2021 has got off to an encouraging start with the group capitalising on the rebound in the US and Chinese markets. Interestingly, strong momentum was visible in prescription lenses and optical retail and sun business was also back on track. Note that Q1 21 sales reported growth above Q1 19 levels and management is now confident to deliver a FY21 performance at least comparable to pre-pandemic levels. The integration process continued to gain momentum and full-year synergy targets were reiterated
Companies: EssilorLuxottica SA
Sales (at CER) were back in the black in Q4 20, driven by the resilience of the lenses segment and the acceleration in the retail segment, led by e-commerce. Management believes that the business environment will begin to normalise from Q2 21 and, combined with an innovative product pipeline, it has the ambition to deliver a performance comparable to pre-pandemic levels. Importantly, the governance structure is being overhauled and Del Vecchio is set to tighten his grip over the company.
The Q3 beat was driven by the ‘resilient’ lenses segment. Wholesale saw a significant improvement, led by the independent channel, and retail bounced back with optical banners and e-commerce leading the pack. Developed markets returned to positive growth while emerging markets remained a drag. A further acceleration was visible in October but, due to fresh lockdowns, the management remains prudently confident. With optical considered as an ‘essential’ category, the sales impact could be less sev
As expected, Q2 was worse than Q1 with sales plummeting 46.1%. However, revenue hit a trough in April, followed by a marked sequential recovery in May and June. Lenses saw almost flat sales in June, benefiting from pent-up in demand for prescription products and new product launches. Retail is approaching normalcy on the back of progressive improvements in traffic and higher conversion rates. Wholesale is a bit behind, though the progressive recovery of independents and key accounts should provi
Q1 was weak as the solid growth witnessed in January-February was offset by a material decline in March due to COVID-19. Despite the acceleration in online sales, Q2 should be worse. However, considering that c.70% of group sales are exposed to resilient optical prescription products, one could see a pent-up in demand when the situation normalises. Early signs from China have been encouraging and, if the recovery is solid, the board might consider a special dividend, though the FY19 dividend has
FY19 ended on a high with an acceleration in sales in Retail, Wholesale and Sunglasses and a steady show in Lenses in Q4. However, given the COVID-19 outbreak, momentum could lose pace in H1 20. Margins should also remain in check as the benefits of synergies would be reinvested into future growth opportunities. Unfortunately, a fraud at the Thailand plant has brought governance issues at the forefront once again. Nonetheless, a go-ahead for the GrandVision deal should come on time.
EssilorLuxottica witnessed a robust acceleration in sales in Q3 (+5.2% at CER), driven by new product launches in the lenses business, good dynamics in retail (both offline and online) and steady growth in fast-growing markets. However, the wholesale business lost pace due to softer demand in the Asia-Pacific region. Given 9M 19 sales of +4.3% and considering the ongoing launch of the next-gen Transitions lens in other countries, the FY19 sales growth target of +3.5-5% is comfortably within reac
EL is likely to outpace the eyewear/eyecare industry in the mid/long term, driven by a shift towards an integrated network business model and an increasing focus on innovation and digitalisation. Geographically, the fast-growing markets would be a key source of growth, benefiting from a growing middle class. Growth in profits would be higher than sales on the back of operational leverage, favourable product mix and synergies from the mega-merger.
Sales momentum accelerated in Q2 led by lenses, sunglasses and wholesale, though retail saw a deceleration. Given the new product launches, momentum is likely to accelerate further in H2 and thus the FY19 sales targets seem attainable. As anticipated, profitability slumped in H1, due to an increased marketing spend to support new product launches and, given the seasonality of the business, we foresee margin compression on a sequential basis. Note that the EssilorLuxottica integration process has
After putting lenses into frames, EL’s decision to augment the retail presence, particularly in Europe, looks like a strategic move. Given that EL and GV have limited business overlap, the antitrust approvals should be obtained in a timely fashion. Also, the integration process between the French and Italians is now in full swing and the amalgamation of GV should be smooth, given Luxottica has a history of incorporating retail networks. With so much on its plate, the appointment of a new CEO has
EssilorLuxottica is considering a takeover of Dutch eyewear retailer, GrandVision. Although the deal seems a good strategic fit, given GrandVision’s mass market business model and increasing focus on emerging markets, we have concerns with respect to the potential integration of the deal. Anti-trust authorities might also be a spoilsport once again.
