Driven by the acceleration in sales in Personal Health and D&T, Philips reported better-than-expected results in Q2, though this was overshadowed by a product recall in Connected Care. Corrective actions could take up to 12 months and the FY21 profitability outlook has been narrowed to the lower end of the guidance range. To soothe some investors nerves, a new three year €1.5bn share buy-back programme has been announced. The double-digit order growth in D&T, indicating hospitals spending are im
Companies: Koninklijke Philips N.V.
Sales momentum accelerated in Q1 21 driven by a strong show in Personal Health and a strengthening performance in D&T. Order intake growth in D&T was in double-digit territory, which is also encouraging. Margin advancement – driven by sales growth and productivity measures – was better than expectations. Given the robust momentum, FY21 sales target has been upgraded. However, the strong results were overshadowed by some quality issues (booked a €250m provision) with certain sleep and respiratory
FY20 ended on a promising note with strong organic sales and order growth as well as margin expansion – mainly driven by the third consecutive quarter of double-digit growth in Connected Care. Notably, Personal Health sustained its mid-single-digit growth, while D&T returned to growth in Q4 20. Given the pandemic is still continuing, management expects a strong H1 21 on the back of sustained demand for acute care and precision diagnosis equipments. Easy comps should also lend support.
Sales growth momentum is likely to accelerate in the mid-term on the back of the growth in core businesses and increasing demand for integrated AI solutions. Connected Care should benefit from structural tailwinds and growth in Personal Health should be innovation-driven. D&T should profit from its solution-centric approach. Top this up with the operating margin advancement target of 60-80bp, including the targeted productivity savings of €2bn, adjusted EPS is likely to grow by c.10% p.a. until
Philips returned to growth in Q3, driven by robust demand for patient monitors and ventilators and a solid rebound in Personal Health. D&T also saw an improvement, though it is still in the red. Profitability improved considerably, benefiting from operational leverage and productivity measures. Management anticipates low single-digit sales growth for FY21 and an acceleration in the mid-term (+5-6%) with all segments growing within this range. The EBITA margin is likely to improve 60-80bp annuall
The Q2 slump was less severe than feared. Connected Care saw a double-digit increase, led by ventilators, though momentum was offset by reduced consumer demand for Personal Health products. D&T was impacted by the postponement of installations and elective procedures. In H2, the robust order book should ensure steady growth in Connected Care and a rebound in elective procedures could bolster growth in D&T. Improving consumer demand bodes well for Personal Health. Ergo, sales should be back in th
COVID-19 lowered sales by 5ppt in Q1 as increased demand for professional healthcare products was more than offset by the decline in demand for personal health products, particularly in China. Lower sales and an unfavourable product mix suppressed profitability. Considering that the virus has spread to the western world, Q2 is expected to be worse. Nonetheless, management anticipates a recovery in H2 and thus guided for modest sales growth and margin improvement for FY20. Robust order intake gro
Impacted by slowdown across all three segments, Philips’ organic growth slipped to +3.3% in Q4 – D&T was held back by imaging and CC was affected by SRC. PH suffered due to negative growth in domestic appliances. Nonetheless, the FY19 revenue and profitability targets were achieved. Considering that domestic appliances does not fit into Philips health-tech strategy anymore, management is exploring strategic options – the proceeds could be channelled towards acquisitions in the healthcare space.
Led by double-digit growth in China and the robust performance in D&T and PH, sales accelerated slightly in Q3 19. However, order intake was flat due to softness in North America. Also, margins were held back by the adverse effect of tariffs, particularly in CC. As the mitigating actions (to counter tariffs) begin to bear fruit, we anticipate a margin advancement in Q4. Also, the c.100bp margin improvement target for FY20 appears within reach, given the positive growth trajectory in D&T and PH.
After a soft start in Q1, organic sales accelerated significantly in Q2 as mature markets and the Connected Care segment returned to growth. The D&T segment also reported a step-up in sales, while the Personal Health division continued with its MSD growth. With comparable order intake growth also witnessing acceleration, sales in H2 are likely to be stronger than in H1. Profitability should also improve further, led by operational leverage and efficiency initiatives.
