Ekf Diagnostics Share Discussion Threads

[wan] 20/5/2022 11:04

I note that the buyback authority to purchase up to 15% of EKF's shares was also passed at the AGM, which is an interesting dynamic given Harwoods current 29.04% holding, and given EKF effectively retired (perhaps temporarily)9m shares, representing approximately 1.94 per cent of its shares into treasury back in March/April.

However, we also do not yet know what will happen to those 9m shares EKF hold in treasury (and do not count when working out the percentage holding), which presumably if re-issued could act to counter/balance the situation. Unless I am missing something?

As I say, its an interesting dynamic, which I assume is unlikely to be triggered.

[wan] 20/5/2022 08:49

James, I understand your reasoning and I also appreciate your frustration.

We may have to patiently wait for delivery of the figures to confirm the potential and the direction of travel in terms of the high margin business opportunities. However, one assumes that any announcement of sizeable contracts and/or trading updates might bring the potential to the market's attention sooner, so a swifter re-rating should not be entirely discounted in my view.

This brings me on to another of my questions at the AGM -
How many EKF proprietary assays are in development, and/or being targeted for development?

EKF are not developing proprietary tests/assays per se, they will however produce both proprietary EKF enzymes as well as third party enzymes that can be produced in bulk scale for mass production of test kits, such as molecular testing, and indeed in other application areas too.

So, proprietary, high margin, enzymes might be an example of an aspect that's underappreciated, as clearly, such enzymes could generate significant value, as well as providing potential to increase EKF's attraction to new and existing partners, and as well as increasing EKF's own moat.

In this regard, the partnership with ABEC to deliver customised, large-scale bioprocess equipment to EKF's specific manufacturing requirements is perhaps particularly worthy of note.

Elsewhere, I note development of a unique fermentation platform to 'sustainably' produce high-quality molecules through fermentation. Such 'bespoke and specialised' fermentation platforms will enable a consistent, scalable, and reliable supply of high-quality functional molecules.

In short, EKF are leveraging their extensive manufacturing capabilities and many years of experience to respond to demand-driven opportunities in a very specialised, attractive, high growth area.

[james188] 19/5/2022 17:30

wan,

I thought that the EKF AGM Q&A session yesterday was excellent - and I noticed that a number of very savvy life sciences private investors who I know from other successful companies (BVXP, TSTL etc) participated. The management team dealt patiently and comprehensively with a broad range of questions, which is to their credit. My frustration is that the very clear messages that emerged as to the direction of travel/high margin business opportunities etc do not come out in the reports or the broker notes that I have seen (limited to Singer, in my case).

EKF is quite a complicated business and I do not think that it is well understood by many people. It really needs a comprehensive note to explain what is going on, but we do not have that. This is a slow burner and I do not expect much to change until the figures confirm the potential.

[tongosti] 19/5/2022 12:08

Since there is a strong negative correlation between wan's posting and share price performance, maybe he/she can stop doing so for a bit in the hope of breaking the jinx? Just a thought.

[wan] 19/5/2022 09:06

Just as an example only, as I have no specific indications as to what EKF might be tendering for, the following provides food for thought regarding my question to EKF regarding continued interest in supply chain resilience and preparedness in terms of molecular sample collection products -

PCR Sample Collection Kits
A Prior Information Notice
by SECRETARY OF STATE FOR HEALTH AND SOCIAL CARE ACTING AS PART OF THE CROWN THROUGH UK HEALTH SECURITY AGENCY

Type - Contract
Value £0-£500M
Sector - HEALTH
Published
25 Mar 2022
Delivery
not specified
Deadline
n/a
hTTps://bidstats.uk/tenders/2022/W12/771424736

PCR Sample Collection Devices and Consumables
A Tender Notice
by THE COMMON SERVICES AGENCY (MORE COMMONLY KNOWN AS NHS NATIONAL SERVICES SCOTLAND) ("NSS")

Type - Framework (Goods)
Duration - 23.5 month
Value - £-£40M
Sector - HEALTH
Published
16 Mar 2022
Delivery - To 08 Apr 2024 (est.)
Deadline
19 Apr 2022 11:00
hTTps://bidstats.uk/tenders/2022/W11/770834779

There are other testing tenders too, for which EKF could provide products and support, but I won't list them all, but suffice to say it provides strong evidence that effectively demonstrates that there are still reasonably large, post pandemic opportunities for EKF's current and compliant, high-quality contract manufacturing products.

[tongosti] 19/5/2022 08:43

Nonsense on tap. What a chap.

[wan] 19/5/2022 06:58

AGM commentary.

As mentioned previously, there was an excellent range of questions submitted in advance (by myself and others) and asked during the AGM.

Several questions and answers particularly stood out, especially in terms of the answers given and are worthy of highlighting by way of a summary from my very quickly taken notes (which do not cover everything) and must be taken on the basis they may not be a perfect reflection (audio was also not always perfect).

A question was raised regarding Oragenics. Oragenics has recently been focusing on vaccines. However, whilst they are still pursuing vaccines for COVID they have also recommenced work with EKF on their novel Lantibiotics aimed addressing antibiotic resistant infections - hTTps://www.oragenics.com/technology-pipeline/lantibiotics

A question was asked about margins on EKF's Fermentation products. The molecular fermentation products have a 'materially' higher margin that EKF's current point of care products (I am not going to put the margin referred to on here), such that it will be a significant driver of EKF's growth over the next few years.

