I have to say that I thought the CEO/CFO came over well in the Equity Development presentation today and answered the questions well.
Interesting that they have had to put back the launch of the MS vaccine in the US as USDA is getting slower with their authorizations and one asks oneself what will happen when Musk gets his chainsaw out. |
 From Citywire
Note that in August Shore retained their Fair Value target share price at 175p so seem to have downgraded their opinion since then,
quote
Vet pharmaceutical group Eco Animal Health (EAH) is still trading at a ‘sizeable̵7; discount to its peers despite its pipeline positioned for delivery, says Shore Capital.
Analyst Sean Conroy retained his ‘buy’ recommendation and ‘fair value’ target price of 140p on the stock, which climbed 11.7% to 71.3p last week despite a 13% decline in half-year revenues due to weaker sales in China and Japan.
Conroy said the group is trading on an enterprise value/[pre-tax profits] of 4.7 times full-year 2025, which is ‘still a sizeable discount to animal health peers’.
Our discounted cashflow, which encapsulates the growth potential of the pipeline, suggests fair value of 165p and implies Eco Animal Health should trade closer to the peer average,’ he said.
‘Securing regulatory approval for its first poultry vaccine should cement upside. Discounting the pipeline dynamics from our model, we see fair value at 140p.’
Conroy added that pipeline development remains fully self-funded and ‘2025 will represent a pivotal period as Eco Animal Healy looks to secure approvals’. |
Outlook
The Group expects that the historically observed increased demand for Aivlosin® associated with the Northern Hemisphere winter will once again result in a stronger second half to our year. 82% of the market consensus revenue is covered by year-to-date revenue, order books and run rate from the Group's stocking locations. Additionally, the first half currency headwinds have normalised and the phasing and mix of revenues, inventory usage and costs all support the forward profitability. The Board will continue during the remainder of this financial year to invest in our exciting new product pipeline and pursue options to realise value.
The Board looks forward with cautious optimism to reporting the full year numbers in line with revised market expectations. |
Rose tinted glasses -Timelines have a habit of slipping. |
"FY25 interims point to a stronger second half"
For the six months to 30 September 2024 ECO Animal Health reported revenue of £33.2m, -13%YoY and (adj.) EBITDA of £0.45m (H1 23: £0.7m). The gross margin remained firm at 40.3% compared to 40.8% a year earlier. In the October Trading Update (Equity Development report ‘Trading update: headwinds in China’) the Group reported that the combination of a lower incidence of disease and reduced Aivlosin® demand in China and SE Asia markets meant that FY25 (adj.) EBITDA would be c.£7.2m. Into H2 the Group has seen “demand accelerate” to the extent that 82% of market consensus revenue is now covered by year-to-date revenue combined with orders and run rate across operations worldwide. Consequently, the (adj.) EBITDA outlook is reiterated.
Following the Trading Update, and in light of Interim results, our Fair Value range is revised to 97p – 102p based on an updated comparative review of EAH peers. We note that this valuation includes only the initial (R&D etc.) costs but not the full potential contribution from next-generation products under development.
Link to note: |
We will be hosting a SIGnet follow-up meeting on December 12 at 7:00 pm to discuss and analyse the latest developments at Eko Animal Health (EAH), following their interim results presentation with Investor Meet Company on December 4.
Register now: |
Checked share trading trading volumes given the share price weakness to see if someone had been losing patience. 62k shares traded today and so far this November not all that much activity.
Checked pig prices in China and while not as strong as they have been not all that bad and do not explain a 65p share price.
I have to say that have more than enough shares so sitting on the sidelines and hoping I am still alive in 2032/5. |
boon - Given expected timeline (assuming success) possible investment for youngsters only then!!!!!!!!!!!!!!!! |
There's a good investor presentation on YouTube. Search EAH Proactive One2One.Minute 10 onwards reveals that the company thinks peak EBITDA from the vaccines could be £160m/yr. Current EBITDA is £7-8m/yr.Estimated NPV of the portfolio is £84m (vs current market cap of £48m).But the average time range to hit peak revenues is probably 2032-2035....(I hold in the Boon Fund) |
At the time of Truss when £ was very weak I remember wondering if they would be taken over by a company with a well established sales force in many countries and while of course the £ is now much stronger the weak share price makes me ask the same question again.
As far as I can see very little trading today and while that of the middle of last week was v active be EAH standards not enough to suggest dumping by a major II.
Too bad it is not the case of holders locking in their capital gains before the budget. |
New multi-year low hit.
R&D costs are sunk costs - Cannot be valued at cost - only by the cashflow their results are/will generate - Looks as though the market is not too enthusiastic about potential returns from the R&D. |
Last time you could buy at this price was back in 1995!! Surely the IP alone must be worth more than the £48m mkt cap. £21m of cash, but most of it locked up in China. Still generating decent free cash. Perhaps a change in management might help? |
Profit warning for this company which is no good |
If you add up all the R&D done in the last few years on the new vaccine programme. Assume a conservative valuation of the programme value is 2x (but should be much higher).Then the 80p+ NTAV at FY Mar24.Effectively if you're willing to hold for 2 years, getting the vaccine programme for free. If it doesn't pan out, it'll trade at least at NTAV then, so the same as the current share price today. If the vaccine pans out, it's then a multi-bagger.Of course, that depends on Aivlosin revenues and profits recovering and not dropping further... |
Yep strong value in its r and d and approved products , arguably way above current price. Will be realised one day if you can stomach the current disappointment. Tough one. |
Broker forecast cuts now in. Equity Dev and Singer -10% and -13% ebitda for FY25. Moderate mild cuts.Singer maintains price target of 258p (!!) saying value in EAH is the upcoming new product launches in 2025-2026. Let's see if the market agrees...(I hold in the Boon Fund) |
Trading Update: headwinds in China - new research note:
In a Trading Update for the six months to 30 September 2024, ECO Animal Health reports reduced demand in China and SE Asia markets for its proprietary Aivlosin® porcine treatment, reflecting lower incidence of disease and some customer churn. The Group expects the customary H2 earnings weighting (H2 FY24: 57.5%), whilst Aivlosin® continues to gain market share in India and Brazil. However, the combination of demand, foreign exchange and other factors across the full range of EAH’s global market presence leads the company at this stage to assess that revenue for the full year should be below market estimates: a consensus indicated of £92.6m and (adj.) EBITDA of £8.2m. Consequently the Group expects FY25 (adj.) EBITDA to be close to FY23 levels (£7.2m).
