PAZ Pharma Zen

[percy]

1334713348

Photos from Percy, with thanks to Minimoke for sharing them

Thanks Rupert Bear.
In the first photo we can see a lot of electricans' vans.We know there are huge transformers at the gate,so I expect these electricans are wiring the factory for the installation of freeze driers.In the background is a tower used for extraction.Extraction of Kril oil,mussells and blackcurrants is very profitable.The higher the tower the better the product quality.
The second photo also shows the extraction tower,together with vessels/cylinders used in the extraction procees.These would have been imported from China.

[percy]

Today's announcement of good turnover and profit increases was welcome.
However what I loved was "Pharma Zen has commenced a range of initiatives to take the company to the next level." Exciting days ahead?

My first post on this thread.21-04-2011.
Exciting days ahead I said,ten and a half years ago.
Some things never change,exciting days ahead...lol

[Sideshow Bob]

Its hard to put a value on a company in a complete vacuum of information. Directors and the new private equity investor will know how they're trading year to date, 11 months to November and accordingly a very good idea on what the annual result will be for 2021 but shareholders are not even provided with proper interim financial statements. The lack of disclosure is disgraceful.

I have a revised value using my own methodology and appropriate discounting for lack of liquidity, lack of financial disclosure, risks, extended Covid influence, Aiora being withdrawn from Chemist Warehouse to name just some factors but its so far south of the recent share price I won't share it on here or bid at that price.

PAZ used to be on a PE of 20 and those that bought on that metric certainly have done extremely well. 20 x eps of 3 cps in 3 years time, (if achievable with Covid headwinds) = 60 cents 3 years hence. Discount that back to today's dollars using an appropriate discount rate for the risk and lack of liquidity. My updated 2 cents worth.

And with that vacuum of information grows speculation or just perhaps disinterest? Looking back at last year, FY announcement was 1st of April, so could be over 3 months before we have any news, and guidance. In the meantime, the share price drifts along......if any trades at all.

It could be a thing with the USX - less regulation, less focus on smaller holders, less updates etc. If look at say SFF, slightly different kettle of fish as a Coop with their major holding a 50% share in SFF Ltd - but get no guidance, or even a half-year. Just have to glean some guidance on how they are going from newsletters, comparison to competitors and other forums. Albeit they are a heavily seasonal business.

But with PAZ, it isn't a tin pot company and now has a market cap of $180m. It does need to double its EBIT to get to a PE of 20, and still alot of growth priced in.

Just drawing on Percy's post, in my mind the key aspect is not producing the stuff, or necessarily how good the quality is. It is about marketing/selling the product, and creating a brand.

For example, Go Healthy sold about 4 years ago for something like $100m. then sold again last year. CDH bankers up for $500m-plus GO Healthy vitamins sale (afr.com) (https://www.afr.com/street-talk/cdh-bankers-up-for-go-healthy-vitamins-sale-20201210-p56m7n) This will be priced for earnings, and they'll probably just buying and capsulting the ingredients. Nothing particularly special in that, but building a brand and sales in a competitive market takes skill, dedication and money.

We all know you can have as good a product as anything, but if you can't market/brand/sell it, then ain't worth jack. Looks at Blis - run by a bunch of scientists and 20 years later largely going nowhere. Plenty of companies in NZ can freeze-dry product, or do extract - but the value/margin gets larger as move closer to the customer, or have some sort of defence or moat.

PAZ are obviously under taking a large capital programme, and while I haven't been close enough (ie been to any meetings etc), they obviously have reasons for capacity and must have some confidence. Understand from Percy they are maxxing out of their current factory.

I can understand all of Beagle's concerns/reasons, but there is risk in plenty of sectors and have to be weighed up. Most holders would be sitting on large paper gains. I wouldn't be buying at these prices or be all-in on them, but I see them as a small dabble as part of diversified portfolio, with a wait and see approach for when the new factory opens and what this translates to.

But some updates in the meantime wouldn't go astray.....;)

[Beagle]

Good post Sideshow Bob. I can confirm the USX regulations do not mandate the full disclosure of interim financial statements.
In my view one needs to factor in the extra risk involved with the lower level of disclosure and much lower level of liquidity.
Last traded at 71 cents = 40.1 times 2020's earnings. Directors made it clear supply chain challenges are serious this year.
Most commentary I have seen from companies and commentators suggest supply chain challenges could endure for quite some time and maybe not normalize until 2024.

When updating my assessment of fair value today I guessed that this years profit will be down on last year and their previously articulated goal of doubling 2020's earnings within 3 years will get pushed out another year so we're looking at maybe 3 cps earnings in 2024 announced in March-April 2025. Choose you own PE and discount rate to bring that back to today's fair value. In a nutshell I expect Covid problems and their earnings impact will be more enduring that I assumed some time back. (Blame Omicron and whatever other variants are to come after that)

[Sideshow Bob]

Good post Sideshow Bob. I can confirm the USX regulations do not mandate the full disclosure of interim financial statements.
In my view one needs to factor in the extra risk involved with the lower level of disclosure and much lower level of liquidity.
Last traded at 71 cents = 40.1 times 2020's earnings. Directors made it clear supply chain challenges are serious this year.
Most commentary I have seen from companies and commentators suggest supply chain challenges could endure for quite some time and maybe not normalize until 2024.

When updating my assessment of fair value today I guessed that this years profit will be down on last year and their previously articulated goal of doubling 2020's earnings within 3 years will get pushed out another year so we're looking at maybe 3 cps earnings in 2024 announced in March-April 2025. Choose you own PE and discount rate to bring that back to today's fair value. In a nutshell I expect Covid problems and their earnings impact will be more enduring that I assumed some time back. (Blame Omicron and whatever other variants are to come after that)

Agree with your comments Beagle, and this is all fair comments and assessment.

While not bound by reporting/disclosure rules on the NZX, I think it is good discipline and investor relations if took a more proactive approach. Understand NZX listing might be on the agenda one day, and this is a fair size company - no longer a penny dreadful.

The price had gone beyond its value in my opinion, and trading has been extremely illiquid of late. There is still a fair bit of growth priced in, and this has most likely been delayed. It is trading at a PE above the likes of EBO, RBD, MFT, MFT - which are commonly seen as "expensive" but these are major companies, with moats that are still growing and generating dividends.

From my perspective, the most worrying aspect of the Covid/supply chain issues is on the new plant, the extra cost in this, and the delays and resulting cashflow in not being operational. At least raw material is local, and shipping a reduced mass or product, in a dry/ambient form. Shipping would be a lower proportion of the product cost.

I'm still hopeful that when their capacity increases then they have the ability to ramp up volumes reasonably quickly and help flow to the bottom line.

There is no update on this years performance (that I'm aware of) so have to guess what that will be - at least have the old factory going while the new comes on stream. But that illiquid nature of the trading does have to be taken into account - even if wanted to exit, wouldn't be that easy at the moment.

Hopefully patience will be rewarded......but we'll see.

Merry Christmas to all holders!

[iceman]

This is a very good summary SB and touches on all the issues that are indeed a cause for concern, mostly caused by COVID like so many other companies are experiencing as well. Like you I appreciate the difficulty PAZ management has in implementing the ramping up with the ridiculous border restrictions as well as the huge shipping issues being experienced World wide.
I have faith in the management and am content, while clearly expecting a delayed ramping up of production and sales. As you and Beagle touched on, it would be nice to see management keep us small holders a bit more up to date with what is obviously a challenging environment.

Despite this being a large holding for me, I am happy to sit this one out and watch progress. Sitting on a +300% paper gain helps keeping the heart rate down :-)

Merry Christmas and a happy, joyful 2022 everyone.

[percy]

https://www.usx.co.nz/uploads/paperclip/documents/2456/original/Chairmans_Update_-_Dec_2021.pdf?1640291574

[Joshuatree]

Lots of good stuff there for the longer-term leavened by the freeze dryer unit completed in march but yet to be delivered.

[Beagle]

Pure guesswork on my part but how I read it...
Break even or small loss for 2021 ? Somewhat muted outlook for next year and 2023 should hopefully see them firing on most cylinders with 2024 being the year when all new plant acquisitions really fire up to maximum capacity and production.
My estimates. Maybe 2.5 - 3.0 cps earnings in 2023 ? rising to 3.0 - 3.5 cps in 2024 ? Choose you own PE and discount rate to arrive at today's fair value.
Growing pains look pretty serious to me.
Many years of growth already baked in at 70 cents in my opinion.

[Joshuatree]

Future growth looks exciting to me.

[Sideshow Bob]

https://www.usx.co.nz/uploads/paperclip/documents/2456/original/Chairmans_Update_-_Dec_2021.pdf?1640291574

Right on cue…….good to see our barking was heeded! (Just joking!!)

[whatsup]

Great update GO 2022 !

[couta1]

Someone needing a bit of spare cash, 50k out the door at 62c.

[percy]

Someone needing a bit of spare cash, 50k out the door at 62c.

I hope it was you who bought them.?

[couta1]

I hope it was you who bought them.? Nah unfortunately I paid 68c earlier in the day for mine.Lol

[percy]

Nah unfortunately I paid 68c earlier in the day for mine.Lol

Been watching buyers go up to meet the sellers,now it has changed, sellers are going down to meet the buyers.

[couta1]

Been watching buyers go up to meet the sellers,now it has changed, sellers are going down to meet the buyers. Big jump down to 62c, maybe someone doing it hard with a job loss or simply a new deck or two.

[Sideshow Bob]

Big jump down to 62c, maybe someone doing it hard with a job loss or simply a new deck or two.

Probably found them in the bottom drawer.....

The bidder at 50c probably rates his chances a bit more after today.

[iceman]

Big jump down to 62c, maybe someone doing it hard with a job loss or simply a new deck or two.

I'm sure there will be many smaller holders questioning this and maybe losing patience now as it is clear the growth has been pushed out a couple of years with the delays, mostly COVID related. Not really surprising.
I'm happy to be patient with this one for the next few years.

[Sideshow Bob]

Is definitely one for patience Iceman. FY results not that far away, and not likely to be stellar. Well delayed with expansion plans/Covid, but think patience will serve holders well long-term.

