Bioprogress is a stock I have been in and out of quite a few times since it floated in May but not much mention here on the Investors' Room. Does anyone else follow this stock. I see it is up 1.5p today and a few good buyers seem to have appeared.

Brokers note finally out. Interesting that they say "as broker to the company we make no recomendation and leave investors to draw their own conclusions as to the value of the company. Thought they might have said stonking buy !

Janus, sounds like CS do not know how to value the company then!!

Janus, thats probably they are going to be replaced with alarger and more commited broker, who will put the interests of BPRG and its shareholders first.

CS are a bunch of crooks

Year to December 2003A 2004E 2005E 2006E
Turnover (m) 0.9 5.4 14.4 32.8
Pre-tax profit (m) (1.7) 1.5 5.9 13.1
EPS (p) (3.4) 1.3 4.1 8.0
P/E (x) n/a 46.1 14.6 7.5
Cash (m) 1.8 12.0 14.1

I especially like this bit:

In summary this is a disruptive technology in one of the worlds largest
industries. Given the strong Intellectual Property that exists on the
technology, operating margins should be very strong and profitability in
2006/07 enough to drive forward the valuation. Our estimates for 2006
should be viewed as conservative, with the companys own internal targets
being 3x our estimated level of profitability.

BioProgress investors have had a real roller coaster of a ride since our feature back in October 2003 at 55p; the shares progressed to an all time high of 158p in February, since then the shares have steadily re-traced back to a low point of 60p on July 7.

Todays 14% thrust north to 71p can be attributed JPMorgan appointment, and of course, the long awaited Collins Stewart broker note; the first of its kind since the company floated on the AIM market just over a year ago. BioProgress announced that JPMorgan Chase Bank has been appointed as the US depositary for BioProgress listing of its Ordinary Shares in the form of American Depositary Receipts (ADRs) on the NASDAQ National Market in the USA, JPMorgan should help drum up US support for BPRG.

BioProgress looks have a three pronged turbine thrust developing behind it; There can be little doubt that such a high profile blue chip appointment in JPMorgan should increased buy pressure once London listed shares are transferred to the US as ADRs. Observers have suggested to me that 20p up side can be expected per million shares transferred as ADRs. I must confess to a head ache once I digested the complexity of the example when explained to me.no I am not going to try! Moving swiftly on.


BioProgress investors have had a real roller coaster of a ride since our feature back in October 2003 at 55p; the shares progressed to an all time high of 158p in February, since then the shares have steadily re-traced back to a low point of 60p on July 7.

Todays 14% thrust north to 71p can be attributed JPMorgan appointment, and of course, the long awaited Collins Stewart broker note; the first of its kind since the company floated on the AIM market just over a year ago. BioProgress announced that JPMorgan Chase Bank has been appointed as the US depositary for BioProgress listing of its Ordinary Shares in the form of American Depositary Receipts (ADRs) on the NASDAQ National Market in the USA, JPMorgan should help drum up US support for BPRG.

BioProgress looks have a three pronged turbine thrust developing behind it; There can be little doubt that such a high profile blue chip appointment in JPMorgan should increased buy pressure once London listed shares are transferred to the US as ADRs. Observers have suggested to me that 20p up side can be expected per million shares transferred as ADRs. I must confess to a head ache once I digested the complexity of the example when explained to me.no I am not going to try! Moving swiftly on.


BioProgress investors have had a real roller coaster of a ride since our feature back in October 2003 at 55p; the shares progressed to an all time high of 158p in February, since then the shares have steadily re-traced back to a low point of 60p on July 7.

Todays 14% thrust north to 71p can be attributed JPMorgan appointment, and of course, the long awaited Collins Stewart broker note; the first of its kind since the company floated on the AIM market just over a year ago. BioProgress announced that JPMorgan Chase Bank has been appointed as the US depositary for BioProgress listing of its Ordinary Shares in the form of American Depositary Receipts (ADRs) on the NASDAQ National Market in the USA, JPMorgan should help drum up US support for BPRG.

