As another sign of IXICO's blossoming reputation across the neuroscience industry, the business said today that it had inked an important agreement with PETNET Solutions (part of Siemens Healthineers, €60bn mrkcap) for the supply of diagnostic agents to imaging sites used for clinical trials - especially for Alzheimer's Disease (AD).
Here, PETNET provides radioactive tracers for 'PET scans', a widely used diagnostic tool that creates detailed 3D images of the inside of the brain. Elsewhere, the deal also builds on IXICO's Tracer Management service, which provides customers with use guidance, logistics, and integration of PET tracers in neurological studies.
CEO Bram Goorden commenting: "IXICO continues to develop its end to end imaging service for clinical trials, and we are therefore delighted to be partnering with PETNET Solutions to provide PET tracers. This partnership is an integral part of an expanding offering and our commitment to positively impact drug discovery and development in critical neurodegenerative illnesses such as Alzheimer's."
Plus, as further evidence that momentum is building, this agreement comes hot on the heels of a £0.5m Phase 2 Huntington's Disease contract secured only last week. All in all marvellous news, and another endorsement of IXI's cutting-edge science.
Lastly, given the robust H2'24 results and >75% FY'25 revenue cover, I suspect there might be a chance of future upgrades as the year progresses. House broker Cavendish is forecasting Sept FY'25 sales and EBITDA to come in at £6.0m (£5.8m LY) and -£1.4m (£-1.7m) respectively, ending the period with £3m of net cash. In contrast, on a pure run-rate basis, if one simplistically doubled the H2'24 numbers, then FY'25 revenues and EBITDA would be £6.6m and -£0.8m.
Meaning at 11.5p, the stock trades on a modest 1.3x EV/sales, which looks far too cheap compared to sector peers and the 2023 takeovers of Instem (clinical trial software) and Medica (radiology services) on multiples of 3.0x-3.5x EV/sales. Cavendish has a 24p/share price target.
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