Not a buyer, but maybe will be if someone gets impatient.

[percy]

The chairman updated on the 23rd of December.:
https://www.usx.co.nz/uploads/paperclip/documents/2456/original/Chairmans_Update_-_Dec_2021.pdf?1640291574


"The 1,200sqm build at our Port Hills site is complete with some minor processing underway. To move
to full processing functionality, we await the receipt of a 2,000kg freeze dryer that, due to its oversized
build, has not been able to be shipped since its completion in March."

An update from the above.
The freeze drier has now been shipped.Not sure whether it has arrived.
Once it has arrived technicians will install it and get it up and operating.They will then move out to the new factory at Rolleston and install and get operating all the equipment out there.Towers for the spray drier and extraction plant are in place,and a number of tanks for the extraction plant are installed.
As we could expect it is like a 5000 piece jigsaw puzzle,with tanks,huge grinders and other equipment all arriving in the great number of containers.
At the front of the new factory are three coolstores which will save PAZ having to use out side suppliers'.
It is very impressive.All of Port Hills Road site in under one big roof.
I think PAZ will be like SKL when they built their new factory at Wigram.Production,productivity and profitability took off .
.

[couta1]

The chairman updated on the 23rd of December.:
https://www.usx.co.nz/uploads/paperclip/documents/2456/original/Chairmans_Update_-_Dec_2021.pdf?1640291574


"The 1,200sqm build at our Port Hills site is complete with some minor processing underway. To move
to full processing functionality, we await the receipt of a 2,000kg freeze dryer that, due to its oversized
build, has not been able to be shipped since its completion in March."

An update from the above.
The freeze drier has now been shipped.Not sure whether it has arrived.
Once it has arrived technicians will install it and get it up and operating.They will then move out to the new factory at Rolleston and install and get operating all the equipment out there.Towers for the spray drier and extraction plant are in place,and a number of tanks for the extraction plant are installed.
As we could expect it is like a 5000 piece jigsaw puzzle,with tanks,huge grinders and other equipment all arriving in the great number of containers.
At the front of the new factory are three coolstores which will save PAZ having to use out side suppliers'.
It is very impressive.All of Port Hills Road site in under one big roof.
I think PAZ will be like SKL when they built their new factory at Wigram.Production,productivity and profitability took off .
. Thankyou Percy for your in the flesh updates, much appreciated.

[percy]

Thankyou Percy for your in the flesh updates, much appreciated.

Just drove past about an hour ago.A lot of activity around the new Port Hills Road factory.I would guess the new oversize freeze drier has arrived and is being installed.

[Sideshow Bob]

Just drove past about an hour ago.A lot of activity around the new Port Hills Road factory.I would guess the new oversize freeze drier has arrived and is being installed.

I can post a picture if you have one Percy! :p

[percy]

I can post a picture if you have one Percy! :p

Sorry no picture,just vans and people around new factory, with more cars parked outside on the side of the road.

[Beagle]

Anyone bold enough to have a guess at the result due next month or early April ?

I think it will be materially lower than last year's 1.7 cps.

[percy]

Anyone bold enough to have a guess at the result due next month or early April ?

I think it will be materially lower than last year's 1.7 cps.

That has been well signaled in the Chairman's 23rd December update,so there will be "no surprises there."
What I think shareholders will be placing more importance on, is progress on the installation of the huge freeze drier at Port Hills Road, and the new Rolleston factory.
Just as a surfer looks outwards to the sea to observe the swells so that he may judge the wave to come,and does not look at the beach to see what has already gone,PAZ shareholders will be looking outwards to Rolleston, to see the huge tsunami of production capacity building.

[Walter]

The decline in the $NZD will provide a tailwind at some stage

[Beagle]

That has been well signaled in the Chairman's 23rd December update,so there will be "no surprises there."
What I think shareholders will be placing more importance on, is progress on the installation of the huge freeze drier at Port Hills Road, and the new Rolleston factory.
Just as a surfer looks outwards to the sea to observe the swells so that he may judge the wave to come,and does not look at the beach to see what has already gone,PAZ shareholders will be looking outwards to Rolleston, to see the huge tsunami of production capacity building.

Fair enough mate. I think Iceman's assessment that Covid and all the drama's has set them back about 2 years is a fair one. 2023's report in March / April 2024 could be a good one provided they can get all the gear installed and systems up and running properly by late 2022 and all the staff required to work it all. Reading and hearing more and more reports of really good business's absolutely desperate and screaming out for staff and they can't get any or certainly not enough. Getting all your ducks in a line is not getting any easier these days that's for sure !

[percy]

Fair enough mate. I think Iceman's assessment that Covid and all the drama's has set them back about 2 years is a fair one. 2023's report in March / April 2024 could be a good one provided they can get all the gear installed and systems up and running properly by late 2022 and all the staff required to work it all. Reading and hearing more and more reports of really good business's absolutely desperate and screaming out for staff and they can't get any or certainly not enough. Getting all your ducks in a line is not getting any easier these days that's for sure !

2021 was very difficult.Covid,logistics,failure of overseas technicians allowed into NZ.All pointed out by The Chairman
2022 the ducks are lining up.
However a huge job still getting all the plant installed and up and producing.Staffing most probably will be an issue,although a few Rolleston residents may decide to work locally.
I am guessing September this year half year result will state they have either have a lot of Rolleston factory producing or near to producing.Freeze driers,spray drier,extraction plant,and coolstores .
AGM May 2023 should be positive and September 2023 Interim should be extremely positive.
January 2024 could be extremely interesting as that is the end of the restrictive period agreed when Cibus came on board. Whether they decide to list on NZX or ASX could be in the wind.
2023 full year should be interesting as it should be the first year of full Port Hills Road and first Rolleston factories full production.
May 2024 AGM I think they will spell out their future plans,and expected projections should be fun.
We have seen SKL hit the deck running with their new factory,and I expect PAZ's will do the same.
There are so many opportunities for PAZ.I expect Cibus will be bringing contacts and partners to work with PAZ worldwide.

[Beagle]

Need another buy one get one free on the Aiora Black current thingies.

[Sideshow Bob]

About due for a result.

Was 1st of April last year and 23rd of MArch the year prior. Must be anytime now.....

[percy]

About due for a result.

Was 1st of April last year and 23rd of MArch the year prior. Must be anytime now.....

Yes is due.
I am expecting a poor financial result,but the outlook commentary should be earth shattering.All ducks now pretty much lined up,and hopefully most of new plant is on site at the new Rolleston factory,ready for installation.

[percy]

For out of towners I checked with PAZ to see when this year's agm will be.
It is scheduled for Friday, 27 May 2022 at 12:30 pm

[RupertBear]

For out of towners I checked with PAZ to see when this year's agm will be.
It is scheduled for Friday, 27 May 2022 at 12:30 pm

Thanks for that Percy.

[stoploss]

For out of towners I checked with PAZ to see when this year's agm will be.
It is scheduled for Friday, 27 May 2022 at 12:30 pm
I will check the schedule , be good to catch up for a beer and a saussie roll Percy, my Aiora supply needs stocking as well :t_up:

[Beagle]

I need some more of those blackcurrent thingies. Someone please tell PAZ to do a buy one get one free and I'll be in like Flynn.

[Sideshow Bob]

I need some more of those blackcurrent thingies. Someone please tell PAZ to do a buy one get one free and I'll be in like Flynn.

I think they have a "buy one, get one" special on at the moment!! :p

[couta1]

I think they have a "buy one, get one" special on at the moment!! :p For sure, buy one bargin basement share at 59c and it will be worth 3 times that in 3 yrs time, now thats a forward 80% discount.

[percy]

I need some more of those blackcurrent thingies. Someone please tell PAZ to do a buy one get one free and I'll be in like Flynn.

The more you pay for them,the more you will appreciate them. .........................lol

[percy]

For sure, buy one bargin basement share at 59c and it will be worth 3 times that in 3 yrs time, now thats a forward 80% discount.

I was thinking 2 years time...............lol.

[couta1]

I was thinking 2 years time...............lol. Didnt want to be a ramper so stuck on the conservative side.

[Beagle]

I maintain they need a buy one get one free on the blackcurrant thingies at $34.99 and the shares at 59 cents.

[Sideshow Bob]

I maintain they need a buy one get one free on the blackcurrant thingies at $34.99 and the shares at 59 cents.

On a serious note, I did have a bit of a google for the AiOra Blackcurrant "thingies" - couldn't see anyone selling them apart from the company.

[percy]

On a serious note, I did have a bit of a google for the AiOra Blackcurrant "thingies" - couldn't see anyone selling them apart from the company.

They are only now available online from www.aioranz.com

[Beagle]

They are only now available online from www.aioranz.com

I signed up to their newsletter thingy. Next time they have a decent special I'll help you guys out.

My nose for finding a feed or smelling trouble coming still works really well but if I don't get some more of those blackcurrant thingies for my eyes I might need to adopt my own seeing eye dog lol

[percy]

I signed up to their newsletter thingy. Next time they have a decent special I'll help you guys out.

My nose for finding a feed or smelling trouble coming still works really well but if I don't get some more of those blackcurrant thingies for my eyes I might need to adopt my own seeing eye dog lol

Think they will help you out more than us.After all it is your eyes we are talking about.
Order now and be done with it.Don't muck about with your eyes.
I find my bone and joint AiOra work really well, and at full price just $1 a day they are well worth the money..
Then next time they are on special load up on them.I certainly will be.

[Beagle]

Fair point mate. As much as I hate paying full retail I think they are making a difference. Retiring early would probably be better for my eyes but that costs more that $1 a day lol

[DarkHorse]

My optometrist recommended a daily brazil nut for the eyes a few years ago - a few tasty cents a day for selenium - and my vision has actually improved :) Not sure if it's that or putting frozen blueberries on my morning cereal - also highly recommended for health and taste. But good on you all for supporting PAZ!

[davflaws]

Retiring early would probably be better for my eyes but that costs more that $1 a day lol

You can't take it with you mate. But of course you may prefer the prospect of being the richest guy in the cemetery!

I'm looking out at the bay, and thinking about snapper for breakfast - one way of distracting myself from my 43% holding in OCA).

