Aroa Biosurgery Limited

ASX:ARX

Aroa Biosurgery Limited

ASX:ARX
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$0.655 (+0.8%)
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Pinned straw:

Straw deleted
mikebrisy
Added one year ago

@Llati - good question.

Here's the report on Simply Wall Street ($ARX not covered on my usual service simplywallstreet.com)

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Jun 01

Full year 2023 earnings: EPS and revenues exceed analyst expectations


Full year 2023 results:

  • NZ$0.001 loss per share (improved from NZ$0.025 loss in FY 2022).
  • Revenue: NZ$63.4m (up 60% from FY 2022).
  • Net loss: NZ$396.0k (loss narrowed 95% from FY 2022).
  • Revenue exceeded analyst estimates by 1.5%. Earnings per share (EPS) also surpassed analyst estimates by 57%.

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So, it looks like the FY23 result wasn't a disappointment to "the market".

The only weakness I can see is that the revenue guidance for FY24 of NZ$73-76m is slightly weaker than consensus of NZ$78. That represents cc product sales growth of 25-30%, which is a significant slowdown from 81% (FY22) and 55% (FY23), and perhaps doesn't reflect such a great return on the increasing investment in sales and marketing. It is also a slower rate of growth than is expected for sector peers, such as $AVH and $PNV.

It does look like FY24 will be profitable, but still a way to go on cash flow, as FCF in FY23 was c.-$13m (I no longer have a forward model)

Because of its illiquidity, it may take a few days for the reaction to results to be digested fully.


Disc: I hold $PNV (RL and SM); no longer hold $ARX


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Rick
Added one year ago

@Llati, the result looks good. I’d say the share price dropped because the total sales were just short of analyst consensus forecasts, and it was also a stinker of a day on the market for most small caps.

b57dace382bf1d2b022da509fa4d59ed8986cf.jpeg

Source : Simply Wall Street

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mikebrisy
Added one year ago

@Rick @Llati I just pulled the below extract out of the daily market news post by @Jimmy . I agree with the Wilsons that $ARX guidance looks conservative. Interesting that Wilson are sticking to the old consensus for revenue, and doing a token trim on their SP target (actually, it might be significant depending on when their earlier target was formed). Also, perhaps $ARX will also be a beneficiary of the $IART recall - not mentioned.

Personally, I've cast my lot in with synthetics and am all-in with $PNV, but otherwise I'd be comfortable buying at today's SP.

Extract

Aroa Biosurgery's FY24 revenue guidance looks conservative to Wilsons analysts, who see the stock's midweek sell-off as a buying opportunity. They tell clients in a note that they see the regenerative-medicine company generating NZ$77.7 million in FY24 sales, compared with Aroa's guidance for NZ$72 million-NZ$75 million. They cite the strength of Aroa's proprietary product lines for their confidence. Aroa's earnings diversity is an important differentiator that helps justify its valuation premium relative to the international sector's median, they add. Wilsons trims target price 2.3%, to A$1.69, and stays overweight on the stock, which last traded at A$0.935. (stuart.condie@wsj.com; @StuartLCondie)

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