Eco Animal Health Share Discussion Threads

[cerrito] 13/7/2022 23:25

The sad reality is that they were very sensible to do the bank financing announced the other day and the further sad reality is that any dividend we are likely to get in the next few years will be nominal

[fastbuck] 13/7/2022 20:29

By my calculations the last Balance Sheet had £60m of net current assets less all liabilities, it is profitable despite expensing £8m of R&D this year and is only valued at £76m. All other IP, vaccines in for free.Chinese Pork prices have risen significantly in last few months which will help FY23 if they are maintained.You have George Soros on the share registerWhat is not to like, I have just taken a new position after being a past shareholder a few years back.

[edmonda] 06/7/2022 11:13

Collaboration to develop poultry red mite vaccine - new research note by Equity Development

(Full link here:

ECO Animal Health has established a research collaboration with Moredun Research Institute aimed at developing a potential first-in-class vaccine against poultry red mite, a blood-feeding parasite with welfare and production implications for egg-laying hens. The move represents ECO’s second new academic R&D collaboration this year and follows an agreement signed with Imperial College last month to develop vaccines against porcine infectious diseases.

Moredun is an independent, although largely government funded, scientific research institution based in Scotland focussed on animal/veterinary health. The three-year project appears to build on the work of Moredun’s researchers, who have notably been able to establish a laboratory colony of poultry red mites and have tested a prototype vaccine based on extracts from the mite. The project intends to use a reverse vaccinology approach to identify epitopes by analysing bio-informatic data from an infection model across the developmental stages of the mite. The aim will be to generate a synthesisable vaccine that can be tested in Moredun’s poultry red mite challenge model.

Poultry red mite (Dermanyssus gallinae) is one of the most important causes of production losses in laying hens, including by acting as vectors for pathogenic bacteria (including salmonella, E. coli and mycoplasmas) and viruses. The mite can feed on up to 5% of a bird’s blood overnight, causing anaemia and stress that can induce feather pecking, cannibalism and increased feed consumption. As there are no effective non-chemical solutions, insecticides are used to kill the mites but this has its own risks including the potential for chemical residues in the eggs/meat and development of resistance. Over 90% of farms in Western Europe are infested with poultry red mite.

ECO’s shares have fallen to their lowest point since October 2008, primarily on concerns around weakness in the Chinese pork market, as the economics of pork production are a key driver of demand for Aivlosin. Chinese pork prices have been highly volatile over the past three years, after an African Swine Fever outbreak in 2019 and its knock-on effects, compounded by the pandemic and the government’s zero-Covid policy. Chinese pork prices fell throughout 2021 (from an unusual high) and into 2022. However, since May they have recovered to a level where Aivlosin demand should stabilise.

ECO is due to report its financial results shortly, with consensus suggesting sales of c. £81.5m and adjusted EBITDA of £6-7m. Both will be lower than exceptional levels seen in 2021. ECO’s enterprise value is currently £54m (based on forecast cash of c £18m), suggesting an EV/sales ratio of <0.7 and EV/EBITDA of ~8-9, both of which are well below norms in the animal health sector. ECO resumed payment of a dividend in 2021, at 1p/share, that if repeated, would offer a yield of 0.9%.

[cerrito] 24/6/2022 21:28

Article in the FT the other day on the role of increase in pork prices in the general inflation situation in China.
Commented that profits of hog producersike Muyuan being squeezed given increase in price of animal feed . It also said the share price of Muyuan suffering but actually only down 1.5pc YTD.
Anyway suggests to me that there continue to be headwinds for EAH despite increase in pig prices.

[cerrito] 17/6/2022 15:01

at least pig prices have edged up in recent weeks from below 13 to just under 16.
On the other hand the ANP AGM statement the other day not inspire confidencde

[brut winky] 17/6/2022 09:28

Was watching these a few weeks back when Director CFO was buying back at £1.60, good update cheers.

[edmonda] 17/6/2022 09:20

Encouraging expansion of vaccine R&D pipeline (new research note from Equity Development)

ECO Animal Health has undertaken what represents a potentially important expansion of its R&D pipeline via a collaboration to develop veterinary vaccines against three porcine infectious disease targets using a novel self-amplifying RNA (saRNA) technology developed by Professor Robin Shattock of Imperial College London. The collaboration will assess saRNA-based veterinary vaccines against two viral and one bacterial infection in ECO’s validated swine disease models with a view to selecting candidates for development and commercialisation under license from Imperial College.

The company is due to report its financial results for the year to March 2022 next month, with consensus suggesting sales of c. £81.5m and adjusted EBITDA of £6-7m. Both will be lower than exceptional levels seen in 2021. Current ECO’s enterprise value is £64m (based on forecast cash of c £18m) suggesting an EV/sales ratio of 0.8 and EV/EBITDA of ~9-10, both of which are well below norms in the animal health sector (peer group EV/sales 2.5-3.0x). ECO resumed payment of a dividend in 2021, at 1p/share, that if repeated, would offer a yield of 0.8%.

Link to note:

[cerrito] 15/6/2022 08:37

The share price is 120p
The cable is US1.20
This must be a bargain for a dollar based investor

[cerrito] 15/6/2022 08:17

Pleased to read this news today and let us hope we will be able to harvest the benefits is 2026.

