Oversubscribed £13m fund raise to drive growth
Kromek yesterday confirmed that it had raised £13m gross at 15p/share from existing and new shareholders. The proceeds being earmarked to further develop the new groundbreaking biothreat/Covid airborne detector (see below), alongside optimising its CZT medical/nuclear imaging & D3S ‘dirty bomb’ commercialisation strategy. Whilst also bolstering the balance sheet.In particular, there are four key reasons why we’re excited about the Covid/Biothreat detectors: this is a large and untapped global market, there are significant aftermarket opportunities, potential demand led growth as a valuable USP &/or revenue generator for clients, and substantial barriers to entry because of the technology.
Development and field trials will take some months, but assuming Kromek can ultimately acquire say a 20% market share, then this could translate into an approx. £100m pa opportunity, generating c.25% drop through rates. Which using 3x sales &/or 12x EBIT multiples – might lift the market cap by £300m (or 69p/share) vs £73.4m today.
None of this potential upside has been included in our re-instated forecasts or 24p/share valuation either.
Where FY21 turnover & adjusted EBITDA (pre SBPs) of £10m & -£1.9m respectively has been pencilled in, climbing to £15m & -£0.1m for FY22. Augmented by an estimated £8m of net funds as at April ’21 (split cash +£15.6m, debt £7.6m), excluding the possibility of receiving some of last year’s £13m in written-off Asian debt (AROC).
Medaphor Group is a holding company. Co. is engaged in the development, marketing and distribution of ultrasound simulation devices for use in the training of medical personnel. Co.'s subsidiary, Inventive Medical Limited, develops three ultrasound training and examination simulators: ScanTrainer, an ultrasound scanning skills training simulator and CPD education platform; ScanTrainer Examine, a cloud-based ultrasound diagnostic skills training simulator; and HeartWorks, a simulation solution for education in echocardiography, cardiac anatomy and lung ultrasound. Co.'s other subsidiaries are engaged in the development and sale of ultrasound training equipment.
Kromek Group is a developer of radiation detectors based on cadmium zinc telluride, providing detection and characterization capabilities within the medical imaging, nuclear detection and security screening markets. Co. designs, develops and produces x-ray and gamma-ray imaging and radiation detection products.
Scientific Digital Imaging is a holding company. Through its subsidiaries, Co. designs and manufactures scientific products for use in applications including life sciences, healthcare, astronomy and art conservation, through its Synoptics Divisions (Syngene, Synbiosis and Synoptics Health), and its Atik Cameras brands (Atik, Artemis CCD and Osiris). Co. also develops and manufactures electrochemical sensors through Sentek, as well as chemical dosing and control equipment via Astles.
Thermo Fisher Scientific is engaged in serving science. The company's segments include: Life Sciences Solutions, which provides reagents, instruments and consumables used in biological and medical research, discovery and production of new drugs and vaccines as well as diagnosis of disease; Analytical Instruments, which provides instruments, consumables, software and services that are used for a range of applications in the laboratory, on the production line and in the field; and Specialty Diagnostics, which provides diagnostic test kits, reagents, culture media, instruments and associated products for customers in healthcare, clinical, pharmaceutical, industrial, and food safety laboratories.
Thruvision Group is engaged in the provision of visually intelligent solutions to the global surveillance, security and safety markets. Co operates through its two business segments: Video Business division and Thruvision Division. Co.'s Video Business division is focused on the surveillance market that covers image and data capture (for example, unattended ground sensors), a range of processing and techniques (for example, thermal image processing, image stabilization, and enhancing low light performance), image transmission (both wired and wireless technologies) and a range of analytics algorithms. Co.'s Thruvision division is focused on the stand-off passive body scanning technology.
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