Venture Life Share Discussion Threads

[csmwssk12hu] 04/8/2022 11:50

I’ve got the feeling this is about to go on a tun to 41 you were informed imho dyor

[basem1] 01/8/2022 07:29

Will ST give a mention today We will know a minute or two after 12

[1jat] 29/7/2022 17:28

Sadly no one is interested inVLG at present.
V low volumes since Monday….all on holiday?

[qs99] 29/7/2022 08:08

Thanks, always love your updates BG, v. helpful!

Good weekend

[brummy_git] 29/7/2022 07:17

Positive H1'22 trading update from OTC healthcare firm Venture Life on Monday.

All the details here.

www.linkedin.com/posts/paul-hill-a5994116_vlg-vlg-activity-6958680648207233025-zY5T?utm_source=linkedin_share&utm_medium=member_desktop_web

[qs99] 25/7/2022 13:45

Great thanks for posting, should see this high 40s IMO ahead of next update, with continued delivery over 6 months allowing progress beyond the TP of these brokers DYOR

[se81] 25/7/2022 13:23

And cenkos

Venture Life has provided a Trading Update for the six months to June 2022, noting that trading is inline with management’s expectations and remains on track to meet our FY22E forecasts. Revenues are expected to be £18.9m for H1/22E (+36%), supported by recent acquisitions and gross and adjusted EBITDA margins have increased. Net debt, including finance leases, was £7.2m, improved versus £7.5m at Dec-21A. The order book remains strong and ahead of the same period last year and supports the H2/22E expectations alongside trading to date and the normal H2-weighting. We maintain forecasts and our Buy recommendation.

 Trading – H1/22E revenues are expected to be £18.9m, up 36% reported (35% at constant exchange rates (CER)), supported by the acquisitions of BBI Healthcare and the Helsinn portfolio, which contributed £6.3m in the period. On a proforma basis revenue growth was 4%, reflecting solid performance in difficult market conditions.

 Margins – Margins improved in the period, with gross margin up by 4% and adjusted EBITDA margin up by 3% versus H1/21A, indicating gross margin of c39.6% and adjusted EBITDA margin of c17.0%. Gross margin was supported by the acquisitions and the mitigation of input costs, while cost synergies supported the EBITDA margin.  Cash – Net debt, excluding finance leases, improved to £2.6m versus £3.2m at Dec21A, reflecting £1.5m of cash flow generated from operations versus an outflow of £0.7m in H1/21A. Net debt including finance leases was £7.2m at the end of June 22.

 Outlook – Management note that conditions remain changing and challenging but with positive signs on supply chain issues. Cost increases are being shared with customers where possible and costs are being managed to support margins. VLG revenues are generally H2-weighted and the company sees its H2/22E trading well underpinned by the order book, which we expect is being well supported by the recent acquisitions, and certain orders which moved into H2/22 due to supply chain timings. The company remains confident on FY/22E expectations.

 Investment thesis – We see H1/22E trading maintaining the performance demonstrated in the H2/21A results following the recent acquisitions. Looking forward, the company has a stronger and broader portfolio of Brands, a larger order book (vs the same point in 2021) and increased available manufacturing capacity to support organic Group level growth. With a strong balance sheet, we expect this organic growth to be supported by additional accretive acquisitions. We maintain our Buy rating.

[se81] 25/7/2022 13:21

From singer this morning

VLG is showing signs of recovery, with mitigations clawing back lost margin. It has also successfully integrated and locked in planned synergies from the recent acquisitions, which are clearly enhancing the portfolio and earnings quality. Although delayed by lock-down, growth potential remains significant in China from its new distribution partner. VLG is therefore returning to profitable growth as forecast. The platform is highly scalable and trades on just 4.9x EV/EBITDA falling to 3.6x, and offers a 13% FCF yield. Our target price remains at 65p.

VLG has delivered H1 revenue of c£18.9m, equating to growth of 36% (35% CCB). This has been driven largely by the effect of acquisitions (BBI and Helsinn), which contributed £6.3m (vs £1.4m H1’21), with LFL growth of 10% at BBI and 6% at Helsinn. Organic growth across the rest of the portfolio was 1%, driven by customer brands rather than VLG own brands. VLG brands still account for well over 50% of revenues. While Covid-related lockdowns in Shanghai impacted performance through its new Chinese partner, restrictions are now easing. Management continues to expect the new partner to begin to realise the potential for its products, but remains mindful of the risk presented by China’s stance on Covid. On a pro-forma enlarged basis, LFL sales growth was 4%, underlining the resilience of Venture Life’s products through the cost of living crisis and the increasing importance of self-care to consumers. Including the recently acquired businesses, the order book remains strong and is ahead of the same time last year too. As seen historically, revenues are weighted towards H2 this year and these are well underpinned by the current order book strength.

