Morning Song

1Spatial (SPA LN) Capital markets day highlights growth potential | Abzena (ABZA LN) Monetising the Abzena Inside portfolio | Consort Medical (CSRT LN) Prelims in line – another setback with Mylan | Gym Group (GYM LN) Positive corporate and premium pricing newsflow | N Brown Group (BWNG LN) In line update but number of moving parts might leave investors cold | Rathbone Brothers (RAT LN) Acquisition of Speirs & Jeffrey, no EPS accretion until FY20e | RhythmOne (RTHM LN) FY18 results show executio

Structural growth in a complex landscape

Pharmaceutical Services is a vast and varied landscape, reflecting the complexities in the discovery, development, manufacturing and monitoring of drugs and devices, all within a stringent regulatory environment. The overall growth prospects are highly favourable: drug development activity globally is on the up, led by smaller companies, which is driving demand for outsourced services. In this report we provide a breakdown of the sector into its main activity segments, and identify biologics, in

N+1 Singer - Consort Medical - In line interims, still waiting for a catalyst

Interims are in line. Revenues +6.1% reported, PBT+7.7% but adj EPS was only up 3.2% and Net Debt is still high at £97.1m. There is no new news on Mylan contract for generic Advair and we do not expect to hear anything until mid-2018. A couple of small contracts have drifted away. We make only minor changes to our estimates and don’t see any catalysts in the short term. The shares now trading on 17.7x P/E to Apr-18, 12.4x EV/EBITDA - not obviously cheap without growth picking up but maybe there

N+1 Singer - Consort Medical - FY results in line with expectations; reiterate Buy

Today’s FY results are in line with our expectations, highlighting an improving operating performance at Aesica. The core Bespak delivered an in-line performance, impacted as expected by the termination of the supply agreement with Nicovations. We reiterate our Buy recommendation (upgraded from Hold in December 2016) and 1,125p target price.

Termination of coverage

Edison Investment Research is terminating coverage on Consort Medical (CSRT). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant.

Nicovations reVokes Bespak supply agreement

Consort Medical has announced that all supply agreements for Voke, an MHRA approved nicotine inhaler, have been terminated with immediate effect by Bespak’s partner, Nicovations. Termination was a contractual right in the event that Voke was not commercially launched before end-2016. Nevertheless, ‘constructive’ talks about Voke’s future continue between Nicovations (holder of distribution rights), Kind Consumer (developer of the product and underlying technology) and Bespak (formerly responsibl

Pipeline and margin momentum

Consort Medical’s H117 interims evidenced underlying earnings growth, ongoing margin expansion and increased diversity in the business and customer base. At Bespak significant contract wins and recent and potential near-term launches support longer-term growth. Increased capacity utilisation and the serialisation opportunity could drive Aesica operating margin towards the double-digit target. M&A could supplement Consort’s existing product, competency or geographic capabilities. Nevertheless, or

New impetus for injectables franchise

Bespak’s first deal for its proprietary Syrina autoinjector platform is with an undisclosed major global biopharma. Syrina is based on proprietary VapourSoft technology that uses a liquid gas propellant (rather than a conventional spring) to provide the force for drug delivery. Bespak’s ability to customise its devices to the specifications of its biopharma customers provides a significant competitive edge, enabling delivery of higher volumes and a broader range of formulations (including viscou

AZ reinforces Bespak strength in MDIs

Consort Medical and Astra Zeneca’s ‘significant’ new respiratory device supply agreement highlights the ongoing strength of Bespak’s metered dose inhaler (MDI) franchise. MDIs accounted for c 51% of the Bespak division’s total product revenues of £117.2m in FY16. This new multi-year agreement includes scale-up and supply of proprietary pMDI valves and actuators, which are critical components of AstraZeneca’s approved COPD (chronic obstructive pulmonary disease) therapy, Bevespi Aerosphere.

Delivering on commitments

Consort Medical’s FY16 results reflected the first full year of consolidation of Aesica. Revenues of £277m evidenced the scalability of its full-service contract development and manufacturing operations, as well as the impact of ongoing operational efficiencies, with improved operating margins at both Bespak (+170bp) and Aesica (+210bp). Consort is making good progress with building scale and is well placed to capitalise on the strong growth in outsourcing development and manufacturing in the se

FY22 in line – focus on core increasing

FY22 results are in line with revised estimates. Management continues to intensify its focus on the growing, profitable and cash generative Point-of-Care and Life Sciences activities, where confidence in the latter opportunity is increasing. We make some modest changes to our forecasts to reflect further streamlining post-period end and point to the strong growth outlook from FY24 onwards. We believe this is being overly discounted by the market and view the shares as being in deep value territo

Clean exit from ADL Health

EKF has announced a clean solution has been found for the non-core Laboratory Testing business ADL Health, selling the business back to one of its management team. Having pared back our estimates for this division in February, we expect no further material impact on earnings from this move. Strategically, we view it as positive, removing a distraction and further re-focussing activities back towards the core established Point-of-Care & Central Labs business and the growing new Life Sciences acti

Hybridan Small Cap Feast - 23 Mar 23

23 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv

SHORE CAPITAL - Destiny Pharma plc+ (DEST, House Stock at 30p)

Hybridan Small Cap Feast - 06 Mar 23

6 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objective

Positive momentum persists

2022 was a pivotal year for NIOX as it moved firmly into sustainable profitability and cash generation. The foundations for a scalable platform are now well-established and the group enters 2023 with strong momentum (revenues in the first two months of the year were +19%). Having upgraded our forecasts following the trading update in January, we push through further EBITDA upgrades on improved margin assumptions. NIOX is a rare asset and fully deserves a premium rating. We stay at Buy, with an i

Tissue Regenix - FY 2022 – a pivotal year to a sustainably profitable business

Tissue Regenix reported full-year results to 31 December in line with its January trading update that indicated it had reached EBITDA profitability in Q4. What was undisclosed then was that it included a $0.45m provision, without which it would have generated an adjusted EBITDA of c.$0.4m in H2, illustrating the positive underlying progression to a profitable and sustainable growth company. The outlook remains positive – new products, new geographies and additional distributors/strategic partner

Morning Note – 27 March 2023

Hybridan Small Cap Feast - 21 Mar 23

21 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv

Hybridan Small Cap Feast - 24 Mar 23

24 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv

SHORE CAPITAL - Warpaint London+ (W7L, House Stock at 198p)

Hybridan Small Cap Feast - 14 Mar 23

14 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv

LIBERUM: Medica Group PLC* - Two deals and on track for FY’23

Hybridan Small Cap Feast - 16 Mar 23

16 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv

Hybridan Small Cap Feast - 20 Mar 23

20 March 2023 @HybridanLLP Status of this Note and Disclaimer This document has been issued to you by Hybridan LLP for information purposes only and should not be construed in any circumstances as an offer to sell or solicitation of any offer to buy any security or other financial instrument, nor shall it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract relating to such action. This document has no regard for the specific investment objectiv