Oxford Biomedica Share Discussion Threads

[takeiteasy] 26/2/2024 17:47

The question i guess more was aimed at the inference that with a bank balance that no doubt stretches to the stars what motivated him to keep on searching for new investments and reaching out to meet management across the globe - could he not afford to relax on his beach on his island in the sun...

[steeplejack] 26/2/2024 17:37

...Oh no,don't say that!! Terry and i are the same age and we were Associated Members of the same stockbroking firm back in the 1980s

(He's done a tad better than me !! )

[takeiteasy] 26/2/2024 17:27

Amazing how Terry Smith has such a passion to go on and on - in a conference call last year he looked somewhat older than I had expected but when questioned on his age/possible retirement knocked it right back and cut the question very quickly. He has made some good calls tbf over many years. A lot of patience needed here so very much a small sized holding for me atm...

[steeplejack] 26/2/2024 17:20

'They may well think (not unreasonably) that with the business update in Dec and the JPM presentation in Jan, it's a waste of resources to prepare another full presentation so close to the results in April'.

Quite possibly and if so they should inform the market.I'd like to go along with the idea that OXB suffered disproportionately from a wave of redemptions as cash strapped punters struggled to keep the heating on but the overall movement of UK stock exchange indices over the last year or so,don't really support such a view.The FTSE100 has barely changed over the last couple of years.The FT250 slumped in 2022 by a short 20% but rose 4.4% in 2023 ending the year only marginally down on the close in Dec 2020.A drab performance compared with the US Nasdaq but not disastrous.There was a well recognised capitulation in the biotech sector though with beloved stocks like Moderna crashing some 80% from their covid induced peak.OXB parodied that slump.The market moves like a mumuration of starlings.One moment,its all about basic resources then suddenly the interest can switch to semiconductors,its all a bit faddish exacerbated by algorithmic trading and the fact that marketmaking books are managed on a sector basis.Neither does the market differentiate that closely(short term) between various constituents of a sector as they fall in and out of vogue,the market is a bit of a simpleton in that respect.

Sure as eggs are eggs,the tide will turn for the likes of Oxford Biomedica just as it will turn for Moderna and probably at much the same time despite the cognescenti telling you that they are very different animals.For the greater part,fund managers are generalists.TerrySmith was a banking analyst well into his thirties and i can assure wouldn't claim to have anything more than a fairly rudimentary knowledge of drug stocks but has recently been more than happy to buy shed loads of Novo Nordisk.Thing is a lot of very successful fund managers don't have especially deep specialist knowledge of this or that sector and their track record doesn't suggest its essential.It's all about opportunity cost and being in the right stocks BUT at the right time!I do feel that the management of OXB could do a bit more to promote their cause but the proof of the pudding will be in the eating.

[takeiteasy] 26/2/2024 15:02

more seriously I wonder if selling fatigue is starting to set in at all...support has held a number of times now around where we find ourselves (famous last words!) ...

[takeiteasy] 26/2/2024 13:47

In Harry we trust who needs Mr Klopp to motivate the team :))

[harry s truman] 26/2/2024 11:56

Personally I'd take the "sign" that sector experts like badger (and groupies) basically gave up posting (following the breakeven projection and the news that IM wanted in) to be a lot more significant than the temporary absence of anyone tired with providing constant reassurance here.

OXB were never going bust. Worst case they would have simply cut their cloth to suit their reduced income.

Reality is that pre-pandemic income is now coming back in spades (arguably already back with Oxford sites at capacity for upstream work), but of course they have Boston and 2 new sites in France to use/fill now as well.

It's not dawned on people outside of our loop (and a few specialists like IM) yet, but the upside is spectacular. It's simply time until that is noticed, and then like many other companies nearly destroyed by the pandemic reaction, there will be a rerating. Likely an overrating too.

Worst case we wait 2 years for what they have promised (record revenue & earnings to trigger a rush into OXB), but it's likely (very likely) to happen long before.

Difficult for some I know, but for those who can accept that OXB's rough breakeven this year is not only true but excludes what ABL can do, then there is a massive cash pile which isn't needed for operations. That scenario is not the general perception in the market. One day that will correct. If nothing else the FY results will be in 2 months, but I expect news before then.