A decent Q1 in which Luxottica witnessed acceleration in sales, driven by retail, while Essilor lost pace, due to unfavourable weather in the US. Given the new product launches, which are backed by effective marketing campaigns, Q2 has got off to a good start and we anticipate an acceleration in sales from hereon. Re-activation of the bolt-on acquisition strategy would provide a further push. With FY19 financial targets within reach and synergies now in execution mode, we eagerly await the upcom
As both the French and the Italian groups accused each other of trying to gain the upper hand at EssilorLuxottica’s leadership, the governance crisis has become uglier and the stock slumped c.6% on 21 March 2019 to hit a two-year low.
The pain aggravated when the executive chairman of EssilorLuxottica, Leonardo Del Vecchio (also the biggest shareholder of EssilorLuxottica and founder of Luxottica), accused its deputy, Hubert Sagnieres (vice chairman of the new entity and ex-CEO of Essilor) of a
While Essilor witnessed and acceleration in sales in Q4, driven by the Lenses business, Luxottica saw a deceleration, impacted by a slowdown in the retail segment. FY18 profitability was also under pressure and management has provided a conservative outlook for the new entity for FY19. The postponement of the Capital Markets Day is a cause of concern as it once again brings back governance issues at the forefront.
For Essilor, organic sales growth accelerated to 5% in Q3 fuelled by double-digit growth in the Sunglasses business. The Lenses segment also performed well benefitting from robust growth in fast-growing countries and sustained demand in developed markets. The e-commerce activities also witnessed a step-up during the quarter. Given organic sales of +4.3% ytd, the FY18 target of c.4% lfl growth is comfortably within reach. Sales for Luxottica also witnessed an acceleration on the back of strong gr
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VLG has acquired BBI Healthcare (BBIH) for up to £36m which fully deploys proceeds from the Nov’20 placing. BBIH is of high strategic value; it is growing, highly profitable and a leader in Women’s Health & Energy/Diabetes Management with 3 brands (2 market leaders). It is well invested, has manufacturing capacity, and made a 28% EBITDA margin in FY20. The price equates to c12x EBITDA before synergies, which will be significant and immediate. We upgrade FY21 EPS by 12.5% (part year) and FY22 by
Companies: Venture Life Group Plc
Venture Life Group has announced the acquisition of BBI Healthcare, a leading Women's Health and Energy Management/Diabetes company. Venture Life will pay up to £36.0m for the business, which generated revenues of £10.2m and adjusted EBITDA of £2.6m in FY20A. We believe the acquisition will fit well within Venture Life, significantly expanding the group's own brand revenues and providing a number of revenue growth and operational leverage opportunities. The acquisition has been financed by exist
In an encouraging sign of building US momentum, Yourgene has announced it has signed a multi-year licence and supply agreement with a major US precision medicine company to enable it to offer a new reproductive health screening service from its own laboratories. The agreement encompasses a non-exclusive licence to Yourgene’s proprietary bioinformatics Flex analysis software and a supply agreement for sample preparation reagents and instrumentation. Notably, this includes the Ranger sample enrich
Companies: Yourgene Health Plc
As midsummer’s day looms (where has this year gone?), there is greater optimism, in general, than may have been anticipated a few months ago. A post-pandemic, ‘vaccine-driven’ recovery demonstrated by increased consumer spending as lockdown measures are lifted has been one of the catalysts. The FTSE 100 has been range-bound in the last month 6,900-7,100. We have seen a combination of broadly positive company results across a range of sectors, further examples of M&A activity and a sequence of ne
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A comprehensive FY’21 (May Y/E) trading statement touts a strong FY’21 outturn in line with our expectations that shows 8x topline growth, building strength in the ImmunoINSIGHTS service business and sets the tone for future upgrades. We leave estimates unchanged, but believe forecasts are prudently pitched with risk to the upside. Notably Investors should take confidence in that management believes that, eight days into the new financial year and a strong start to FY’22, it has visibility on up
Companies: Oncimmune Holdings Plc
MED3000 is a breakthrough therapy for erectile dysfunction (ED). It works much faster than existing therapies, has a better side-effect profile and can be sold over the counter. However, the market has been sceptical on management’s ability to secure a major European out-licensing deal and to complete a small US study due to its cash constrained position. Following the completion of £12m fundraise Futura is funded through to at least the end of 2024 which includes several major catalysts over th
