Alliance Pharma Share Discussion Threads

[woodcutter] 16/9/2013 14:50

i sold my holding today, for a 12% profit based on a number of considerations:

Not a lot of cash on the balance sheet so i figure more funds need to be raised for further acquisitions, increasing debt in the process. The convertible debt will add a couple of percent to the shares issued when converted.

pricing agreement although only 50% of sales will most likely restrict profit growth.

growth in sales was 4% but growth in admin expense was 12% compared to last H1. I know this was more than offset by the gross margin improvement of 8% but i'm not sure that's sustainable so after much deliberation i took the profit.

operating cashflow not as good as i'd hoped either.

Will watch closely for any fall back to 30pish and reconsider then.........if it happens.

Woody

[2vdm] 13/9/2013 08:30

I still like this company. It has a good strategy, is profitable and the BOD has its finger on the pulse. It will probably drift a bit now until/unless an acquisition or major contract is announced, but if drifts too far, I have no doubt that serious investors will pick up stock at the cheaper prices. Any chartists out there who can provide an insight please?

[pyemckay] 11/9/2013 18:06

markets look ahead and the mention of pricing pressures certainly caught the eye.

[yorgi] 11/9/2013 16:34

Disappointing day after the decent results with the market cap hardly demanding at this level for a proven business model with a good history a growth.

[yorgi] 11/9/2013 16:18

And now the offer !

[yorgi] 11/9/2013 15:53

Interesting MM's moved the bid up a tad !

[woodcutter] 11/9/2013 14:35

It's very undervalued by comparison to it's peers on per and yield aimho.

WC

[yorgi] 11/9/2013 13:58

I don't know anything about CLIN at all. I'm sure the drop today as a number of small sells have been made is down mainly to the cautionary comment but it should also be considered that we do have a trustworthy BOD who are not trying to mislead but tell us how it is.

What should be remembered we are making a profit and have funds to a acquire new products as they become available to build our portfolio and of course although small a growing dividend for those wanting income as well as capital growth.

Also what are the risks here......not very high at all as the business works and although APH is not about to multi bag on some new wonder drug, as that is not the business we are in here it should continue it's sound growth and in my view still looks cheap.

[woodcutter] 11/9/2013 12:55

What is interesting is the way CLIN has raced ahead in terms of share price growth and it's per is double that of APH for forecast eps and it has no divi, yet it has less product diversity.

I used to have a detailed knowledge of CLIN but that's lapsed, so i may be a little behind the times, still i believe there is a differential in value here which at some point i expect to be recognised.

Woody

[yorgi] 11/9/2013 11:44

All very true Woody.

[woodcutter] 11/9/2013 11:26

Todays reaction is most likely driven by both the comments regarding possible outcome of H2 performance but more importantly the comments regarding longer term pricing pressures as a result of government intiatives, this becomes more than just an H2 issue.

As their portfolio of products grows and their global reach stretches my feelings are that this will be mitigated to a larger extent.

My main reasons for investing here were the operating margins and the yield with the potential for further growth, that story hasn't changed and i see any share price weakness as an opportunity. Seems some investors are intent on short term gains, nothing wrong with that but i think APH has much more to run yet.

You don't increase your divi by 10% unless you have confidence in your growth prospects.

Woody

[yorgi] 11/9/2013 10:40

Yes quite difficult to understand Mazarin, on decent results as expected.

[mazarin] 11/9/2013 10:04

I am often puzzled by the market's fickle capacity to take fright and exaggerate the slightest hint of caution whilst at the same time completely overlooking the broader 'more positive' and important aspects contained in the same news. And so today with announced increased profits, reduced debt and increased dividend, APH's share price rapidly ticks down a few notches in quick succession. Why so...are people simply unwilling to hold and wanting to cash in with the hope of buying back in cheaper later, or am I just missing something?