[marwalker] 26/2/2024 11:05

SayingsNever try to catch a falling knife Had thatBeware a dead cat bounceHad that slightlyTime to buy is when the last bull capitulatesWill this one turn out to be true ?

[takeiteasy] 26/2/2024 10:52

I can understand entirely that OXB holders are too depressed to post anything - spot on.

I nearly swapped all this into PRTC recently and did not on the basis it is such a small position and give the british underdog a decent chance etc etc - but have no plans to add more...

[dominiccummings] 26/2/2024 10:47

I can understand entirely that OXB holders are too depressed to post anything. Why would you, stuck down at these levels with no sign of change?
Perhaps though, the company prefers that PIs shut up and 'suck it up' quietly?

[philh75] 24/2/2024 10:14

Industry trend, sorry if this has already been posted but it’s quite interesting how OXB are right on trend with their strategy.

[steeplejack] 22/2/2024 21:28

Well,sadly Dom,i have to suggest that your average investor punter isn’t remotely interested in OXB.Afterall,with a cap of only £170m the stock is arguably very much in the small company category and arguably at danger of falling below the institutional radar(Indivior by comparison has a market capitalisation some 12 times larger).There’s little to immediately commend the stock until OXB update the faithful.It’s all about AI right now as Nvidia leads NASDAQ 3% higher this evening.However,Moderna (which spookily seems to presage OXBs future share price moves)has risen some 14% today in the US on better than expected results.Cost cutting has been applauded apparently as Moderna tightens its belt in the face of sagging Covid vaccine demand

[marcusl2] 22/2/2024 21:18

Back in 2023’s third quarter, Moderna took a hefty $1.3 billion inventory write-down attributed to “excess and obsolete” COVID vaccine stock. Further, the company paid $500 million for a contract manufacturing wind-down cost and $100 million for its cancellation during the period.

Around the same time, Pfizer recorded $5.6 billion in coronavirus-related inventory write-offs and other charges.

[dominiccummings] 22/2/2024 19:34

I am a believer Mr President Sir. I simply muse as to what other folks, not followers, might see.

[dominiccummings] 22/2/2024 16:00

New mode of operation
Two new acquisitions
Operating across two international boundaries
No briefing from the company for 6 months

Not hard to understand why investment sector are cautious.

(Yes. WE understand the issues, but we are knee deep in experience and data)

[harry s truman] 22/2/2024 15:45

It's difficult to say anything with 100% certainty and especially in this market.

So with regard to the future then it's anyone's guess. I do know quite a bit of the history with OXB though.

I remember 2018 pretty well as it became apparent that we were going to turn a profit. That was akin to a coming of age for OXB and got us a lot of positive headlines because as many commentators wrote - it's so unusual to become profitable in this business.

Before that and 2012 to 2014 nobody was interested. Price hardly moved, prospects came and went and that's where a lot of my shares are from as at one point I was buying for 1.5p (this is obviously pre the 50 to 1 consolidation).

The end of 2014 Novartis give us the first of their big contracts and over Q4 of 2014 / Q1 of 2015 the share price quadrupled.

2017 there's a major supply deal with Novartis (same one we are still working on) and when it became clear that 2018 was going to be our first profit on operations then the price hit £10 in June that year (would have been 20p vs 1.5p in 2013).

Why am I going on about this? Because 2018 was our maiden profit on operations (£13.4m on £66.8m sales) and the market loved that.

Unfortunately you know why covid-19 is called that (2019) and the next year the world went mad. Yes we had a profit again in 2021 (£23m) but everyone knew that 87% of bioprocessing income was coming from AZ for the covid jab - which even OXB said was exceptional.

Which brings us to now. I was very pleasantly surprised by the amount of work Seb's team brought in last year (contracted value signed in 2023 of £124 million by Dec 7th).

Nobody else seems to be as impressed by that, but it's a staggering amount of work won at a time when industry papers regularly say the market is coming back but still flat after covid.

We're all of course still waiting for Stuart to update on 2024 and I'm hopeful that "roughly breakeven" (his 2024 forecast from 5 months ago) will become "profitmaking" and he will say that with some certainty on booked in work, because we will soon be approaching the point where almost everything Seb's team sells is going to be for billing in 2015 and on.

If he does that then (imho) the market wakes up and I get my "back in the FT250" target for this year.