[Beagle]

You're preaching to the converted mate. I have a lot of lifestyle idea's we're working on as I continue the slide from semi retired to mostly retired and then fully retired. I've seen a few reports now that all say essentially the same thing. A hard retirement date is not a good idea. A gradual slide into first, semi retirement, (where I've been for years), and then gradually more and more retired is way better for you in every way.

[Beagle]

My optometrist recommended a daily brazil nut for the eyes a few years ago - a few tasty cents a day for selenium - and my vision has actually improved :) Not sure if it's that or putting frozen blueberries on my morning cereal - also highly recommended for health and taste. But good on you all for supporting PAZ!

Good tip. Turning down the brightness on one's computer screen is another.

[Joshuatree]

You're preaching to the converted mate. I have a lot of lifestyle idea's we're working on as I continue the slide from semi retired to mostly retired and then fully retired. I've seen a few reports now that all say essentially the same thing. A hard retirement date is not a good idea. A gradual slide into first, semi retirement, (where I've been for years), and then gradually more and more retired is way better for you in every way.

Good onya,"taking the weight off "and living longer ,healthier and with more energy.

[Sideshow Bob]

Annual Result is out:

PharmaZen_FY2021_April_release_Final.pdf (usx.co.nz) (https://www.usx.co.nz/uploads/paperclip/documents/2505/original/PharmaZen_FY2021_April_release_Final.pdf?164936753 8)

UNAUDITED RESULTS FOR THE YEAR TO 31 DECEMBER 2021

PharmaZen reports second half FY21 recovery as it navigates supply and COVID disruptionsChristchurch biotechnology company PharmaZen (USX.PAZ) today reports FY2021 results showing, as signalled at the half year release, a stronger financial performance in the second half than the first half. T

he improvement follows continuing strong demand for its nutraceutical products and successful adaptation to the constraints of the COVID-19 pandemic with the associated ongoing global supply chain challenges.Revenue1for the year to 31 December 2021 was only marginally weaker at $20.5m from $21.5m in the prior year, an outstanding outcome given the often severe covid imposed operating constraints throughout the year.

Most pleasingly there was an 18% sequential improvement in second half revenue to $11.1m, offsetting the weaker $9.4m result in the first half when disruptions to production were at their peak.Underlying EBITDA2for the year dropped from $6.7m in 2020 to $2.3m, however the second half year represented a significant turnaround with underlying EBITDA more than $1.5m up from the $776k achieved in the six months to the end of June 2021.

The company is meanwhile underpinned by a strong balance sheet and solid operating cashflow. Chair Ken Fergus said: “As we detailed at the half year result, COVID-19 related travel and freight restrictions, along with a four-month shut down of the company’s largest freeze dryer to install a new one without overseas engineering support, saw the company running at a loss for the first four months of the year.

“In the second half of the year these challenges continued. We have faced difficulties freighting finished goods to our offshore customers and importing equipment to meet the demand. We have also faced high staff vacancy rates (over 20%) and intense competition for skilled labour alongside the ongoing difficulties of importing engineers because of COVID-19 border restrictions.

“However, PharmaZen has mitigated what must be seen as a ‘perfect storm’ with the entire team stepping up to meet these pressures and deliver for our customers,” Mr Fergus said. “The easy option was to postpone developments until the borders reopened, however we backed ourselves to undertake the installation and commissioning work that would have previously fallen to equipment suppliers.

This meant building an entire engineering team from ground up to work with some very novel technologies.”Key achievements over the half year have included:

• The completion of the Nuttall Drive facility, including the installation of a 2,000kg dryer.
• The installation of a new 2,000kg dryer at the Port Hills Road facility.The installation of a new Energy Hub at the Port Hills Road facility.
• Completion of the Tawhiri building to a stage where we can commence installation and internal fitoutThe majority of the new equipment for our site at Tawhiri is now in New Zealand with the exception of the next two energy hubs (shipping in April) and three new freeze dryers also scheduled to start shipping in April.

“These challenges have in some measure made the company stronger” Mr Fergus said. “Notably, the experience the team has gained on the initial installations means we now have a selfsufficient engineering team. This capability promises to not only serve us well amid the continuing disruptions, but well into the future.

”Outlook Mr Fergus said the company is pleased with the progress it has made in the first quarter of the new financial year, albeit recognising the continuing challenges posed by the supply chain and those that are emerging with COVID-19 endemic in the community. Given that demand for the company’s products continues to outstrip capacity the company is now reviewing options for bringing forward the commencement of the build at the second facility at Tawhiri.

“The growth opportunities in core products remain strong but we are constantly looking for additional opportunities to grow the company with our new investor providing valuable input.“PharmaZen is well positioned to continue the recovery it has seen in the second half of the financial year. We are targeting the dryers at the Port Hills Road and Nuttall Drive facilities to be running by the end of the third quarter, representing a doubling in our freeze-drying capacity” Mr Fergus said.

“The company also has a number of other already well researched and considered new product development opportunities that the Board is very excited by. These opportunities, coupled with continuing strong demand for our existing products, an easing of border restrictions and our newly developed engineering capabilities, position PharmaZen for a substantially better result for the new financial year.”

[percy]

A very good update.

[Sideshow Bob]

A very good update.

I take it as reasonably positive - yes turnover and profit is down slightly, but between Covid and more importantly all of the capital work has clearly been the focus in recent times.

Need to put some runs on the board - they are a company with $150m mkt cap turning over $20.5m. Hopefully not too much more patience is required.....

[percy]

I take it as reasonably positive - yes turnover and profit is down slightly, but between Covid and more importantly all of the capital work has clearly been the focus in recent times.

Need to put some runs on the board - they are a company with $150m mkt cap turning over $20.5m. Hopefully not too much more patience is required.....
More patience is required.
Building world class state of the art factories under Covid conditions will reap long term rewards.[Yes a lot of short term pain.]
The decision to proceed with the second factory at Rolleston means their long term strategy remains on course.
The right business,in the right sector,at the right time is still true.
Runs on the board.In a year or two they will be scoring 6s off every ball bowled.
Then we will look back and say I could have bought PAZ shares for 60 cents in 2022.
Whoops perhaps 70 cents..lol

[whatsup]

A very good update.

PAZ certainly have not been standing still, to be working and dealing with the Covid headaches is truly commendable, well done PAZ team.

[Joshuatree]

A very good update.


"Well positioned". He must have got that off you Percy:t_up:

[iceman]

This update is better than I was bracing myself for. We have known for awhile now that the COVID and border restrictions have placed enormous constraints and difficulties on the company and management, being unable to execute their huge upgrade plans as scheduled. It has taken nerves of steel to build their own engineering team from scratch to build these factories and install the equipment.
I was surprised at the huge level of confidence displayed with the commitment to bring forward the build of the 2nd Rolleston factory. With the huge labour shortages all over the country it makes sense for them to continue with the construction and engineering team they have assembled, so why not another factory.

Positive to see the confidence with being able to sell all they can produce and good to see the comment about the new partner being of value there.

But as expected with these delays and having to shut down production for a long time, we have had a poor financial result. I'm with Percy that a lot more patience is required here but I am very comforted to see that everything seems to be heading slowly in the right decision.

Hopefully we will get some more info and detail at the AGM.

[DarkHorse]

Better than I expected too. While the gale force headwinds they've faced have reduced short-term profits, the fact that they still made a $2.3m profit, while also significantly ramping up productive capacity, to meet ongoing unmet demand for their products to boot, has actually increased my faith in the business and its resilience.
Once all the added capacity is in place, there should be tremendous operating leverage and cashflows once conditions normalise.

[Beagle]

I'm surprised everyone seems pleased with that EDITDA result which is a massive reduction ($6.7m EBITDA falling to just $2.3M is a massive fall), on the previous year, (challenges notwithstanding).

I know everyone is holding for future growth but...I can't help observe that some people appear to be making the mistake of misinterpreting EBITDA for profit. Earnings before interest tax and depreciation of $2.3m is not net profit and last year net profit was $1.5m lower than EBITDA. I would expect more than $1.5m in expenses and depreciation below the EBITDA line this year with more plant and equipment (capital raise costs are another sperate thing entirely), but sticking with $1.5m in expenses and depreciation below the EBITDA line as per last year my back of the envelope calculations suggest about $800K profit before tax or just on $600K after tax which equates with the higher number of shares on issue to just 0.24 cents per share. PE appears to be be a whopping 250 !!

The company makes a fair bit of noise about the second half performance being much better so what do the metrics look like if we annualize the most recent half's performance ?
Annualizing the second half EBITDA result of ~ $1.5m would suggest annual after tax earnings of about 0.43 cps, much better than above but still trading at 140 times annualized most recent half trading performance. WOW, that's quite some PE ! This suggests to me that several years, perhaps even 5 years, of expected future growth is already baked into the current share price. (When I originally invested at 20 cents when they were growing earnings they were on a forward PE of only 20 times earnings so the metrics are certainly very, very different today). One could of course argue that their growth prospects are better now than they were in the past but I think their growth prospects were pretty good a few years ago so maybe the current metrics are far too stretched...it seems that way to me.

Actual earnings, (if any after capital raise costs), will be revealed with their annual report shortly.

What's abundantly clear is they face a human resource crisis in this labour intensive industry and 20% staff vacancy rate with current modest staff needs is an extremely serious situation. Its all very well to be building significantly more processing capacity in the years ahead but where on earth are they going to find the staff from if they can't even staff their current processing machinery's needs ? To me I see no solution other than to dramatically lift pay rates to attract the necessary staff and this surely begs the question of how serious is the impact on future profitability ?

For my money, I think the private equity guys paid about the right price (40 cents) at that time but the challenges the business has faced and continues to face with labour shortages, shipping and installation challenges and delay's are probably a lot worse than they or anyone else were expecting at the time so fair value now is probably below the 40 cents they paid. That's how I see it and I am sure others see it differently and that's fine.

We are seeing a real reckoning unfolding overseas with high PE stocks generally and more specifically in the tech and biotech area's.
Higher risk free long term bond rates are really caustic to valuations on these sort of stocks and I see the USD ten year rate leapt up yet again on the US market our time this morning. Against this backdrop the metrics noted above are exceptionally challenging for PAZ so I will remain on the sidelines for the foreseeable future until such time as realistic pricing for future growth emerges. I foresee 2022 being another extremely challenging year for PAZ. Maybe they can get back to 1.0-1.5 cps earnings in 2023, which if possible is still considerably lower than 2020 (1.7 cps).

