Yourgene Health Share Discussion Threads

[christopher logsdon] 09/12/2018 11:09

Thank you for your insight my fellow investor, I have a very diverse portfolio in blue-chip companies all giving dividends.Although unlike most of you millionaires on the bulletin board I am not, it would be nice to retire at 55 but not essential, I still think this particular investment has great potential. Best wishes

[the monkster] 08/12/2018 11:09

Under a penny in two years I suspect with so many more shares in issue.

[itchycrack] 07/12/2018 19:11

If you are 55 and looking to retire soon then you should NOT be investing in small companies like this, especially given that the global macro situation is deteriorating, markets are rolling over and global debt is still rising. If I were in your situation I would have a massively diversified portfolio with a large amount invested in fixed income and cash/gold. IMHO of course.

[christopher logsdon] 07/12/2018 11:55

Have this in a sipp, 55 in two years where will it be?

[christopher logsdon] 07/12/2018 11:52

Break even seems so far away?

[fillipe] 05/12/2018 12:00

Mkt Cap at current share price = close to £33m.

418m shares

Unbelievable...

f

[ngen yap] 05/12/2018 11:54

Hmmm......and the directors knew that and bought more at 10p including Bill Chang for 7,500,000 shares! Steven Myers too! Unwarranted fall is my verdict on this. I expect a quick bounce on low volume, the same as the fall! GL all.

[goforgold1] 05/12/2018 09:44

This company will need at least 10million Before it can become cash positive. They have raised so much money each year. They have had loans they have raised money. At 4p as well. It's going to be about same price. They are a long way off yet. I got out at 10p with a slight loss. I will wait now for next fund raising see what price they get. This is being shorted now because they know. They will be asking for money at a lot lower price

[humphries1] 04/12/2018 15:14

i will have cash ready and waiting

[catch007] 04/12/2018 14:49

Cutting to the chase there will be a further cash call early in the New Year. Cash is needed in the business now. At current share price we are looking at circa 6p call and further dilution.

[twix386] 04/12/2018 13:37

Post 29 - What a load of old b*ll*cks! LOL.

If revenue growth assumptions are maintained then any further funding will be related to acquisition.

Aimho of course.

[humphries1] 04/12/2018 08:27

cheers Ngen Yap

[itchycrack] 04/12/2018 06:58

Excellent analysis Ngen Yap!

[ngen yap] 03/12/2018 22:28

Oh dear, I think PIs got spooked by the potential cash call, and ignored the significant progress made by the company - both in terms of business development in the 6 months to 30 Sept, including ligitation settlement, partnerships and revenue growth, and the numbers within the interim.

First things first, the going concern note is standard when a company is loss-making. I won't quote the many growing companies which have done so including billion dollar ones (!!). The fact we can continue to account as a going concern shows necessary due diligence has been done and it can do so! Secondly, Lynn Rees mention of further cash call is to fund GROWTH, following his strategic review and revised business plan. This is not unexpected for a growth company.

I have analysed the results in detail. A few key points:

- Revenue, its growth and gross margins strong - gross profit H1 FY18/19 is c£2.0m;
- Expenses excluding depreciation, amortisation, interest and tax (measure of real operating cash outflow) before gross profit is £3.8m - this annualises at £7.6m of which there are key actions to reduce by £1m annually;
- cash outflow from operations in H1 FY18/19 is £3.2m;
- The savvy reader will ask why if we have £2.0m gross profit and £3.8m expenses, which should be £1.8m cash outflow from ops is actually £3.2m = this is because in this half, we had to unwind working capital of c £1m and pay legal / settlement of £400k.

Based on the EXACT same revenue / gross profit, cash outflow in H2 FY18/19 should be around £1.6m (£1.8m as above + £300k remaining legal / settlment - £500k R&D credit). We have £3.3m in the bank post recent placing - so we have well enough headroom to end March 2019.

Of course, revenue / gross profit expected to increase, especially with the $1m research tests deal. Therefore, I anticipate gross profit growth by at least £500k in H2 FY18/19, meaning cash outflow around £1.1m only. Again, we have £3.3m in the bank.

Extending this to H1 and H2 FY19/20, I expect us to achieve break even in H1 and cash generative in H2, this time I actually agree with FinnCapp - so even conservatively without new deals, we have enough cash all things being equal to last us without cash call.

HOWEVER, we want to accelerate growth and expand product portfolio, etc - so the cash call will only be done to support growth.

I am not surprised with directors, Stephen Myers and institutional investors going in at 10p and disappointed with share price performance. But, hey, low volume and moving up / down with that. We are good!

Re TF deal, this is definitely something that will help the balance sheet and remove the final "cuff" in our progress. Some people ask why TF would do the deal? Today, TF has effectively a 6% interest bearing loan. They can convert it into equity should they choose in 2023. But, failing that, expect Yourgene to repay. By then, I have no doubt, Yourgene will be able to raise enough to pay it off - it is another form of debt for equity except not with TF. But if you were TF, and limited exposure to NIPT because Illumina has patent in large parts of the world + a company selling your machines + share of consumables in a $1bn market, would you like to be out? Any debt for equity conversion today will be at better valuation, and guarantee a stake in the company - double action of owning a slice of Illumina NIPT growth + their own. I imagine board of directors thought they could get deal done by interims and would not be surprised we get it at year end or turn of year.

