(Ibex Technologies Inc) Due Diligence Report
Symbol: IBT.V
Price: $0.10
Common Shares: 24,703,244
Insider Holdings: 9,133,650 (37% as per SEDI)
**CEO Paul Baher recently purchased 246,000 or 1% on December 2nd through the market**
Q1 2016 Financial Results + MD&A (Ending October 31st 2015)
ASSETS
Cash: $2,636,690 ( July 2015: $2,084,826) - $0.1067c a share in cash
Receivables: $735,182
Inventories: $676,683
Prepaid Expenses: $103,680
Assets Held For Sale: $438,012
Property & Equipment: $2,121,192
Total Assets: $6,711,439 ( July 2015: $6,379,167)
LIABILITIES
Payables: $476,337
Long-Term Debt: $1,203,255
Deferred Income: $28,989
Total Liabilities: $1,679,592 ( July 2015: $1,707,405)
NAV(Net Asset Value) is just over $5 million or $0.20c a share.
Q1 Revenue
Sales: $1,414,875 ( prior year sales: $627,447)
Net Income: $360,206 or $0.0145c EPS
Prior year sales Recap(from year end results)
Total Sales in 2015: $3,491,130
Net Income: $209,628
IBV is so undervalued given the financials that it makes sense as to why insiders were buying stock near 52 week highs just recently. IBT could pay all it’s debt and liabilities off right now and still have around a million dollars in liquid cash. Revenue keeps growing and the US/CDN dollar exchange will help that. A realistic price for IBT right now would be around the $0.20 to $0.25c range given its assets and earnings.
MD&A Highlights
The Company, through its wholly owned subsidiaries, IBEX Pharmaceuticals Inc. and BioResearch Products Inc. (“BRP”), manufactures and markets enzymes for biomedical use. These enzymes are sold directly by the Company to manufacturers of medical devices, quality control labs and academic research institutions. Heparinase I is the most important of the IBEX enzymes. Its potential lies in its ability to cleave heparin and low molecular weight heparins and thereby neutralize the effects of heparin and heparinoids, drugs commonly used in hospitals which interfere with haemostasis test. Heparinase I recognizes and cleaves a pentasaccharide sequence which occurs in both heparin and the low molecular weight heparins, thereby neutralizing their anticoagulant activity. IBEX produces its enzymes at its sites in Montréal, Québec and North Liberty, Iowa, as well as at third party manufacturing facilities monitored by IBEX personnel. In addition to making and selling enzymes, IBEX also provides lyophilization services related to the making of components for disposable medical devices which are used in the hemostasis point of care market.
As at October 31, 2015, the Company had net working capital of $3,629,097 compared to net working capital of $3,192,333 as at July 31, 2015. Cash and cash equivalents increased by $551,864 to $2,636,690.
Management believes that the Company has sufficient funds to meet its obligations and planned expenditures for the ensuing twelve months as they fall due. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but not limited to, twelve months from the end of the reporting period.
We see an improving picture and expect to be cash positive in the 2016 Fiscal Year if current customer purchase projections hold, and if we continue to benefit from the favourable US/CAN exchange rate.
The Company continues to work on a number of projects with our key customers, some of which it hopes will result in significant revenue in Fiscal 2016 and beyond. However, we cannot give any assurances that any of these projects will come to fruition and produce revenues
As at December 16, 2015, the Company has 1,015,000 stock options outstanding with exercise prices ranging from $0.05 to $0.24 and expiry dates ranging from January 2017 to December 2023. As at December 16, 2015, on an if-converted basis, these stock options would result in the issuance of 1,015,000 common shares at an aggregate exercise price of $191,400. |