[percy]

I'm surprised everyone seems pleased with that EDITDA result which is a massive reduction ($6.7m EBITDA falling to just $2.3M is a massive fall), on the previous year, (challenges notwithstanding).

I know everyone is holding for future growth but...I can't help observe that some people appear to be making the mistake of misinterpreting EBITDA for profit. Earnings before interest tax and depreciation of $2.3m is not net profit and last year net profit was $1.5m lower than EBITDA. I would expect more than $1.5m in expenses and depreciation below the EBITDA line this year with more plant and equipment (capital raise costs are another sperate thing entirely), but sticking with $1.5m in expenses and depreciation below the EBITDA line as per last year my back of the envelope calculations suggest about $800K profit before tax or just on $600K after tax which equates with the higher number of shares on issue to just 0.24 cents per share. (PE 250)

Annualizing the second half EBITDA result of ~ $1.5m which was about double the first half, would suggest annual after tax earnings of about 0.43 cps, much better than above but still trading at 140 times the most recent half financial performance. This suggests to me that several years, perhaps even 5 years, of expected future growth is already baked into the current share price. (When I originally invested at 20 cents when they were growing earnings they were on a forward PE of only 20 times earnings so the metrics are certainly very, very different today). One could of course argue that their growth prospects are better now than they were in the past but I think their growth prospects were pretty good a few years ago so maybe the current metrics are far too stretched...it seems that way to me.

Actual earnings, (if any after capital raise costs), will be revealed with their annual report shortly.

What's abundantly clear is they face a human resource crisis in this labour intensive industry and 20% staff vacancy rate with current modest staff needs is an extremely serious situation. Its all very well to be building significantly more processing capacity in the years ahead but where on earth are they going to find the staff from if they can't even staff their current processing machinery's needs ? To me I see no solution other than to dramatically lift pay rates to attract the necessary staff and this surely begs the question of how serious is the impact on future profitability ?

For my money, I think the private equity guys paid about the right price (40 cents) at that time but the challenges the business has faced and continues to face with labour shortages, shipping and installation challenges and delay's are probably a lot worse than they or anyone else were expecting at the time so fair value now is probably below the 40 cents they paid. That's how I see it and I am sure others see it differently and that's fine.

I am sure short term traders will agree with you,while long term investors will not.

.

[Beagle]

I am sure short term traders will agree with you,while long term investors will not.

.

Some time back early last year I vision casted a formulated scenario whereby they could possibly generate 3 cps in earnings within three years of this new investment program. I worked out what I though was a fair PE of those earnings three years hence and discounted that back at my required rate of return for a low liquidity, non dividend paying, unlisted investment in this high risk biotech industry and arrived at a fair value of about 47 cents early last year, which is I why I sold out when the price was ~ double that.

Now I foresee it taking them 5 years to build up to that level of profitability, (Covid pushed them back 2 years I think that's a fair comment by Iceman) but we're one year down the track now so four years hence from now they might make 3 cps, (depending upon how critical the human resource challenge is and what the pay rate implications are in addressing that). This could be worth ~ $1 four years from now...or maybe the extent and severity of the human resource cost challenge means it takes even longer to grow earnings to 3 cps ?

Maybe in 5 years they're worth 30 - 35 times 3 cps = $1 ? maybe less, may be a bit more. Predicting the future that far out is very difficult ! Five years forward is at the limit of my ability to assess what might happen. If people are more patient than 5 years, good for them but for my money with no dividends likely anytime soon I fail to see how this makes the cut of a compelling investment case at present at the current price and considering the truly extraordinary current metrics. For my foreseeable investment horizon, as a short term trade or a five year plus investment this looks like a high risk and extremely expensively priced investment. I'm a value investor and I will pay for growth but the PE needs to be realistic. It was when it was 20 cents and the forward PE was 20, (thanks again for bringing this to my attention), but its certainly not now.

[winner69]

Didn’t realise Peter Dobbs is a Director

[percy]

Didn’t realise Peter Dobbs is a Director

Yes a member of an incredibly talented board.
Also has a large shareholding.
Been aboard for a few years now.

[couta1]

I am sure short term traders will agree with you,while long term investors will not.

. Best to ignore "White Noise Barking"

[iceman]

Best to ignore "White Noise Barking"

Fair enough for him to come and repeat what he has said before. I think those of us that invested in this are aware of the issues and that we are looking at long term horizon that has been pushed further out with the COVID issues hampering progress. It is totally understandable this is not for short term traders like Beagle and I respect his view. Each to their own.

[couta1]

Fair enough for him to come and repeat what he has said before. I think those of us that invested in this are aware of the issues and that we are looking at long term horizon that has been pushed further out with the COVID issues hampering progress. It is totally understandable this is not for short term traders like Beagle and I respect his view. Each to their own. I think posts number 814&815 (P82)sum things up nicely. Lol

[winner69]

Yes a member of an incredibly talented board.
Also has a large shareholding.
Been aboard for a few years now.

Share register has some interesting and familiar names on it ….even on the first page

Smiled when I saw two bowling club guys are shareholders …..they hadn’t told me …keeping all the good stuff to themselves

[percy]

Share register has some interesting and familiar names on it ….even on the first page

Smiled when I saw two bowling club guys are shareholders …..they hadn’t told me …keeping all the good stuff to themselves

More fun for you.
http://www.sharechat.co.nz/article/b88ff1f0/international-banker-takes-on-a2.html
But wait there's more fun.
https://www.cibusfund.com/

Your blowing club guys are a major concern.How come they did not run their investment in PAZ past you?
Must have bought when Beagle was in love with PAZ...lol.

[couta1]

More fun for you.
http://www.sharechat.co.nz/article/b88ff1f0/international-banker-takes-on-a2.html
But wait there's more fun.
https://www.cibusfund.com/

Your blowing club guys are a major concern.How come they did not run their investment in PAZ past you?
Must have bought when Beagle was in love with PAZ...lol. Love can be a fickle beast.

[winner69]

Your bowling club guys are a major concern.How come they did not run their investment in PAZ past you?
Must have bought when Beagle was in love with PAZ...lol.

I’m concerned for them as well as I’d say (for one of them at least) they are overweight PAZ ….by a long way. …….esp since they only started buying shares for dividends when term deposit rates plummeted

[percy]

I’m concerned for them as well as I’d say (for one of them at least) they are overweight PAZ ….by a long way. …….esp since they only started buying shares for dividends when term deposit rates plummeted


Don't be.
Directors are major shareholders.."The owners' eye."
New state of the art factories are being built to try and keep up with rapidly growing demand for NZ sourced product, manufactured up to "active pharmaceutical ingredient" ,in a world where product traceability and provenance has become even more important since Covid .,
A case of being in the right company, in the right sector, at the right time.

[couta1]

Best to ignore "White Noise Barking" Looks like the market is doing just that, bottom at 58c and now stabilized and drifting up slightly after the result has been digested, you don't buy this stock on a PE ratio but rather on potential/potential/potential.

[couta1]

Broking company buying at 69.5c, mum's the word on which one.:cool:

[percy]

Looks like the market is doing just that, bottom at 58c and now stabilized and drifting up slightly after the result has been digested, you don't buy this stock on a PE ratio but rather on potential/potential/potential.

Still drifting up steadily.
Looks as though those who were waiting for the share price to go lower are now buying.
More depth means for liquidity.

[couta1]

Still drifting up steadily.
Looks as though those who were waiting for the share price to go lower are now buying.
More depth means for liquidity. Just imagine when it lists on the main board/boards, will be an exciting day when it comes.

[couta1]

Fair value probably below 40c now according to some, these buyers at 70c obviously don't believe that and who could blame them.:cool:

[percy]

Pleasing seeing the strong buying.

[couta1]

Pleasing seeing the strong buying. Sure is going into winter.

[percy]

https://usx.co.nz/uploads/paperclip/documents/2527/original/FY21_PharmaZen_AR_FINAL.pdf?1651176849

[winner69]

https://usx.co.nz/uploads/paperclip/documents/2527/original/FY21_PharmaZen_AR_FINAL.pdf?1651176849

Negative operating cash flow ….$0.9m v positive $3.5m pcp

Percy …what’s up

[percy]

Negative operating cash flow ….$0.9m v positive $3.5m pcp

Percy …what’s up

This was caused by COVID-19 related travel and
freight restrictions, along with a four-month shut down of the
Company’s largest freeze dryer to install an additional dryer
without overseas engineering support
We are
seeing potential for some of the strongest demand in our
history and decisions to progress with expansion plans during
the pandemic mean we are well positioned to take advantage
of increased opportunities.

Pleasing seeing "well positioned."

[winner69]

Why they write off $306,330 of inventory.

[percy]

Why they write off $300,000:of inventory.

Product being rebranded.[I think]
ie PAZ are about to relaunch their online offering,which [again I think] will include a number of new products.
Possibly we will hear more at the agm,which I trust the bowlers will be attending or watching.

[percy]

We also have a number of other well researched and considered new product
development opportunities that the Board is very excited by. These opportunities,
coupled with continuing strong demand for our existing products, an easing of
border restrictions and our newly developed engineering capabilities, position
PharmaZen for substantially better growth in 2022.

[Beagle]

($813,600) Loss after tax, Ouch ! Just as well according to some, earnings don't matter and its all about the future.

[percy]

AGM details.
https://usx.co.nz/uploads/paperclip/documents/2529/original/Notice_of_Annual_Shareholders_Meeting_27-May-2022.pdf?1651189668

[Ferg]

Has anyone looked into the impact of the convertible notes converting to shares? In particular the impact on EPS?

[percy]

Has anyone looked into the impact of the convertible notes converting to shares? In particular the impact on EPS?

