Vita Life Sciences Ltd

 
 
    VSC Dividend Details
 
Continued Growth in Australia: Vita Life Sciences Ltd (ASX: VSC) shares have plunged 9.93% this year to date but rose 11.44% in the last five days (as of December 21, 2015). For the first half of FY 2015, the company reported sales revenue up 3% to $18.2 million, earnings before interest and tax (EBIT) down 28% to $2.37 million, net profit after tax down 67% to $1.56 million, diluted earnings per share down 66% to 2.79 cents and dividends per share up half a cent at 1.5 cents per share.
 

DPS and Gross Operating Cashflow to EBITDA (Source: Company Reports)
 
In Australia, the company reports continued growth in core Herbs of Gold brand and the ongoing establishment of VitaScience in the pharmacy channel. In Singapore, there is continued growth in the core VitaHealth brand and first sales of the Herbs of Gold brand reported. In Malaysia, challenging economic conditions and the introduction of the GST in April 2015 let the management implement sales support initiatives impacting both product pricing and margins. Performance in the other Asian region was impacted. Particularly, the product regulation changes in China affected the number of products available for sale and ongoing underperformance in Thailand resulted in the establishment of a new management team. For the full year, revenue guidance has been revised to approximately $ 38 million and EBIT guidance to approximately $ 5.5 million. We believe that, considering the future prospects of the company, there is not much room for upside and the stock is Expensive at the current price.
 
 
VSC Daily Chart (Source: Thomson Reuters)
 

SomnoMed Ltd

 

   SOM Details
 
Growth Acceleration in Canada and US: SomnoMed Ltd (ASX: SOM) was recognised and honoured by Frost and Sullivan in their awards for 2015 for the Obstructive Sleep Apnea Company of the Year Award. The company is growing well in the area of Obstructive Sleep Apnea on a global basis and continues to make significant progress in 2015/2016. The company has also announced that its Canadian subsidiary has acquired the business of Strong Dental in Lexington, Ontario, Canada for consideration of C $ 700,000 including the transfer of certain lease liabilities. This entails all tangible and intangible assets and an exclusive license to all patents linked to devices made by the acquired company. The company manufactures the SUAD device for distribution in the US and Canada. This acquisition will enable SOM to control the distribution of their brands besides adding a highly reputable device to the product line. The company reported an outstanding growth performance in US direct sales in the first quarter of FY 2016 indicating 37.8% rise above the same quarter in the previous year; and a new record of 6888 devices sold was the main accelerator, which allowed the company to break another quarterly sales record. The high growth in direct sales in the US and in other regions more than compensated for the fall in sales to licensees. Consequently, global sales revenues grew in the first quarter year-on-year by 30.1% to $ 9.64 million. Revenues generated from the sale of MAS devices grew by 32% to $ 8.12 million and accounted for 83% of total revenues for the quarter. During this quarter, Europe reported a solid performance in line with the expectations growing by 18.3% compared to the previous year, with 4453 devices sold while APAC/Japan posted sales of 1498 units, representing a growth of 13.3%. The shares have fallen 4.06% this year to date but rose 8.33% in the last three months (as at December 21, 2015). The company continues to perform impressively though we would classify the stock as a speculative buy at the current price of $2.55
 
 
SOM Daily Chart (Source: Thomson Reuters)
 

Capitol Health Ltd

 

CAJ Dividend Details
 
Response to governments’ changes to bulk-billing incentive program: Capitol Health Ltd (ASX: CAJ) plunged 70.69% this year to date (as at December 21, 2015). With the changes announced by the Federal Government with regards to the bulk-billing incentive program for diagnostic imaging, CAJ responded by stating that without details it is difficult to infer the way changes would operate beyond implementation starting in July 2016. The changes (aligning incentives with those of a general practitioner service and reduction in incentive for magnetic resonance imaging services from 15% to 10% of the medical benefits schedule fee) are taken as key catalyst with regards to CAJ’s efforts to increase the productivity of its operations. CAJ still estimates an impact of about five to seven percent on the revenue. The Company is thus attempting to obtain more details in order to determine the definite effect of the proposed changes on the financial performance in FY17 and beyond. CAJ also intends to evaluate remedial options such as co-payment for services provided, review of services and the like. Partnership with Enlitic Inc is therefore seen as a technological advantage in such situation as it is expected to generate revenue during FY17. We do note that FY15 performance entailed revenue up by 23% to $ 111.2 million and underlying net profit before tax up by 59% to $ 16.2 million. On the other hand, the performance for FY 2016 shows slower than anticipated growth so far because of regulatory uncertainty and subsequent disruption to referral patterns. We still believe that the company would be able to circumvent the issue pertaining to the regulatory changes in the long run. Also, growth in the demand for healthcare services with growing ageing population will still be a driving force. Accordingly, we give a speculative buy recommendation considering the long term potential for the stock at the current price of $0.29
 
 
CAJ Daily Chart (Source: Thomson Reuters)
 

Japara Healthcare Ltd

 

JHC Dividend Details
 
Strong performance: Japara Healthcare Ltd.’s (ASX: JHC) shares have delivered 46.63% returns this year to date (as at December 21, 2015) and surged 7.39% in the last five days. The company has confirmed that the acquisition of the Profke residential aged care portfolio comprising four aged care facilities in Queensland and New South Wales was completed on 1 December 2015 as expected. The final net acquisition price for the Profke portfolio was $76 million after adjustment for additional refundable accommodation deposits and accommodation bonds transferred. This was below the previous price advised to ASX, which has also resulted in reducing upfront funding requirements.
 


Result Summary (Source: Company Reports)
 
The financial results for FY 2015 also have been ahead of guidance with revenue up 14.8% to $ 281.3 million, EBITDA up 26.5% to $ 50.6 million, EBITDA margin up from 16.3% to 18% and net profit after tax of $ 28.8 million. The future potential for the company look good with demographic shifts indicating strong forecast demand for residential aged care with 82,000 additional beds required in the next decade, necessitating over $ 33 billion in investment. We believe that all the above point to considerable upside for stock price appreciation, and accordingly, we recommend a buy at the current price of  $3.08
 
  
JHC Daily Chart (Source: Thomson Reuters)

---

Disclaimer
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people.Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376).The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation.Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product.The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd currently hold positions in:  BHP, BKY, KCN, PDN, and RIO. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.
Copyright
Copyright © 2014 Kalkine Pty Ltd ABN 34 154 808 312. No part of this website, or its content, may be reproduced in any form without the prior consent of Kalkine Pty Ltd.
Kalkine is a trading name of Kalkine Pty Ltd ABN 34 154 808 312, which holds Australian Financial Services Licence No. 425376.