under delivered.
Seems to need a rescue rights or similar.
CEO very keen on 'awards' and Royal visits.
Now who does that remind me of??!!

[gbh2] 17/2/2017 09:03

Now retired after thirty six years in business I find the words "management" and "trustworthy" in the same sentence, an excellent example of the word, Oxymoron!

[bjfanc] 16/2/2017 21:50

I'd second that. Nice post. My two pence worth is the following.Previous management played the revenue growth game. Nearly at the cost of the company. Numbers prior to 2014 are not worth the paper they are written on.I think the new management are trust worthy. Backed by the cash generation. My hope and belief is that the revenue growth, was only 10% as they have had to rebuild the revenue correctly. Based on positive margins etc. I'd like to see them leverage off the AMS relationship or do similar deals.

[meijiman] 13/2/2017 12:37

Great post-I have voted it up. On first read can't see anything to disagree with in your analysis. One issue here has been to get 'independent' data on the market opportunity. Very difficult to forecast hospital buying decisions for instruments.
Be interesting to know if Chris Rea is still in any way involved or just a passive shareholder.Obviously if you have 15% then you have a bit more access than someone with 0.15%.

[srichardson8] 13/2/2017 12:12

This is just me thinking aloud. I have been following for years but only a shareholder for about a year or so.
Surgical Innovations Facts
Mkt cap is around £16mn and turnover £6mn. A reasonably demanding price to sales.
First half gross profit margin was 26.6%. The 9th Jan trading update states full year GPM at 32% which implies second half GPM at 37% i.e. much better
The number of shares in issue has gone from 488mn (June 16) to 533mn (end December) principally on the conversion of 44mn shares at 2.5p but also small allotments to 3 non-execs and the Executive Chairman Paul Rogers. These latter have been issued in lieu of salary but in terms of current value do not look ‘exorbitant217;. The convertible bonds, £1.0mn in total of which £0.5mn were issued each to Chris Rea and Getz Bros, a BVI registered company, in November 2014, would have put their relative shareholdings (very roughly) up to 88mn and 80mn (rounded) respectively or 16.5% and 15%. Getz Bros owns ACP which is referred to as SUN’s Far East distributor and historically accounted for >5% of revenues. Getz is a well-established, privately owned Pacific region specialist trading company/ distributor. Rea resigned as interim CEO in October 2015.’with regret’.
It doesn’t look, on the face of it, that Chris Rea has sold any more shares since the RNS of 13.4.2016 and given the conversion of the CB his holding has actually increased substantially. I get the feeling (without any real knowledge at all) that relations between major shareholders and management are pretty good.

Guesswork
Should the company be able to achieve GPM of (say) 35% this year and sales of (say) £6.6mn (+10%) gross profit would be £2.3mn. That should be (possibly and hopefully very) conservative. Guessing admin costs at £1.75mn, statutory operating profit on this basis would be £0.5-0.6mn, EBITDA (assuming depreciation and amortisation at £1mn) would be £1.55mn. Those would suggest a P/E of x29 (assume finance income and tax neutral) and EV/EBITDA of x10. Still a bit high but getting there.
Frankly the disappointment in the trading update for me was the rather modest sales increase for 2016, only 10%. Second half sales seem to have been pretty flat compared to the first six months. There has been a simply huge improvement in the inventory and financial position but it may well be that on the first point the pipeline became a little over-supplied. I hope so. I also hope that the YellowPort Elite certification, and the acquisition (which I have ignored but will affect numbers this year) will make the revenue higher than my suggestion. I reckon gross margins need to be considerably higher, say 40%, but I don’t understand the competitive landscape. I do, however, know that laparoscopy is going to get bigger.
So all in all I am sticking and hoping the March release is reasonably upbeat.

[mandate] 10/2/2017 09:12

'a short pattern is small and frequent' - depends how much you have in the war chest

[gbh2] 10/2/2017 07:54

It's been going on since we hit 4.25p, off the top of my head I'd say four months, however imo the period isn't the indicator, a short pattern is small and frequent sells.

Just an observation, I'll be here until we find out more at the end of March.

[mandate] 10/2/2017 07:40

Well, it's funny it's happening on the run-up to the results.

[gbh2] 10/2/2017 07:35

I don't think so, it's nothing like any shorting pattern I've seen before.

[mandate] 09/2/2017 16:53

I think it's just pre-results shorting/tree-shaking

[gbh2] 09/2/2017 15:49

Still appears to be someone getting rid of Millions, guess we'll see what the score is in March.

[bjfanc] 09/2/2017 07:51

Where are our friends telling us this is going downhill fast? Tree shake didn't last long. I was all set for the pending doom. In reality bounced off of 3p on the offer very quickly.

[gbh2] 08/2/2017 14:50

Hopefully Ken.