Another 3 reasons to add Feedback #FDBK to your watchlist
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Another 3 reasons to add Feedback #FDBK to your watchlist

THE CONTENT OF THIS BLOG / WEBSITE (OR CONTENT ASSOCIATED WITH IT) IS NOT INTENDED AS INVESTMENT ADVICE, IT IS FOR INFORMATION PURPOSES ONLY. YOU SHOULD TAKE PROFESSIONAL FINANCIAL ADVICE IN CONNECTION WITH, OR INDEPENDENTLY RESEARCH AND VERIFY, ANY INFORMATION THAT YOU FIND ON THIS BLOG / WEBSITE AND WISH TO RELY UPON, WHETHER FOR THE PURPOSE OF MAKING AN INVESTMENT DECISION OR OTHERWISE. WE ARE NOT REGULATED UNDER UK FINANCIAL SERVICES LAW. THE AUTHOR OF THIS BLOG MAY HOLD AN INTEREST IN THE STOCK FEATURED.

FEEDBACK #FDBK
SHARE PRICE: 1.62p
MARKET CAPITALISATION: £4.5m


Feedback plc is a specialist medical imaging technology company. It develops software and systems that provide innovative techniques and improved workflows for practitioners involved in medical research and treating patients.

TexRAD®, the Company’s patented quantitative image texture analysis technology, has the potential to assist clinicians in diagnosis, prognosis and treatment of patients with cancer and is currently installed in over 40 of the world’s leading research institutions across Europe, North America, Asia and Australia.

The Cadran platform provides a suite of medical imaging tools for decision support. The Cadran range includes the picture archiving communication system (PACS) to provide decision support for scan analysis, diagnostic workstations which provide secure remote access to view scans on demand, and products to securely share and transport patient data.

To read my previous blog on Feedback #FDBK click here

3 ANOTHER REASONS TO ADD FEEDBACK #FDBK TO YOUR WATCHLIST

THE APPOINTMENT OF SIMON STURGE AS NON-EXECUTIVE DIRECTOR

On 16th April Feedback announced the appointment of Simon Sturge as Non-Executive Director with immediate effect.

Simon is also the Chief Operating Officer for the biopharma business of Merck Group and a regular speaker at conferences including the World Economic Forum.

Merck is a leading science and technology company, active in Healthcare, Life Science and Performance Materials with 52,000 employees in 66 countries. Merck was founded in 1668 and is the world’s oldest operating chemical and pharmaceutical company, as well as one of the largest pharmaceutical companies in the world.

In 2017 Merck’s turnover was €15.3bn, pre-tax profits were €2.6bn and they spent €2.1bn research and development.

Also included in the announcement was this:

“Simon Sturge currently holds 6,000,000 ordinary shares in the Company, equivalent to 2.13 per cent of the Company’s total issued ordinary share capital.It’s very interesting to note that Simon also purchased.”

So before his appointment Simon also purchased 6m shares, which at today’s value is £90,300 or £75,000 at the placing price of 1.25p.

 

SKIN IN THE GAME

The directors are increasingly taking equity in the company.

In the recent placing and subscription, where they raised £400,000, the following directors purchased the following number of shares.

Dr Alastair Riddell (Chairman) 1,000,000

David Crabb (CEO) 1,000,000

Tom Charlton (NED) 8,800,000

As I mentioned above Simon Sturge also purchased 6,000,000 shares before his appointment.

This means directors now hold nearly a third (32.7%) of the entire issued shares capital. This is significant skin in the game.

Another source of encouragment came in the in the RNS release on 16th April entitled, “New company structure and changes to the Board of Directors“.

It stated that:

“Furthermore, Dr Alastair Riddell and Simon Sturge will receive share options in lieu of fees to reduce board cash costs and a further announcement will be made when such options are granted.”

This is further evidence that the directors are not only wary of the cash burn but are putting a real value on the equity of the business by accepting their fees in shares.

THE BOARD

On 16th April the company released an RNS entitled, “New company structure and changes to the Board of Directors“.

The main change here, as I mentioned above was the appointment of Simon Stuge as Non-Executive Director. Dr Alex Menys also stepped down as Non-Executive Director.

The board has undergone a major overhaul in the last 12 months and the board now contains some heavy hitters with impressive track records.

CEO David Crabb, who I’ve written about previously here, was only appointed in February but seems to be carrying out some positive developments at the company including a new company structure, announced on 16th April, which:

“Streamline operations and act as a fully-integrated organisation, CCI has been renamed to Feedback Medical Limited and TexRAD Limited will become dormant.

All employees will be working for Feedback Medical Limited as a wholly-owned subsidiary of Feedback. These organisational changes are aligned to the Company’s mission to create evidence-based imaging software, arming clinicians with innovative tools to improve patient outcomes.”