Q1 was soft with negative lfl growth in Connected Care, decelerated sales growth momentum in D&T and a dismal showing in mature markets. But, Personal Health regained momentum and emerging markets posted double-digit comparable sales and order intake growth, which was a positive. Given the robust order book, particularly in Europe and North America, momentum should accelerate in the coming quarters and thus the FY19 financial targets should be met.
Royal Philips ended the year on a high with revenue as well as profits exceeding expectations – sustained growth in D&T overshadowed the slowdown in PH and CC&HI. Shareholders were rewarded handsomely with a 6% increase in dividends for FY18 and a new two-year €1.5bn share buy-back programme. Given the robust order intake growth (for D&T and CC&HI) and the continuous focus on new product launches (particularly PH), Philips remains on track to meet its financial targets for FY19.
At its Capital Markets Day, Royal Philips reiterated its financial targets of 4-6% comparable sales growth pa during FY18-20 and EBITA margin expansion of 100bp per year until FY20. Segment-wise, the revenue guidance for the Diagnostics & Treatment/D&T segment (c.39% of sales) has been upgraded to 5-7% pa (vs. previous guidance of 3-5%) while the EBITA margin target of 14-16% has been maintained (to allow for extra room for investments). The revenue and profitability guidance for the Personal He
Q3 was a weak quarter. While the sales momentum was held back by a dismal show in the CC&HI segment and a slower than expected recovery in the Personal Health division, profitability was impacted by adverse currency movements and increased investments in sales and marketing. However, robust comparable sales as well as order intake growth in D&T should enable Philips to meets it financial targets for FY18. Nonetheless, the US-China trade war and Brexit remain the key headwinds for FY19.
Q2 was a mixed quarter wherein comparable sales were a tad below estimates while profitability met expectations. A slowdown in the PH segment, particularly in China, was the main reason behind the sales miss. However, we view this as a one-off and, given the seasonality of the business, we expect an acceleration in H2 18. Also, given a strong order book in D&T, we believe that the company would be able to meet its sales and profitability targets for FY18.
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H1 EBITDA declined by 45% YoY, albeit this was slightly better than we had anticipated after the pre-close update in August. The beat was cost related (efficiencies/savings). There was a significant gross margin drag though and, while transitory in nature and diminishing in H2, this means further savings need to be realised to hit full year forecasts. This is our view and we retain a good level of confidence in next year’s forecasts. Having de-rated, valuation looks very undemanding now on just
Companies: Venture Life Group Plc
Venture Life has announced its interim results for the six months to June 2021. As previously announced in the August trading statement, revenues were down YoY due to lower HSG sales and sales to the Chinese partner, though revenues are expected to grow subsequently, benefiting from the two recent acquisitions. H1/21 gross margin was impacted by a number of factors including supply chain costs and stockholding costs; however, the company expect margins to improve in H2/21E. Despite the set-backs
Cambridge Cognition has announced strong interims which are consistent with our recently upgraded forecasts. Revenue increased 50% YoY, which outstripped growth in admin expenses leading the group to swing to a net profit. Demand for the company's software & services to support clinical trials continues to be strong, with a contracted order book of £15.2m at the end of H1 21 (+36% HOH; +105% YoY). Contract prepayments aided strong cash generation which led net cash to increase +37% versus FY20 Y
Companies: Cambridge Cognition Holdings Plc
Companies: SourceBio International Plc
Warpaint’s interim results for the six months ended 30th June demonstrate a highly encouraging rebound in sales and profitability as the markets have reopened post various degrees of Coronavirus lockdown. Strong strategic progress has been made, with the relationship with Tesco expanded and an 84-store trial with the UK’s leading cosmetics retailer Boots confirmed; this is very good news to us. Whilst ahead of our expectations for H1, we leave FY21 forecasts unchanged reflecting the very well do
Companies: Warpaint London PLC
