Roth Capital, analist Scott R. Henry, datum 26 oktober 2018
ongewijzigd koersdoel € 2,25
ongewijzigd koopadvies
omzetverwachting 2018: van €129,6 naar €137,9 miljoen
Revenue (€ millions)
Yr Dec —2017— —2018E— —2019E—
Curr Prev Curr Prev
1Q 15.5A 29.5A 29.5A - -
2Q 15.2A 30.0A 30.0A - -
3Q 26.1A 38.8A 32.8E - -
4Q 32.9A 39.6E 37.3E - -
YEAR 89.6A 137.9E 129.6E 177.2E 175.5E
Bijdrage profylaxe omzet 2019: € 0,00
PHGUF: 3Q18 Recap - Ruconest Trends Strong
Pharming reported 3Q18 results that were at the high end of expectations.
The key takeaways, in our opinion, include 1) Ruconest revenue trends were ahead of target for 3Q18, 2) the quarter would have beat on the bottom line if not for 1X noise in other income, 3) we have increased confidence in our 2019 Ruconest revenue forecasts, and 4) the company's pipeline should continue to generate news flow in 2019. Reiterate Buy rating with price target of €2.25/ share.
-3Q18 Recap. Pharming reported revenues of €38.8M versus our target of €32.8M (Ruconest: €38.6M actual versus our estimate of €32.6M). Gross m argins were below target (83.5% versus 85.3% target), but gross profit of €32.5M still exceeded our target of €28.0M. Spending netted about as expected, but other expense was ~€7M higher than expected (1X noise).
Thus, net income of €5.4M trailed our €6.1M target (EPS of €0.01 was in-line). Net, we viewed the quarter at the high end of expectations given the strong Ruconest revenues relative to expectations.
Takeaway #1 - Business is good for Ruconest. The company commented that there was "slightly larger than anticipated sales demand in the US and Europe" for Ruconest. Further, the company targets 4Q18 results to be similar to the strong 3Q18 results. It appears that there has been no negative impact from the recent delay to the prophylaxis expanded indication (received Complete Response Letter with another trial requested).
Takeaway #2 - More confidence in model. No major changes to our revenue and earnings model. That said, we have increased confidence in future targets as the annualized revenue run rate off of 3Q18 sales is already approaching €155M (and we are at ~€177M in 2019).
Takeaway #3 - Pipeline update. The company's pipeline should be incrementally important to investors in 2019 - particularly post recent positive data from the investigator study data for Ruconest to treat contrast-induced nephropathy (IND expected in early 2019). Upcoming dates to monitor include 1) an investigator study data comparing Ruconest to Firazyr in 4Q18, 2) an IND for Ruconest to treat pre-eclampsia in 4Q18, 3) a potential IND for PGN004 to treat Pompe disease in early 2019, and 4) potential updates on new delivery vehicles for Ruconest in 2019.
Reiterate Buy rating, PT to €2.25. Pharming is benefiting from growing Ruconest into a significant product that is driving profitability. Further, the company is turning Ruconest into a platform pipeline drug that could have magnitudes of greater revenue potential. We reiterate our Buy rating as we have increasing confidence in our estimates post a strong 3Q18