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Ascendis Health Ltd. – JSE:ASC


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#21 Investment novice

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Posted 02 April 2021 - 11:20 AM

Dear IN, all

IN I see you mention both R3 and R10 per share in some below posts. While I'm planning on selling at R3 - what's your opinion for R10? Best case scenario?



Based on Marks interviews on media and discussions woth institutions the predominant view to return maximal value to shareholders is to have an entity that is free of debt and where asc has full control. The belief is this structure leads to a better valuation multiple when trading or when acquired.


I am certainly comforted by the SA strategy and growth including the cleanup with opertaions and othe cost cutting initiatives coming through. I was very surprised that both ceo and cfo talked to returning money to shareholders even in the form of dividends and on the other hand concluding saying dont vote and you get zero. Media has been asleep.

Ceo and cfo were calm controled and knowldgeable. They were articulate and decisive in a very vague and difficult position. The body language choice of wording suggests their own anxieties and stresses are controled amd thwre is alot more positive in the background.

With that i have the end of April- announcement may result in a pump due to the most importamt hurdle being crossed...which is agremement between parties on the way forward. I see this as more significant than the june timeline and shareholder vote as this will guide many on the future- release fears and support valuation.


So r1.50 is the resistance for april news and we may get there before as noted with snh 2 weeks before disclosure the pump was on..leaks...
Sens on disposal refucing debt further r500m may also be announced. . This month...supporting r1.50..

Potentially a few days after april announcement we may see a pump to r2 or higher depending on what the predominant model is.

If i hedge on one model....unfortunately dispose all of europe to cover 90% of all debt and other expenses....we own all of SA assets and have debt r500m working capital and full control.if this os signed by june and presented as predominant. We could have deal wrappedup by h2 results.

Whats left would be ASC with continued support from institutions. A growth strategy focussing on additional pharma piprlines that we access from relationships with farmilida and remedica.....

This entity if i link to Andis posts...would definately command a multiple valuation.

This model would be growth and value accretive. And my modest hope is for this to be a r6 share until first dividend declared h1 2022. I initially expected first div by h2 2022- but ceo and cfo have their own share kickers and performance incentives. H1 divided even if just 10c to 30c will create renewed confidence and then r10 realiseable. By end 2022 h2. And 2023 we would see the share breach r10 if the company demsonstartes growth.....

My fear would be a acquisition consideration at r6 by dec or end h1 2022. And institutions accept that.


Share currently trading at 48c. None of our posts are buy instructions. Its an expression of my owm delusional views. And as you can see very far from 48c hence nonsensical.
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#22 DeltaHedge

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Posted 02 April 2021 - 08:10 AM

So as promised I did a review of the numbers.

The operating businesses did exceptionally well and they will most likely produce an EBITDA of around 1.5 Billion for the year.

Net Debt was surprisingly under 7 billion. 6.6 Billion to be exact.

Unfortunately we had additional impairments and other once off items which led to an overall loss. Also we had an average of 15% interest on the loans which is crazy.
Good point is that ASC has produced a positive operating cash flow.

Now getting to the prime question of what will be left after the recapitalization.

So as Mark has mentioned there are several different types of valuations and luckily we have the independent specialist who will oversee the process. Again this will be expensive.

But Mark has mentioned they had an offer on the table for more then 300 Million euros just for Remedica. And normally in the business world a fair and reasonable price is what people would pay in an open market. So I cannot see a fair and reasonable price below that 300 Million Euro. And this 300 Mil was based on June 2020 numbers. We now know that EBITDA has increased and I think we will see an annual EBITDA of between 800 and 900 Mil. So now with the new numbers I see a reasonable price at 350 Million.
Different valuation would be 800 Million times 14.5 EBITDA multiple. Apply a 50% discount for entity under distress also gives us around 350 Million euro. And remember we might get a small premium as lenders also want the deal to be approved. Under a business rescue they would loose out big time.

So guys I still see value here in my opinion. But again we need to wait and see what they will be offering. At the end of the day we can decide whether we all get a fair share or if we all go down including blantyre and L1 if a fire sale happens

Again no recommendation to trade in this share.

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I cant see see the offer being below R1 but not above R2.50. 

Anything above R2 would be a win for us in my opinion. 

The risk reward is good here @ 48 cents, I got in at 85 cents so not that great for me but I still would be bleak if I lost money here, no reason why a semi decent cannot be reached.