Yes.
Incredible that for mostly the modest amount of shares that will be issued PAZ will have been able to triple their production capacity.
I think this was covered here over a year ago,when Cibus were first introduced to us..
Also PAZ have been using the same Chinese equipment manufacturers for over 20 years.A great working relationship,which means PAZ get the very latest state of the art equipment.And the bonus is it all this Chinese sourced equipment costs 30% less than NZ equipment.This helps return on capital.
I believe few firms have gone ahead with their capital plans in this sector, because of the issues caused by Covid.
This with mean PAZ will be ahead of the field,when the additional two new factories at Rolleston are up and running..

[petty]

AGM details.
https://usx.co.nz/uploads/paperclip/documents/2529/original/Notice_of_Annual_Shareholders_Meeting_27-May-2022.pdf?1651189668


Fingers crossed the SHA makes a valuable and insightful contribution this year. Excited to hear about what opportunities lie ahead this year

[percy]

The odd time on this thread I have mentioned PAZ director Dr.Wayne Burt.
The following is from PAZ's Notice of AGM.

Dr Wayne Burt
BA (Hons) PhD (Economics) - University of Otago 1984
PGD Applied Finance - Securities Institute Australia 1986
PMD - Harvard Business School 1992
New Zealand expatriate investor based in Europe. Principal of Lotus Capital Partners Limited; venture
capital investment and advisory business founded in 1995.
Director PharmaZen Limited, since 2009; NZ based innovative developer, manufacturer and marketer
of science based, natural nutritional products. Provided 20 percent of IPO funding in 2001 and has
continued to invest over recent years.
1984-1994 Director of Deutsche Bank Australia Limited - Head of Equity Capital Markets and
previously ECM Divisional Director of Macquarie Bank Limited.
Founder Northern and Southern Television companies 1995; merged with Liberty Global to become
Austar United Communications which became Australia’s second largest pay-TV network with 765,000
regional subscribers - acquired in 2011 by Foxtel for $A2.5billion.
Strategic investor and adviser in the buyout from Heinz Foods of Weight Watchers International and
the subsequent IPO of Weight Watchers on the NYSE 2001.
Co-founder of A2 Milk Company Limited 2000; provided all initial venture capital; Director first ten
years; reached peak market capitalisation circa NZ$14bill – then NZ’s second largest company.
Lead Investor in CPE Investments LP, a US based private equity fund - invests in companies that
develop and commercialise energy efficient technologies; including major shareholdings in Calnetix
Technologies, Upwing Energy, Sapphire Technologies and Riskspan.
Substantial shareholder in Inside Out Nutritional Goods Limited, Australia’s leading plant milk
developer, manufacturer and marketer and shareholder in several other natural food and beverage
companies, including Lavit Life and Fluid Screen

[davflaws]

I feel much better about my 20k @84c.

[percy]

As I still have a cough from recently catching Covid, I will not be attending Friday's agm.
Looking forward to watching it online.

[whatsup]

As I still have a cough from recently catching Covid, I will not be attending Friday's agm.
Looking forward to watching it online.

Percy, What r we expecting ?

[percy]

Percy, What r we expecting ?

An interesting presentation from the MD.
An update on the logistics issues,and when the build of the 2nd factory at Rolleston will start.

[couta1]

Sounds like the foundations are being laid for a very exciting sustainable future for the patient here.

[whatsup]

Top table, well done for a comprehensive thorough and very informative AGM, I look ahead to a personal visit to next years AGM, imo PAZ with its top level management has a most exciting future, well done Percy for keeping us all updated with your comments, please keep it up !!

[percy]

Thanks Couta1 and whatsup for your positive comments.
Craig MacIntosh always gives an interesting presentation.
First time I have heard COO Tony Wise present.Again an interesting presentation.
Also I was please Dr.Wayne Burt spoke via the web.
Think every one is looking forward to next year's agm,,when everything will be a lot further down the track.

[Mr Slothbear]

An excellent presentation was really impressed with Tonys background and what hes bringing and think hes a great addition.

as always Craig did not disappoint.

everything sounding great and wow they are really poised to benefit as all countries start to impose higher carbon pricing worldwide, this could be a serious point of competitive advantage in medium term.

[DarkHorse]

Some great operational insights. I was hoping to gain more of a sense of future earnings. I know it's hard to predict costs atm, but at least some scenarios based on pessimistic and optimistic assumptions.

[Baa_Baa]

Also good that listing on the Unlisted affords abysmal liquidity to the market, dodging the effects of a systemic downturn everywhere else. A place to hide some wealth while everything else goes to hell. Funny how illiquidity can be an advantage, if you have or can get enough.

[percy]

Also good that listing on the Unlisted affords abysmal liquidity to the market, dodging the effects of a systemic downturn everywhere else. A place to hide some wealth while everything else goes to hell. Funny how illiquidity can be an advantage, if you have or can get enough.

I think you see traders on NZX and investors on USX.
I guess investors spend more time on research,so do not change their minds every five minutes..
Liquidity .? Never been an issue for me.Think it is only talked about by people who do not own USX listed shares. I know a number of people who own PAZ and SFF shares.I had no trouble selling my Syft holding.If you are buying/selling a large number then yes,but that is the same with most NZX listed companies, $1mil worth of shares would take time on either exchange,$100,000 in a day or two.

[petty]

Thought the presentation was great. Prospects are sound. However on thing that stuck out to me this year and at last years presentation was that china seems to be making more and more freeze dryers every year and demand for these dryers is booming. I guess the question in is when does competition catch up and whats the economic moat? Nz green green products? Manufacturing with Low carbon emissions? Manufacturing cheaper due to automation?

[Sideshow Bob]

Thought the presentation was great. Prospects are sound. However on thing that stuck out to me this year and at last years presentation was that china seems to be making more and more freeze dryers every year and demand for these dryers is booming. I guess the question in is when does competition catch up and whats the economic moat? Nz green green products? Manufacturing with Low carbon emissions? Manufacturing cheaper due to automation?

One of the main/well-known manufacturers of freeze-dryers are Cuddon's from Blenheim. They are well regarded, but like anything made in NZ compared to China, they are higher priced. But understand Cuddons have good demand/pretty full order book/quite a lead time.

The Chinese manufacturers are naturally cheaper, and would guess getting better than what they were. Freeze-drying technology has been around for years, and nothing too top secret squirrel about it.

I think with Pharmazen, they have clearly got a good supplier/relationship with their manufacturer in China. I think between the capital costs of buying out of China, and then with the potential benefits of the energy centres they are installing, then likely to be the lowest cost operator.

There is not much in the way of spare freeze-drying capacity in NZ.

In terms of emissions, not sure about the manufacture of the units, but would think with the energy centres/NZ renewable energy then would be relatively low emmssions compared to other countries/producers.

[couta1]

A couple of broking companies having their annual cull of PAZ currently. Lol

[whatsup]

A couple of broking companies having their annual cull of PAZ currently. Lol

cull or call couta1?, and if its cull what do u mean ?

[couta1]

cull or call couta1?, and if its cull what do u mean ? No i mean cull, they do it every year around this time, either estate selldown or custodial reduction.

[percy]

AGM presentation.

https://usx.co.nz/uploads/paperclip/documents/2556/original/2022_-_AGM_PowerPoint_Presentation.pdf?1653863354

[percy]

I note in the results of the agm,both directors ,Ken Fergus and Wayne Burt received 100% votes.First time I have ever seen that in any company.

[Sideshow Bob]

Seems to have broken support.....latest trades $0.50-0.52.

[iceman]

Seems to have broken support.....latest trades $0.50-0.52.

If I wasn't so overweight with them already, I'd be scooping up a few at this price. Could be a great buying opportunity.

[whatsup]

Lets hope PAZ can hold the .50 level !!

[whatsup]

Great to see PAZ back off the .50 level now.

[percy]

https://usx.co.nz/uploads/paperclip/documents/2633/original/PharmaZen_1H_2022_Final.pdf?1660596869
Outlook:
PharmaZen is well positioned to continue the recovery achieved to date and given our increased
capacity and continuing strong demand for our products, we are forecasting notably higher sales
and a higher underlying EBITDA than the first half.


I do not know what the new product is,so look forward to finding out..

[whatsup]

https://usx.co.nz/uploads/paperclip/documents/2633/original/PharmaZen_1H_2022_Final.pdf?1660596869
Outlook:
PharmaZen is well positioned to continue the recovery achieved to date and given our increased
capacity and continuing strong demand for our products, we are forecasting notably higher sales
and a higher underlying EBITDA than the first half.


I do not know what the new product is,so look forward to finding out..

P, very good report under the circumstances and S P off the bottom now. .60 here we come then onwards.

[iceman]

Why would someone buy $60 worth of PAZ shares and another 50% on top of that in fees, as happened today. Very strange !

[Posh]

I think it was the remaining amount from the earlier 5,000 trade - it was originally 5,100 @0.575 so had to bump up to 0.60 to complete.

[iceman]

I think it was the remaining amount from the earlier 5,000 trade - it was originally 5,100 @0.575 so had to bump up to 0.60 to complete.

Possibly. I thought however that if you changed a partly filled order, you were charged the fee again. But maybe I’m wrong

[Sideshow Bob]

Possibly. I thought however that if you changed a partly filled order, you were charged the fee again. But maybe I’m wrong

Probably all part of the overall/total brokerage of the purchase, but might just have to pay the USX trade charge - which I think is $7.50?

But still, $60 of shares and $7.50 in fees isn't a good equation!!

[whatsup]

Percy, when can we expect further " good " news !

[percy]

Percy, when can we expect further " good " news !

Perhaps ?
However last year's update was 24th December.

[iceman]

So the website is not working and one can not order our products. I am not impressed. This is the response I got to my enquiry:

Hi XXXXX
Thanks for your email.

Sorry that the newsletter link isn’t working - we are in the process of re-launching our Aiora brand. The products/formulations aren’t changing; however, we will be launching a new look website and packaging early next year.

I will manually add you to our database to ensure you are kept up to date with the latest news and offers 😊

We don’t have any stock available for purchase through the website during this transition period, as we are now re-bottling product into the new packaging ready for re-launch. We will notify you as soon as we have re-launched and have new product available for purchase.

Thanks,
XXXXX

[justakiwi]

Wow. That is really poor marketing strategy. Given that you cannot buy their products anywhere else currently, "shutting down shop" seems really counter-productive. Sounds like they are saying nothing will be available until the re-launch next year.