One of my questions - Is there any interest from private or public sector customers in providing supply chain resilience and preparedness in terms of molecular sample collection products for future pandemics/health emergencies?
Yes, EKF are also actively tendering for several government contracts.

One of my questions - Are there any expansion plans for veterinary applications/tests?
EKF are already in the veterinary market with one test, but will be launching a new product for Lactate testing next month, and expanding their offering further with other products. The CEO described the veterinary market as very interesting, which is not as highly regulated as EKF's other healthcare markets.

There was a question regarding an apparently recent note from Investec, that 'apparently' has a price target for EKF of 94 pence. This question was not directly answered (obviously), but provides food for thought if correct.

One of my questions - Can you provide an update on the development of the EKF Response aimed at Sepsis testing in critical care settings?
Ongoing development, if all continues to go well, then launch expected in 2023.

I may be able to add a few other aspects in due course.

[wan] 18/5/2022 11:08

An excellent range of questions submitted and asked, and indeed answered, during the AGM meeting.

A question was asked about Mckesson (not from me) and how they were preforming with regard to the McKesson Consult™ Hb. The answer was that it was doing very well. I note from the Growth Strategy that it stated the following - Displace HemoCue (Danaher) with DiaSpect Tm.

This is something I have also been trying to keep tabs on as one indicator, and I recently noted the following when I did a comparison - hTTps://cutt.ly/DHEMa87

There is a big difference between the products, with the McKesson/EKF product being being far superior.

Also, when you search Hemoglobin Analyzer Kit, that's the only two that come up (previously Hemocue also featured), albeit I believe that you can still purchase Hemocue products, but this may due to servicing the existing installed base, which hopefully will continue to migrate over and 'upgrade' to the McKesson Consult Hb, for which EKF have a private label distribution agreement with McKesson

[tongosti] 18/5/2022 09:00

Mr Market's judgement on your broken record nonsense is simply blah blah blah

[tongosti] 18/5/2022 08:13

Can't agree more.

[dan_the_epic] 18/5/2022 07:20

I disagree. 19x earnings is too expensive in my book when revenues and eps will go sharply backwards this year because of the covid revenue and when there have been a major increase in competition in some of the areas they want to get into because of covid.

And that is assuming they hit their growth numbers when the macro is going to get much worse

[wan] 18/5/2022 07:18

Edited/tweaked the above post

[wan] 18/5/2022 07:11

Todays AGM Statement reads well, indeed it would appear that some of the investments made in supporting EKF's Growth Strategy look set to start delivering strongly by the end of this year, with potential for "significant revenue growth through to 2024". In my view, that is already starting to read better than the original 'conservative' potential guided in their Growth Strategy presentation.

I remain very interested in the redeployment of Contract Manufacturing and Laboratory Services capacity and skill set into non-COVID related areas, which looks set to start delivering in the current year. I believe there is much more to this aspect than is currently being revealed (for obvious reasons). So, I believe we are likely to get more information as the year unfolds with regard to both contract manufacturing and expansion of EKF's laboratory Services.

There are early signs of growth in the core business compared to 2021, which had broadly recovered to pre-pandemic levels, and is also very encouraging.

[beckaroo] 18/5/2022 07:02

Record Q1 last year with Covid revenues included. Matching that this year is a great result.

[dan_the_epic] 18/5/2022 06:58

No growth in q1 and macro is about to get worse. Not cheap enough.

[tongosti] 17/5/2022 08:54

If this baby doesn't hold the key 30 level, then in all probability the final leg of this long journey South should probably take this to 16. Far less certain this potential last leg is (compared with the previous 48 and 33 milestones) but being under all key moving averages still give this scenario the edge.

[tongosti] 12/5/2022 15:48

If only Mr Market would listen to the poor sod. 33 finally captured. Lol

[wan] 12/5/2022 07:26

Recall that EKF intends that the new ordinary shares received as a result of its participation in the recent Verici fundraise will be distributed to its own underlying shareholders, along with EKF's existing shareholding in the Company, as soon as reasonably practicable.

With further news flow expected, Verici Dx is one to keep an eye on.

[wan] 12/5/2022 07:07

Excellent news from Renalytix spinout and EKF holding, Verici, this morning.
hTTps://uk.advfn.com/stock-market/london/verici-dx-VRCI/share-news/Verici-Dx-PLC-Results-of-Tuteva-clinical-validatio/88084086

[tongosti] 09/5/2022 11:08

Have you mortgaged house and all then?!

[sarcoline] 07/5/2022 16:49

Big Oz asset news imminent at CLON as early as Monday 7am. Price target....multibag.

[tongosti] 07/5/2022 16:48

If wider markets are in a generational super bubble and SPX and NDX are to go another 50% or more from here, where will certain individual shares trade at? That's right. What most "value" gamblers in this game do not understand (even after losing big) is that if the boat has been sinking with a rising tide, what will happen when the tide goes in reverse?

[p1nkfish] 07/5/2022 14:06

Take it private, wait 3 years, re-list.