Byotrol Share Discussion Threads

[sikhthetech] 14/5/2020 13:35

1gw
"means they've added around £1m in orders in April doesn't it?"

No it doesn't.

They said they 'entered the new year with orders in exceeding £2m. Now they are still stating they had orders of over £2m at end of April.

[1gw] 14/5/2020 13:27

Great to see that they're keeping the order book topped up as sales get delivered. £1m of sales in April and an order book of "over £2m" at end April (vs "exceeding £2m" at end March) means they've added around £1m in orders in April doesn't it?

And that I think is without counting licence revenue.

It looks like 1H will blow last year's £2.2m 1H revenue out of the water, doesn't it? It seems to me that we're currently looking at around £6m on a run-rate basis plus licence revenue.

[sikhthetech] 14/5/2020 12:56

There hasn't been any increase in orders since their last TU, 3 weeks ago.
I would have expected them to show continuing significant increases in sales going forward, especially for June, as it's only 2 weeks away!!.



3 weeks they stated - 24 Apr.
"We entered the new financial year with a strong order book exceeding £2m and expect to generate record sales from products (i.e. excluding licenses, royalties and technical development deals) in the first quarter of the year."





They haven't changed that £2m orders - no mention of orders or significant increases for June - only 2 weeks from now!!


"Sales in March and April 2020 each exceeded £1m and we are expecting to show similarly strong performance in May. Our order book at the end of April stood at over £2m. "




Where's the significant increases in orders they mentioned 3 weeks ago??? I would have thought the expected orders for Q1 to have exceeded £3m by now.
More Jam.

[1gw] 14/5/2020 12:45

As the company puts in place licensing deals with "material minimum annual guaranteed payments" I wonder if it will consider a dividend before long?

[sikhthetech] 14/5/2020 12:25

Cash has been declining for years...
As of March 31st, 6 weeks ago they only had £1.7m cash, which missed Finncap's expectations of £2.6m.


With only £1.7m cash, I wonder if they will have a placing soon.


Cash:
"Cash balances at 31 March were £1.7m."
Expectation: £2.6m.

Cash:
fy2018 £3.85m
fy2019 £2.8m
H12020 £2.01m
fy2020 £1.7m

[1gw] 14/5/2020 11:08

An interesting question now is whether the byotrol24 licensees want to pursue the Target agreement - that would seem like an easy win for them once they have an efficient supply chain scaled up.

And perhaps if Walmart was the other retailer (as evidenced by the byotrol24 product on their website) could the new licensees land them as well? At the AGM I seem to remember David Traynor saying that the second retailer was still interested but that it would want byotrol to put some marketing spend behind the product - something byotrol wasn't prepared to do at the time (risking precious cash resources) but the new licensees presumably would if they think the margin and/or exposure would be beneficial.

[1gw] 14/5/2020 10:42

Advanced Hygienics (identified as a "sister company" of Integrated Resources) distributes the (byotrol) red-cross (and Protect-8) hand sanitisers in the US. What chance they might look to put some financial resource behind that in parallel with the byotrol24 venture?

[nashwan123] 14/5/2020 09:42

The main negative at the moment is competition to secure enough base ingredients to make their end products. This could restrict sales and increase costs.Apart from that BYOT looks an attractive proposition especially with new royalty incomes.

[sikhthetech] 14/5/2020 09:38

Whatever happened to all those long term deals following the Swine flu pandanmic.. A DECADE AGO, including deals in US.



"The significant increase in sales is in part due to the concern regarding swine flu; however it can also be attributed to a greater appreciation of the qualities, efficacy and broad applications of Byotrol. "
"We remain confident of the prospects for Byotrol "

Distributors & Parners


" Healthcare through our relationship with Synergy Health plc in Europe and through distributors in the US
* Food and beverage, both through distributors and direct sales
* Consumer products through our joint venture, Byotrol Consumer Products Ltd. "

[riddlerone] 14/5/2020 09:38

My thoughts exactly 1gw,really pleased they have now given a bit more clarity and like you say more to come.

