Sanj K. Patel, the President and Chief Executive Officer of Synageva BioPharma Corp. (GEVA), announced positive topLine results for the biopharmaceutical company’s first therapeutical product at the Canaccord Genuity 34th Annual Growth Conference at the Intercontinental Hotel in Boston, Massachusetts.
Synageva has received positive topline results in its Phase 3 trial for sebelipase alfa, a recombinant form of the human lysosomal acid lipase (LAL) enzyme, he said.
FOR THE LATEST TWST BIOTECHNOLOGY REPORT, CLICK HERE.
The therapy is seen as an enzyme replacement for LAL Deficiency, a rare autosomal recessive lysosomal storage disease that results in the buildup of fatty material in the liver, blood vessel walls, and other tissues and organs. Infants, children and adults can have the deficiency, which can be fatal and for which there are currently no approved therapies. Synageva is targeting 2015-2016 for commercial launch of sebelipase alfa for LAL Deficiency, he said.
Sebelipase alfa has been granted orphan designations by the U.S. Food and Drug Administration (FDA), the European Medicines Agency (EMA) and the Japanese Ministry of Health, Labour and Welfare, he said.
The company is also advancing on its SBC-103 to treat MPS IIIB, a genetic disorder that makes the body unable to break down large sugar molecules called glycosaminoglycans. Patel said Synageva hopes to have clinical trials started by the end of the year. It hopes to initiate clinical trials by the end of this year
Patel said in Q2 of this year, the company has $535 million in cash on hand with no debt. It has a global commercial focus in the U.S., EU, Japan and portions of South America and owns worldwide rights to all its programs.
FOR THE FULL PRESENTATION, CLICK HERE.
Ultratech Inc. (UTEK) Senior Vice President and CFO Bruce R. Wright outlined trends that present a more positive financial outlook for the company at the 34th annual Canaccord Genuity Global Growth Conference held this week in Boston.
Ultratech, a supplier of lithography, laser-processing and inspection systems used to manufacture semiconductor devices and high-brightness LEDs (HB-LEDs), has seen decline in revenues since the first quarter in 2013, primarily due to more memory spending than logic, Wright said. However, he says that the demand for newer technology, particularly in the nanotechnology arena, promises greater market and revenue growth potential.
FOR THE LATEST TWST SEMICONDUCTOR REPORT, CLICK HERE.
This is good news for Ultratech, who is the leader in this sector and is poised to meet new industry demands for components that provide greater speed and memory space, he said.
“We’ve shifted from memory spending to seeing logic spending on the rise,” Wright said. “We perform much better on the logic side. Our guidance is showing a 15-25% revenue increase over 2013 by fourth quarter 2014.”
Wright noted the company’s other business units, including advanced packaging and laser processing are also seeing increased bookings, which will add to increasing revenue by year’s end.
FOR THE FULL PRESENTATION, CLICK HERE.
Doug Baker, Chairman and CEO of EcoLab Inc. (ECL), discussed plans for EcoLab to continue the 15% EPS growth and improve ROIC while increasing shareholder value at the 34th Annual Canaccord Genuity Global Growth conference on Wednesday.
FOR THE LATEST TWST INDUSTRIAL REPORT, CLICK HERE.
He added that they will continue to follow an aggressive strategy of targeting the largest customer account opportunities and build business in the growing energy market.
Baker said ECL had sales of $13 million in 2013, in an industry that totals $100 billion. He said its products and on-site services provide solutions for safe food, maintain clean environments, optimize water and energy use and improve operational efficiencies for customers in the food, healthcare, energy, hospitality and industrial markets.
FOR THE FULL PRESENTATION, CLICK HERE.
Todd Meredith, Executive Vice President – Investments of Healthcare Realty Trust Inc (HR), says the company continues to incorporate development as an important part of its strategy. Meredith says developing is a good investment and also makes Healthcare Realty Trust a better acquirer.
“A lot of acquirers are simply taking an investment, a rent roll from a property, and putting a cap rate on the cash flow,” Meredith says. “We think by building from the ground up and being involved in everything from location to the structure of the building, the aesthetics of the building, the design of the building to tenants and all the contracts and leases that you have to put in place, that we have a good understanding of what it takes to have a great asset.”
FOR MORE INFORMATION ON THIS INTERVIEW CLICK HERE.
Meredith says that when Healthcare Realty Trust finds good developments, the company can generate better returns by taking calculated risks on some of the leasing to fill up the building. He says the company has a couple of locations where it already owns land on or next to a hospital campus, and that management is planning to pursue development opportunities on those properties by year end.
