Sphere Medical Share Discussion Threads

[johnlewis79] 03/10/2017 10:58

The sales price / value will be subject to how far we will be diluted from now on in which could take us towards 800m+ outstanding. I personally think 10 is very optimistic in years 2018-21
unless sales are way beyond forecasts because I don't think W&Co intend to be holding Sphere if we ever get into the US market. To gain traction over there could be 5 or more years away. One of lse posters posited Sphere at 50 or a mrkt cap of £100m+ as UK iis are loathe to invest in tiny Healthcare med device companies. If I'm right on the dilution that would value Sphere at £400m! Not on imo. My guess he wants P5 plus FDA or equivalent then sell us on asap. Were not far from P4+ as to the automated version I've no idea so if a deal could be done it might happen sooner than we think. As ever sales penetration will be crucial but how are these are going?
A quick sale or a very long road ahead? One thing I'm sure about we will never see the full value of this Co.

[dusseldorf] 03/10/2017 10:07

Thanks both - I think the key to any sale value (i.e. sale of Sphere Medical en-mass, which is really why I bought in) will be in the growth of Monthly recurring revenue from units sold (P4 or next gen) - the monitoring unit sale price itself is seems somewhat irrelevant to valuation based on the number examples you've shown, though long term, the hospitals would be silly to not go for reduced disposable rate and up front cost. As long as private equity can see demonstrated uptake, solid projections and consistent repurchases it's pretty straight forward to calculate a value for offer.

Based on previous investment rounds, and taking into account last investment round, I'd anticipate a 'sale' value in the region of 6-10p/share - IF the sales materialise in line with projections that I would assume Woodford and Wales fund have both been party too. I guess a few issues for me remain:

- Can the company gain critical mass, sufficient to cover costs in just 1 year - seems unlikely, where would new money come from
- Will Woodford and Wales wait more than one year before putting the for sale sign up? If they do, will they inject more capital and at what price
- Is anyone interested in buying? I would assume so, numbers speak for themselves regardless of sector

[johnlewis79] 03/10/2017 05:37

The sensor (disposable)with a lifetime of 72 hours and as many bga's as you like over this time period so very cost effective has been mooted at £200 per sensor. So effectively pays for itself after c 10 bgas as the b/tops charge per bga test. Widening the scope and usage of P with added analytes is critical to its success, but......as ever it's getting hospitals to use the device and we know how successful Sphere have been at that! Remember P4 has only been available since Dec'16 so not even a year of sales. I doubt we will ever know how many hospitals have ordered P4 as they won't be obliged to give us this info and any nos (outside of the taxman) will be released on a need to know basis....ie not us.

[del44] 02/10/2017 21:09

The monitor can either be free with a premium paid for disposables of pay for the monitor with a reduction for disposables..Usually one would be bought in and if benefits are seen perhaps a few more can be bought.....

[johnlewis79] 02/10/2017 18:01

Sorry dusseldorf no idea on either. We think the unit with monitor will be either free or on lease but as to volumes that was never disclosed. Gut feeling very few in the first take ups. I know Sphere were aiming for 4-5 P4 systems per 10 cc beds. With lactate (sepsis, trauma, renal,paediatric & general complex surgery ) they hoped for 5-6 per 10 ITU beds.The rev for year ended 16 was only £30k and forecast for 2017 was c £400k. I don't think we got any 2017 H/Y numbers so back to guessing!

[dusseldorf] 02/10/2017 13:28

johnlewis79 - Do you know what unit volumes a hospital would take are and what the MRR on one of the units is?

[johnlewis79] 02/10/2017 07:34

Back in Feb'17 we were advised that 16 hospitals had undergone evaluations (patients connected to P4) and others were on going of those 6 had placed orders for P4 across Europe. That was 6 months ago so one would hope we have converted a decent nos of those yet to place orders! For all we know we may have the 16 & more! Ok I'm joking but we will not be turning business away. P4 is pretty much the gold standard Proxima device with only sepsis to be added
Some may wait for lactate I don't know but I'd guess as fitted out now it more than does the job. Once we get 10,15,20 hospitals using P4 that bloody snowball effect which has pretty much melted away might be seeing signs of life!

