Welcome to our new product “Friday Takeaway”
This will delve a little deeper on individual companies and focus on non-house stocks under £200m market capitalisation to help raise awareness
Friday Takeaway from UK Small Caps
This will delve a little deeper on individual companies and focus on non-house stocks under £200m market capitalisation to help raise awareness
21st February 2025
Alphabetically arranged
Share prices and market capitalisations taken from the current price on the day of publication
Medical technology takes a notoriously long time to develop, but usually it’s a significant market opportunity. We think the recent news flow from these two companies suggests a chance of accelerated revenue growth.
GENI passed US Test
SUN is coming out
GENinCode 3.55p £10.2m** (GENI.L)
Financial Calendar:
Year End December, Report April, Interims June, Report September
Three Main Shareholders (pre recent placing):
Octopus Investments Limited 17.66%, Maven Income and Growth VCT 13.34%, Santi 11.41%
Key Investment Points:
US Open, Recently funded, Saving Lives
A specialist in predictive genetics used in patient risk assessment focusing on cardiovascular disease (CVD), and Ovarian Cancer. CVD includes stroke, heart failure, hypertension and is the leading cause of death and disability worldwide accounting for 1 in every 4 deaths in the US. In the UK around 7.6m people live with heart and circulatory disease, which causes 25% of all deaths annually. GENinCode listed on 22 July 2021 at 44p, raising £17m, and significant progress has recently been made since the IPO, notwithstanding the current share price.
It completed a £4.1m fund raise at 3.7p on 18th of February with directors investing £0.74m and the funds will be used to accelerate commercialisation by completing the remining US regulatory program, and expanding activities in the UK and Europe. It recently announced that the CARDIO inCode for the prevention of coronary heart disease has been launched in Catalonia, Spain.
The CARDIO in Code-Score test is included in the US Centres for Medicare services price schedule from 2025. The test price varies, on a state-by-state basis, ranging from $450-$570, with a median price of approximately $500 a test and is being clinically adopted across leading US healthcare institutions. The Company is also progressing its FDA 'de novo' submission for CARDIO inCode which is a fast-track marketing pathway and expects to provide an update on progress over the coming months.
Interims to June 2024 reported revenue increasing 46% to £1.39m, and the Adjusted EBITDA loss decreased to £2.16m from £3.37m, with administration expenses 24% lower to £2.2m. The operating loss declined 31% to £2.5m and gross profit margins were steady at 52%. Management anticipates significant revenue growth and a reduction in losses for the Y/E December 2024. After the recent fundings, the Company has stated that it is firmly on the pathway to breakeven, and then profitability.
Hybridan Comment: As the commercial cycle moves into gear, the price may follow.
** The market capitalisation is calculated using the market price and the new number of shares in issue from the recent placing.
Surgical Innovations Group 0.55p £5.13m (SUN.L)
Financial Calendar:
Year End December, Report April, Interims June, Report September
Three Main Shareholders:
Thalassa Holdings 22.29%, Getz Bros & Co (BVI) Inc 14.37%, BGF Investments 7.58%
Key Investment Points:
Restructured, Margin improved, New Product & Investor
SUN designs, manufactures, and distributes innovative medical technology focused on reusable instruments
primarily for use in minimally invasive surgery (MIS}, and medical robotics. MIS technology reduces risk, surgical, and recovery time. Its trading Update for the Y/E December largely went unnoticed, but reported that after losses and a turnaround period, the second half is profitable.
Operational improvements have been implemented to reduce costs and improve margins and the H2 adjusted EBITDA is slightly ahead of market expectations. June’s 2024 Interims reported a 9.3% increase in Revenue to £6.2m with, gross profit margins up at 32.9% from 28.7%. After investing 9.2% of revenue in R&D and compliance, the adjusted EBITDA profit is £0.2m compared to £0.1m, and including (non-cash) exceptional restructuring costs of £300k, the interim loss before tax was £487k.
Sun is mitigating the challenging NHS market with tighter operations, wider distribution, and product introductions. New non-NHS distribution deals are with US Aspen Surgical Products and Cipher Surgical; both generating new revenue streams. Sales of SI-branded products in key markets such as Asia remains strong and were helped with better training and marketing provided to partners. Two new products, LogiTube (a gastric calibration tube designed to meet specific needs of the obesity market} and a new reuseable surgical hybrid port access system, present significant opportunities, with advanced international rollout plans.
There has not been a fund raising since 2020 when £2.2m was raised at 1.6p. Y/E net debt is set to be £0.3m compared to £0.5m, while the gross cash headroom remains the same at £1.2m. The listed Thalassa Holdings
(THAL.L) has recently built its holding to 22.29% and is a proactive fund seeking to add commercial value.
Hybridan Comment: After SUN’s dark days, light is appearing with new products; SUN’s prospects are brighter.
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