[waldron] 14/5/2022 17:13

Cerrito
14 May '22 - 17:09 - 1359 of 1359
0 0 0
This article goes through all the headwinds in the global pork industry but I was particularly interested in the comments on the increased focus on gut health

[cerrito] 14/5/2022 17:09

This article goes through all the headwinds in the global pork industry but I was particularly interested in the comments on the increased focus on gut health
hxxps://www.feedstrategy-digital.com/feedstrategy/may_june_2022/MobilePagedReplica.action?utm_source=Omeda&utm_medium=Email&utm_content=NL-Feed+Strategy+eNews&utm_campaign=NL-Feed+Strategy+eNews_20220512_1600&oly_enc_id=8786C7274956B8R&pm=2&folio=6#pg8

[waldron] 12/5/2022 14:36

Targets Six months: 180.24 One year: 207.90

Supports Support1: 116.00 Support2: 96.51

Resistances Resistance1: 154.32 Resistance2: 178.00



The world according to stoxline

[ariane] 12/5/2022 13:29

Strong support implied at 116.50p

CEO A reader of charts

[aimingupward2] 12/5/2022 13:05

New C.E.O. has now joined in with the buying - 33K shares @ 117p.

[cerrito] 25/4/2022 17:10

Given current pig prices in China down at 12.8 RMB a kilo and lockdowns not only in Shanghai but in key agricultural areas, I can well understand why the price is where it is. I also see there is herd contraction of pigs in North America.
I have to say that I do not see clearly what effect the very high feed prices that pig farmers work wide are paying will have on Aivlosin sales.
My gut, which may be wrong, tells me it is negative.
I do not see myself buying or selling in the foreseeable future.

[brut winky] 10/4/2022 22:47

Noticed the purchases myself and wondered why the accountant is buying and a reasonable amount as well.

[aimingupward2] 23/3/2022 20:35

And now, a couple of days later, he’s added another 25,000 shares at 160p. Clearly pretty confident of things picking up for the company.

It may well be that the new C.E.O. appointment, which takes effect on 1st April, has something to do with it. He seems to be a highly qualified, experienced, person - so fingers crossed. ( see ‘News’ item dated 18.01.22.

EDIT - and on 29th March he’s added another 35,000. Is the outlook getting even better, I wonder.

EDIT - and another 16,000 on the 31st !!

[aimingupward2] 21/3/2022 08:56

Some encouragement this morning in that “on 18 March 2022, Christopher Wilks, Chief Financial Officer, purchased 50,000 Ordinary Shares of 5 pence each ("Ordinary Shares") at a price of 140 pence per share.”

[cerrito] 15/3/2022 20:08

I agree a very sloppily worded RNS and you would have thought with three joint brokers not to mention a PR agency and ED they would have done a better job.
We are told about revised expectations in para 2…not clear who revised them when as no mention of revisions in the January 12th TU when they said this year’s revenue will be in line with then current market expectations.
Very disappointing that they do not tell us their understanding of consensus estimates for the current FY.
FWIW I see that Singers-one of the three joint brokers- have out a note today with a buy at 253p just below the previous TP of 264p. They have this year’s adjusted EBITDA at £7.1m compared to that of 20/21 of £22.2m and have left unchanged their forecasts for the next two years. Singers comment that they had estimated total R&D expenses in this FY of £8.4m and now management guidance is £10.2m. Difficult to know if Singers got hold of the wrong end of the stick or EAH have no grip.

What happens to the share price depends on the amount of patience that their larger holders have. To remind myself of their shareholder structure I went onto the web site and found that there has been no update since September 31. Since then of course we have said goodbye for all intents and purposes to Amati and hello to SFM with their 11.39% holding. Seems rather lackadaisical.
The magnitude of the share price drop, the -for EAH- very large volume today of almost 1.2m shares suggests that some have decided not to hang around.
With the current share price, the cable at $1.30 and an apparent lack of management grip, this must be a takeover target,,,although I do not understand the industry enough to know who it could be.

[topvest] 15/3/2022 09:47

It's possibly a late decision on the capital versus revenue R&D allocation (i.e. they have expensed more than expeced versus capitalisation). If that's the case they should have said so, rather than provide an RNS that makes no sense to anyone and just looks another excuse.

[topvest] 15/3/2022 09:44

Yes, it makes no sense. Poorly controlled. It might start to beome an interesting recovery play at some point, as its starting to look undervalued.

[tysoepr] 15/3/2022 08:07

What am I missing here: R & D will be maintained at the BUDGETED rate, but they then seem to say that this will result in a charge to the income statement of £8.7m, which will result in EBITDA being 15%-20% below consensus expectations. If it's budgeted then surely they should be guiding the market rather better when they make the budget?

[boonkoh] 15/3/2022 08:02

And we all know that early stage R&D means years more of investment before any revenues and profits flow through....

[value hound] 15/3/2022 07:27

So what were the consensus EBITDA expectations?

[az4hr] 15/3/2022 07:16

15-20% missed forecasts another brutal day in store