[1gw] 14/5/2020 09:33

The great thing about the longer-term deals is the visibility it gives, once they are up and running. The minimum guaranteed payments give a baseline of secure (subject to the financial health of the licensee) cashflow and if the licensee is successful then royalty payments should progressively build upon that. Moving from supply agreements to technology licensing should improve margin and free up resources for their organic sales efforts.

And once they have done a number of these multi-year deals there should be fewer (confidentiality) concerns about releasing aggregated multi-year forecast information which would make life easier for finnCap and investors to build sensible cashflow models to facilitate valuation.

[riddlerone] 14/5/2020 09:28

From 2018/19 results
Given the mix of Byotrol's activities, gross margin across the sales mix is not a particularly meaningful measure of performance and is better considered on a segmental basis where the gross margin in the Professional segment increased to 40% (2018: 20%), boosted by the acquisition of Medimark, and in Pet a slight decrease to 43% (2018: 47%). The increase in Consumer margin largely reflects the income from sale of patents and IP over 2018 and 2019, as discussed in the Chief Executive's report.

[1gw] 14/5/2020 09:08

rimau1 - your £10m-£12m is going to be underlying product sales isn't it, if current demand and current supply constraints persist for most of the year? What about licence revenue? If they do book several years worth of guaranteed payments (and as I say I am not sure they would but think under IFRS15 they might have to) on the Tristel Cache, SC Johnson and/or byotrol24 licence deals that could be another material amount, couldn't it? They wouldn't have the cashflow from the out-years but they might have the revenue in this year's accounts.

And having done the US/byotrol24, the company is now looking to land other agreements, so there is potential for a number of other agreements to be concluded this year, and potentially all with minimum guaranteed payment terms.

"The agreement with Integrated Resources and the new agreement with SC Johnson Professional Ltd are two such examples and we expect to complete more as the year continues."

[rivaldo] 14/5/2020 09:03

Finncap retain their 9p target - and that would imply £9m revenues, which given the current £1m/month run rate may well be nicely exceeded.

Once the increased demand is modelled to continue, as is likely imo in this new world, then that 9p target may be raised further:

"Although we do not have FY 2021 forecasts at present, given the challenges of modelling the duration of demand, we reiterate our 9p target price, at which level a c.4.0x EV/Sales multiple would imply revenues of c.£9m. Given the current outlook, the likely fundamental shift that we are seeing in disinfection and the financial firepower that the two licensees bring, this is not an unrealistic outlook."

[sikhthetech] 14/5/2020 08:47

The revenue expectation of £9m is disappointing. Compare that to their expectation of £6m, which was before the outbreak.
They failed to beat the £6m revenue expectation even though the original expectation was before Covid19 outbreak.

An extra £3m revenue with the biggest virus threat in years!!

[sikhthetech] 14/5/2020 08:42

Peter,
"Somebody is selling blocks of 100,000 every few minutes since the opening today."

Pump and dump..
The 100k sells probably rotating the shares..

[rimau1] 14/5/2020 08:41

Yep, i actually think revenues will land between £10m and £12m depending on covid. Worst case trading at 2.5x revenues its a stonking buy with the US uncertainty removed. Tristel which i also hold is pretty fully valued until FDA approval comes through trading at 7.5x 2020 revenues. I don’t use PE for these stocks whilst they are in a high growth phase but this is all just my own methodology.

[wisecat2] 14/5/2020 08:36

sickinthehead you are struggling mate another deal and you will have an aneurysm making a lot of people here and your wife very happy

[dan_the_epic] 14/5/2020 08:35

Finncap are happy with £9m of revenue this year being achievable

[petersinthemarket] 14/5/2020 08:35

Somebody is selling blocks of 100,000 every few minutes since the opening today.
Lots of shares on the move and some odd pricing going on.

[sikhthetech] 14/5/2020 08:25

The initial upfront fee of only $250k (£200k) probably suggests Royalty fees are expected to be low.

I think it's too little too late in US.

[rimau1] 14/5/2020 08:15

1gw, yes, they will recognise the licensing fee upfront in this years financials.

[sikhthetech] 14/5/2020 08:10

The £1m sales per month is during the initial stage of the virus. They said they don't expect to maintain that level going forward.

After all these months of seeking a US partner, they couldn't find a major one. The US partner was already known.

How much was the agency fee? Probably more than the initial fee $250k they receive from the partnership.