Regardless though, they are on record as saying that better than 20% EBITDA margin on better than £180m sales in 2026 were numbers picked as being very achievable and they expect better.

Our best ever year (dominated by exceptional covid vaccine work) was £143m sales.
Our best ever earnings year (same year) £23m in earnings.

Better than 20% of £180m in 20026 will be better than £36m in earnings.

This is without all the other theories we regularly mull of what OXB might be up to.

It's not widely accepted yet, because we are currently this "small cap" share which likely lost £50m last year and £41m the year before, but what they have done to turn those losses around is remarkable.

When you consider that they also managed this despite the misfortune of the guaranteed late stage / main customer of their new US venture all but going bust, then it's a "can this really be true?" moment, which I think is a problem that a lot of the covering brokers have struggled with.

[harry s truman] 22/2/2024 11:40

Will primary listing in the US make Indivior profitable again or is it just easier for the bosses to raise more money and pay themselves bigger salaries?

I didn't know anything about Indivior until you posted the name this morning, but Yahoo tells me that they have a trailing 12 month income of -235m which suggests to me that they maybe have bigger issues than where their primary listing is.

I know little of Nasdaq other than it was the assumed reason for our consolidation (minimum share price history to meet listing requirements) and that the listing is more expensive than the UK.

US companies which I've followed seem to get away with much less (lawsuits from investors and regulatory investigations which, unlike the UK slap on the wrist, can result in free orange overalls and chains).

So, if Indivior shareholders think that moving their primary listing there is a fix-all then I wish them well, but I can't help remembering a quote when (I think) Whicker did one of his programmes on expats. The Australian guy I'm thinking of said that the people who did best in Australia were the type of people who saw the upside wherever they were. Yes there was opportunity there, but the people who saw the downside of everything in the UK usually didn't last long as they quickly saw the downside of everything in Australia too.

[harry s truman] 21/2/2024 21:48

It's curious but no real guarantee that anything is happening. Obviously we think that we are due something from them before the prelim results in April, but outside of that it could be anything (or nothing).

I'm hoping that they aren't going to buy anything else (Homology's manufacturing arm in 2022 & ABL in 2023 might have them on a roll, but I hope not).

It would be interesting to know how the put option works with regard to LV work from Oxford being done in Boston.

The original deal said this "at any time following the three-year anniversary of the Closing (March 10 2022) OXB will have an option to cause Homology to sell and transfer to OXB, and Homology will have an option to cause OXB to purchase from Homology, in each case all of Homology’s equity ownership interest in (OXB Solutions) at a price equal to 5.5 times the revenue for the immediately preceding 12-month period, subject to a specified maximum amount.".

But is that just revenue on earnings related to the AAV side? Remember Homology own nothing of our LV now in early work there.

More to the point though, Homology are a bit stuffed. Nasdaq are peeved at how low their share price is and they have a 6 month warning on that



But as they are merging with Q32 Bio and abandoning the old business, would it not make sense (closure) for them to try to get bought out of their option rather than having to wait 13 months?

Do it now and they can wrap everything up and move on. In the interim results the option was valued at £20.3 million (end of June 2023).

Yet another possibility there of what OXB might be up to. If OXB are breakeven or better this year then they can afford £20m. If I was correct with a previous post about how many Orchard shares we have remaining, then that cheque from Japan would be timed very nicely.

I appreciate this is too many guesses now of what they might be up to, but I would say that the people wrapping up Homology will have a need with some urgency whilst OXB have the cash. There is a natural meeting point there I think where Homology get their money early in exchange for a discount. But maybe they are happy to wait until March next year?

[steeplejack] 21/2/2024 20:37

Indeed,Harry,some news could be imminent.The volume over the last couple of days suggests that "somethings in the building" to quote an old expression.

[harry s truman] 21/2/2024 16:51

That sounds very early stage Marcus and they get a fraction of the headline figure now. It could easily be 10 years before we have the commercial fruits of that competing with Novartis and BMS (if every trial stage is a success). As always, we wait and see.

Regarding here & now though, 1.25% of the company traded today? Nearly half a percent yesterday. Both days we have been up and down on price, but finishing slightly up today?

If it was a massive volume and all buying then I would guess leaky ship news tomorrow or maybe that the analysts have had their long mentioned conference call and the private clients now know a better story. As it is though I would say anybody's guess.