“They’re fairly modest in size, probably $15 million to $20 million a piece, and would be funded over the course of 12 to 15 months to construct those properties,” Meredith says. “Generally, our developments would be leased anywhere from 35% to 50%, maybe even more, as we break ground and start those projects. So it will continue to be a part of our strategy.”
Richard Blickman, President and CEO of BE Semiconductor Industries (BESI), discussed the Dutch company’s performance at the 34th Annual Canaccord Genuity Global Growth conference on Wednesday, and he is optimistic about the future of the company.
“The industry is expected to grow 12% this year, while we are projecting 15% growth, which shows we are definitely running the company on all cylinders,” Blickman said.
In the last 12 months, BE Semiconductor reported revenue and net income of € 304.7 and € 35.7 million respectively, Blickman said. The company has paid € 57 million of dividends and share repurchases since 2011, he added.
FOR THE LATEST TWST SEMICONDUCTORS REPORT, CLICK HERE.
Blickman said that while revenue is down slightly due to cyclical industry trends, the company has managed to post gross margin profitability of 40% for the past three years, despite market declines in that same time frame. As a result, the company has seen a consistent increase in base dividends of 10% since 2011 and projects with lower per unit costs revenues will continue to increase as well, he noted.
Blickman explained that since 2008, the company has implemented an aggressive restructuring plan, moving operations from Europe to Asia, and reducing the European workforce. As a result, the company has been able to lower its per-unit cost, while at the same time expanding its market share, he said. Between 2012 and 2013, BE Semiconductor saw an increase in market share from 75.8% to 83.8%, and is on track to outgrow the market this year, he added.
Blickman noted that the company will continue to expand the Asian supply chain and expects additional gross margin gains of 5% in 2014.
FOR THE FULL COMPANY PRESENTATION, CLICK HERE.
Henk Derksen, the senior vice president and CFO of Belden Inc. (BDC), presented the company’s financial financial plans to achieve four specific goals over the next three years at the 34th annual Canaccord Genuity Global Growth Conference in Boston this week.
The first goal is to grow organic revenue from 0.6% to 4%-6% over the next three years, which includes a commitment to capture market of 2% or better, he said. The second goal focuses on growing operating profit margin from 13.8% in 2013 to 14%-16%.
FOR THE LATEST TWST WIRELESS COMMUNICATIONS REPORT, CLICK HERE.
The third goal was to continue growing the company’s free cash flow, a goal the company has met over the last nine years. And fourth, growing ROIC from 10.6% in 2013 to the 13% to 15% level, he said.
Discussing past achievements, Derksen said revenue has grown from $1.2 billion in FY 2005 to nearly $2.1 billion in FY 2013, while operating income increased from 5.5% to 13.8% and a diluted EPS from $0.69 to $3.69 adjusted.
FOR THE FULL PRESENTATION, CLICK HERE.
Vic Richey, Chairman and CEO of ESCO Technologies Inc. (ESE) presented a plan to increase shareholder value at the 34th Annual Canaccord Genuity Global Growth conference on Wednesday. He projected sales to increase at more than 10% and EPS at more than 15%, and he said ESE would continue investing in new products and solutions, while also engaging in selective acquisitions to supplement the core business.
Richey also reported the company has seen consistent growth in profitability along all product lines for the past four years, ending 2013 at $86.3 million EBIT. He said this does not include the completion of the sale of Aclara, which was completed in March 2014.
FOR THE LATEST TWST UTILITIES REPORT, CLICK HERE.
The CEO said the company is second only to Nepal internationally in its filtration/fluid flow products for the aerospace industry. The RF shielding and test group achieved sales of nearly $500 million in 2013, far above and away from its nearest competition, he said. The competitive edge here, according to Richey, is the company’s ability to provide turnkey engineering solutions from anywhere in the world.
Richey said he plans to aggressively expand Doble, the flagship company of ESCO’s Utility Solutions Group, which currently has 95% of market share. As there is a global need for more intelligent energy grids due to the retiring of qualified personnel, the company’s dobleARMS could provide a solution through its centralized grid intelligence solution with automated sensors at customer location, according to him.
FOR THE FULL PRESENTATION, CLICK HERE.
Christopher Reading, CEO of U.S. Physical Therapy, Inc. (USPH), says 2013 was the company’s biggest year ever in terms of capital devoted to merger and acquisition activity. In total, he says the company spent about $50 million on acquisitions last year.
“The company continues to grow organically, as we have over the years,” Reading says. “We generally open about 20 or so new organic facilities a year, many of those in conjunction with our very best partnerships around the country.”
FOR MORE INFORMATION ON THIS INTERVIEW CLICK HERE.
Reading says U.S. Physical Therapy’s high level of acquisition has been building over the last six or seven years. He says the company’s strategy is to buy a majority ownership interest in already established physical therapy companies around the country.