BioProgress looks have a three pronged turbine thrust developing behind it; There can be little doubt that such a high profile blue chip appointment in JPMorgan should increased buy pressure once London listed shares are transferred to the US as ADRs. Observers have suggested to me that 20p up side can be expected per million shares transferred as ADRs. I must confess to a head ache once I digested the complexity of the example when explained to me.no I am not going to try! Moving swiftly on.

here's the full article.........

Elric Lloyd-Langton

August 4 2004


BioProgress investors have had a real roller coaster of a ride since our feature back in October 2003 at 55p; the shares progressed to an all time high of 158p in February, since then the shares have steadily re-traced back to a low point of 60p on July 7.

Todays 14% thrust north to 71p can be attributed JPMorgan appointment, and of course, the long awaited Collins Stewart broker note; the first of its kind since the company floated on the AIM market just over a year ago. BioProgress announced that JPMorgan Chase Bank has been appointed as the US depositary for BioProgress listing of its Ordinary Shares in the form of American Depositary Receipts (ADRs) on the NASDAQ National Market in the USA, JPMorgan should help drum up US support for BPRG.

BioProgress looks have a three pronged turbine thrust developing behind it; There can be little doubt that such a high profile blue chip appointment in JPMorgan should increased buy pressure once London listed shares are transferred to the US as ADRs. Observers have suggested to me that 20p up side can be expected per million shares transferred as ADRs. I must confess to a head ache once I digested the complexity of the example when explained to me.no I am not going to try! Moving swiftly on.

The second thrust could continue to develop now that the ever imminent CS note has finally materialised, and now circling the BBs. The interesting thing about BioProgress, is that a mere c8% of the companys ordinary shares are held by institutions, leaving the remainder with Company employees and of course, the volatile trading minds of private investors, who I must confess to being part of. The point I am making is this; now that the CS broker note is out, one must assume (if you like) that institutions will now feel less constrained, thus take a closer look at the company, previously restricted without any official research document to fall back on, no one to blame syndrome, of course institutions do have a rigid investment criteria to which some must stick to; a broker note, or lack of, may just impair ones judgment a little.

The third thrust should come from the closure of the bear positions as they clamber for the exit before margin call a comes knocking, after all, they have fed long enough, helped by the lengthy due diligence periods similar to Wyeth`s, who have an option to use XGEL SWALLOW technology. These are complex times, as well as time consuming; FMC Corporation for example in addition to its own internal patent department employed no less than five firms of patent attorneys to scrutinise the BioProgress patent portfolio. This rigorous due diligence which would have also been performed by Perrigo and FMC Corporation is supportive to the companys case.

The bears have been feeding on the back of investor pessimism due to the lack of understanding the nature of the complex nature surrounding due diligence periods. Should Wyeth be convinced of BioProgress technology, we should here more by mid September, by which time, the bears who have braved todays signals will surely clamber for the exit and become buyers.

With the likelihood of the SEO debacle being heard after the judge returns from his jollies, further impetus may be evident, assuming the BioProgress patent case is a good one. Nevertheless, the potential downside is minimal, given the companys view that the out come will not impact on its existing patent portfolio.

There can be no doubting that the shares will be driven by news items in the future, as this is often the case; a case in point is the continued negotiations relating to licensing two other BioProgress dosage forms, namely SEPTUM and WAFERTAB.

The TABWRAP technology competes with gelatin, cellulose spray coating
and sugar tablet coating technologies in the 900bn per year solid tablet global market. BioProgress is working with a number of other pharmaceutical companies on projects involving the transfer of branded OTC products into the TABWRAP technology.

BioProgress is known to be in discussions with at least two other major pharmaceutical companies on projects to transfer existing coated tablet products into the TABWRAP technology.

