A market leader in organ recovery
Lifeline Sctnf (LONDON:LSIC)’s flagship product is LifePort Kidney Transporter, a hypothermic machine preservation device used by over 193 transplant programmes in 28 countries. We forecast a step-up in growth from 2015 from continued geographic expansion, notably in China and South America and the launch of LifePort Liver Transporter in US. The shares trade at 1.4x FY15 EV/sales and a P/E of 11.8x FY15, our forecast 2014-18 EPS CAGR is 12%.
Clinical evidence and high unmet needs
LifePort Kidney is well established in the lead North American market and is installed in 85% of US and 100% of Canadian organ procurement organisations. Three year outcome data from the landmark Machine Preservation study published in 2012 in the New England Journal of Medicine showed LifePort significantly increased graft survival in kidneys recovered from higher risk donors at 86% vs 76% in those preserved via cold storage (CS). LifePort is proven to help transplanted kidneys to function sooner and last longer with fewer post-transplant complications. Growth drivers include the significant worldwide shortfall in donor kidneys leading to rapid growth in the transplantation of higher-risk donor organs.
Strong underlying growth in the US
Lifeline reported FY14 sales growth of 6% to $35.2m led by North America, where sales of LifePort Kidney Transporter and consumables grew 12% to $27.3m. China grew 51% to $1.9m. Weaker markets included South America, down 70% to $0.6m as a result of well-flagged importation issues. Reported EPS increased by 24% from 14.7c to 18.2c. At the end of the period net debt stood at $1.2m.
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