OptiCept Q4 on Tuesday: customer evaluations in focus
OptiCept will announce its Q4 results on Tuesday, February 27th. We anticipate good revenue growth compared to the corresponding quarter last year, primarily driven by increased volumes in PlantTech within the cut flowers segment, as well as aftermarket revenue within FoodTech. Additionally, we expect a lower cost structure due to ongoing cost-saving efforts and a more focused business approach in specific areas. With several ongoing pilots, both within the core focus areas (such as olive oil) and in applications close to focus area (juice and potatoes), our focus will be on any updates regarding the direction of these evaluations.
Sales growth driven by increased treatments and aftermarket services
We estimate OptiCept’s Q4 revenue to rise to 1.9 MSEK compared to 1.6 MSEK in Q4’22, driven by increased treatments within PlantTech for cut flowers and aftermarket revenue within FoodTech. Additionally, we anticipate initially low volumes from cuttings due to machines being shipped to customers in late 2023. We expect the order book to remain at high levels, some ~30 MSEK, due to a low conversion rate from order book to revenue, primarily because a significant portion of the total order book is tied to OliveCept systems undergoing evaluation from October 2023 to February 2024.
Cost-saving efforts support decreased operating loss
Throughout 2023, OptiCept has implemented cost-saving measures to decrease external costs and personnel expenses, which started to take effect in the previous quarter. As a result, we estimate that the company’s fixed cost base will remain relatively stable quarter-over-quarter but will be approximately 30% lower year-over-year. Consequently, we anticipate the operating loss (adjusted EBIT) to decrease to -18.1 compared to -30.0 in Q4’22. Cash flow-wise, we expect a negative operating result as well as a high capital commitment due to machines out for evaluation, which will depress cash flow. However, we anticipate some offset due to a directed issue and redemption of warrants during the quarter, totaling approximately 27 MSEK.
We focus on comments regarding customer evaluations
Our current full-year revenue estimate for 2024 is 27.3 MSEK, with an EBIT estimate of -39.9 MSEK. The company's target is to reach positive EBITDA result for the full year 2024, which means that OptiCept needs to secure revenues of 85-90 MSEK during the year, according to the company. In order for the company to achieve its target, strong growth in the order book is required. Although we believe that OptiCept will reiterate its target, our estimates are lower, because of the order book is around SEK 30 million. Since the order book mainly comprises OliveCept systems, and the evaluation period for these machines should largely be completed, we will be alert to any signals regarding the progress of these evaluations. Furthermore, while we anticipate a clear improvement in OptiCept's profitability in 2024 and the release of capital, we believe the company will require additional financing during the year. Thus, we seek any comments regarding the company’s outlook on financing needs for the next 12 months.
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OptiCept Technologies
OptiCept Technologies is a provider of the food and plant industry with technological solutions that are used to increase the sustainability of various raw materials. The company works with biological processes that provide increased extraction from the raw material, extended shelf life reduced waste, and retained taste, aroma, color, the nutritional content of the end product. The company has a patented technology within PEF (pulsed electric field) and VI (Vacuum Infusion). The company sells its products on a global level and is headquartered in Lund.
Read more on company pageKey Estimate Figures02.02.
2022 | 23e | 24e | |
---|---|---|---|
Revenue | 10.5 | 10.2 | 27.3 |
growth-% | 136.46 % | -2.91 % | 168.25 % |
EBIT (adj.) | -89.7 | -68.6 | -39.9 |
EBIT-% (adj.) | -854.52 % | -672.92 % | -145.78 % |
EPS (adj.) | -4.68 | -1.96 | -1.07 |
Dividend | 0.00 | 0.00 | 0.00 |
Dividend % | |||
P/E (adj.) | - | - | - |
EV/EBITDA | - | - | - |