So, by my reckoning, the SA plant is worth about $100m (see page 48 of the annual report,) and they currently have about $300m in cash, versus a market cap of $400m.
They were asked at the AGM about the possibility of selling the SA asset at some point, which they didn't reject and agreed that divesting it might be an option down the track if the opportunity was right. They also added that the plant is undergoing state-of-the-art upgrades courtesy of a government grant and is the biggest manufacturing plant of its kind in the Southern Hemisphere (words to that effect.)
This may appeal to a suitor interested in separating and divesting the parts of the business they don't want (Mayne may do this themselves at some point.)
In the meantime, they need to stabilise the dermatology business and turn Nextstellis to profit (which is a long-term proposition with short-term cash burn.) There will be further write-offs in Feb, but I think this is all priced in for now.
The "new launches including gCARDIZEM® SR, gNUVARING ®" in 2HFY23 remain to be proved as does the focus on "driving improved profitability and cash flow with return to positive EBITDA expected in FY24."
The return of capital is enough to keep investors interested for now, with the prospect of a buyback also flagged alongside the share consolidation (although they didn't say how they might fund this while committing more funds to Nexstellis.)
They did say they expected the dermatology to normalise 2HFY23 and return to profitability (perhaps somebody can correct me if I misunderstood that?) Hopefully that offsets some of the cash burn as they grow their three business for the future and hit their FY24 objectives.
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(20min delay)