They added me "manually to the database" and I've never had any news or offers from them ever.

This is very disappointing and I too am unimpressed.

[percy]

https://usx.co.nz/uploads/paperclip/documents/2749/original/PZ_History_and_Future_Growth.pdf?1671571696

[Sideshow Bob]

https://usx.co.nz/uploads/paperclip/documents/2749/original/PZ_History_and_Future_Growth.pdf?1671571696

Thanks for sharing Percy, and certainly details how far they've come (and how much money they've spent).

Obviously much of the development has been hampered by Covid - with time, money and availability of contractors/expertise. They seem to be progressing reasonably well, given the challenges - and exciting developments are coming! Clearly they have the production experience and knowledge to get these operations up and running.

My main concern (from the outside) is sales and marketing - and their ability to execute further into the value chain. There is a large increase in capacity, alot of money spent - and will be a large growth in volume of production. Would have to presume that expect that they can grow sales significantly and relatively quickly with their existing customers/existing products or new customers/products.

Some of this expansion from my understanding will be toll-processing, at least on the pet side. Which should be profitable and help buffer volumes - but the real value is in brand - did PE pay $1.5b for Ziwi for their manufacturing?? Or for human products, the sale of Go Healthy a couple of times at lofty multiples. The markets that these two examples operate in are both highly competitive, lots of players or would-be players, lots of investment and lots of risk - but good margins and the prizes can be very big.

We've seen DOT, which nothing seems to have happened with, and AiOra, as detailed in JK's post above. However expect that so much time/resource has gone into the capital works - and need to walk before running. So for me, would be great to see them execute a few of these initiatives.:)

[whatsup]

Thanks for sharing Percy, and certainly details how far they've come (and how much money they've spent).

Obviously much of the development has been hampered by Covid - with time, money and availability of contractors/expertise. They seem to be progressing reasonably well, given the challenges - and exciting developments are coming! Clearly they have the production experience and knowledge to get these operations up and running.

My main concern (from the outside) is sales and marketing - and their ability to execute further into the value chain. There is a large increase in capacity, alot of money spent - and will be a large growth in volume of production. Would have to presume that expect that they can grow volume significantly and relatively quickly with their existing customers/existing products or new products.

Some of this from my understanding will be toll-processing, at least on the pet side. Which should be profitable and help buffer volumes - but the real value is in brand - did PE pay $1.5b for Ziwi for their manufacturing?? Or for human products, the sale of Go Healthy a couple of times and lofty multiples. The markets that these two examples operate in are both highly competitive, lots of players or would-be players, lots of investment and lots of risk - but good margins and the prizes can be very big.

We've seen DOT, which nothing seems to have happened with, and AiOra, as detailed in JK's post above. However expect that so much time/resource has gone into the capital works - and need to walk before running. So for me, would be great to see them execute a few of these initiatives.:)

Me to SsBob , was hoping for some more financial infos !

[RupertBear]

I was sent this link. Not sure if this will impact PAZ….

https://www.parliament.nz/en/pb/sc/make-a-submission/document/53SCHE_SCF_BILL_130084/therapeutic-products-bill

[percy]

Yes but they already have:
• GMP (Good Manufacturing Practice) certification – Approved to manufacture an
“Active Pharmaceutical Ingredient” under a “Licence to Manufacture Medicines”
authorised by Medsafe (New Zealand Medicines and Medical Devices
Safety Authority.
• Licensed to produce consumer ready products including softgel and hard–shell
capsules.
• Issued US patent for “High Osteocalcin Microcrystalline Hydroxyapatite for
Calcium Supplement”.

[RupertBear]

Yes but they already have:
• GMP (Good Manufacturing Practice) certification – Approved to manufacture an
“Active Pharmaceutical Ingredient” under a “Licence to Manufacture Medicines”
authorised by Medsafe (New Zealand Medicines and Medical Devices
Safety Authority.
• Licensed to produce consumer ready products including softgel and hard–shell
capsules.
• Issued US patent for “High Osteocalcin Microcrystalline Hydroxyapatite for
Calcium Supplement”.

Thanks Percy

[whatsup]

Feb 10 stuff ann says 20 workers laid off due to poor sales but semiconductor business remains " strong ".

[stoploss]

Feb 10 stuff ann says 20 workers laid off due to poor sales but semiconductor business remains " strong ".
Sup got the right company here ?

[percy]

Feb 10 stuff ann says 20 workers laid off due to poor sales but semiconductor business remains " strong ".

Not PAZ but Syft......

[iceman]

Not PAZ but Syft......

Damn, after reading whatsup's post I got excited that we may become the next NVIDIA (NVDA) which I've been buying into a bit over the last few months :t_up:

[whatsup]

Damn, after reading whatsup's post I got excited that we may become the next NVIDIA (NVDA) which I've been buying into a bit over the last few months :t_up:

Ice4, Sorry about that I did try to edit my comments after posting but for some reason nothing happened, should have double checked , damm damm !!

[percy]

New AiOra labels look great.
https://aioranz.com/collections/all
I use Bone + Joint replaced by 04 05.
Used to pay $29.90 for 60.
Note I will now be paying $36.50 for 120...
A good saving for me.

[iceman]

[QUOTE=percy;992775]New AiOra labels look great.
https://aioranz.com/collections/all
I use Bone + Joint replaced by 04 05.
Used to pay $29.90 for 60.
Note I will now be paying $36.50 for 120...
A good saving for me.[/QUOTE

DELETED DELETED

[iceman]

I see they offer a subscription delivered every 4 weeks. This is good but I wish they allowed selection of frequency of delivery, not only every 4 weeks. Went to look at their subscription policy and here it is https://aioranz.com/policies/subscription-policy

They need to be a bit more onto it.

[justakiwi]

Same. The blackcurrant one was 1 capsule per day before - now they say 4 capsules per day. Subscription for that one is 4 weekly - no way in hell am I taking 4 a day when 1 was fine before. Which means a bottle would last me four months - why should I have to do a 4 weekly subscription? The other product I take is the calcium + collagen product - that one is still 2 per day (was basically the old joint and bone product) - with an 8 weekly subscription.

Makes zero sense.


I see they offer a subscription delivered every 4 weeks. This is good but I wish they allowed selection of frequency of delivery, not only every 4 weeks. Went to look at their subscription policy and here it is https://aioranz.com/policies/subscription-policy

They need to be a bit more onto it.

[percy]

With AiOra product 04 05 subscription would work for me.
One bottle every two months would cover the two a day I use.
20% saving .
So currently paying $29.90 for 60 capsules or 49.83 cents each.
Buying on subscription :120 capsules $36.50 less 20%=$29.20 or 24.33 cents each.
Crickey that's under half price..!!.
Just have to see if there is a delivery charge and what it is.
Like the new web site too.

[iceman]

Obviously some holders losing patience with this, judging by the trades this week. Not surprising really given the lack of any information or announcements. That's life on the USX I suppose.

[Sideshow Bob]

Obviously some holders losing patience with this, judging by the trades this week. Not surprising really given the lack of any information or announcements. That's life on the USX I suppose.

Agree. There was the presentation just before Christmas, however it does seem to be life on the USX. Companies could (voluntarily) uphold themselves to good/better disclosure over & above what the USX requires.....

From FY results were announced 8th of April last year, so guess likely that will be the next meaningful update. :sleep:

[Sideshow Bob]

Greg Shepherd's resignation from the board

https://www.usx.co.nz/uploads/paperclip/documents/2778/original/Director_Resignation_-_Gregory_Shepherd.pdf?1677548659

[winner69]

Greg Shepherd's resignation from the board

https://www.usx.co.nz/uploads/paperclip/documents/2778/original/Director_Resignation_-_Gregory_Shepherd.pdf?1677548659

to be replaced by percy?

[justakiwi]

I would happily second that nomination ;)


to be replaced by percy?

[percy]

Greg Shepherd's resignation from the board

https://www.usx.co.nz/uploads/paperclip/documents/2778/original/Director_Resignation_-_Gregory_Shepherd.pdf?1677548659

Surprised me.
Largest shareholder and former long term Chairman's son and a shareholder himself.
He served in senior positions at FPH,and was a welcomed director at PAZ.

[Baa_Baa]

Surprised me.
Largest shareholder and former long term Chairman's son and a shareholder himself.
He served in senior positions at FPH,and was a welcomed director at PAZ.

Didn't like the "for personal reasons" .. leaving "immediately". When substantial shareholders bail out of senior positions in a company, for whatever reasons, it creates uncertainty around the real reasons and what they will do with their shareholding.

[percy]

Didn't like the "for personal reasons" .. leaving "immediately". When substantial shareholders bail out of senior positions in a company, for whatever reasons, it creates uncertainty around the real reasons and what they will do with their shareholding.

It is his parents who are the major shareholder.
Allocation 1 : 35092204 shares (13.79%)

M G Shepherd & L A Shepherd & Downie Stewart Trustee Limited (Maxwell Gilbert & Laraine Alice Shepherd Family)

Gregg's holding :
Allocation 16:2067282 shares (0.81%)

GREGORY PAUL SHEPHERD & RACHAEL LANGLEY & ANDREW MICHAEL HARKNESS SHEPLEY FAMILY AC

[winner69]

Maybe been made CEO of AA Money instead of Acting CEO and life getting too busy

Simple explanation

[percy]

Maybe been made CEO of AA Money instead of Acting CEO and life getting too busy

Simple explanation

Simple is usually correct.
Thanks for your post.

AA Money's gain.PAZ's loss.

[whatsup]

I see in todays Business News that there is a proposed law that would regulate the $1 bil export Natural Health Products , would this catch any of PAZ's products?

[percy]

I see in todays Business News that there is a proposed law that would regulate the $1 bil export Natural Health Products , would this catch any of PAZ's products?
I doubt it.
From PAZ's 2018 annual report.;
• GMP (Good Manufacturing Practice) certification – Approved to manufacture an
“Active Pharmaceutical Ingredient” under a “Licence to Manufacture Medicines”
authorised by Medsafe (New Zealand Medicines and Medical Devices
Safety Authority.
• Licensed to produce consumer ready products including softgel and hard–shell
capsules.
• Issued US patent for “High Osteocalcin Microcrystalline Hydroxyapatite for
Calcium Supplement”.

