There has been a change for the better in sight.. At the general meeting, it was said that there is a need to screen one hundred million people in the EU area.. around 50 years old. 136,000 people contract stomach cancer and, if I remember correctly, 52,000 die every year. The matter was already recorded in 2022, but it has not yet been implemented. Lobbying has been done and many MEPs support the matter, as does the former Minister of Health. When a million Gastropanels are sold, that alone doubles the turnover. I noticed that Osmo was in a good mood.. a signal..:)
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Here is Anttiâs preview as Biohit publishes its H1 report next Wednesday.
We expect revenue to continue double-digit growth, driven by Gastropanel and new openings announced earlier in the year. We also expect the result to show moderate growth. Uncertainty for the figures is brought by the situation in the Middle East, the uncertainties of which, having started in late 2024, the company has stated will continue into 2025. Besides the figures, interest is aroused by the success of the new product launch, the commencement of distribution partnerships, and a new market opening, which the company has anticipated around the middle of the current year. On the balance sheet side, we are monitoring the development of receivables.
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Biohit did not quite meet Inderesâ forecasts. What region in the Middle East, where exports are now stalling, is meant in their case? Does the Gaza war affect exports to the entire Middle East?
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https://www.inderes.fi/releases/biohit-konsernin-puolivuosikatsaus-11-3062025-tilintarkastamaton
SUMMARY
JanuaryâJune 2025
- Revenue EUR 7.4 million (EUR 7.4 million), growth 0.3 %
- The situation in the Middle East hampered growth, other sales grew by 14.0 %
- Operating EBITDA EUR 1.4 million (EUR 1.5 million), 18.3 % (20.9 %) of revenue
- Operating profit (EBIT) EUR 1.2 million (EUR 1.3 million), 15.9 % (17.8 %) of revenue
- Cash and other short-term financial assets totaled EUR 5.1 million (EUR 4.8 million) at the end of the period
- Equity ratio 74.1 % (76.0 %)
- Earnings per share EUR 0.06 (0.08)
- Share of international business in revenue 98.6 % (98.6 %)
Growth forecasts were indeed significantly missed, with revenue at last yearâs level and profit slightly below. However, the guidance for the full year was maintained.
GUIDANCE FOR 2025 (UNCHANGED)
We expect revenue to increase to EUR 15.7â17.1 million in 2025 (growth of 10â20 % from 2024) and the operating profit percentage to be 10â20.
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- The situation in the Middle East curbed growth, other sales grew by 14.0%
This seems to be the core reason why the result was a bit flat.
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Yep, as usual, weâll probably get more information about this in the form of Jussi Hahtelaâs video interview. It would also be interesting to hear whatâs in the pipeline for the rest of the year, as we are still confident in the full-year guidance. Is the much-talked-about opening of a new market still coming to boost the end of the year, or something else?
And a video of it
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After watching the video, falling short of expectations doesnât seem very serious considering the long-term investment case. Middle East volumes were -80% from the comparison period (which was reportedly strong in the region), and deliveries were apparently on hold until June, after which something has been delivered to the region again.
Other countries, however, grew by +15%, meaning the earnings disappointment came practically entirely from reasons independent of the company, i.e., the unrest in the Middle East. Jussi commented on reaching the guidance, stating that year-end sales forecasts have been thoroughly reviewed and there is confidence.
The contract and sales receivable situation in China/Hefei is very difficult to assess from the outside. So everything is fine as long as the receivables are smaller than the value of the pledged shares?
Iâll wait for @Antti_Siltanenâs report and comments.
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Siltanen has published a new report after H1.
Biohitâs H1 remained at the comparison periodâs level and fell short of our forecast. Headwinds have been caused by the situation in the Middle East, but the biggest setbacks in that regard should now be behind us. Otherwise, the business appears to be on a path of healthy growth. We are slightly lowering our forecasts for the coming years, but on the other hand, we are revising our longer-term expectations upwards. We reiterate our âaddâ recommendation and raise the target price to 3.4 euros (previously 3.2) in line with the longer-term forecast changes.
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Biohit still seems to be investigating the potential of Acetium in migraine prevention, and with quite promising results. Itâs already been a long time since Osmo spoke at the general meeting about Ace as a potential ânew Disperinâ. I had already started to think that these dreams had been buried, but they are apparently still alive.
Press release:
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Is my memory failing me now, as itâs been so long, but didnât the acetium migraine studies result in âno effectâ?
Regarding those patents that were brought up, they too were probably granted over 10 years ago, if not 15 years ago. Did anyone have a recollection of this?
For the study group as a whole, Acetium did not have a significant effect. However, in some subjects, migraine attacks decreased by over 50%. The aim was to determine with further studies how to identify migraine patients who would benefit from Acetium. The dosage was also intended to be optimized.
Press release from 2019:
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Now my memory is returning, thanks for the announcement. Even then I thought that the design of that study was flawed when they tried to get an overall response in the entire migraine population and with a low dosage, when it was clear that it was a multifaceted symptom and there were good hypotheses for affecting the mechanisms of certain migraine types.
It is probably clear that they are starting or have done those subpopulation trials now that they have issued such a press release and are activating this Acetium business branch; otherwise, the matter would be very peculiar.