Although against a weak comparative, gross margin has improved c400bps, reflecting the accretive impact of the acquisitions and progress mitigating some of the adverse effect of increased input costs. Early than normal purchasing by certain customers is enabling supplies to be procured cost effectively and in sufficient time to produce. Encouragingly, there are signs that the supply chain issues have plateaued. Alongside delivery of pre-identified acquisition synergies, EBITDA margin has recovered c300bps, suggesting c£1.3m EBITDA growth YoY to c£3m. ND reduced by £0.6m vs Dec’21 to £2.6m.

Impact on earnings & valuation The progress to date, and strength of the order book, mean VLG is confident it will deliver financial performance in line with market expectations. The margin uplift is particularly encouraging, and customers have been very responsive to its request to order further out than normal, enabling it to ensure supply of raw materials/packaging in time to produce, and to also manage costs effectively. Our 12-month target price of 65p offers a TSR of c100%. This uses a target multiple of 8x EV/EBITDA underpinned by improving visibility and confidence in the profitable growth outlook. For a business generating >20% EBITDA margins and a forward (2-year) EPS CAGR of almost 25%, this could prove to be too miserly and therefore leaves scope for further multiple expansion.

[qs99] 25/7/2022 12:36

Isn't VLG a Simon T fav, so could see some positive write ups in IC? DYOR

[qs99] 25/7/2022 12:01

Does make you wonder IMO, with the net debt levels so low, whether Exec team may try and take it private at subdued levels? Thoughts? DYOR

[qs99] 25/7/2022 11:54

That is a massive vote of confidence again by directors....DYOR but looks good for further progress IMO...

[csmwssk12hu] 25/7/2022 11:47

Trading statement
Director buys
Takeover bid
Written on the wind
Imho dyor

[eagle eye] 25/7/2022 11:19

Good to see director buying this morning and not an insignificant amount either.

Paul Mcgreevy, Non-Executive Chairman, today purchased 277,151 ordinary shares of 0.3p each in the Company ("Ordinary Shares") at a volume weighted average price of 35.0 pence per Ordinary Share.

Following this purchase, Mr Mcgreevy beneficially holds 564,590 Ordinary Shares representing 0.45 per cent. of the Company's issued share capital.

[csmwssk12hu] 25/7/2022 11:07

I think china’s lockdowns are going to be a thing of the past, just reading a piece in south China morning post from three days ago about how they are preparing the public for normality and living with covid, they are going to present it as no longer severe threat to health as new variants are just like getting a cold and shift emphasis on to treating the few patients who get severely ill, with that China will get back to normal and in turn will provide a huge uplift for these, probably why a member of the board has just bought £100k worth of shares, get ready for more directors buying, they know what’s happening in the business and are putting £100k a time in, that’s not chicken feed to anyone imho dyor

[rivaldo] 25/7/2022 10:35

Yep, an encouraging update. Nicely in line and no unpleasant surprises. The more and longer that VLG can churn out these solid reports the more quickly confidence will return and the rating will improve.

China's still in thrall to Covid so no surprises there, but huge potential once the fog clears.

Singer Capital Markets have reiterated their 65p target price. They forecast 2.9p EPS this year rising to 3.9p EPS next year.

[qs99] 25/7/2022 07:05

Agreed. Net Debt coming down nicely, allowing extra firepower if required. Let's hope China don't go full lockdown idiocy again...

[pedigree_scum] 25/7/2022 06:28

Solid results and healthy order book. Decent value here

[qs99] 25/7/2022 06:16

Seems like a decent trading update, at least in line! Let's see DYOR

[csmwssk12hu] 13/6/2022 13:27

Yes very true, 41 providing some resistance as per the technicals, if it can hold and cross 41 should be in the fifties quite swiftly, both times it’s crossed 41 this year within days it’s been in the fifties, resistance is then at 57, imho dyor

[eagle eye] 13/6/2022 13:06

Very promising to see good relative strength when market sentiment is poor.

[csmwssk12hu] 13/6/2022 10:06

No it’s been climbing for about two weeks, directors keep buying large amounts and volume is very high, either business is a lot better than expected they have started supplying in China very recently or they are getting taken out or both imho dyor

[brummy_git] 13/6/2022 10:03

Has VLG been tipped anywhere today?

[csmwssk12hu] 13/6/2022 09:56

And that’s it leaderboard in 15 minutes, 40-43 real spread

[csmwssk12hu] 13/6/2022 09:54

Only takes 8% rise to get on the leaderboard today a touch more and we are there

[se81] 13/6/2022 09:48

Great strength on such an awful day for the wider markets