 


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#23 LarryK

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Posted 02 April 2021 - 04:54 AM

Dear IN, all

IN I see you mention both R3 and R10 per share in some below posts. While I'm planning on selling at R3 - what's your opinion for R10? Best case scenario?
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#24 Tolly12

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Posted 01 April 2021 - 07:56 PM

I've started in these days to follow Ascendis stock.
So current market cap in Euro is about 15 million?
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#25 andi222

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Posted 01 April 2021 - 07:51 PM

So as promised I did a review of the numbers.

The operating businesses did exceptionally well and they will most likely produce an EBITDA of around 1.5 Billion for the year.

Net Debt was surprisingly under 7 billion. 6.6 Billion to be exact.

Unfortunately we had additional impairments and other once off items which led to an overall loss. Also we had an average of 15% interest on the loans which is crazy.
Good point is that ASC has produced a positive operating cash flow.

Now getting to the prime question of what will be left after the recapitalization.

So as Mark has mentioned there are several different types of valuations and luckily we have the independent specialist who will oversee the process. Again this will be expensive.

But Mark has mentioned they had an offer on the table for more then 300 Million euros just for Remedica. And normally in the business world a fair and reasonable price is what people would pay in an open market. So I cannot see a fair and reasonable price below that 300 Million Euro. And this 300 Mil was based on June 2020 numbers. We now know that EBITDA has increased and I think we will see an annual EBITDA of between 800 and 900 Mil. So now with the new numbers I see a reasonable price at 350 Million.
Different valuation would be 800 Million times 14.5 EBITDA multiple. Apply a 50% discount for entity under distress also gives us around 350 Million euro. And remember we might get a small premium as lenders also want the deal to be approved. Under a business rescue they would loose out big time.

So guys I still see value here in my opinion. But again we need to wait and see what they will be offering. At the end of the day we can decide whether we all get a fair share or if we all go down including blantyre and L1 if a fire sale happens

Again no recommendation to trade in this share.

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#26 Investment novice

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Posted 31 March 2021 - 12:26 PM

Debt under r7b......doomsday was at r9b or r8..expected r7.5...

If not for impairments in h1 not h2...results would have looked even more impressive.


Why did they impair now......


Because they need clean books for a full exit....scenarios

1. Leave europe debt free
2. Stay in europe
3. Non consensual...buyout shareholders
4. Non consensual...business rescue....


Noone wants scenario 4..not even lenders.......3 scenarios looks good to return money to shateholders....
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#27 Investment novice

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Posted 31 March 2021 - 12:24 PM

Andi....nav pls
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#28 Daytrader01

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Posted 31 March 2021 - 07:57 AM

Results are out

 

https://www.moneyweb...-december-2020/


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#29 LarryK

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Posted 30 March 2021 - 11:43 AM

Looking forward to tomorrow!

Thinking about adding a little more in case it shoots up, but that 30c scenario sounds great as well
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#30 LarryK

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Posted 30 March 2021 - 10:38 AM

Looking forward to tomorrow!

Thinking about adding a little more in case it shoots up, but that 30c scenario sounds great as well
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#31 JR7800

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Posted 30 March 2021 - 10:07 AM

Sorry, Had the dates wrong. It is tomorrow at 10am right?


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#32 JR7800

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Posted 30 March 2021 - 10:05 AM

Presentation late?


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#33 Investment novice

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Posted 29 March 2021 - 12:38 PM

Where is my mind at...debt at r7.5b
We have 2 scenarios...

1. settling complete debt and exiting europe debt free. This leaves asc debt free and still revenue from non core divestment and ooerational cost reduction. Probable revaluatiin and special dividend 50c


2. Remain in europe. Non core divestment. Outstanding debt refinanced. Swapping the limited amount of assets for debt obligated



Think either of the two plausible. 2 allows us to hold equity and ebitda with rand hedge and debt to ebutda optimised. Can always at a leter stage sell remaining asset at premium. We lose control though.

Whats the blind sided scenario....sell all of europe and still have r1b in debt...okay so perhaps r500m from non core divestment....and current SA ebitda sufficient debt to ebitda and liquidity risk reduced...