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This got me thinking over the weekend. The press release states that hundreds of patients have been studied and 80% get help from a 2x evening dose. I tried to estimate the prevalence of morning headaches with ChatGPT, and itâs 250-500 million people, which is within the range mentioned in the release. Additionally, a patent has been applied for morning headaches; this was communicated for some reason.
The half-year review states the following:
âKey operational highlights from the reporting period include the further development of sales and distributor cooperation, as well as the decision to invest nearly half a million euros in new production technology.â
In the interview, Juho does not elaborate on this investment further than stating that it is a âqualitative and quantitative production investment for an existing productâ and that a third party is involved as a partner.
Could it be possible that progress has been made quietly on this headache matter, and we are now so far along that production is being set up?
What do you think?
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I was still wondering about that new production line where some changes/improvements are made to existing products and which involves a third party (most likely a distributor).
I recalled a patent filed 2 years ago; below is an AI summary of the patent. Could this be what itâs about?
The patent describes a method combining two separate, non-invasive biomarker tests â
- GastroPanelÂź (stomach-specific biomarkers measurable from a blood sample: pepsinogen I, pepsinogen II, gastrin-17, and Helicobacter pylori antibodies)
- ColonViewÂź (hemoglobin (Hb) and hemoglobin/haptoglobin complex measurable from a stool sample)
The goal is to:
- First-stage screening for individuals with dyspepsia, reflux, or other non-specific abdominal symptoms, as well as for asymptomatic risk groups.
- Replace gastroscopy and colonoscopy as first-line examinations, so that invasive procedures are only directed to those whose tests indicate a significant finding.
- Stratify patients into three risk groups (low, moderate, high) based on the risk of gastric cancer and related precancerous conditions, according to GastroPanelÂź results.
- The ColonViewÂź test is used especially for those in whom gastric pathology is unlikely, but an intestinal disease (e.g., colorectal cancer) is possible. The use of two biomarkers (Hb and Hb/Hp) and multiple consecutive samples increases sensitivity, especially in detecting tumors in the proximal colon.
Key advantage: up to 80% of unnecessary gastroscopies and most unnecessary colonoscopies can be avoided, which significantly saves healthcare costs.
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A new production line could very well be related to combining automated biomarker analyses for Gastropanel and ColonView. The investment is so significant for a small company that one would assume it must somehow be related to the companyâs main products, Gastropanel or Acetium. Regarding Gastropanel, the need could indeed be related to the patent you presented. A potential partner in this case could be guessed to be analyzer manufacturer Randox, which also acts as a distributor for Biohitâs tests. Here is a link to a previous press release about the collaboration between Biohit and Randox in the distribution and analysis of Gastropanel tests:
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Biohit technically, 10-year curve. It seems we are back on the base curve, a steady rise from which news occasionally throws it up and back to the curve. The underlying trend is driven by 10-20% growth and profitability, realized, guided, and in line with strategy. Quality work, defensive sector, I consider it undervalued.
Image included for illustration. Vertical line placed where Hahtela started as CEO, coincidence ?
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How concerned are forum members and @Antti_Siltanen about Biohitâs rapidly growing trade receivables and contract-related receivables? Most of the receivables are presumably related to the distribution agreement made with Hefei in China.
Agreements related to Chinese distribution have been contentious between the parties before, which then resulted in the matter being settled and a new multi-year distribution agreement being negotiated, for which 1.5 million Biohit shares were pledged as collateral, amounting to over âŹ4 million at current market value.
However, in the latest H1 report, during the period of the renewed distribution agreement, trade receivables and contract-based items had grown to a total of 9.2 million euros on the balance sheet.
Jussi Hahtela said in an Inderes interview that there is no drama associated with the growth of receivables, but their growth has strained the businessâs cash flow for so long that the matter is starting to concern me a little, at least.
Somehow, Iâd like to believe that both parties have strong incentives to keep the Chinese business running without drama, especially since Hefei is also Biohitâs main owner.
Of course, itâs possible that some kind of internal power struggle is underway again, using Chinese business operations as leverage, but itâs not really helpful to draw conclusions from the outside.
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Ugh, I almost forgot to reply to this. The actual sales receivables on that line are certainly quite ordinary receivables. Then there are the âcontract-based itemsâ, which indeed relate to that China agreement and and which have grown rapidly since H1 2024.
I am largely on the same page with your writing, meaning that one cannot approach the matter completely carelessly. From the outside, it is naturally not possible to say exactly what is at stake, so a certain uncertainty is inevitably included in this package at this point.
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Thanks for the answer! Thereâs nothing to do but wait for the financial statements, when we can check again how the situation has developed.
In my opinion, tolerating the balance sheet risk is sufficiently eased by a hefty net cash position and the fact that the receivables related to the agreements are from the companyâs main owner, against whom there is still collateral.
At least I havenât yet come up with a scenario from this situation that would be catastrophic for minority shareholders. However, the financial interests of the parties involved should be strongly tied to the development of Biohitâs business and market value.
If a similar balance sheet risk were directed at a single important market area where the partner did not have similar interests, the situation would be significantly more concerning.
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