[justakiwi]

38 cents. Damn that's depressing.

[iceman]

38 cents. Damn that's depressing.

Yes it is disappointing, but given that the company is very poor with SH communications, it's maybe not very surprising. Despite the USX having very lax requirements for SH comms, companies like PAZ could show a little more regard for those of us that are not insiders and rely on their market announcements for keeping ourselves informed.
I suppose the next announcement will be the annual results in the next couple of weeks sometime. I'm expecting the result to be unfavourable and will be more interested in a detailed progress update

[justakiwi]

I only have a minuscule holding - only 1000 shares. I bought in at $0.93 though, so pretty disillusioned now. I don't have enough for them to be of any real use, but not worth selling at this price either.



Yes it is disappointing, but given that the company is very poor with SH communications, it's maybe not very surprising. Despite the USX having very lax requirements for SH comms, companies like PAZ could show a little more regard for those of us that are not insiders and rely on their market announcements for keeping ourselves informed.
I suppose the next announcement will be the annual results in the next couple of weeks sometime. I'm expecting the result to be unfavourable and will be more interested in a detailed progress update

[whatsup]

I only have a minuscule holding - only 1000 shares. I bought in at $0.93 though, so pretty disillusioned now. I don't have enough for them to be of any real use, but not worth selling at this price either.

kiwi, please dont even think of selling, once they start production from the new factories and the product gets out there in the market PAZ will regain their upward trojectory .

[iceman]

kiwi, please dont even think of selling, once they start production from the new factories and the product gets out there in the market PAZ will regain their upward trojectory .

While not wanting to give an advice, I agree and certainly wouldn't consider selling any of these at the moment. We've had serious delays in factory construction and no doubt serious overruns in costs in getting new capacity up and running, mostly due to COVID related delays and cost increases. But the new production facilities and freeze dryers will have some serious grunt when they're all in full operation. That can not happen soon enough.

[percy]

Yes that buyer at 48 got hit too quickly.
Last Saturday I sent their sales manager an email asking about subscription freight charges etc.
Thought she would reply on Monday,.Received a reply straight away.Did my order and received it on Tuesday morning.Great service,great product.

[justakiwi]

Thanks guys. Yes, Percy has also encouraged me to "hang in there" and I will, but I am unlikely to ever be able to add to my holding, for financial reasons, so I do sometimes wonder just how worthwhile holding on to 1000 shares really is.


kiwi, please dont even think of selling, once they start production from the new factories and the product gets out there in the market PAZ will regain their upward trojectory .


While not wanting to give an advice, I agree and certainly wouldn't consider selling any of these at the moment. We've had serious delays in factory construction and no doubt serious overruns in costs in getting new capacity up and running, mostly due to COVID related delays and cost increases. But the new production facilities and freeze dryers will have some serious grunt when they're all in full operation. That can not happen soon enough.

[Sideshow Bob]

While not wanting to give an advice, I agree and certainly wouldn't consider selling any of these at the moment. We've had serious delays in factory construction and no doubt serious overruns in costs in getting new capacity up and running, mostly due to COVID related delays and cost increases. But the new production facilities and freeze dryers will have some serious grunt when they're all in full operation. That can not happen soon enough.

From their presentation/release end of December, it seemed that most of the capital expenditure was done, with lesser amounts for 2023.

Really now it is about waiting for the 22 result. Last year was 8th of April, so guess we can expect any day now. I too have no expectations of a great result, but progress is the key and timeline for better/brighter times now that Covid is in the rear mirror, at least currently.

I agree with you Iceman re announcements etc, and the paucity of disclosure/updates with many of the USX companies. There is some time/cost with this, but hope companies can aspire to best practice, especially the larger entities.

[iceman]

Last year we got the annual report on 29 April. I think we deserve to see it pronto to try and see where this company is at.

[Langara]

Bit of a concern how slow they have been with the update. Makes me rather concerned that it will not be that great…. Happy to be proven wrong.

[iceman]

Bit of a concern how slow they have been with the update. Makes me think it may not be that great…. Happy to be proven wrong.

We're certainly a long way behind the plan so SH deserve a honest update

[percy]

Annual report has been held up as PAZ have a new auditor.
Looks like next week.
AGM on 26th 12.30 pm.Te Pae.

[Bluebell]

Didn't like the "for personal reasons" .. leaving "immediately". When substantial shareholders bail out of senior positions in a company, for whatever reasons, it creates uncertainty around the real reasons and what they will do with their shareholding.

All seems a bit vague "for personal reasons" Why would anyone leave a directorship of a seemingly successful company...doesn't make sense. There will be more to it than is being disclosed

[justakiwi]

Who are you talking about?


All seems a bit vague "for personal reasons" Why would anyone leave a directorship of a seemingly successful company...doesn't make sense. There will be more to it than is being disclosed

[Sideshow Bob]

Who are you talking about?

https://www.usx.co.nz/uploads/paperclip/documents/2778/original/Director_Resignation_-_Gregory_Shepherd.pdf?1677548659

[justakiwi]

Thanks! Missed that somehow.


https://www.usx.co.nz/uploads/paperclip/documents/2778/original/Director_Resignation_-_Gregory_Shepherd.pdf?1677548659

[Muse]

I see that Greg was Chairman of AA Money but got made Acting CEO in December 2022. Possible he had to free up some time by axing his PAZ directorship to handle the role. But as Baa Baa says - just say so!

Disc: just watching w/ interest from the sidelines.

[justakiwi]

Or maybe, he or someone he loves, is really unwell? Or maybe he is going through a marriage breakup? Or maybe he is struggling with his mental health?

Why do we automatically assume he is lying when he says "for personal reasons?"

Clearly none of you paid attention to the recent discussion in the ATM thread. Nor learned any lessons from that particular situation.

Do better people!

[blackcap]

Or maybe, he or someone he loves, is really unwell? Or maybe he is going through a marriage breakup? Or maybe he is struggling with his mental health?

Why do we automatically assume he is lying when he says "for personal reasons?"

Clearly none of you paid attention to the recent discussion in the ATM thread. Nor learned any lessons from that particular situation.

Do better people!

"for personal reasons" is generally a euphemism for: he resigned abruptly/we got rid of his sorry arse/there is more to the story than we want you to know/etc.

But sometimes it is for genuine personal reasons but experience teaches that more often than not, it is something else.

That is why when this explanation is given, there is often speculation about what the real reason is. The effective immediately is normally a red flag.

Possibly a conflict with the board that was irrevocable? Hard to say.

[justakiwi]

I do realise that. But given the discussion on the ATM thread, and the regret people expressed for having harshly judged Jayne at the time she resigned "for personal reasons" - I would have thought this announcement would have met with less judgment and a little more trust.


Why do we automatically assume he is lying when he says "for personal reasons?"

Clearly none of you paid attention to the recent discussion in the ATM thread. Nor learned any lessons from that particular situation.

Do better people!


"for personal reasons" is generally a euphemism for: he resigned abruptly/we got rid of his sorry arse/there is more to the story than we want you to know/etc.

But sometimes it is for genuine personal reasons but experience teaches that more often than not, it is something else.

That is why when this explanation is given, there is often speculation about what the real reason is. The effective immediately is normally a red flag.

Possibly a conflict with the board that was irrevocable? Hard to say.

[percy]

Annual report should be out next week.
The AGM has been moved to;
AGM date Friday 19th June

[nizzy]

Annual report should be out next week.
The AGM has been moved to;
AGM date Friday 19th June
Percy, do you mean Friday 9th June? there's no AGM announcement on their USX page.

[percy]

Monday the 19th.
Sorry I put Friday.

[percy]

https://usx.co.nz/uploads/paperclip/documents/2826/original/FY22_PharmaZen_AR_FINAL_.pdf?1684113808

And notice of meeting;
https://usx.co.nz/uploads/paperclip/documents/2827/original/Notice_of_Shareholder_Meeting_2023_with_Bio's_atta ched.pdf?1684116433

[iceman]

Have had a first skim read of the report. It is great to finally see the 2 freeze dryers commissioned, doubling the freezing capacity, which should see a significant revenue and EBIDTA increase in FY23. It is also a positive that they have sold the first factory at Rolleston to invest further in plant & equipment of the 2nd factory.
But of great concern with this business like so many businesses in NZ at the moment is how the growth is being held back by lack of reliable staff, both in own operation and also for our suppliers simply being able to supply our raw materials.

They talk about a partners new boat being delayed until 2024 causing further supply issues. I'd be interested in more detail on this so if someone can please ask at the AGM (I'm overseas and won't be able to attend) I'd very much appreciate it.

We are still heading in the right direction, albeit at a slow pace. From what can be seen from this report though, I'm relatively satisfied and content for this to remain a large part of my long term portfolio. But it will require an enormous amount of patience.

I would like to see comments from the CEO in the Annual Reports in the future.

[percy]

Have had a first skim read of the report. It is great to finally see the 2 freeze dryers commissioned, doubling the freezing capacity, which should see a significant revenue and EBIDTA increase in FY23. It is also a positive that they have sold the first factory at Rolleston to invest further in plant & equipment of the 2nd factory.
But of great concern with this business like so many businesses in NZ at the moment is how the growth is being held back by lack of reliable staff, both in own operation and also for our suppliers simply being able to supply our raw materials.

They talk about a partners new boat being delayed until 2024 causing further supply issues. I'd be interested in more detail on this so if someone can please ask at the AGM (I'm overseas and won't be able to attend) I'd very much appreciate it.

We are still heading in the right direction, albeit at a slow pace. From what can be seen from this report though, I'm relatively satisfied and content for this to remain a large part of my long term portfolio. But it will require an enormous amount of patience.

I would like to see comments from the CEO in the Annual Reports in the future.

Page 58 of last year's agm presentation.

https://usx.co.nz/uploads/paperclip/documents/2556/original/2022_-_AGM_PowerPoint_Presentation.pdf?1653863354

[Bluebell]

"for personal reasons" is generally a euphemism for: he resigned abruptly/we got rid of his sorry arse/there is more to the story than we want you to know/etc.

