Ekf Diagnostics Share Discussion Threads

[tongosti] 09/2/2023 09:26

Great couple of days?!

[wan] 09/2/2023 08:31

James...Answer Re post 3000: well, I would certainly rather that customers are supporting the project with long term contracts. And With EKF reporting that "The customer onboarding processes (internal audit, validation and tech transfer) have progressed well." one would assume that those processes are not based on a whim, or a maybe.

And yes, as indicated in my post further above, I too want to see more detail on the projections and regular updates on the progress.

And as a general rant...it is a very frustrating situation that those deploying and investing other peoples money get more information compared to those of us that invest ourselves with our own money.

[wan] 09/2/2023 07:57

Large diagnostic companies have been reporting falling sales as a consequence of a continued fall in COVID-19 assay sales/testing and confirming that COVID-19 testing will no longer be a driver of growth going forward. However, most have reported strong performances in their core non-COVID-19 diagnostics businesses, on average reporting good rates of organic revenue growth, and forecasting growth in the high-single-to double digit range for 2023.

So, we are not an outlier in terms of the effects of transitioning away from COVID testing, with EKF's core diagnostics business well placed for continued growth (as EKF indicated).

Large diagnostic players have a lot of cash destined for deployment in terms of expansion and M&A, and hence their M&A teams are apparently very active. Some diagnostic companies are also looking to execute on their internal growth ambitions, and EKF's Contract Manufacturing, Laboratory Testing, and molecular enzyme offerings, is well placed to address some of those opportunities.

[tongosti] 09/2/2023 07:41

Lesson of it all - never outsource your thinking to anyone else. There was a genius around here going by the MG alias and had a big mouth with anyone who was not aligned in his views with Mills. Lol

[p1nkfish] 09/2/2023 05:49

FCRM too. He might have let his guard down and be spread too thin. Finger in too many pies, let his guard down or losing his mojo?

[yasx] 09/2/2023 01:14

What I have noted with Mills over the past couple of years is that whatever he is invested in or associated with, it appears to collapse and spectacularly so. RENX, SBI, this and the list goes on...

It reminds you of Woodford....!

[p1nkfish] 08/2/2023 20:54

Might get back in - TBD.
I like Mills (hold NAS), not done me any harm so far, he's had some dogs recently.

[tongosti] 08/2/2023 19:14

Funny how things turn out. At around 80 the mantra on this board was "if it's good enough for CM it's good for me too". Will they ever learn? Lol

[james188] 08/2/2023 17:13

Cisk,

I quite agree as to Mills, who as you say does this sort of thing frequently - most recently with SourceBio. Other shareholders were more relaxed when I raised this concern on this board a month or so ago, given the EKF shareholder base, which is very different to the SourceBio mix. I remain nervous and will not invest again in a company where Mills/the companies he controls or manages has an involvement.

Even at these depressed levels, I am disinclined to add, but I will hold.

Wan,

It seems clear that the customers are not funding the fermenter upgrades, so there had better be some decent long term contracts to justify the material extra costs. We have reasonable visibility as to the costs that EKF is incurring, but much less visibility as to the projected revenues, with very little from the house broker. They need to do better.

[p1nkfish] 08/2/2023 17:12

Or buy into NAS perhaps. Jumped out of this and may have contributed to the decline but didn't like what the price was saying. It exhibited classic signs of an imminent decent leg down.

[cisk] 08/2/2023 17:00

I really hoped that they would have avoided acquisitions like the plague, I remember the Stanbio days when they massively overpaid and it took years to recover from that.

Suspect exactly the same is true now.

IMHO the biggest risk is that Mills tries to take EKF private on the cheap - which let's face it, has a record of doing....

Having said all that, I remain a holder and may top up slightly at these levels.

[wan] 08/2/2023 16:52

James...the original investment in the new enzyme fermentation facility was estimated at $9.7m, but according the Trading Update the total capital cost of the development is now estimated to be around $14.2m (some of which is enhanced customer requirements).

I agree that ADL appears to be the most problematic area, but at least they are starting to see early signs of a recovery, and its transition to non-COVID testing now has a more concentrated focus.

[tongosti] 08/2/2023 16:44

This is more than -60% down from all time highs and you still holding? Maths tells us you need +166% just to get back to that ath level. Not exactly a small feat. Each to their own but hard to understand why folks do completely away with risk management. Surely it is the ONLY variable one has under control in this game.

[james188] 08/2/2023 16:14

The core businesses remain attractive, but there have been far too many management missteps recently and the succession planning strategy obviously failed. I was worried when Julian Baines first stepped back and I am relieved that he is now back in charge.

I also think that they overpaid significantly for ADL, which was supposed to be immediately earnings accretive but which is still operating at a loss. Added to that, we do not yet know the extent of the cost overruns on the fermenters programme, which is running around six months late.

