Tissue Regenix Share Discussion Threads

[cyberbub] 23/3/2022 12:05

Still climbing nicely. Heading back to the 0.55p-ish next resistance?

[gsg] 22/3/2022 16:32

Nice little L2 move just before the closing bell. L2 3 v 1 into the close.

[cyberbub] 22/3/2022 11:53

Yes you may be right. I topped up with 2M late yesterday. I think the key thing is that they definitely have enough cash, so no risk of a placing, which is always the concern for small loss-making companies. Onwards and upwards hopefully.

[tnt99] 21/3/2022 19:10

I believe they are reducing costs if you read the report and I for one expect break even this financial year maybe even a small profit as no expansion costs this yearWe shall see but is definitely heading in the right direction

[cyberbub] 19/3/2022 18:45

PS I'm not saying it's unachievable in 2022, with post Covid business rebounding it's possible we might get a 40% profit growth this year! I think it's more likely to be a 'run rate' though, later in 2022.

[cyberbub] 18/3/2022 10:30

Tnt - gross margin is 42%. They need to cover their $12M admin costs to break even. $12M divided by 0.42 = $28.5M, or roughly $30M. Simple maths.

[carrotandstick] 18/3/2022 07:52

Tnt99 - I agree. I trust TRX enough to hold long term, but if I wasn't invested and looking towards doing it, the low share price and the dilutions would probably put me right off. If I was a large company, looking to take a smaller one over however...

It's frustrating because quality, lack of demand, lack of innovation isn't what's holding TRX back, that's what's driving it.

These next 12 months are certainly going to be very interesting to watch.

[tnt99] 17/3/2022 20:49

And they stated that they expect at least 20 per cent growth this year and with the Italian deal maybe researching new products in their field should be simple very excited by this company could be huge in time or taken over at this ridiculously low price but they have diluted share holders twice and therefore they have to get the trust back

[tnt99] 17/3/2022 20:45

No way 22 million is break even with current costs in fact they reached break even over the last 6 months if you take out the 900000 thousand they spent on expansion

[cyberbub] 17/3/2022 08:34

Well we need $30M revenues to breakeven and overcome those massive admin costs. Sounds like might not be achieved in '22 but as you say the $30M 'run rate' might be achieved by then...

[wobblywilbur] 16/3/2022 13:36

Thx GSG. Brief but v positive!

[gsg] 16/3/2022 12:53

Stifel reiterates its BUY rating for Tissue_Regenix

after its FY results.

TP 0.9p
BioRinse sales up 33%
Capacity increased 50%

"Rev growth accelerating, break-even expected during '22 and an EV/sales of 1.8x; we believe the shares are significantly undervalued"

[wobblywilbur] 16/3/2022 12:49

Daz - you may well be right, I'll listen to it again when I can. I think they also said that the cash burn in H2 was c$1.7m so it is clearly going in the right direction.
Mention was made of forecasts in the market (broker research?)and 2022 revenues of $25m. Can anyone point to this - is it Hardmans? - and is it independent or 'paid for' research?

[daz] 16/3/2022 11:12

Wilbur - Unless I missed something, I don't think they meant that 2022 as a whole would be profitable, I think it means that on a monthly or quarterly basis, they may be before the end of the year. I stand to be corrected if they said otherwise.

[cyberbub] 16/3/2022 09:07

Wilbur thanks. I haven't yet had time to review the presentation as I am a under the weather this week, off work ill.How could TRX hope to reach profitability in 2022 unless they forecast a 35%+ jump in revenues this year? Was any such forecast mentioned? All I can see in the results is mentions of ongoing 20% rises. Would be great if they can achieve 35% of course!

[wobblywilbur] 16/3/2022 08:55

cyber - in the presentation yesterday the CEO was pretty clear that the company is fully funded through to profitability (expected in 2022) and that they are likely to use non-dilutionary finance (debt)to fund future expansion (their Phase 2). Pre the next stage of expansion they currently have capacity to support c20/25% growth per annum.

[cyberbub] 16/3/2022 08:39

The company could use their new debt facility to ramp up expansion plans, but it's not huge, and they still have the other debt to start paying off from July 2023. I would think in their current cash-constrained situation they might only want to take out more debt from late 2023 when they're hopefully profitable. Alternatively they might raise some more equity mid- next year sometime, but I would hope that would be at a substantially higher price, as Mr Market sees profitability approaching.