[del44] 01/10/2017 13:37

I am still trying to figure out exactly where we stand on sales presently...I am assuming that we are going to continue to supply those customers that have already bought P4?
But just not looking for new customers at the moment......
Interesting article and thanks for the link..I shall certainly keep an eye on that source....
JL...I was looking up recently all the big private companies...and it swayed me into holding (and adding) here. It is not the complete dark side I had thought...possibly because I never held privately before....

[johnlewis79] 01/10/2017 09:29

Of that £17bn...Healthcare is c £2bn. With our focus on the US the recent Bombardier
fracas won't help, the commerce dept slapping on 200% duty on their aircraft.
So much for our new best friend as he seeks to dump NAFTA. Guess we better find a US 'white knight'pronto.

[johnlewis79] 01/10/2017 09:00

A hard Brexit set to damage exports to the EU says research by Baker Mckenzie.Casualties inc Healthcare, automotive,tech & consumer products to the tune of £17bn! Losses from a hard Brexit equate to c 20% of worldwide exports for the 4 industries.

[johnlewis79] 01/10/2017 08:39

That should read £650m! Some very well known names in this sector....Chelsea FC...Travelogue...Aston Martin...Betfred...Virginia active...David Lloyds leisure...oak furniture land...Acorn stairlifts... Hatfield...Timpson....etc. Of the 250 listed London has 68 the South East 46, Northeast 32 & East England
15 the rest are spread about the UK.

[johnlewis79] 01/10/2017 08:22

I had no idea how large the private Co sector was.Take the 250 mid market growth companies and the last one turns over £112m and Mclaren Automotive the top Co £650m.
The entry level for the top 100 is t/o of £60m.Be interesting to see if we appear in the bottom 100/200
next year!

[johnlewis79] 01/10/2017 07:54

I think your right Tim..He has/d a big job at Sphere and came across well whenever he presented. However as his title suggested 'business developer'We can argue he didn't quite cut it.I'm surprised he was the first to leave.

[timbo003] 30/9/2017 20:36

It looks like Gavin Troughton had(?) quite a big job.

Mind you, he might still be on the payroll and as VP for Bus Dev and the reason they notified Companies House this week, is because they forgot to do so many moons ago (pre-IPO) when as one of the founders he presumably would have been a director.

[johnlewis79] 30/9/2017 15:31

A NED? so not material.

[johnlewis79] 30/9/2017 15:08

Who was the Director?

[timbo003] 30/9/2017 12:57

Some News!





It's not very interesting though JL

That's one director down, several more to follow now we are delisted I would have thought. It should save the company a bit of cash, although I don't see him listed as receiving any remuneration in the last annual report (see below), so I have no idea how much we will save through his departure.

[johnlewis79] 30/9/2017 12:29

That's a start dusseldorf. ..let us know if anyone wants your shares at a penny
Heh heh heh!!!

[dusseldorf] 30/9/2017 12:19

Johnlewis79 - reasons to be cheerful include:- not worrying about price declines- knowing the business is fully funded for at least another year- knowing Woodford is in for £8m average circa 4.8pshare likewise Wales fund- knowing there may be another investor lined up for the other £3m which would extend point 2- knowing costs are being reduced, but supply increased to meet demandI have quite a few below 0.6 average. I'm set to wait for end game (sale to Private equity or perhaps administration), but in the interim I've contacted both the company and Woodford fund with scaling offer prices for my stock. Bird in the hand and all that.

[johnlewis79] 30/9/2017 12:05

This is an exciting board I know sfa is going on but c'mon...reasons to be cheerful?....There must be a couple!

[johnlewis79] 26/9/2017 08:12

Relax dusseldorf you missed nothing. As others will confirm anything I have ever posted on lse turned out spectacularly wrong! Those who chase moonbeams etc...

[dusseldorf] 23/9/2017 18:15

Did I miss something, I don't see anything posted by johnLewis79, can someone post or DM me. Thanks

[del44] 23/9/2017 11:30

Good man JL.....
Got to be worth at least 2p a share...best news on this thread for a long time....

[rugs2] 23/9/2017 07:16

well done JL.......

[johnlewis79] 23/9/2017 06:32

Just looking if this gets posted having wandered around all over the place