Venn Life Sciences Share Discussion Threads

[cocker] 12/9/2017 07:33

Results OUT & I have really not to much to say about them. Is it me or are they quite insignificant ?

[cocker] 04/9/2017 19:25

Was there any mention in Techinvest ?

[cocker] 24/8/2017 09:27

Very good analysis Yump. Venn directors need to get their house in order & make sure that the next set of accounts are transparent. They say the market very seldom lies, so perhaps that's why the shares languish at such a low. Having said that I fully understand why some would have a nibble at these levels.

[yump] 24/8/2017 08:11

So, given that the statement only mentioned revenue and the previous statements have mentioned profitability, are you not interested in where that fundamental has disappeared to ?

Only it seems a fundamental fundamental to me.

Also, just out of interest, how long do you think cash should be used as a valuation, after a business has raised it ?

I'm sure you've seen cash balances used as a positive a few months after its been raised, so how long does that go on ?

Free cash flow is the only decent measure of whether a business is actually generating decent cash from its operations imo.

[rivaldo] 24/8/2017 07:11

Good news for VENN's investee company SKIN today, receiving 3 new patents and trademarks in the USA and Canada:

[rivaldo] 23/8/2017 10:03

Nice start today - but it's just the start imho.

[basem1] 23/8/2017 08:47

I could only get 10k at 14p

[cocker] 23/8/2017 08:44

Wow Riv, looks like investors following your advice.?

[rivaldo] 22/8/2017 09:48

Cheers basem, appreciated.

Personally I follow the fundamentals, and they're telling me that VENN is fundamentally undervalued. That will be the case even if VENN fails to achieve Hybridan's forecast £1.27m adjusted PBT, which I'm not sure they will.

If VENN were to achieve only 50% of that - say a £600k PBT - if you combine that with the almost €3m cash pile, the investment in SKIN and the value of the core business as outlined in my post 1005 then VENN is worth considerably more than the current share price.

In a small-cap like this, one or two larger sellers can easily drive the share price down to silly levels given the propensity of others to follow them out on a drifting share price, the hitting of stop-losses etc. I believe that's what happened here.

As spooky says, it looks like the share price has hit a bottom and is starting to lift itself off that bottom now. The solid H1 update and the confidence for the full year should continue this into and onwards from the H1 results next month.

[spooky] 21/8/2017 17:10

No you are right basem but it could be in the process of forming a bottom. There is value there if mgmt. don't destroy it, and a break out from a bottom, if it forms, may be the time to buy.

[basem1] 21/8/2017 17:04

Hear what your saying Rivaldo and have always respected your analysis over the past 10-15 years. But that chart.........cannot buy that at present.

[rivaldo] 21/8/2017 12:15

Interesting note out from Hybridan a couple of weeks ago. This pointed out that Evotec's recent acquisition of Aptuit was on a multiple of 2.4 times revenues, and on 23 times adjusted EBITDA.

Other similar deals include Inc Research buying InVentiv Health at 2.1 times trailing revenues and 13 times EBITDA, Thermo acquiring Patheon at 4 times trailing revenues and 18 times EBITDA, Pamplona buying Paraxel at 2.3 times trailing revenues and 25 times operating profit, Labcorp acquiring Chiltern at 2.2 2017 forecast revenues and 13 times EBITDA etc.

Based on their 2017 numbers VENN trades on an EV/Sales of 0.32 times and 4.39 times EV/EBITDA.

With £19.3m forecast revenues this year, and £1.27m adjusted PBT, a multiple of say 2.3 times sales would value VENN at £44.4m.

This compares to the current £8.2m m/cap - which also includes the (now reduced!) stake in SKIN and the almost €3m cash pile.

[yump] 17/8/2017 11:29

Spin out of a loss maker that wasn't going anywhere within Venn isn't a great selling point to new investors.

[adamb1978] 28/7/2017 20:51

Also be interested to get people's views on how they look at the amortisation charge in VENN's P&L. I saw that consensus estimate figures stripped it out, though the company never make that adjustment. Given the asset being amortised are customer relationships and 'workforce' (spurious capitalisation!) I personally wouldnt adjust for that however if you do, it takes the PE sub 10x.

Not particularly a great basis to buy the company on, however if Mr Market started to look at them like that then it would look cheap. However at the moment, it doesnt appear to be
Interested in any thought-through views
Cheers

[adamb1978] 28/7/2017 20:00

Presumably VENN will/does account for SKIN as an associate so will consolidate its proportoinal share of SKIN's after tax-losses in its P&L? So whilst its deconsolidated that business from the P&L, its still going to suffer a hit each year whilst SKIN is loss-making

[buywell3] 26/7/2017 14:42

You might want to tread carefully with what you say

But I take your point

Staff do seem to be going and coming

Continuity suffers as a result

[rivaldo] 24/7/2017 10:23

Hybridan brought out a new note on Thursday envisaging a 30p+ share price on delivery of 2017 forecasts.

Their forecasts are:

this year : €1.83 EPS, €3.62m cash pile
next year : €2.07 EPS, €4.03m cash pile

"Solid H1 2017

After a lacklustre full year results released in March 2017, the growing Contract Research Organisation providing drug development, clinical trial management and resourcing solutions to pharmaceuticals, biotechnology and medical device clients today provided a trading update for the six months ended 30 June 2017.

The new financial year started well with the Company securing contract wins in January and February with a value of €5.7m. Total revenues for the Company were
ahead compared to the same period last year at €9.11m (H1 2016:€9.06m), with the client and revenue mix well balanced and strong rates of repeat business.

Moreover, we understand that Venn, has successfully introduced and delivered cross selling between early and late phase client bases.

We estimate that the Sedana contract announced in November 2016 and the €5.7m contracts won in January and February this year will contribute €4.3m in fee income in the current year. The Company has a strong proposal book, which should begin to turn in to business wins now that the full R&D lifecycle proposition is up and running. In addition to this, solid first half performance brings confidence around full year revenue expectations.

The sector continues to see growth, with encouraging trends in outsourcing likely to continue. We would expect that Venn continues to evaluate complementary acquisition targets which could at least in part be funded from its current balance sheet depending on size. The Company is well positioned to accelerate its win rate particularly with Biotechnology companies where its offering of a full lifecycle service combined with a customer-centric flexible approach sets it apart from the competition.

The shares of Venn have slid by 11% over the past 3 months, and given this trading update and its potential to meet expectations for full-year results, it presents a potential buying opportunity for investors. Delivery of our 2017 forecasts should see a recovery in the share rating and we see scope for the shares to surpass 30p over that horizon which would put the shares on a 16.5x 2018 earnings rating.

Cash and cash equivalents remained strong at €3.4m at 31 December 2016 and we are forecasting for FY 2017 cash and cash equivalents of £3.6m. With that said, a HY 2017 cash of €2.9m puts the Company in a strong cash position."

[buywell3] 24/7/2017 07:44

I think our freind yump might be able to concoct a case to make you ponder Dibbs

[dibbs] 20/7/2017 20:51

I did hold a while back but did sell out for a small loss. It is a share that I still keep an eye on. The update sounds broadly positive but they talk of "confidence around full year revenue expectations" There is no reference to profitability which leaves me feeling less positive than I was after my initial read. Anyone else see it this way?

Cheers

Dibbs