So, I have not sold any of my shares, but I am by no means happy with what has happened.Lots to ask about when the results come out.

[wan] 08/2/2023 12:47

It's suffice to say (with perhaps hindsight) that the original Growth Plan was quite ambitious in terms of scale and timescale.

In my view, the Growth Plan has suffered a setback but it has not been blown completely off course, with the main ingredients and direction of travel still intact, and maybe even enhanced. And with EKF confirming and indeed predicted good rates of growth in the core established business for 2022 and 2023 respectively, providing, on the face of it, a reasonable degree of comfort. Nonetheless, shareholders have not exactly been rewarded for their patience, confidence, and belief. That of course needs to change, otherwise why are we even here to start with, and importantly why are we invested here for the long term being key questions!

Although I fully appreciate that risks still remain and that not everything will necessarily go exactly to plan, but with the revised timescale and increased focus on the new enzyme fermentation project, this now appears more likely to succeed overall i.e. the execution risk has reduced significantly given the advanced stages of development, vessels already delivered/installed to date, customer on-boarding, and the inclusion of enhanced customer requirements (which by my assessment/reading may also include a notable increase in vessel volume?). Amongst the number of applications and markets being addressed, I also very much like the potential from producing not only third party OEM molecular enzymes, but also EKF branded molecular enzymes.

EKF appear to have covered the crux of the issues, which are all being effectively addressed, but regardless, regular updates are now going to be essential going forwards, not least their upcoming guidance on the outlook for 2023 and 'beyond' which will be provided at the time of release of FY Results 2022, expected to be reported in late March 2023.

Singer recently stated that the current share price weakness represents a buying opportunity given the growth on offer, which aligns with the assumption that the Growth Plan is still intact, so we should probably assume that the potential upside is significant if the Growth Plan is effectively executed and delivered.

There are, from what I can tell, some relatively large players aligning with some of EKF's existing and new offerings, including the new enzyme project. Implying that EKF has the potential to become a 'materially' larger company in terms of revenue and market cap. So, I would like to see more of that ambition laid out in terms of how and to what degree the potential upside looks like and over what timescale, and not just the indicative conservative assumptions given to date.

As always, please conduct you own research when making investment decisions as I, or the threads contributors, could be either wrong or inaccurate.

[tongosti] 07/2/2023 14:46

Technicals indeed lead fundamentals - most of the time and it is surprising a lot of folks decide not pay enough attention to such a market truism. Investopia - I agree with your take on it.

Cumnor - I take your larger point and it is indeed surprising. However, where I hold a different view is on the magnitude of volumes ahead of the release. They were flashing red in the context of inexplicable price action breakdown. From 24 Jan onwards, the cumulative volumes on a rolling three day timeframe shot up dramatically. From 24 Jan to last Friday there were back to back increases in volumes. The cumulative period covering Wed to Friday last week amounted to almost 7mill shares (you have to go back to June 22 to find similar sell volumes) traded on a huge break south. That was clearly a massive warning sign.

[investopia] 07/2/2023 13:53

Should be RNS'd first, yes. But it rarely works that way. News tends to follow price and not the other way around, I reckon. The news almost always leaks out to someone. And my guess is any selling leading up to this update was a reaction to what we all now know from the update. So there's a case to be made that it's now all in the price and then some because markets often overshoot in both directions

[cumnor] 07/2/2023 13:42

Usually with not that much volume Investopedia as its generally PIs getting nervous. IIs are generally 'in the loop' and any big changes in outlook that might tempt them to dump beforehand should be RNS'd to the market first. Which is why I am wary-company looks decent on paper though...

[investopia] 07/2/2023 12:52

Hi cumnor,

Don't stock price movements almost always precede a news release though for all companies?

[cumnor] 07/2/2023 12:15

Looks interesting at these prices-what's putting me off is heavy sales and share price drop prior to update could smack of possible insider dealing or leaks. Won't touch till more clarity or possibly in the high teens as speculative punt, for that reason.

[tongosti] 06/2/2023 16:18

Wan old boy - it's when it's raining cats and dogs that you need to argue your case (your own not copy and paste from the web). Instead you've decided to hide under a rock. Not that you have anything of much value to say old pal, sorry - just making a point.

[tongosti] 06/2/2023 14:40

Are you saying -17% should be +17% instead?LOL

[investopia] 06/2/2023 12:33

The Trades data (buys and sells) is useless on Advfn. Once again, my buy just now shows as a sell. Note to self: don't bother looking at the Trades data and definitely don't let it influence you!

[sirshagalot] 06/2/2023 11:22

20p? i wonder

[tongosti] 06/2/2023 11:20

Morning bowling man