[davebowler] 11/9/2013 09:22

Alliance Pharma (AIM: APH), the speciality pharmaceutical company, has announced that sales for the six months ended 30 June 2013 were up 4% to £22.8m (H1 2012: £22.0m)

The company says that Hydromol�5533; continues to grow well and is now a £5m brand.

It is also launching MolluDab�5533;, a new treatment for molluscum contagiosum.

The half year profit before tax was up 29% to £6.8m (H1 2012: £5.3m) and the interim dividend is being increased by 10% to 0.303p per share (H1 2012: 0.275p)

Michael Gatenby, Alliance Pharma's chairman, said: "The strong start to 2013 augurs well for meeting full year expectations. We are energetically pursuing additional growth through further acquisitions, supported by strong UK and international teams, a good flow of opportunities, healthy cash flow and ample headroom in our funding facilities."

[2vdm] 11/9/2013 07:42

Woodcutter, I don't think it's less optimistic. All the management have done is to flag up where the company is heading and they have identified both the strengths and weaknesses as we move forward, and after a very credible first half. What gives me great confidence is such a clear unambiguous report, i.e. the BOD clearly know what they are doing. We are cash rich, profitable and continue to look for acquisitions. With ImmuCyst looking like it will be back in 2014, this is to my mind a nice small steady performer. I agree with you comments about the markets view and like you will buy on any dips.

[woodcutter] 11/9/2013 07:32

strong H1 results but less optimistic on the outlook. Difficult to predict how the market will react this morning. Some confidence in the full year given by the 10% increase in divi.

Watch and wait, any fall could be a decent buying opportunity.

Woody

[yorgi] 09/9/2013 14:01

Yes and pays a dividend as well :-)

[2vdm] 09/9/2013 13:57

fingers crossed yorgi. At least this is profitable unlike many AIM stocks

[yorgi] 09/9/2013 13:27

Steady buying today pushing the share price on again ahead of Wednesdays results.

The question is will there be any news of further acquisitions to add to our portfolio.

[mazarin] 30/8/2013 11:54

Found this comment relating to CULS program, reportedly quoted from John DAWSON at APH Mayfair Master Investor Presentation, thanks to Cisk's Post (No. 327)

"....CULS: I bemoaned the fact that the drip feed of CULS into the market depresses the price each time - John said he was not considering using these again to fund a deal (and indeed the recent enlarged banking facilities support this). I think he said they expire in October / November...."

So the above comment at least, suggests they should be finishing later this year.

[mazarin] 30/8/2013 11:01

It was my understanding from previous posts following a Company Presentation in May that APH BoD had decided no longer to continue with current round of CULs converstion transactions and that the program was due to finish. In my experience they generally have a negative impact on the share price that takes a little time to recover after the announcements. I believe CULs enables a Company to convert allotted shares into cash by way of unsecured loans. I thought the APH already have agreed Bank loan facilities in place, so wonder why BoD feel it necessary to continue with this process?

[yorgi] 22/8/2013 12:53

Buyers appear to be returning after some have taken a small profit this morning.

[yorgi] 21/8/2013 22:31

Having been introduced to APH at the Mi show in April and since then done my homework I made the decision to buy and added again close to recent lows......am I confident this has been a good buy.....Yes.

It has to increase sales and profitability to move forward and acquiring further products to their portfolio as well I agree but they have the funds for that and if history is anything to go buy then I have no doubt John Dawson will come up with the goods.

If it does not float your boat Pyemckay then I would give it a wide berth and move on to what does.

I was pleased to have discovered the company and Nigel Wray would appear to rate the business model as does Mark Slater along with others......

[pyemckay] 21/8/2013 21:48

i look at identical revenues over the last 2 years and next 2 years. Totally stagnent.It doesnt really float my boat.
I like real assets on the balance sheet but this has built up a lot of intangibles on the balance sheet that will need amortisised over time. Probably the norm for pharma.
With profits forecast to fall in 2014 This company needs to aquire to stand still.

[yorgi] 21/8/2013 21:24

Something like 70% of the shares are held by directors, investemnt institutions and Nigel Wray holds 13%.