Chairman of Feedback Dr Alastair Riddell and Simon Sturge have history together. They we both involved with Silence Therapeutics and are currently on the supervisory board Cristal Therapeutics.

Cristal Therapeutics describe Simon as, One of the most successful and seasoned biotech CEOs in the UK, and was voted CEO of the year by his peers in 2005. Simon has built a very strong reputation not only in the industry but also in the investment community.”

Timothy Irish, who was appointed as Non-Executive Director on 8th June 2017.

He is a Professor of Practice at Kings College London as well as a board member of Bournemouth University. Tim joined the board of the National Institute for Health and Care Excellence (NICE) in April 2015 and became the Senior Independent Director in May 2017.

NICE also has a connection with Merck. On November 10th 2017, NICE approved Merck’s Multiple Sclerosis treatment, Mavenclad, as an option for treating highly active multiple sclerosis in adults on the NHS.

“We are delighted NICE and the Appraisal Committee have reached this decision and consider this an important step in enabling rapid patient access to Mavenclad in England, Wales and Northern Ireland,” said Simon Sturge, Chief Operating Officer for the biopharma business of Merck. “The positive conclusion NICE has reached is testament to the value, cost-effectiveness and innovation Mavenclad brings to the multiple sclerosis treatment paradigm.”

How does itfit in with my research model, C.C.A.S.S.H which you can read more about by clicking here

GREEN = POSITIVE

BLACK = NEUTRAL

RED = NEGATIVE

CAPITALISATION

It’s a micro cap, which means it doesn’t take a lot to move the needle and only needs to create less the £5m in value to double the market capitalisation, not a big ask for a board so experienced and well connected.

CHART

The share price as rallied over the last 7 days, mainly due to the recent positive corporate activity but at 1.62p it’s still not a long way away from the 52 week low of 1.2p.

ASSETS

Cash as at 30 November 2017 was £266,756 and they made a loss after tax for the six-month period £348,079

On the 29th March they raised £400,000 gross at 1.25p.

All things being equal you could argue that these fund will last for 6 months, if we use their interims as a measure of their cash burn and revenue generation. Although if you read their interims it does suggest revenue is growing and it seems costs are being kept down with certain directors taking their fees in shares.

SHAREHOLDERS

As I’ve described above, the shares are quite tightly held and directors hold nearly a third of the entired issued share capital. This includes newly appointed director Simon Sturge, who bought 6m shares. Why would a big hitter buy in excess of £75,000 worth of shares in a micro cap company before he was appointed?

SIGNIFICANT MILESTONE

There’s no specific milestone outstanding, the last major milestone they achieve was the CE Mark for their release of TexRAD®, which now allow them to sell or licence the product in a clinical environment, which is a lot more commercial than it being used a research environment, which it has been up until now.

HEAD HONCHOS

As I’ve described above, the board has a lot of experience and are well connected, they also have skin in the game.

 

Over the last 12 months Feeedback has evolved positively into a company I believe are now ready to capitalise on their product.

In summary they’ve appointed Dr Alastair Riddell as a Non-executive Chairman, David Crabb as CEO, Simon Sturge as NED, achieved the first CE marked release of TexRAD® and restructured the company.

One would expect, going forward with this new board and a product that has received over 100 scientific paper presentations and conference presentations (with 19 alone in the 103rd Scientific Assembly and Annual Meeting of the Radiological Society of North America in November 2017) that this year should provide some upward trajectory for the share price.

Add to this the fact that, in their interims it was revealed they have experienced:

– An increase in purchase orders for TexRAD® from leading medical institutions in South Korea.

– Significant interest in China, underpinned by the exclusive distributor agreements signed during the period.

And…

– Strong demand for TexRAD® in India having increased our presence in this market.

Then I am looking forward to reading their next financial update, especially when they stated in their interims:

“We anticipate that the benefits of these agreements will be seen in the full financial year.”

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THE CONTENT OF THIS BLOG / WEBSITE (OR CONTENT ASSOCIATED WITH IT) IS NOT INTENDED AS INVESTMENT ADVICE, IT IS FOR INFORMATION PURPOSES ONLY. YOU SHOULD TAKE PROFESSIONAL FINANCIAL ADVICE IN CONNECTION WITH, OR INDEPENDENTLY RESEARCH AND VERIFY, ANY INFORMATION THAT YOU FIND ON THIS BLOG / WEBSITE AND WISH TO RELY UPON, WHETHER FOR THE PURPOSE OF MAKING AN INVESTMENT DECISION OR OTHERWISE. WE ARE NOT REGULATED UNDER UK FINANCIAL SERVICES LAW. THE AUTHOR OF THIS BLOG MAY HOLD AN INTEREST IN THE STOCK FEATURED.

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