Full year PBT is 4% ahead of our expectations and strong trading momentum has continued into FY22 (14.4% LFL). The strength of the results reflects favourably on the strategy new management put in place in 2019 to focus on optimal patient care and to make CVS an employer of choice. Having shown remarkable resilience through the pandemic, CVS is emerging as a stronger business with excellent ongoing growth prospects. Its integrated veterinary model is ideally positioned to capitalise on sector ta
Companies: CVS Group plc
Exactly one year ago, the FTSE 100 closed at 5,862, having fallen 100 points on the day, the lowest point since mid-May 2020, due in part, to the strength of sterling vs US$ at $1.34. One year on, the FTSE 100 has risen to 7,119, a rise of 21%, it remains 7% below the peak in January 2020. From an international viewpoint, US and European markets continue to trade at record highs. The US Federal Reserve is close to withdrawing some of its economic support this year as inflation picks up and the e
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Interim results to 30 June 2021 were in line with the trading update issued on 3 August, which resulted in upgrades to our forecasts and target price. On the back of a 50% (£1.5m) rise in revenues to £4.5m, adjusted EBITDA increased £0.5m to £0.2m, illustrating the operational leverage of 80% gross margin software & services. Period-end cash increased 38% (+£1.2m) in the period to£ 4.2m. Cambridge Cognition is well positioned to be a long-term beneficiary of the trend of running virtual decentra
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Eurowag confirms its intention to undertake an initial public offering on the Main Market (Premium). The Offer would be expected to comprise both (i) new Ordinary Shares to be issued by the Company, raising gross proceeds of approximately EUR200m to support Eurowag's growth strategy and (ii) existing Ordinary Shares to be sold by existing Eurowag shareholders. Eurowag is a leading pan-European
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Allergy Therapeutics reported FY 2021 results that were 95% (+£2.1m) ahead of adjusted pre-tax profit expectations, driven by lower than forecast overhead costs. This underpinned 20% growth in pre-R&D EBIT to £16.9m on 6% CER revenue growth. Year-end net cash was £36.9m, providing the company with the financial resources to complete both its Grass MATA MPL Phase III trial and complete the VLP Peanut Phase I trial. The readout of the exploratory Phase III (G309) Grass MATA MPL study in the autumn
Companies: Allergy Therapeutics plc
Deltex has reported 2021 interim results which reflect the challenges of the current healthcare environment with COVID cases causing disruption to the Company's core elective surgery market. That said, the Company has demonstrated it is able to keep costs low to match the current low activity, in anticipation of improving activity in 2022.
Companies: Deltex Medical Group plc
Synairgen reported FY 2020 results that showed an adjusted net loss of £13.7m, with year-end cash of £75.0m, some £27m higher than our expectations. The delta can largely be accounted for by delays in starting enrolment into the Phase III trial as well as the treatment of prepayments for drug substance and nebulisers: the latter reflected in working capital rather than expensed through the income statement. Near-term focus remains on the outcome of the Phase III study (SG018), and with the enrol
Companies: Synairgen plc
EKF has delivered another strong set of results, with the step change in the scale of the business firmly consolidated. H1 revenues increased 46.5% driven by an ongoing recovery in the core business and strong demand from a number of public and private sector customers for sample collection devices. The outlook remains positive and progress is being made against the new strategy set out earlier in the year. We upgrade our FY21 revenue forecasts by 7% and EBITDA by 13% noting this still implies a
Companies: EKF Diagnostics Holdings plc
Momentum is building in Circassia, with the recovery from the pandemic gaining traction and actions taken by management to focus the business having a material impact on the bottom line. Having already upgraded in July, we are upgrading forecasts again today to reflect the further progress on reducing fixed costs. We now expect the group to trade close to EBITDA breakeven this year and for significantly improved profitability and cash generation from next year onwards.
Companies: Circassia Group PLC
As we had already speculated at a recent target price change (on 05/02/2021), the announced departure of Dr Krick, Fresenius’ dinosaur, could trigger some changes. The first ‘victim’ may be the head of Kabi and we clearly expect more to come. In essence, this could signal to the capital markets that there is something already set in motion. This might change sentiment towards Fresenius as we still see the share is clearly undervalued.
Companies: Fresenius SE & Co. KGaA