Currency in USD
Last close As at 17/03/2023
USD0.17
▲ 0.04 (30.77%)
Market capitalisation
USD7m
Research: Healthcare
OpGen has announced preliminary FY22 results and provided a business update ahead of the detailed FY22 report expected in March 2023. Group revenue came in at $2.7m, slightly below the mid-point of the guidance range of $2.5–3.0m and 15% below our estimate. While the year was marked by several business advancements (including two Acuitas AMR Gene Panel commercial contracts, successful completion of the urinary tract infection (UTI) test panel trial, launch of ARES sequencing services in the US, and collaborations with FIND and BioVersys), top-line growth was undermined by a tough macroeconomic environment and longer sales cycles for ARES. The year-end gross cash balance stood at $7.4m and has been bolstered by the $6.8m in net proceeds raised in the January 2023 equity issue. Management estimates the combined balance will fund operations to June 2023. Our estimates and valuation are under review.
OpGen |
FY22 wrap offers key operational takeaways |
FY22 preliminary results |
Pharma and biotech |
19 January 2023 |
Share price performance Business description
Analysts
OpGen is a research client of Edison Investment Research Limited |
OpGen has announced preliminary FY22 results and provided a business update ahead of the detailed FY22 report expected in March 2023. Group revenue came in at $2.7m, slightly below the mid-point of the guidance range of $2.5–3.0m and 15% below our estimate. While the year was marked by several business advancements (including two Acuitas AMR Gene Panel commercial contracts, successful completion of the urinary tract infection (UTI) test panel trial, launch of ARES sequencing services in the US, and collaborations with FIND and BioVersys), top-line growth was undermined by a tough macroeconomic environment and longer sales cycles for ARES. The year-end gross cash balance stood at $7.4m and has been bolstered by the $6.8m in net proceeds raised in the January 2023 equity issue. Management estimates the combined balance will fund operations to June 2023. Our estimates and valuation are under review.
Year end |
Revenue ($m) |
EBITDA* ($m) |
PBT* ($m) |
EPS* |
P/revenue |
P/E |
Net debt/ (cash) ($m) |
12/20 |
4.2 |
(19.6) |
(24.7) |
(31.5) |
1.7 |
N/A |
6.7 |
12/21 |
4.3 |
(20.4) |
(35.7) |
(23.4) |
1.7 |
N/A |
(14.4) |
Note: *EBITDA, PBT and EPS are normalized, excluding amortization of acquired intangibles, exceptional items and share-based payments. EPS adjusted for the 1:20 share consolidation in January 2023.
Following positive sales traction in H122, the second half of the year has been softer for OpGen, with top-line growth adversely affected by a slowdown in international sales of Unyvero systems/cartridges and longer than expected sales cycles for ARES. The FY22 revenue of $2.7m was a c 37% decline over the FY21 figure of $4.3m, and while the Q422 figure was better than the previous quarter ($0.8m revenue in Q422 vs $0.5m in Q322), it was still lower than the $1.4m figure recorded in Q421. We anticipate sales momentum to pick up in FY23 driven by our expectation of the two Acuitas systems reaching full capacity, commercial conversion of sales pipelines (Unyvero, ARES and Acuitas) and the contribution from the FIND collaboration (the first milestone payment was triggered at the end of FY22) and BioVersys clinical trials ($100–200k across 18 months, starting in 2023). Management also anticipates submitting the FDA application for its UTI test panel in the coming months (following encouraging top-line data from the clinical trial), which would add another revenue stream on clearance and subsequent commercialization.
The beginning of FY23 has seen several key developments for OpGen, including a 1:20 share consolidation and a $7.5m (gross proceeds) equity issue in January 2023. Management estimates that the net proceeds from the raise ($6.8m) along with cash at hand should be sufficient to fund operations to June 2023, but we anticipate it will need to raise another c $10m in H223 and $45m over FY24–26, before OpGen reaches the scale to fund its operations from internally generated cash flows by FY27.
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Research: Healthcare
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.
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