Vectura Share Discussion Threads

[vecturaking] 18/3/2021 07:43

Strong Results Special Divided ReRating Shareprice

Strong Results
Special Dividend
Better then Expected Trading
Leaves Around £200million Cash in the bank

130pence in Open with 150pence Soon after

Enjoy the Ride up. 200pence end of this year

[jeevsje] 18/3/2021 07:33

Volvo, that is not the point. Shareholders were not informed of the change in date from Feb to April. This has a material impact on the balance sheet. Even now, they have hidden it within the text. To some extent, it explains lack of RNS confirming the receipt of the funds back in end Feb/early March.

[polaris] 18/3/2021 07:30

Anyone's guess on how the market will interpret these results. So many one-offs to take into account but at least the headline number is positive this year! ;-)

EBITDA from underlying business is well up at £61.5 M cf. restated £43.4 M. That's well ahead of expectations, as were revenues. Given the buyback in 2020, the total number of shares in issue is considerably lower than 2020, so the adjusted EPS is over 10 p per share.

The dividend is subject to GSK not petitioning the Supreme Court but, given they have paid up and paid Q4 2020 royalties of 6.5 M (confirms my numbers from previous post) in January and February respectively, i don't see an issue with that being paid.

CDMO is still small fry compared with legacy revenues. 2021 will continue to be a transitional year, with forward guidance hard to judge. That needs fleshing out in the presentations today.

The footprint in CH will be closed in 2021, leading to some one-off costs but looks like the operation will be lean and focussed by the end of 2021, ready for subsuming into a larger organisation or bolting on additional capability to expand offering.

Now to read on into the notes...

[vecturaking] 18/3/2021 07:30

Should open around 130 pence
And climbing to 150pence

Enjoy.

[volvo] 18/3/2021 07:25

jeev The Board consider that the likelihood of the US Supreme Court overturning the previous decisions is remote, based on the average acceptance rate of cases petitioned to US Supreme Court and the merits of the case.

[volvo] 18/3/2021 07:23

Best guess, over the next month the share price will at it least rise 19p before losing it when it goes ex divi...as the income brigade jump onboard

[jeevsje] 18/3/2021 07:17

"Further details regarding the proposed return of capital will be provided in late April, after the window in which GSK can petition the Supreme Court has expired."

I thought the window had expired in Feb, as per previous announcements. Now, they are stating an expiry of late April. Not pleased that info was not passed on to us previously.

[volvo] 18/3/2021 07:14

17pc divi coming

[volvo] 17/3/2021 19:28

Whatever it is value the company on its turnover, its cash in the bank and its future prospects.... its 30pc above here

[slim9] 17/3/2021 18:21

& Moi. Lets Hope Its a good one............

[a1ord53] 17/3/2021 17:55

Thanks Paul .

[polaris] 17/3/2021 17:39

So - let's see how tomorrow morning stacks up against the consensus numbers from #10934

On 15th Jan it was consensus of 5.7 p on revenues of £177.43 M for 2020 from 6 brokers.

It is now a little lower than that at 5.56 p on revenues of £177.57 M from 7 brokers.

I've an alarm set for the morning to analyse figures before market opens. Hopefully, i'll have time to post thoughts before the bell.

[base7] 17/3/2021 10:52

Will had time to "bed in " ,build his CDMO team & start building revenues from scratch.Presumably the Board appointed him as they liked what he had to say & his vision for Vec.Tomorrow is his opportunity to demonstrate decisive leadership ,&confirm the direction in which his vision sees us going & the potential of that vision.He has advised that CDMO revenues should treble this year ( to £9mill + ) & perhaps he will share his view of the future beyond 9 months & perhaps an acquisition policy will be announced. I agree that special dividends would be unlikely to help our share price although a commitment to a regular & growing dividend would be well received & attract income funds & there could well be another reduction in share capital ,as happened last time capital was distributed although I am sure they will not wish to do anything which would reduce our market cap as surely , the who point in appointing Will was to improve sentiment towards us & improve our market cap , having disappointed now since the acquisition of SKP , which ironically has proved to be our saviour, so far !

[gbcol] 17/3/2021 09:52

I would agree that a value adding acquisition would be the best use of cash if they can get the right company without overpaying. Failing that unlikely event, signalling a regular dividend would be my choice. One off divis or share buybacks are a bit pointless, even counter-productive, particularly how they did them last time and would risk exit from FTSE250.

[diesel] 17/3/2021 08:33

If they announced an intention to be a divvy paying company that would signal confidence in their ability to generate cash and profits going forward, however a one off distribution of a cash windfall could end up being negative for shareholders. This is all about market confidence in the managements ability to grow the business, unused cash in the bank is not necessarily a positive.

[justiceforthemany] 16/3/2021 23:47

Go for both.
Small special dividend (2-3p) and share buy back.

[jimboyce] 16/3/2021 16:34

I agree, however VEC have a habit of overpaying for their acquisitions, and then the resulting impairment hits the bottom line. I would prefer to see VEC assimilated into a larger outfit.

[polaris] 16/3/2021 16:27

For anyone thinking a large cash return is on the books, the current automatic exit point for the FTSE250 is near £600 M, about 101 p here. I'd say there is little to no chance of any cash return putting that into jeopardy. If the board have any sense they will buy something in the £1-200 M range that is value additive. Best guess as of today is that VEC have about £200 M in cash, leaving the EV close to £500 M, below the index exit point.

[volvo] 16/3/2021 16:01

polaris yes 130p plus seems minimum, we were near 115p before the GSK news or Advair approval.

No value given to either really yet.

Still on we go to Thursday and an interesting read at 7 in the morning

[polaris] 16/3/2021 15:28

No, they are just parking the share price back at the price at the end of business on the trading update day. This is classic manipulation in a period where the company has no means to defend itself. It is blatant but authorities will do SFA! Best just to ignore the last 6 weeks of trading.

edit
They were already in the process of parking it when the delay of results date came in. They took the chance to revisit the low of the trading range to load up on forward contracts. I also took the opportunity as it was predictable.

A real indication of where VEC is will happen in the days post results. Upper bound low 130s.

[volvo] 16/3/2021 15:24

hmmm is the brake coming off?

[polaris] 16/3/2021 13:28

SP being walked back to park it in the same area as the trading update, when VEC entered close period. Job done for the trading algorithm.

[polaris] 16/3/2021 10:01

$164 M was in one of the RNS or court papers and then you have the remaining royalty-based up to expiry of IP on top of that, due in Q after sales recognised by GSK. By my reckoning, that is 3 Qs of royalties and the Q4 2020 was around £6.5 M from relevant sales in the GSK results (post #11004). There will be tax on the lump sum and the other revenues will be recognised in 2021 figures, so also be subject to tax-rate on eventual FY2021 results.

edit
It was in the trading update - $164 M to be paid by end January 2021