Cavendish stays positive on Allergy Therapeutics as attention turns to key 2026 decision

Cavendish reiterated its 13p target on Allergy Therapeutics after the group reported FY to June 2025 revenue of £55m (broadly flat, +2% at constant FX), noting a faster-than-expected shift in Germany from non‑registered to fully registered allergy immunotherapies that has altered product mix while demand for registered treatments remains firm. The balance sheet has materially strengthened after shareholder lenders exercised warrants to repay a £55m shareholder loan and the company put in place a new £50m uncommitted facility, giving management flexibility ahead of several value inflection points. Cavendish cut FY26 forecasts—revenue to £68m from £77m and now an adjusted EBITDA loss before R&D of £6.3m (vs a prior £9.6m profit)—citing timing uncertainty around the Grass MATA MPL commercial launch and planned marketing investment, and says a positive German marketing-authorisation decision expected in early 2026 would be a major catalyst.

Analysis

Allergy Therapeutics reported FY to June 2025 revenue of £55.0m, effectively flat year-on-year and up ~2% at constant exchange rates, with Cavendish noting a faster-than-expected shift in Germany from non-registered to fully registered allergy immunotherapy products that has altered the product mix. Demand for the group’s registered treatments is described as firm, indicating underlying commercial resilience despite the transitional effects in its largest market.

The company’s balance sheet materially strengthened post-year-end after shareholder lenders exercised warrants and proceeds were used to fully repay a £55m shareholder loan facility; management also secured a new £50m uncommitted loan facility, which Cavendish says provides flexibility to navigate upcoming value inflection points. Cavendish reiterated a 13p target price and remains supportive of the long-term outlook, citing progressing late-stage programmes.

Cavendish cut FY26 forecasts because of uncertainty around the precise timing of the Grass MATA MPL launch in Germany and planned commercial and marketing investment: FY26 revenue is now forecast at £68m (down from £77m) and adjusted EBITDA before R&D is expected to be a £6.3m loss (versus a prior £9.6m profit). The expected early-2026 marketing-authorisation decision for Grass MATA MPL is the key near-term catalyst, while launch timing, uptake speed and elevated marketing spend are the principal execution risks that could prolong near-term earnings weakness.

Key Decisions for Investors

• Maintain a measured hold or modest position given the strengthened balance sheet and supportive broker view, but avoid materially increasing exposure until the German marketing-authorisation decision and clearer launch timing are confirmed
• Actively monitor the regulatory timeline and early commercial uptake metrics for Grass MATA MPL (expected early 2026) and use confirmed approval plus initial sales/uptake data as a trigger to add to positions
• Limit downside risk in the near term by sizing positions conservatively or using hedges, because management’s guided FY26 reflects an adjusted EBITDA loss driven by timing uncertainty and planned marketing investment