Companies: Futura Medical plc
This morning Oncimmune issued a Trading Update for FY2021, ending 31st May, highlighting strong revenue growth, successful fundraising and investment, plus a number of new key ImmunoSIGHTS contracts signed in Q4. Growth in demand for blood-based lung cancer test EarlyCDT® was also noted, both in the UK (NHS) and US. Positive FY2022 guidance highlighted an ongoing increase in IMMUNOSIGHTS contracts, and potential investment in a new US laboratory and accompanying business development team. We mai
Trading has strengthened significantly since restrictions eased in April, especially in the UK. UK brand sales are now up 64% YTD (+18% vs 2019). Further distribution gains are being made, including in the USA and online sales have tripled, albeit off a small base. Net cash has increased to £6.6m (Dec’20, £4.9m). Risk appears to lie to the upside vs prudent forecasts. The re-rating looks well supported to us, and we look forward to the H1 update in July
Companies: Warpaint London PLC
AVO’s goal is to deliver an affordable and novel PT system, called LIGHT, based on state-of-the-art technology developed originally at the world-renowned CERN. Over the past two years, important technical milestones have significantly derisked the project. Now, AVO is working on the verification and validation phase, prior to LIGHT being used on the first patients to support CE marking. In its recent technical update, the company highlighted progress made over the past three months towards a ful
Companies: AVO ARBB ARIX BBGI CLIG DNL FLTA ICGT OCI PCA PIN RECI STX SPO SCE TRX VTA
Full year results for the year ended 31 December 2020 reflect a period of change for the company as it sets the stage for the commercialisation of its next-generation DNA synthesis and delivery technology. 4basebio UK Societas was spun out of 4basebio AG (now 2Invest AG) on 8 December 2020, and was admitted to AIM on 17 February 2021. 4basebio generated revenues of £0.46m (2019: £0.20m, +129%), with a pre-tax loss of £0.72m (2019: £0.53m, +35%), with year-end cash of £15.0m (versus our £14.6m es
Companies: 4basebio UK Societas
Data presented at the ASCO further supports the use of eftilagimod alpha ("efti") in PD-1 / PD-L1 immune checkpoint inhibitor ("ICI") combinations. These include data in 1st line NSCLC (non-small cell lung cancer) and 2nd line HNSCC (head and neck cancer). The new Phase 2 TACTI-002 interim results show that 7 patients have now seen complete responses to the efti-pembrolizumab ("pembro") combo (2 in 1st line NSCLC and 5 in 2nd line HNSCC). Treatment was well tolerated in the total 127 patients. W
Companies: Immutep Ltd
Warpaint has issued a highly positive AGM trading update (covering the financial YTD). Trading is said to have been “encouraging”, with UK brand sales some 18% ahead of pre-covid levels, with good progress in international markets and online sales reported at 3x a year ago. We leave forecasts unchanged at this stage of the year, with 2021F at EPS of 5.3p, although we see growing scope for upgrades if the current momentum can be sustained into H2 2021, and if significant additional Covid disrupti
The UK market showed a continued recovery in the first quarter albeit the indices are still well short of their all-time peaks, unlike many of their international peers. The FTSE 100 has risen by 1,186 points (21.4%) since the end of October and the FTSE 250 by 4,304 points (25.0%). The comparable performance since the start of the year is less spectacular- the FTSE 100 has risen by 253 points (3.9%) and the FTSE 250 has risen by 1,070 points (5.0%). The factors behind the sustained rally are fa
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Creo Medical has published its final results for the 12 months to Dec-20. In line with recent trading statements, the company generated revenues of £9.4m through the year and closed the year with cash of £45.1m. Operating loss was £23.5m (Cenkos est. £25.4m) reflecting increased R&D and commercial activities. Despite COVID-19 impacting the adoption of Creo's products, the company had a strong year, completing two acquisitions and achieving additional regulatory clearances. We note that Creo ende
Companies: Creo Medical Group Plc
NetScientific, the life sciences and sustainability technology investment and commercialisation group, announced intraday on Thursday 10 June 2021 that it had raised gross proceeds of approximately £7.7m in an oversubscribed fundraising at a price of 130p, a 10.3% discount to the previous day close of 145p. A total of 5,958,123 placing shares will be admitted to trading on 29 June 2021, subject to placing agreements and shareholder approvals. The placing significantly strengthens the balance sh
Companies: NetScientific plc