At this stage we have adjusted our FY25 outlook accordingly. Our FY25 revenue estimate is reduced by 7%, and (adj.) EBITDA by 10%. We remain prudent but will review further as H2 develops. |
Eco Animal Health Group PLC Trading Update
01/10/2024 7:00am
RNS Regulatory News
RNS Number : 3399G
Eco Animal Health Group PLC
01 October 2024
1 October 2024
ECO Animal Health Group plc
("ECO" or the "Company")
Trading Update
ECO Animal Health Group plc (AIM: EAH), a rapidly growing global animal health company with a portfolio of marketed veterinary products and a maturing proprietary R&D pipeline, today announces an update on its trading for the six months ending 30 September 2024.
Aivlosin® continues to gain market share in key territories, particularly Brazil and India, with revenues in these regions exceeding the Board's expectations. In addition, and as expected, we are continuing to gain market share in the US. We are however, encountering challenges in China, due to low disease incidence in the summer months, and in Southeast Asia, where sales have slowed reflecting some customer churn.
The ECO Group is second half weighted and this pattern will continue in FY 2025. Nevertheless, the recent challenges we've faced in China and Southeast Asia lead us to believe that revenue for the full year will be materially below market expectations.1
Due to the complex mix of geographies in which the ECO Group operates, foreign exchange headwinds, and the differing gross margins across each region, forecasting an adjusted EBITDA figure for the full year at this stage is challenging. The Board expects that adjusted EBITDA for FY25 will be in the region of that observed in FY23 and notes it is likely that more accurate guidance will be provided when interim results to 30 September 2024 are announced in late November.2
The ECO Group has grounds for optimism for an improved performance in the second half with pork prices improving in China, strong order books and continuing strength in North America, Brazil and India. In addition, we have recently been notified that the ECO Group has received regulatory approval for the marketing of Aivlosin® in Paraguay. This market produced 1.4m pigs in 2023, nearly 80% of which were in industrial farms.
The ECO Group is strongly cash generative and has a non-China cash balance in-line with that on hand at 31 March 2024. This ensures that the ECO Group's valuable R&D programme continues to move forward on a self-funded basis at the planned rate.
1. The Board understands market expectations for revenue and EBITDA in FY25 is £92.6m and £8.2m respectively.
2. Reported audited revenue and adj EBITDA for FY23 was £85.3m and £7.2m respectively.
-Ends- |
I see they have their AGM this Thursday but assume no-one is going as by having it at 9am they are saying do not bother to come.
We have not had an AGM TU in the last couple of years but as it is 2/3 weeks later, we may this year. |
From the ANP interims this morning
Quote
. There are clear signs that the pig market is improving in China,
Unquote |
Good to see CEO picking up more shares. He's done some buys before in 2022, 2023 but this is his first in 2024. Doesn't look like any regular periodic pattern, so thinking he's buying when the shares look cheap to him.(I hold in the Boon Fund) |
saw this.
Those of you who were more on the ball than me and who bought a couple of weeks back in the mid 90's will not regret it.
quote
Vet pharmaceutical group Eco Animal Health (EAH) could be through its nadir and on the cusp of an attractive period of growth, says Shore Capital.
Analyst Sean Conroy retained his ‘buy’ recommendation and a ‘fair value’ target price of 175p on the stock, which softened 0.8% to 106.7p on Tuesday, putting it down 2.1% over the last year.
Full-year 2024 results from the group ‘evidenced a robust performance from Aivlosin (used in drinking water for turkeys and chickens), which underpinned the delivery of +11% top-line growth despite the recent, challenging period its customers have faced’.
unquote
‘We sense the sentiment nadir could be passing with respect to the current lull in the hog cycle and highlight that Eco Animal Health should benefit if pork producers continue to return to profitability,’; said Conroy.
The next 18 months will ‘represent a pivotal period’ as the company looks to secure regulatory approvals and launch new products, and ‘looks set to offer an attractive period of near-term growth’. |
ECO Animal Health Group plc
("ECO" or the "Company")
Posting of the Annual Report and Notice of AGM
ECO Animal Health Group plc (AIM: EAH), a rapidly growing global animal health company with a portfolio of marketed veterinary products and a maturing proprietary R&D pipeline, announces that its Annual Report and Accounts for the year ended 31 March 2024 and Notice of Annual General Meeting ("AGM") together with Form of Proxy have today been sent to shareholders who have elected to receive hard copies by post.
The Annual Report and Accounts is available on the Company's website at
The Company will hold its AGM at The Grange, 100 High Street, London, N14 6BN on Thursday, 26 September 2024 at 9:00 am.
A copy of the Notice of AGM and Form of Proxy will be available on the Company's website at
-Ends- |
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