“We opened this year with a great acquisition in the mid-Atlantic region that will be a terrific addition to our company, and we continue the network and dialog with private owners around the country on a daily basis,” Reading says.
Liberum Research’s executive turnover data for July 2014 continued to maintain a positive trend for North America’s economies. CEO, C-level and Board of Director changes monitored by Liberum saw high percentage increases from a year earlier for the same month as well as increases from the previous month of June 2014. The only category that experienced declines was CFOs. In totality, the July executive turnover numbers and overall monthly job growth and level of unemployment continue to point in a positive direction for the North American economy. Both ADP and the U.S. Labor Department’s Bureau of Labor Statistics (BLS) released their monthly employment numbers for July. While neither report was fabulous, the trend continues to remain positive. Liberum expects this will be the case through the Fall months.
ADP’s Employment Report for July 2014 stated,
Private sector employment increased in all four major regions and all nine
U.S. Census Bureau Divisions during the month of July 2014. The ADP National Employment Report(R) reported total U.S. private sector employment increased by a total of 218,000 jobs from June to July.
The U.S. Department of Labor’s Bureau of Labor Statistics (BLS) Employment Report for July stated,
Total nonfarm payroll employment increased by 209,000 in July, and the unemployment rate was little changed at 6.2 percent, the U.S. Bureau of Labor Statistics reported today.
Job gains occurred in professional and business services, manufacturing, retail trade, and construction.
Both the unemployment rate (6.2 percent) and the number of unemployed persons (9.7million) changed little in July. Over the past 12 months, the unemployment rate and the number of unemployed persons have declined by 1.1 percentage points and 1.7 million, respectively.
Below is a breakdown of Liberum’s key executive category percentage changes for July 2014 compared with July a year earlier and the previous month of June 2014.
Below are the overall turnover totals for July. The information is just illustrative of how institutional investors could view executive turnover and its possible relationship with a company’s performance. Using Liberum’s database could offer a totally new perspective on investment and is a potential way to come up with unique special situation opportunities.
79 COMPANIES WITH CEO CHANGES WORTH RE-EXAMINING
According to Liberum’s Management Change Database, a total of 225 CEO related changes occurred during July 2014. Here are 79 from the time period that caught my eye. By significant, I’m looking for situations where I think a particularly strong or weak choice has been made – given the apparent current state of the company – or where there is an interesting special situation.
DATE COMPANY TICKER EXCHANGE MARKET CAP $ MILLIONS
07-11 Accretive Health ACHI OTC 911
07-01 Actavis, Inc. ACT NYSE 38959
07-01 Alere Inc. ALR NYSE 3256
07-17 Amber Road, Inc. AMBR NYSE 384
07-18 American Apparel, Inc. APP NYSE 189
07-14 American International Group, Inc. AIG NYSE 79638
07-24 Arno Therapeutics ARNI OTC 35
07-10 Aurcana Corporati AUN CVE 52
07-08 Axion Power Intl AXPW OTC 32
07-21 Calibrus Inc CALB OTC
07-31 Canadian Imperial CM NYSE
07-01 Cannabis Sativa, CBDS OTC 94
07-16 Cannabusiness Gro CBGI OTC
07-22 Cannlabs Inc. CANL OTC
07-23 Cash America International, Inc. CSH NYSE 1305
07-07 Cca Industries, I CAW NYSE 25
07-02 Changing Tech CHGT OTC
07-07 Clean Diesel Tech CDTI NASDAQ 30
07-30 Clean Enviro Tech CETC OTC 883
07-09 CryoLife, Inc. CRY NYSE 260
07-28 Darden Restaurants, Inc. DRI NYSE 6203
07-30 Dendreon Corporation DNDN NASDAQ 329
07-02 Deq Systems Corp. DEQ CVE 19
07-02 Echo Therapeutics ECTE NASDAQ 27
07-03 Efactor Group Cor EFCT OTC 50
07-29 Eltek Ltd. ELTK NASDAQ 15
07-07 Empire Global Cor EMGL OTC 20
07-21 Ezcorp Inc EZPW NASDAQ 517
