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Summary
- The Polymer IP business unit of RUA Life Sciences performed well during FY20, which is evident from the fact that its licence fee and royalty income increased to £489k (2019: £463k)
- Novacyt generated an excellent revenue of €72.4 million for the first half of the year 2020 (H1 2019: €7.2 million)
- Intelligent Ultrasound expects the turnover to touch £2.5 million for H1 2020 (H1 2019: £3.1 million).
Innovations in the field of technology are the propelling force of the new century. The success of a nation depends on the decisiveness with which investments in research and development are being carried out. We live in a world where the power of science is clearly evident every day. Biotechnological research has also developed extraordinarily, especially during the last decade. In fact, science did not have so many potential applications for public health and medicine earlier.
With this background in mind, let's take a closer look at the three stocks belonging to the medical science sector.
RUA Life Sciences PLC
Company Profile
The RUA Life Sciences group was formed in April 2020. AorTech International plc acquired RUA Medical Devices Ltd, in order to establish a fully formed medical device business, mainly using the biomedical polymer technology. It aims at improving the lives of the patients by enabling medical instruments with Elast-EonTM, a long-term implantable polyurethane.
Financial Highlights
On 3 July 2020, the company released its audited final results for the financial year ending 3 March 2020. The Polymer IP business unit performed well, which is evident from the fact that the licence fee and royalty income increased to £489k (2019: £463k). Despite the continuous R&D expenditure incurred by the company, the cash position remained strong, reflecting funds totaling £1,976k for FY20 (2019: £2,412k). After incurring costs for the acquisition of RUA Medical Devices Limited, the cash balance of the company was £1,507k as on 7 July 2020. The company achieved success in the fields of Vascular as well as Structural Heart business units. All the overheads remained tightly controlled by the Group
Stock Performance
RUA Life Sciences PLC (LON:RUA) stock was trading at GBX 101.50 at 4:05 PM on 14 July 2020, down by 0.49 per cent. The 52-week low price was GBX 102.00, and the 52-week high price was GBX 132.50. It was having a market capitalisation (Mcap) of £16.51 million. The volume traded at the time of reporting was 25,130. The company recorded a negative return on price, which was 19.37 per cent on a YTD (Year to Date) basis.
Novacyt Group PLC
Company Profile
Founded in 2006, Novacyt is a French based diagnostic group, specializing in cancer and other infectious diseases.
Financial Highlights
On 13 July 2020, the company declared it trading results for the half year ending 30 June 2020. The company generated revenue of €72.4 million for the first half of the year, displaying a whooping jump of 900 per cent y-o-y (H1 2019: €7.2 million). The company successfully developed and launched the world's first molecular tests for COVID-19, resulting in the estimated EBITDA to be over €45 million. The cash position stood at €20 million on 30 June 2020 (H2 2019: €1.8 million), as a result of the investment in order to meet the continued demand for the COVID-19 test. The sales of the company in June 2020 depicted €25.4 million. The company became debt-free for the very first time.
Stock Performance
Novacyt Group PLC (LON:NCYT) stock was trading at GBX 257.50 at 4:15 PM on 13 July 2020, down by 3.70 per cent. The 52-week low price was GBX 6.50, and the 52-week high price was GBX 491.00. It was having a market capitalisation (Mcap) of £190.69 million. The volume traded at the time of reporting was 561,842. The company recorded a positive return on price, which was 1,828.57 per cent on a YTD (Year to Date) basis.
Intelligent Ultrasound PLC
Company Profile
Intelligent Ultrasound PLC was established in 2014, with its headquarters in Cardiff, United Kingdom and Georgia, USA. Catering to the needs of the world's leading medical institutions, it helps in the development of technologically advanced ultrasound training stimulators, Artificial Intelligence (AI) image analysis software, and guidance system for medical practitioners.
Financial Highlights
On 13 July 2020, the Group declared its trading update for the half-year ending 30 June 2020. It was announced by the company that the turnover is expected to touch £2.5 million for H1 2020 (H1 2019: £3.1 million). The effect of COVID-19 can be seen on the sales, especially in the Chinese and European markets, declining to £0.6 million (H1 2019: £1.4 million). In spite of the pandemic affecting the US revenues, the direct sales for the period increased by 4 per cent to £1.9 million (H1 2019: £1.8 million). There was an increase in the sales in the UK, limiting the sales shortfall overseas and managing Group expenses to limit the adjusted EBITDA loss for the half-yearly period to be between £1.3 million-£1.4 million (H1 2019: loss of £1.3 million). The company’s operations were hampered by the Covid-19 lockdown and constrained ability of the company to demonstrate and therefore sell ultrasound training simulators to hospitals globally. In May 2020, a successful placing was undertaken by the company, raising £4.8 million net of costs and therefore the company’s cash position stood at £10.1 million on 30 June 2020 (31 December 2019: £7.3 million).
Stock Performance
Intelligent Ultrasound PLC (LON:MED) stock was trading at GBX 10.35 at 4:28 PM on 14 July 2020, down by 0.98 per cent. The 52-week low price was GBX 6.50, and the 52-week high price was GBX 14.75. It was having a market capitalisation (Mcap) of £27.61 million. The volume traded at the time of reporting was 35,136. The company recorded a negative return on price, which was 8.89 per cent on a YTD (Year to Date) basis.
Conclusion
The Covid-19 pandemic proved to be a boon for RUA Life Science and Novacyt Group as they saw a substantial increase in their earnings during FY20 and H1 2020 respectively. Whereas, the revenues of Intelligent Ultrasound are expected to marginally decline during HI 2020 as compared to the half-yearly values of 2019, owing to the impact of the coronavirus pandemic.
