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Roche reported decent results, with a recovery in oncology and routine testing and strong shows by other key pharma franchises helping to more than offset the declining contribution from COVID-19 business initiatives. Although, the full-year outlook has been maintained, possibly due to the ongoing macro-economic mess. Also, on a separate note, a CEO change was announced, which was surprising but shouldn’t be a game-changer. Nevertheless, our positive stance on the group is reiterated due to the
Companies: Roche Holding Ltd Dividend Right Cert.
2022 began on a mixed note, with COVID-19 testing sales again making up for slowly recovering Pharmas – continue to be impacted by biosimilar erosion and pandemic, and the weakness in some core drugs. While its COVID-19 solutions are expected to take a severe hit in the coming months, it should be offset by the expected recovery in the core businesses. Moreover, the unchanged long-term potential of innovative offerings in Pharmas, supports our positive recommendation on the Swiss giant.
Roche ended 2021 on a healthy note, with strong top-line growth in Q4 (+12%) ‘again’ being driven by Diagnostics, gains from COVID-19 treatment initiatives, and well-complemented by recovering core pharmas. However, profitability (quite understandably) came in slightly lower due to the higher contribution from low-margin COVID-19 offerings. While the 2022 outlook was also below market expectations, the recovery dynamics in core pharmas is a critical takeaway and, hence, the recent sell-off shoul
Roche reported healthy Q3 sales numbers (8% CER growth), with the robust performance in Diagnostics being complemented by a strong contribution from COVID-19 treatment initiatives, and recovering core pharma offerings. Although, the pandemic and biosimilars-induced headwinds could still have some near-term impact, the group is possibly hurt the worst on both fronts. Further valuable cushion comes from Roche’s innovation supremacy – evident in the post-pandemic testing times and which is here to
Q2 sales growth was healthy, with a strong performance in Diagnostics being complemented by some recovery in Pharmaceuticals. However, sustained headwinds (pandemic + biosimilars) in the lynchpin oncology franchise (and partly in other areas as well) has resulted in a ‘surprise’ margin deterioration. Moreover, resurfacing COVID-19 risks are expected to keep the Swiss giant on the hook. While near-term Pharmaceutical normalcy seems difficult, one should find confidence from growing Diagnostics do
Recently, there has been a turnaround in Roche’s fortunes, with its share price outperforming peers. While, fundamentally, Roche had always been a solid business, the revival in sentiment can be attributed to moderating COVID-19 risk(s) in the US – a key end market. This could be an inflection point for heavily US reliant innovative pharmas. Whereas, for Roche, its positioning as a sector bellwether is now likely to be better appreciated.
2021 began on an encouraging note, with Diagnostics again lending support to the lynchpin Pharmas division – continued to be impacted by biosimilar erosion and/or pandemic disruption. While the group’s near-term outlook still remains jittery – amid the current backdrop of resurfacing COVID-19 risks, growing Diagnostics dominance – backed by near-term tailwinds and long-term potential of innovative offerings in Pharmas – lend ample support to our investment case.
Roche has provided a re-assuring update for its Diagnostics division. Besides leveraging the COVID-19 testing opportunity, the group is well-positioned to capitalise the pandemic-driven emphasis on testing and investment in healthcare infrastructure. These are soothing developments, especially at a time when the core Pharma division may take some quarters before witnessing a complete recovery/normalisation. Moreover, with the group recently resorting to inorganic growth in diagnostics, we believ
Roche ended 2020 on a disappointing note, with biosimilar erosion and pandemic disruption taking their toll on the lynchpin Pharmaceuticals division. Although some meaningful support, as expected, surfaced from Diagnostics – a major pandemic beneficiary.
While the near term remains uncertain, there’s apt balance-sheet strength to pass this phase with minimal negative implications for growth plans and shareholder rewards. And, on top, with the innovations under-development, Roche remains amongst
Recently, there has been pertinent share price performance divergence between Novartis and Roche. While, for a long time, Novartis had the upper hand, it seems that Roche’s (rare) underperformance offers a window of opportunity. Remember, despite the recent concerns, some of which are/have also moderating/moderated, Roche still remains the undisputed leader on a host of performance parameters.
After a disappointing Q2 (-4% CER sales growth), Roche had some respite in Q3 (+1%) – though below expectations, largely driven by diagnostics due to the strong demand for COVID-19 tests. While the older oncology drugs continued facing pressure, newer drugs did better.
Management maintained its 2020 guidance and committed to higher dividends. While the on-going pharma transition may cap near-term sales, an adequate cushion should emanate via diagnostics. Moreover, investments in newer (high-pot
The second quarter performance pressure in Pharmaceutical was far more severe for Roche vs. Novartis. However, other than the impact of the Q1 forward-buying reversal, Roche was also impacted by the accelerated decline of the older and off-patent oncology trio. Fortunately, Diagnostics render a valued cushion, thanks to the group’s COVID-19 test offering. While Roche’s top-line is somewhat vulnerable to biosimilar risks, despite an impressive pipeline, its profitability prowess and hidden potent
With CHF13bn ($14bn) annual sales, Roche is a dominant force in the global diagnostics market. Interestingly, in recent years, most diagnostics majors have witnessed material re-ratings – also a function of increased M&A euphoria. Now, in the backdrop of COVID-19, Roche has also emerged as a prominent player on the testing front. With big pharmas moving away from (low-growth) non-pharma offerings, is it time for Roche to consider unlocking value from Diagnostics?