07-11 Fuelstream Inc FLST OTC 188
07-09 Gaming Partners International Corp. GPIC NASDAQ 66
07-29 Genworth Financial, Inc. GNW NYSE 8070
07-08 Headsup Entertain HDUP OTC
07-02 Horizon Lines Inc HRZL OTC 14
07-22 Integrated Drilli IRIG OTC 28
07-16 Intelgenx Technol IGX CVE 40
07-28 Jgwpt Holdings In JGW NYSE 142
07-01 Leidos Holdings, Inc. LDOS NYSE 2888
07-08 Lexicon Pharmaceu LXRX NASDAQ 855
07-31 MAXIMUS, Inc. MMS NYSE
07-30 Meadowbrook Insurance Group, Inc. MIG NYSE 309
07-24 Medbox Inc MDBX OTC 432
07-24 MGPI Ingredients, Inc. MGPI NASDAQ 146
07-10 Micronet Enertec MICT NASDAQ 25
07-24 Neogen Corporation NEOG NASDAQ 1619
07-28 Neurokine Pharm NEUKF OTC 1
07-18 Neurotrope, Inc. NTRP OTC 22
07-31 Northsight Capita NCAP OTC 48
07-28 NTELOS Holdings Corp. NTLS NASDAQ 269
07-02 Omnicare, Inc. OCR NYSE 6575
07-24 Pacific Continental Corporation PCBK NASDAQ 248
07-09 Petromaroc Corp 0LZ FRANCE
07-29 Powerdyne PWDY OTC 2
07-21 Purespectrum, Inc PSRU OTC 263
07-30 RealNetworks, Inc. RNWK NASDAQ 276
07-29 RMG Networks Holding Corporation RMGN NASDAQ 26
07-01 Santa Fe Gold Cor SFEG OTC 8
07-17 Scio Diamond Tech SCIO 20
07-24 Sierra Metals Inc. SMT TORONTO 283
07-08 Sierra Monitor Co SRMC OTC 16
07-31 Silver Predator C SPD CVE 4
07-18 Solera Natl Banco SLRK OTC 13
07-29 Sollensys Corp SOLS OTC 6
07-21 Sterling Group Ve SGGV OTC 3
07-24 Suburban Propane Partners, L.P. SPH NYSE 2716
07-03 Sun Bancorp, Inc. /NJ SNBC NASDAQ 372
07-31 Target Corporation TGT NYSE 38383
07-10 Team, Inc. TISI NYSE
07-21 Tesco Plc TSCO LONDON 222
07-31 The Bon-Ton Stores, Inc. BONT NASDAQ 201
07-21 Tractor Supply Company TSCO LSS 8986
07-21 Trans Energy Inc TENG OTC 56
07-29 Turner Valley Oil TVOG OTC 889
07-29 Vantage Health VNTH OTC 18
07-01 Vape Holdings Inc VAPE OTC 23
07-10 Vapor Hub Interna VHUB OTC 9
07-23 VirtualScopics, Inc. VSCP NASDAQ 12
07-12 Wanderport Corpor WDRP OTC 1
07-07 WebMD Health Corp. WBMD NASDAQ 1953
07-17 Zhone Technologies, Inc. ZHNE NASDAQ 121
C-LEVEL MANAGEMENT CHANGE STATISTICS
GRAND TOTAL – 1570
TOP INDUSTRY SECTORS
> Drugs/Biotech – 155
> Banking – 149
> Business Services – 103
JULY 2014 CEO CHANGE STATISTICS
GRAND TOTAL – 225
TOP INDUSTRY SECTORS
> Drugs/Biotech – 24
> Business Serivces – 18
> Banking – 15
JULY 2014 CFO CHANGE STATISTICS
GRAND TOTAL – 158
TOP INDUSTRY SECTORS
> Drugs/Biotech – 22
> Banking – 15
> Business Services – 13
> Energy – 13
JULY 2014 BOARD OF DIRECTOR CHANGE STATISTICS
GRAND TOTAL – 556
TOP INDUSTRY SECTORS
> Drugs/Biotech – 62
> Banking – 53
> Energy – 32
Investors need to diligently monitor key management changes. Certain management changes should be viewed as a “special situation” that can have a direct and major impact on a company’s performance and share price.
Richard Matros, CEO of Sabra Health Care REIT Inc (SBRA), says his company has recently experienced increased competition from financial buyers in the senior housing space. He says that trend is creating some price dislocation, particularly on smaller portfolios.
“It’s interesting because they’re entering the market at what some would think of as a peak, if not a bubble,” Matros says. “Since those financial buyers have five- to seven-year horizons, it’s a little bit perplexing why they’re doing what they’re doing because they are paying 15% to 20% more than most of the rest of us will pay for the same assets, and when they have to exit in five to seven years, they’re not going to get that.”
FOR MORE INFORMATION ON THIS INTERVIEW CLICK HERE.
However, Matros says many of the deals that Sabra does are sale/leasebacks, where operators want to stay in place. Those operators, he says, are more inclined to continue a long-standing relationship than to take more money from a financial buyer.
“But for those transactions where operators are staying in place, and they are just recapitalizing or cashing in some equity, then we’re still in good shape there,” Matros says. “And that’s a lot of the deal activity that’s out there, so our pipeline — despite all that — has remained healthy, but it’s definitely created some dislocation.”
