Creo Medical (AIM: CREO)

Currency in GBP

Last close As at 25/01/2023

GBP0.20

0.05 (0.25%)

Market capitalisation

GBP36m

UK-based Creo Medical focuses on the development and commercialisation of minimally invasive electrosurgical devices. Its six products in the flagship CROMA platform have all been CE marked, with four cleared by the FDA. In 2020 Creo acquired Albyn Medical, which provides it with profitable products and a direct salesforce in Europe.

Creo Medical products are in a large and lucrative market. Conmed estimates the GI endoscopic technologies market alone is approximately $3.0–3.2bn with the RF energy based surgical device market at $2.7–2.9bn per year. Entering the robotics and laparoscopic markets further increases the scale of opportunity open to Creo.

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creo05

Sector

Healthcare

Equity Analyst

Soo Romanoff

Soo Romanoff

Managing Director - Head of Content, Healthcare

Key Management

  • Craig Gulliford

    CEO

  • David Woods

    Chief commercial officer

  • Rhys Davies

    Communications manager

  • Richard Rees

    CFO

Balance Sheet

Forecast net cash (£m)

6.3

Forecast gearing ratio (%)

N/A

Share Price Performance

Price Performance
% 1M 3M 12M
Actual (20.8) (56.9) (84.0)
Relative (23.7) (61.0) (84.4)
52 week high/low 172.0p/20.0p

Financials

2022 was an eventful year for Creo Medical, as it progressed on all fronts of its ‘Build, Buy and Partner’ strategy. The period was marked by the increasing traction of Speedboat Inject (its flagship electrosurgical device) and its proprietary CROMA technology platform. Enhanced levels of user, robotics deals with Intuitive and CMR, and multiple heads of terms agreements all suggest a potential inflection point for Creo. To factor in these developments and the improved visibility of the company’s near-term plans, we have revisited our model assumptions and introduced more granularity to our estimates. We now categorise Creo’s revenue stream from three sources: Core technology, Consumables and Partnerships, resulting in our valuation rising to £493m or 272p/share, from £489m (269p/share) previously. We note that at current burn rates, Creo would need to raise funds by Q223 to continue supporting its development plans.

Y/E Dec Revenue (£m) EBITDA (£m) PBT (£m) EPS (p) P/E (x) P/CF (x)
2020A 9.4 (21.4) (23.0) (12.75) N/A N/A
2021A 25.2 (26.7) (29.7) (14.58) N/A N/A
2022E 27.1 (23.4) (26.4) (12.36) N/A N/A
2023E 31.0 (19.0) (21.8) (10.22) N/A N/A

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