Ann: Appendix 4C and Business Activity Report - Sep-2023 Qtr, page-9

Nice set of numbers, and really liked the gross margin growing to 57% with more room to improve as the new product takes over completely.

My persistent gripe is that the number of US ECPs remains stuck in a band and hasn't improved since 2021 - the RCT results need to make a big impact on this number.

The news on Mention expanding into further countries is match by Menicon's own emphasis on Myopia in its recently released annual report - the lead growth strategy is focused on myopia, and Menicon Bloom gets a good mention:


A bit of speculation then to pass the time on a lazy Saturday arvo.

• Menicon has about Aus $500M in cash on the balance sheet
• Menicon has invested heavily in the Bloom product suite, with training, apps, advertising etc, and replacing Naturalvue would presumably be a huge pain, let alone not having a leading product in Bloom day.
• Menicon now as a strategic emphasis on Myopia (as does CooperVision)
• Misight revenue increased from Aus $30M in 2021 to what should be about $100M in 2023

Put all that together, and you would think Menicon would see VTI as an attractive acquisition to protect its investment and gain significant growth.

Now,

• Revenue for VTI in CY2023 should be about Aus $15M
• 12x revenue is Aus $180M, a multiple probably at the higher end for a sale, but the RCT result certainly helps (think the promise of the scale of the Misight revenue above)
• Thorney will have an average price of between 60c and 65c after the rights offer

If Menicon acquired for VTI at a SP of $3 ($180M), they could easily recover that in revenue in 3-4 years if they are as good as Coopervision in generating sales, and it's only 1/3 of their cash.

Presumably Thorney would be happy with x5, and not waiting out the next 2 years for the RCT to finish and US FDA/China approvals might sound attractive.