Eco Animal Health Share Discussion Threads

[rzbrdbe] 29/10/2017 09:33

Well I asked Mr Lawrence about this at the AGM that I attended in 2016, he did say that inventory levels would go back to normal when the new plant was up and running. Now he is saying that the increased inventory is to "ensure continuity of supply" I look at this positively in that he might be expecting further increased sales now compared to the position in 2016.
I get the impression that there is very little likely hood of another manufacturing facility being built, (as prudent as that might be especially as the one he's got is in China).

[aimingupward2] 29/10/2017 09:02

rzbrbde, you raise the matter of increasing inventory stocks of Aivlosin and express some concern about this even though saying that Mr Lawrence has said that this is to ‘ensure continuity of supply’.

Given that there is only one production source and that unforeseen events could conceivably put it out of action for a while, I feel that this is a wise precaution, especially given the recent marketing approval in the U.S.A. and expected sales increase, on top of growing sales worldwide.

Another possibility, surely, is that the company might seek to establish either an alternative production site or, more likely, a second one. As a prudent safeguard I would hope so. In the circumstances a generous buffer stock is a prudent move, surely?

[audigger] 28/10/2017 20:07

Thanks for the interesting post RZ, some great insights. The high inventory is only a concern if they don't shift it. Nothing worse than not being able to meet demand! I didn't know they used a biological synthesis as I was led to believe that Aivlosin had a complicated multi-step chemical route of synthesis hence it is very difficult to copy. I had some correspondence with PL and others last year and this reassured me that the IP and patent side of things is secure for years to come. They have other older chemistry which is becoming increasingly profitable but Aivlosin is clearly the major product upon which they are heavily reliant. I see the main risks as being restrictions due to new resistance management strategies imposed by regulators and
increased freedom to operate for their competitors. So long as the competition is hurting and they have an effective product to sell in a weak GBP/USD environment, then the bottom line should continue to increase significantly as they reap rewards from the ever growing product range. I've always viewed Elanco as one of the more likely candidates to buy EAH. However I can't see this happening unless they are prepared to pay a significant premium to the current share price December could be very interesting for EAH as we get to learn more about their earnings potential.

[hydrus] 28/10/2017 11:15

rzbrdbe what a helpful and insightful post thank you. My superficial knowledge put to shame.

[hydrus] 28/10/2017 08:31

I agree that it should be, but if the trend is for using less antibiotics full stop could that impact on Aivlosin? Hopefully the company would educate and overcome any confusion

[audigger] 28/10/2017 08:01

My understanding is that this will be beneficial to EAH as Aivlosin has very low to zero residues hence it poses a lesser risk of conferring resistance.

[hydrus] 27/10/2017 21:29

This should in theory be good for EAH as Aivlosin isn't like other antibiotics. However I guess the danger is that a blanket ban comes in to force at some point. Or they just get phased out slowly. https://www.theguardian.com/environment/2017/oct/27/farming-sector-aims-to-cut-antibiotics-use-to-help-tackle-human-resistance

[mad foetus] 13/10/2017 12:27

Lots of apparent buys, but who knows what is going on!

[audigger] 12/10/2017 12:43

I'm not worried about the recent drift. We're still seeing very little volume which is the norm for EAH. I fully expect another record breaking set of financials with the interim results which, hopefully will propel this back towards 700p. I too think this is a good buying opportunity although I have very little spare cash right now....always the way!

[aimingupward2] 12/10/2017 11:29

I agree that it's frustrating, but it's not worrying. The interims are not that far away (early Dec) and we will almost certainly see a pick up then. As you rightly say ,mf, it's a quality company. Patience needed - or see it as an opportunity to add a few more at a modest price.

[mad foetus] 12/10/2017 11:19

Yes, it is getting frustrating. Quality company but nobody like a share price that drifts down.

[shanklin] 11/10/2017 13:41

Anybody any thoughts on the slow downward share price drift here please. It does not seem to be on much volume which is some consolation.

TIA. Martin

[mad foetus] 27/9/2017 16:29

Big volume again, suddenly

[audigger] 21/9/2017 19:59

SP went from red to blue this pm which is unusual for EAH but fits with the seller theory. Perhaps PL has got rid of another load?

[mad foetus] 21/9/2017 17:23

Much bigger volume today. Could be a seller finally being shifted?

[aimingupward2] 20/9/2017 12:57

JIGSAW47 has posted the following on the iii site:

"A good AGM with the Board demonstrating professionalism and strong commercial grasp of their market and although unable to update trading and profit forecasts, appeared confident for the future. The flagship product Aivlosin is still gaining further regulatory approvals and although the emphasis is still on pigs and chicken could also be used for a range of other animals. High levels of stock to cater for ongoing expansion of sales with stocks having a lengthy shelf-life."

[audigger] 20/9/2017 12:50

As the multitude of new approvals translate in to continued record increases in the bottom line, the share price should react accordingly. There is clearly a lag between an approval being granted and revenue from sales relating to that approval which will depend on region and indication. My guess is that, at some point, we will get a "revenues are materially ahead of expectations" RNS which will drive the next leg-up.

[hydrus] 20/9/2017 09:41

It could be good value currently - broker is expecting approx 20% profit growth and that leaves it on a PE of around 31. If it exceeds that, and one might hope based on last year's performance, then it could start to look interesting. Especially if growth is anywhere near last year's level.

[mad foetus] 20/9/2017 09:38

Difficult to see what might trigger the next leg up. Updated brokers forecasts? As it is, the regular news of approvals in new territories is good, but not enough to shift the share price

[tanners] 20/9/2017 09:17

No mention anywhere of the AGM, not even on their website....oops, just spotted the RNS!

[hydrus] 18/9/2017 21:21

AGM tomorrow so might be a trading statement. There was one last year.

[aimingupward2] 22/8/2017 12:42

Population 95 million, biggest in the middle east (?) so, yes, O.K., as you say, not insignificant assuming that they are egg eaters on a par with other countries.

[topvest] 21/8/2017 13:09

Second biggest egg market in the Middle East so not insignificant.

[aimingupward2] 21/8/2017 09:16

Another regulatory approval this morning. Not the biggest of markets, but a welcome addition nonetheless less.