Although CS seemed unable to put a price target on BioProgress, CS did say, Our estimates for 2006 should be viewed as conservative, with the companys own internal targets being 3x our estimated level of profitability. CS also pointed out that the recent placing underpinned the shares potential, and further suggested that the company would not need further funding to achieve profitability.

The company is intending to operate on the Tetrapak model of selling machines that can only use its proprietary film. (the very point Edward made in his initial story) As such profitability in later years could be very significant, although in the early period the numbers will be modest.

I think the bears were long gone 2-3 weeks back!

Keep up will you?

;-))

Re-edited August 7 2004
Elric Lloyd-Langton
Edward Kalfayan


BioProgress investors have had a real roller coaster of a ride since our feature back in October 2003 at 55p; the shares progressed to an all time high of 164p in February, since then the shares have steadily re-traced back to a low point of 56p during the day on July 7.

Wednesday's 14% thrust north can be attributed to the BPRG announcement that JPMorgan Chase Bank had been appointed as the US depositary for BioProgress to list its Ordinary Shares in the form of American Depositary Receipts (ADRs) on the NASDAQ. The high profile blue chip appointment in JPMorgan should help drum up US support for BPRG. For the moment the company has sufficient cash to cover planned investment and working capital, and is disinclined to dilute the existing 115m shares. Current financial forecasts for future EPS also refer repeatedly to the same 115m unchanged over 2004/5/6, though any new acquisition opportunity would affect the picture.

BPRG looks to have a three pronged turbine thrust developing behind it; Provided that no new shares are issued, only a modest transfer of UK shares out of the UK market will be needed to drive up the price. Observers have suggested to us that 20p up side can be expected per million shares transferred as ADRs. For the moment no one has any estimate of how much traffic JP Morgan can hope to generate, but several teams from US companies have dug deeply enough into the future prospects for BioProgress to have come to believe, as we do, in this colossal, and most unusual investment opportunity, whilst necessarily acquiring much more of a valuable insiders view. It is not too fanciful to think that the normal demand from US investors whilst modest at the start, could nevertheless spellbind at least ten colleagues, friends, and social contacts through each of Wyeth, Bristol Myers and Convatec, Perrigo, and FMC, not over looking insiders and clients of Biotec films at Tampa- surely 50 -150 potential new investors - at the very minimum averaging 5000 shares a piece. On our calculations this would sustain a share price increase of 5p -15p

The second thrust could continue to develop from the long awaited Collins Stewart broker note, which became available by mid-day Wednesday to a very few of their key clients. A clandestine copy was immediately copied and distributed on the BBs to the few hundred private investors who keep closely in touch with events. This was regrettably the first report of its kind since the company floated on the AIM market just over a year ago, but has made up for that omission by the depth of detail in its 16 pages, and the quality of the writing. However it will not have been distributed to general City institutions until Friday. As it requires several hours of concentrated study to reveal its many messages, some quite cryptic, it could not have been of much influence on the share price until next week.

The disclosures most influential in fuelling the future upward trajectory of the share price must be the estimates of future profit, with CS conservatively quoting 4.1p for next year, and 8p for 2006, boosted by BPRGs own disclosure that internal targets are x3 higher. PEs for this level of growth are accepted by most investors at a minimum of x25 times, leading to conservative future values by CS of 102p next year, and 200p for 2006, bearing in mind that the company's own targets would lead to 306p next year and 600p in 2006.

Net profit margins rising rapidly to 38%( with those from Tabwrap at an incredible 58%), and operating cashflow of 12.6m, by 2006, are such further attractions that investors could easily decide to value the share at anything up to x40 of EPS. Unusually for this pre-commercialisation stage, there is no looming cash requirement, and the share price currently contains 14p of cash, forecast to reach 23p by end 2006.

Interestingly a mere 8% of the companys ordinary shares are held by institutions; and of those shares not with Company employees, the remaining bulk are controlled by the volatile trading minds of private investors, of which we both are. The institutions, which usually have rigid investment criteria, will at last have an official research document to fall back on, and be allowed to pass a decision to invest.

