Hi TP Good to see you on the NEU thread. Thanks for your...

Hi TP

Good to see you on the NEU thread. Thanks for your thoughtful post.

As you say, there is nothing new about volatility in the NEU share price – we have seen some big ups and downs before, sometimes in quite a short space of time.

I want to focus on the four downturns in share price referred to in your chart and discussion.


Back in February 2020 a massive fall of 66% from $3 to $1 in just 7 weeks! (i.e. mid-Feb –mid-Apr 2020)

• SP was ~$3 at end of Jan 2020
• Lang Walker first tranche sale @$2.50 on 14 Feb 2020
• Lang Walker sale of remaining 14% NEU stake @ $1 in mid-March 2020
• Pandemic declared and international border closures mid-March 2020
• NEU announced it would defer ROW deal to post-Ph 3 on 17 March 2020
• Ph 3 trial halted due to COVID on 24 March 2020.
• ASX All Ords falls 33% from 17 Feb - 23 Mar 2020

Then back down 45% to $1 again in 29 weeks! (May-Nov 2020)

• $20m cap raise in late June 2020
• Long period of no news

Then back down 32% from $14.75 to $10 (late July – late Oct 2023)

• Share price rose ~$3 to $14.75 following ROW deal announcement mid-July
• $100m upfront received (27/7)
• Half year after-tax profit of A $48m announced for H1 23. (28/8)
• Director (J Basile) purchases A $60,000 of NEU shares on market. (14/09)
• NEU addition to ASX 200 on 18/9 announced on 01/09.
• ASX 200 all Ords falls ~ 7% over same period

Now 40% down in just 7 weeks (i.e. 17 July - 9 Sep 2024)

• NEU received rare paediatric disease designation for NNZ-2591 in PMS. If NNZ-2591 is approved in PMS, this is potentially worth US$150m+ to NEU (19/07)
• Q2 24 Daybue sales announced, up from US$75.9m to US$84.6. (07/08)
• FY 24 Daybue sales guidance revised down by ACAD from US$370-420m to US$340 –370m, potentially lowering NEU’s FY 24 licence fee revenue by ~A7m. But this was balanced by positive real world data for Daybue, 46% reduction in discontinuation rate and confirmation of EU filing in Q1 2025
• Announcement of positive Ph2 results for Angelman syndrome – a trifecta for NNZ-2591! (09/08)
• Director (J Basile) purchases A$100,000 of NEU shares on market. (16/08)
• Investor roadshow presentation released (19/08)
• H1 2024 results announced – A$24.3m royalty income; A$8m profit after tax; COH A$213m
• ASX All Ords falls just 1% from 17 July – 9 Sep 2024

I see a significant difference between the two share price downturns seen in 2020 and the two seen since just over a year ago.

The two downturns in 2020, in retrospect, I can understand.

The 32% downturn in shareprice from July to October last year was against a background drop of just 7% in the market and a number of positive announcements. So it makes less sense. The key event here, I believe, was the announcement of NEU’s addition to the ASX200 on 01/09/23.

More concerning, and making even less sense, is the downturn NEU is in at the moment. Down 40% in just 7 weeks against a backdrop drop of just 1% in the market. One modest reduction in guidance on licence revenue for 2024 (perhaps A$7m less over the full year) versus multiple positive announcements.

To me, it's not just overdone, it smells off.

(My apologies that there’s no chart in this post!)