All of these gives me above r3 scenario per share
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#34 Investment novice

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Posted 29 March 2021 - 11:18 AM

I am holding cash- at meeting...ceo may spook market with choice of wording or comfort market.
Debt more than r8.5 to r9b will be negative...less than r8b or r7.5b will be positive.

Hope he takes our advice through our direct engagements....


If the market spooked...may add more with price dipping to 30c...or 5c.....then i will target massive share purchase...or if market appeased...will try pickup more end of day..


Or you could buy close of business tomorrow....


Not certain we will get enough info to make a call. But if we get the debt- and the debt holding of blantyre. And some target valuatiin range for european assets this may be significant to give market and idea of the road ahead and may draw investors. .


We really hope Mark at least says this is a lender driven process but it is a consensual process working towards benefit for all stakeholders...

If he indicates this is a consensual process and the 3 comoanies supporting this including the use of jefferies report as a guide this will calm market feats and we may see renewed confidence..



At the moment we trading on a multiple of fear...rather than a multiple of future revenue....


Pls decide to buy based on your investment thesis.....
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#35 Investment novice

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Posted 29 March 2021 - 11:16 AM

I am holding cash- at meeting...ceo may spook market with choice of wording or comfort market.
Debt more than r8.5 to r9b will be negative...less than r8b or r7.5b will be positive.

Hope he takes our advice through our direct engagements....


If the market spooked...may add more with price dipping to 30c...or 5c.....then i will target massive share purchase...or if market appeased...will try pickup more end of day..


Or you could buy close of business tomorrow....


Not certain we will get enough info to make a call. But if we get the debt- and the debt holding of blantyre. And some target valuatiin range for european assets this may be significant to give market and idea of the road ahead and may draw investors. .


We really hope Mark at least says this is a lender driven process but it is a consensual process working towards benefit for all stakeholders...

If he indicates this is a consensual process and the 3 comoanies supporting this including the use of jefferies report as a guide this will calm market feats and we may see renewed confidence..



At the moment we trading on a multiple of fear...rather than a multiple of future revenue....


Pls decide to buy based on your investment thesis.....
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#36 LarryK

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Posted 27 March 2021 - 12:05 AM

IN I trust you buddy!

The question is should we add more????
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#37 Investment novice

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Posted 26 March 2021 - 11:43 AM

Damn wasn't expecting such a high loss. Wonder what they did here. Hopefully management wasn't manipulated by the lenders to already impair everything to scare off shareholders and to except a shitty deal.

Once I see the financials I will do a analysis. Will share a high level overview here.

Sent from my SM-G973F using Sharenet Sharechat mobile app



I was shocked with the additional impairments. But bodes well for us future.
The restructuring costs i expected to be over r200m at about 15m euros...

Would this be a legitimate plan to dampen share price. I am still on the fence. I think its just accountant led
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#38 Sleepwa123

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Posted 26 March 2021 - 10:48 AM

I had similar thoughts. If I was them thats what I would be doing.

 

After financials published then come through with an offer to shareholders substantially above market value but significantly below fair value...We will still win in that scenario but not to the extent that we could.


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#39 andi222

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Posted 26 March 2021 - 10:22 AM

Damn wasn't expecting such a high loss. Wonder what they did here. Hopefully management wasn't manipulated by the lenders to already impair everything to scare off shareholders and to except a shitty deal.

Once I see the financials I will do a analysis. Will share a high level overview here.

Sent from my SM-G973F using Sharenet Sharechat mobile app
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#40 Investment novice

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Posted 25 March 2021 - 03:52 PM

Any comments on the ASCENDIS HEALTH LIMITED – Trading statement for the six months ended 31 December 2020

https://www.moneyweb...-december-2020/

Are we all doomed?




Andi will comment as well. Do your numbers scenarious. 59% increase in ebitda....this is a spectacular business compared to a non covid period where surgical revenue is not reflected here.....


Debt max is r7.5 even if r8.5 fy....less non core of r500m ....we at r7.5b debt....the pik finnace costs are accounted already.....this business on the books undervalued as valuations from 2017 at r12b..........minus r8b.......r4b equity for us....come on these are thumb suck....end of day...sell all of europe or keep part....take risk out...company debt refinanced or no debt.....we left with a net positive company cleaned and pumping.....further head office costs still to be taken out.....sure a smaller company....but heos 2022 fy will be spectacular......and we will see share trade at 10x multiple...happy to wait till then for r10 share
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