Pharmaceuticals and well-complemented by Diagnostics. Interestingly, although Roche’s management claims minimal COVID-related Q1 disruption, there were delayed appointments for some chronic diseases and a drug shortage. While it is difficult to believe that the performance in the coming quarters will continue unscathed, Roche – by virtue of its competitive offerings and balance sheet strength – should be able to sail through with minimal damage.
Roche ended 2019 on a subtle note, with erosion of key off-patent drugs capping gains from new high-potential drugs like Ocrevus, Hemlibra and Tecentriq. Nevertheless, full-year sales growth was 9% CER vs. early-2019 guidance of low-to-mid single-digit growth. While the group’s pipeline – especially in oncology, remains impressive, relatively muted 2020 guidance (vs. Novartis) is an indication of the biosimilar impact eventually gathering momentum.
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EKF has reported a strong H1, with revenues of £37.5m and double-digit growth in underlying non-Covid related business. Management reports it is trading in line with expectations for the full year and we make no change to our profit forecasts at this stage. New growth initiatives are proceeding to plan and should lead to accelerated core growth from FY23 onwards. We continue to see substantial upside on successful execution with the shares trading on an FY23 P/E of 13.1x and an EV/EBITDA of just
Companies: EKF Diagnostics Holdings plc
Singer Capital Markets
Kromek reported full-year results to 30 April that were in line with the trading update of 16 May. Record visibility over our FY 2023 revenue forecast of £18m (c.53% of which is already contracted and 37% “Awarded not Contracted”, with the balance from its normal monthly run rate) is a great start for FY 2023 on which the company can build further. We are leaving forecasts unchanged for the moment, despite additional contract wins, and expect to introduce FY 2024 forecasts at the time of its int
Companies: Kromek Group Plc
Kromek announced a £1.7m fundraise by way of the issue of convertible loan notes (8% coupon, 18-month conversion period at 15p per share), which will allow the company to minimise any potential supply-chain disruption to the delivery of contracts during the year. We make only minor changes to forecasts to reflect the additional interest (c.£0.1m) accrued, with adjusted pre-tax loss increasing to £5.0m. We leave our target valuation of £118m (27p) unchanged, with near-term catalysts (e.g. a secon
Ahead of its upcoming results, ECO has issued an update flagging an issue around a sales tax liability and the treatment of certain items of capitalised development, offset by a foreign exchange gain will result in it reporting FY22 Adj EBITDA of ~£6.5m vs SCMe £7.1m. It has also indicated trading in China has been difficult in Q1 FY23, particularly with the large producers, but margins have improved on mix. Trading in the Rest of the World has been strong YTD. Given the proximity to the results
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Unigel Group, intends to join the Aquis Growth Market. Unigel Group is a pioneer in the field of thixotropic gels for the fibre optic cable industry. The Company is also a supplier of laminated steel tapes to the fibre optic cable industry in the US. Thixotropic gels and laminated steel tapes are essential components to the rapidly growing global fibre optic cable market. The Group export
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Smith & Nephew reported mostly in-line Q2 22 numbers, missing the top-line estimates (-0.6%) but beating on the trading profit (+0.5%), albeit marginally.
The Q2 performance was overshadowed by a 100bp margin downgrade for FY22 (-50bps Y-o-Y vs +50bps previously), which sent the stock ~9% lower in the session following the update. The reiteration of the top-line growth outlook of 4-5% was no help either.
We will cut our estimates, largely to reflect the soft margin guidance.
Companies: Smith & Nephew PLC
In Q2, Astra sustained its solid top-line momentum. Like in the past few quarters, this outperformance was again driven by higher COVID-19 business sales and solid growth in Diabetes drug Farxiga. Moreover, the recovering Oncology and much-needed green shoots in Rare Diseases were the icing on the cake. Although, profitability again came under the scanner but should improve in the coming quarters/years as the company completes its ‘growth phase’. Overall, a decent set of results and our positive
Companies: AstraZeneca PLC
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Inteliqo Limited, intends to join the Aquis Growth Market. Inteliqo Limited provides sales, marketing and distribution services to technology product owners under long-term distribution agreements. The Company has agreed its first such agreement in respect of the Ipedia iQ product range. The iQ product is a smart translation earphone (earbuds) system which offers integrated real time speech
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Belluscura has announced that it has entered into a Group Purchasing Organisation Product Supply Agreement with VGM Group which further expands its distribution network across the US.
Companies: Belluscura PLC
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Inteliqo Limited has joined the Access Segment of AQSE Growth Market. Inteliqo Limited provides sales, marketing and distribution services to technology product owners.
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Unigel Group, intends to join the Aquis Growth Market. Unigel Group is a pioneer in the field of thixotropic gels for the fibre optic cable industry. The Company is also a sup
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For the year to 30 April 2022 Kromek reported results in line with the Trading Update of 16 May: revenue of £12.1m, +16.5%YoY, and an EBITDA (adj.) loss of £1.2m. We estimate revenue in the Advanced Imaging division grew 28% YoY to £4.6m, whilst the CBRN segment grew 1.5x to £5.4m.
Kromek reports that it expects growth to accelerate in both its core segments – security-related CBRN and advanced imaging – with the prospect of “a substantial year-on-year increase in revenue”. The CBRN segment in