The third thrust should come from the closure of bear positions as they clamber for the exit before margin call comes a- knocking. They have fed well and undisturbed for several months, - long enough - during lengthy periods reserved for due diligence, and for optional extensions to exclusivity, by the likes of Wyeth. They have profited from repeated surges of hope which have propelled share spikes, each of which, at the end, have left investors unsupported by real events, and nursing heavy falls. This has been so easy for the Bears that they may well believe that the opportunity would last for ever and have now been well and truly caught.

It has been suggested that Wyeth's option to postpone the finalisation of the contract may be driven by the need to await the outcome of the Court Case on ownership of the contested patents. On the other hand it is known that Wyeth is visiting Tampa this month to check that the progression from food-grade film manufacturing capability to that for the higher grade pharma film, is assured..

Last year the interim result was declared on September 4. By the same date this year, now just five weeks away, we should hear more of the Wyeth contract; the Nasdaq listing; progress with, and performance with, the acquired Aquafilm assets, and of many, many, other initiatives all in progress; by which time, the bears who have braved todays signals will surely have taken a beating, clambered for the exit, been transmogrified, and become buyers.

Lemming Article

The CS forecasts, if fulfilled, should support the price now, which is no better than it was at the start of the year. It should also drive the price upwards.

There's a couple of things from the above that may curtail the high expectations of retail investors though.

Firstly, as stated above, we should have seen bear covering by now. Any expectation that this will be a factor and drive further gains should be dismissed IMO.

Secondly, institutions. They may well want to get a slice of the action, even though there were previous forecasts, I'm led to believe. More often than not in these situations, institutional investment is satiafied by companies placing new shares in their hands and over time I'm sure this will happen. Smaller cap stocks traditionally do this as they build up a company and I would be amazed if BPRG did not do the same. Needless to say, this will have a dilutive effect on the price over time.

Personally, I'm considering sticking a few in the bottom drawer for the long term regardless of the above.

Cheers,
Al
;-)

Al , go read all the IMG buy notes ... they always forecast huge profits in two years time !

Reason I have never looked at these as more than a trading oppurtunity is that they have no manufacturing experience and in manufacturing nothing ever goes to plan , best bet for the product is that they get taken out by someone with manufacturing experience.

Margins are also too optimistic , they will get screwed by the customers ... not a must have item so big pharmas hold upper hand,

All imo.

Dil - true as well.

Not many wee bios have "proper" management, who know how to cope with the above. The market is indeed littered with them.

Interesting in regard to DIL's comment that BPRG have farmed out most of the 'manufacturing' to very experienced specialists - such as HH for the machines.

The true beauty of BPRG is that it's not rocket science, but is well protected by patents and fills a well focused niche market requirement - and a very substantial niche at that.

Yes but building machines isn't their business so you would expect any firm to do the same.

DIL - I would agree that a firm with 'proper management' might do the same. But I would differ on your views on margins and the need of the pharmas for the product.

Making even pharma grade film is not that difficult and by buying an established film manufacturing company they have moved a long way down the learning curve.

I'm impressed by most aspects of the deals so far and I believe that the management are very much aware of their limitations and strengths.

aol , the pharmas have managed thus far without it so can carry on managing without it if they want to. Not sure if its cheaper or dearer than current process but if it is cheaper then they have a better chance of getting a decent margin for longer but over time it will fall but can be compensated for with larger volumes.

My only comment on the management is that they appear to have been very nieve in the way they have leaked info , whether knowingly or not.

Hope it works out for you aol , your one of the good uns from the zoo across the road.

Thanks DIL. I understand that the process does offer significant cost advantages, otherwise I would be far more sceptical having some experience of both manufacturing and selling technological products to large companies over many years.

Also, I think that the management are learning from their previous mistakes, there is far less leaked info about these days, which is also encouraging.

Found by win2003 on ADVFN..looks good

http://www.foodnavigator.com/news/news-NG.asp?id=54108

Exelleent find