This report is prepared for the Warsaw Stock Exchange SA within the framework of the Analytical Coverage Support Program 3.0.
Sector: Health Care & biotechnology Market
Cap: US$ 20.3 m
Bloomberg: BMX PW
Av. daily turnover: US$ 0.02 m
Price: PLN 22.40
12M range: PLN 18.14-39.00
12M EFV: PLN 33.90 (→)
Free float: 73%
3Q22 financial results preview
In 3Q22 BioMaxima will not book any revenues from the significant contract for a delivery of SARS-CoV-2 diagnostic tests (worth PLN 94.8 million) which helped materially the Company’s results in 1H22. Besides, the 3rd quarter is the weakest seasonally due to a relatively low incidence of infectious diseases. We forecast 3Q22 revenues/ EBITDA/ EBIT/ NI to reach PLN 15.1/ 1.8/ 1.3/ 1.2 million which implies some growth of revenues and flat margins yoy.
Delivery of analyzers
In 3Q22 there was only one significant contract the Company informed about, namely a delivery of 2 analyzers for cell cultures monitoring worth c. PLN 2 million (this year BioMaxima received orders for 6 analyzers). According to the Company’s estimations, each analyzer will generate additionally c. PLN 0.5 million of annual revenues on a sale of consumables.
Valuation
As there are no changes to our financial forecasts for BioMaxima and the peer group multiples changed slightly, our 12M EFV at PLN 33.90 per share stays intact.
Catalysts
1. The SARS-CoV-2 becomes endemic
2. Increase in demand for the Group’s products unrelated to the pandemic
3. Increasing patients awareness
4. Production capacity expansion
5. Successful launch of new products
6. Exports development
7. Need for diagnostics of unvaccinated Ukrainian migrants (SARS-CoV-2, measles, tuberculosis, poliomyelitis)
8. Acquisitions of companies compatible with the Company’s operations
9. A potential takeover target
10. Successful restructuring of the Romanian subsidiary
11. Moderate efficacy of vaccines and drugs for Covid-19
12. Presence in all the fast growing IVD segments
13. Increasing recognition of the Company in Poland and abroad
14. High efficacy of the Company’s tests in detection of Omicron
15. Spreading over time the changes in law (IVDR)
Risk factors
1. Dwindling demand related to the economic deterioration
2. The SARS-CoV-2 pandemic development
3. Change in the health care systems priorities
4. Change in reimbursement policies and IVD funding
5. Change in cooperation terms with public bodies
6. Change in law (IVDR) (postponed for 3 years)
7. Entry of new solutions to the market
8. Growing competition
9. Intellectual property breach
10. Deterioration of products quality
11. Loss of key employees
12. Lack of qualified staff
13. Changes in the shareholding structure
14. FX rates
Competitive advantages
1. European brand (vital for exports)
2. Attractive products prices as compared to global players
3. Well established market position in Poland
4. Important sales relationships outside Poland
5. Broad product offer (over 3,000 indexes)
6. Own production technologies
7. Focus on globally known and implemented technologies
Analysts: Sylwia Jaśkiewicz, CFA Mikołaj Stępień
GPW’s Analytical Coverage Support Programme 3.0