Remaining very confident!

Good luck all.

[dj trading] 03/12/2018 12:05

Not posted here since March - a post entitled Cash Critical!
Since then there has been not one but two fundraisings
May £2.5m at 4.5p and Oct £3m at 10p
The only good news being that they got them away and there was significant Director participation

Summary of important numbers
.....Rev Cashburn
2016 2.5 8.2
2017 3.1 7.9
2018 6.1 10.2 (inc Yourgene)
1H19 3.9 2.9
Borrowings now at £13m

Cash at 30 Sep £0.2m and £3m raised October
So at current burn rate - cash critical March/April 2019
dyor

[captain_kurt] 03/12/2018 10:18

Business growth rate of 45% and set to increase...looking real bad LOL

[timojelly] 03/12/2018 09:10

I must of read the wrong RNS. Looking great

[pj 1] 03/12/2018 08:59

They should put it up for sale, that would be fairer to shareholders than operate under the possible bankruptcy cloud.

[dave444] 03/12/2018 08:46

I did tell you!

[michaelmouse] 03/12/2018 08:18

It's pretty stark ramas. They'll need far more than 3 to 4 million with their debts and cash burn. If growth doesn't live up to expectations then either massive dilution will occur or it's curtains. Even if growth does go as planned they need huge funding and at what price?

It tells you all this in the financial statement and going concern. It's bleak!

Aimho of course.

[captain_kurt] 03/12/2018 08:14

New note out this morning

Yourgene Health (YGEN): Corp Interims – strong momentum and EBITDA upgrades Yourgene Health’s (previously Premaitha Health) interim results to 30 September reflect the strong momentum seen over the past few years, with revenues up 45% on the back of a 73% increase in NIPT volumes. A 140bp improvement in gross margins (more to come) and 25% decline in costs drives the business closer to EBITDA breakeven and the new CEO’s stated goal of profitability. With £1m of cost savings identified following the resolution of its IP litigation, and clarity over sales & marketing strategy, we expect this to be achieved in FY 2020 and are upgrading FY 2020 adjusted EBITDA by £0.5m to £0.6m. We maintain a target price of 16p, which implies CY 2020 EV/Sales of 4.9x; justified in our view, given the strong revenue momentum and clear progress towards profitability.

Interims in brief.
In line with the trading statement on 12 October, revenues increased by 45% to £3.9m, driven by a 73% increase in Non Invasive Pregnancy Test (NIPT) volumes, with operating losses down by 46% to £2.5m. Adjusted LBITDA and pre-tax losses fell 29% to -£1.9m (£2.6m) and 4% to £3.3m, respectively. ?

Attention to costs.
Underlying administrative expenses fell 6% to £4.4m, with cash costs (excluding depreciation and amortisation) down 7% to £3.8m. With c.£1m of annualised cost savings being implemented by the end of the current financial year, the company moves significantly closer to its goal of profitability. ?New CEO brings new focus to group. With an increasingly platform agnostic approach for its products and a move to partnership models with both Illumina and Thermo Fisher as Next Generation Sequencing providers, Lynn Rees has redefined the business structure to one focused on strategic growth drivers. At the same time, he is simplifying and normalising the cost structure, to reflect the outlook of the business post-IP litigation resolution, with the overriding goal to achieve profitability. ?

Forecasts.
We upgrade EBITDA for FY 2020 and 2021 by £0.5m to reflect the full realisation of savings being implemented, with the group now expected to become EBITDA-positive during H1 FY 2020. Pre-tax losses are c.£1m higher in FY 2019, reflecting higher finance costs, £0.3m of which relates to the revaluation of the US$ loan. ?Valuation. We retain our target price of 16p, at which level the stock would trade on a CY 2019 EV/sales multiple of 6.3x, falling to 4.9x in 2020. Transactions multiples for companies with novel, clinically relevant genetic tests that were still loss making but have shown clear evidence of revenue traction have ranged from 6-11x EV/Sales and support our valuation target now that the IP litigation has been resolved.

[ramas] 03/12/2018 07:44

Well. Not quite as stark as MM however having said that I've written my current investment to zero and it's down to the expertise , errr, to raise funds as efficiently as possible although is suspect dilution is inevitable. If they can raise 3 to 4 mill then could be a good buy from that point and should see them through to significant future profits. An example of horrific ignorance of patent risk and a lesson learned by me .

[michaelmouse] 03/12/2018 07:36

Interims are out! Company is on the brink of insolvency.

"If revenues fail to grow at the anticipated pace, there could be lower cash headroom or even a cash shortfall. In this situation, the Group will need to seek additional funding through its existing funders, the London capital markets or potentially through Asian investors now that the Group is more balanced to that region. The directors have not yet sought to raise additional funding and therefore the availability of this in the future is inherently uncertain."

The going concern warning is even more stark. Cash burn still over £3m in six months.

Market cap of £36m is just laughable.

Best left to the boiler rooms and lunatics methinks!

Aimho of course.