[cyberbub] 16/3/2022 07:46

Just thinking more about TRX. In simple terms they need to cover the $4.9M loss incurred last year, to reach breakeven. At 45% gross margin that's around $10M extra revenue, ie they need to go from $20M to $30M revenue. I think at 20% growth (and assuming that 2022 growth is higher than that as pandemic recovery gathers pace), I think this is very achievable by Dec 31 2023 - even taking into account the start of some loan repayments in mid 2023. Cash spend will be dropping as revenues keep growing, so I think $7.7M is enough.

Currently the company is on a price to sales ratio of about 2. This doesn't seem very expensive. And hopefully LTH investors will hold on, with a few new ones coming in as they 'look forward' to profitability.

Having said that, it implies that it could still be a while until we see any serious value gains here. If profit to Dec 31 2024 is say $5M, put it on a p/e of 15 makes a share price of only 1p or thereabouts.

I think investors wanting to see us above 1p are possibly going to have to hold for another 18 months +... or else hope for a takeover - which I actually think is quite likely... The company's market cap is pocket change for a big pharma at the moment, and we have good IP and know-how that a less cash-constrained company could push forward much faster.

Just my views. No investment advice intended.

[cyberbub] 15/3/2022 22:08

Thanks very much!I do struggle to see how a small company has $12M in admin costs. I don't think the CEO and directors are paid massive salaries are they? I might have a look at the emoluments section.I would tend to agree that the company should be able to get to breakeven with current cash, but will need more (which could be debt of course, not equity, if they are profitable) if they want short-term significant expansion.But forecast 20% ongoing growth rates are positive!

[daz] 15/3/2022 21:31

Cyberbub and everyone else!

I missed the first 10 minutes but I asked the question and the CFO said that none of the expansion costs form part of the admin costs, which is what I suspected. The finals mention the restructuring, so there is a focus on costs.
The underlying question is I think on cash and whether they have enough. There were many questions on this and they said that they had enough to fund the 'current operation' through to profitability. I suspect though that they are no longer able to fund the Phase 2 expansion, unless there is significant growth, although they raised the funds to do this.

They have put through price increases to reflect the extra costs of supply chain issues and also said that the addressable market is more than enough to support 20% growth for many years.

He repeated that the 2021 outcome was very good considering the reduction in elective surgery due to Covid, which affected the 1st and 3rd quarters particularly.
By implication 2022 should be much stronger, as surgical procedures return to normal levels, the price increase coming into effect and the 20% growth they expect year on year.

They have launched some new products but given the short presentation, he didn't elaborate much on how these have been received, although that might have been deliberate.
Someone asked a good question on quarterly reporting, which would make the growth rate more transparent and although acknowledged, they aren't planning to do that soon.
Another question on a share consolidation was well received and they said that it was discussed regularly and so I suspect will happen at some point.

A repeat of the presentation will be available on Investor Meets Company soon, so people will be able to form their own view.

FWIW and this is only my view I would emphasise, I didn't find the reassurances on cash completely convincing. I asked for the net cash figure, that is after borrowings and the credit facility, and the answer was that it could be worked out by looking at the accounts. That the CFO wasn't prepared to provide a basic piece of information indicates some defensiveness. I also asked how they were planning to repay the Midcap borrowings, which is due next year but there were many questions and they ran out of time but I suspect that the increase in the revolving credit facility is for that purpose.

I hope this helps

[gsg] 15/3/2022 17:25

Further product extensions to come across all three technology platforms next year, according to CEO.

[gsg] 15/3/2022 17:22

Further deals to come on OrthoPure XT in Europe to follow on from the deal in Italy. They are working on these deals at the moment according to a reply by the CEO during presentation.

Further 20% growth anticipated by management.

[mickhay3] 15/3/2022 15:30

https://www.proactiveinvestors.co.uk/LON:TRX/Tissue-Regenix-Group-PLC/

[cyberbub] 15/3/2022 11:32

Daz would you mind asking what component of their $12M Admin costs were related to the new building construction and other expansion, which won't be repeated next year?If you wouldn't mind just dropping a few quick notes from the meeting to people I'm sure everyone would be grateful.Thanks