But sometimes it is for genuine personal reasons but experience teaches that more often than not, it is something else.

That is why when this explanation is given, there is often speculation about what the real reason is. The effective immediately is normally a red flag.

Possibly a conflict with the board that was irrevocable? Hard to say.

Its a red flag - tend to agree with you on that one blackcap - If it were really for a personal reason and decision was with regret I dont think the term effective immediate would have been used

[justakiwi]

If you had just received bad news related to your own health, or that if a close family member, do you not think it would instantly become your priority? Do you really think you would be in the right space to carry out a role like this, in that situation? It doesn’t even have to be a health issue. It could be a marriage breakup or any number of other scenarios. “Effective immediately” implies an emergency type situation to me, nothing else.


Its a red flag - tend to agree with you on that one blackcap - If it were really for a personal reason and decision was with regret I dont think the term effective immediate would have been used

[nizzy]

Yes balance sheet is stretched but a good result in a tough year. Staffing issues won't be resolved easily, this is a challenge across much of the developed world, demographics of an aging population.
Most worrying to me is the lack of open communication to shareholders we've been seeing in the last year and second, I'm always wary of companies that focus so much on the engineering side - lots of photos showing off their new stainless steel and physical buildings but relatively little talk about the market and customers -what they do, are they growing or not, who their consumers are etc.

[Sideshow Bob]

The problem is that with the lack of communication, then it leaves a vacuum and leads to speculation (as evidenced by a few posts here and elsewhere). It has been frustrating the lateness of the report but while delays happen, it does no harm to update the USX with a timeline.

The companies focus has been inwards on plant and processes and not outwards at the market - and also they are an ingredient B2B business, so a little more difficult to talk about customers/markets. That is where the branded business comes, and ability to move up the value chain.

Having an initial read, I was pleasantly surprised with the result and a number of things in the report. The impact of Covid has been ongoing with their factory development, and disappointing the slow progress.

Some of the points I took out of it:

- New Dryers and energy hub only became operational in December - ie the last month of their FY. So the benefits of this has not flowed into the FY22 result.
- Demand is 'extremely strong' and 'beyond supply'. That bodes very well when they can execute.
- Cash is extremely tight, and living off the overdraft. But proceeds from sale of plant will come in after end of FY.
- Staffing is a huge handbrake (like everywhere). However in recent times I've anecdotally heard from a number of places that their labour issues while not resolved have eased in recent times.
- Change in revenue policy - which makes sense. Already $400k in the jar for next year.
- No update on their branded initiatives.
- If I had a serious holding, I'd be heading to the AGM.

I noted that while some on the offer, none have traded since the result. But how do you value them??

So to me, reasonable result, but progress on their plan is delayed. I still see plenty of potential, and that new capacity is needed but still badly need to get some 'runs on the board'.

Back in the bottom drawer they go.

[Bluebell]

Thanks to Percy for posting the link to last years AGM presentation,

https://usx.co.nz/uploads/paperclip/documents/2556/original/2022_-_AGM_PowerPoint_Presentation.pdf?1653863354

The company identified the need to invest in automation to reduce manual handling, reliance on labor and reduce wage costs. The company is still citing challenges with labor. Either very little automation has been put in or the issues around labor are so chronic that its negated any gains from automation. The recent report only seemed to mention capacity increase - nothing on automation gains so picking little has been implemented.

[blackcap]

I am just reviewing the Annual Accounts for PAZ and am quite concerned at their debt levels.

I also note that finance costs (Note 3c) states that net finance costs are $520,679. But a further dig reveals this gem: "Interest costs that are directly attributable to the acquisition of property, plant and
equipment have been capitalised at an average interest rate of 4.2% (2021: 3.3%)".

I guess the auditors allow this but this looks like creative accounting to me. (Can some bean counter explain the rationale of this?)

Capitalised interest is $721,826, so the total interest bill comes to a rather large $1,201,752 which does take the gloss off the result somwhat.

I understand operational cash flows are strong but I feel the company could be in trouble if interest rates continue to climb, sales diminish somewhat.

Happy to be proven wrong.

On the debt side:
Bank Overdraft $5,132,170 ($920,048)
Current Borrowings $3,174,014 ($2,298,960)
Non-Current Borrowings $21,145,790 ($17,283,122)

That's total debt of $29,451,974

[blackcap]

If I may, I will just qualify my previous post by saying its not all doom and gloom.

Sales were up nicely, gross margin was up and an operating profit is achieved. If they can scale this up then there is huge potential....

Add to that, there is a sale of an asset listed in current assets and that will reduce debt by $8,543,276. So the debt not as acute but still very high.

[Bluebell]

Thanks Blackcap for unravelling the (creative accounting) report. They are not that straightforward to interpret. So thats quite some debt, money that's been spent on equipment and facility that is yet to brought into operation and generating cash Going to take sometime to trade out of that!!

[Sideshow Bob]

I see it has finally traded over the last few days - the first time since the Annual Report release. A flurry of smaller trades at 35c, and still more on the offer at this level.

AGM on the 19th - who is going??

[blackcap]

Thanks Blackcap for unravelling the (creative accounting) report. They are not that straightforward to interpret. So thats quite some debt, money that's been spent on equipment and facility that is yet to brought into operation and generating cash Going to take sometime to trade out of that!!

I had a chat to the CFO at PAZ and he clarified the Capitalised interest piece. Apparently it is a requirement under NZ IAS 23, where it says: An entity shall capitalise borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset.

What that has done is artificially inflate profit by $700k and.

To the credit of the company, the CFO did concede this and also he himself was a bit miffed at the standard and to how it applies. It really makes no sense. It also means, further down the track is will come off the P and L at some stage.

I also talked to him about the high levels of debt. He said it was a strategy decision, and debt was obviously required to complete what they wanted to complete. High risk possibly but high reward if it succeeds.

[RTM]

Thanks for sharing…appreciated.



I had a chat to the CFO at PAZ and he clarified the Capitalised interest piece. Apparently it is a requirement under NZ IAS 23, where it says: An entity shall capitalise borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset.

What that has done is artificially inflate profit by $700k and.

To the credit of the company, the CFO did concede this and also he himself was a bit miffed at the standard and to how it applies. It really makes no sense. It also means, further down the track is will come off the P and L at some stage.

I also talked to him about the high levels of debt. He said it was a strategy decision, and debt was obviously required to complete what they wanted to complete. High risk possibly but high reward if it succeeds.

[iceman]

Thanks blackcap for talking to the CFO and sharing the info

[whatsup]

AGM Mon 12-00 in CH-CH but a virtual link is available, a good headsup should be given.

[Bluebell]

Interesting....high levels of debt as a strategy....would love to know more about the nuts and bolts of that!! Of course they need to finish what has been started so that revenue can be generated. It sounds to me like they over capitilized and that sort of thing is reckless

So what's the big "if" around it succeeding. Surely there was a good business case for doing has been done

All sounds a bit loose to me

[Bluebell]

Evidently quite a number of upper level and key appointment staff have left over the past few months. In the last AGM there was mention of an employee share scheme to retain staff...so what's happened.

I suspect not all is well on on this ship

[blackcap]

Interesting....high levels of debt as a strategy....would love to know more about the nuts and bolts of that!! Of course they need to finish what has been started so that revenue can be generated. It sounds to me like they over capitilized and that sort of thing is reckless

So what's the big "if" around it succeeding. Surely there was a good business case for doing has been done

All sounds a bit loose to me

I should in fairness qualify my statement. High debt is not the strategy. The strategy is to pursue growth and debt is required to do that.

[percy]

Hybrid Annual Meeting

This is a reminder that the Annual Meeting of PharmaZen Limited will be held at the Te Pae Christchurch Convention Centre, 188 Oxford Terrace in the Bealey 3 Room and online at www.virtualmeeting.co.nz/paz23 at 12:30pm (New Zealand time) on Monday, June 19, 2023.

If attending online, Shareholders will be able to hear and view the meeting, vote on resolutions and ask questions. If you will attend the Annual Meeting online, you will require your CSN/Holder Number for verification purposes.

More information regarding online attendance at the meeting (including how to vote and ask questions virtually during the meeting) is available in the Virtual Annual Meeting Online Guide available here.

Shareholders who wish to participate in the online Annual Meeting are recommended to log-in to the online portal at least 15 minutes prior to the scheduled start time for the meeting.

[justakiwi]

Watching the presentation, but I have to say, I am not feeling the love for this company anymore. I am not hearing any real passion from the speakers, and have heard nothing to give me confidence that we will see any major progress anytime soon.

I am concerned about the comments re staffing issues. I get that some of the staff who left very shortly after starting, may simply have been ticking boxes for WINZ, as implied, BUT what exactly is the company doing to attract people and motivate them to want to work there? Are they paying employees appropriately? Are they taking advantage of apprenticeship schemes etc? It just makes me wonder what the real issues are.

I may of course, be misunderstanding/misinterpreting - but my gut feeling is that my investment in PAZ is pretty much a "bottom drawer" write off now (only a very small holding which I brought at close to $1).

Sorry Percy :(

[mfd]

Watching the presentation, but I have to say, I am not feeling the love for this company anymore. I am not hearing any real passion from the speakers, and have heard nothing to give me confidence that we will see any major progress anytime soon.

I am concerned about the comments re staffing issues. I get that some of the staff who left very shortly after starting, may simply have been ticking boxes for WINZ, as implied, BUT what exactly is the company doing to attract people and motivate them to want to work there? Are they paying employees appropriately? Are they taking advantage of apprenticeship schemes etc? It just makes me wonder what the real issues are.

I may of course, be misunderstanding/misinterpreting - but my gut feeling is that my investment in PAZ is pretty much a "bottom drawer" write off now (only a very small holding which I brought at close to $1).

Sorry Percy :(

I was only half watching due to work commitments, but did they not say they are fully staffed as of April/may? Hopefully they are on top of this issue now. Certainly seems to have caused some problems though, lots of new gear with noone to run it for a few months.

[winner69]

Watching the presentation, but I have to say, I am not feeling the love for this company anymore. I am not hearing any real passion from the speakers, and have heard nothing to give me confidence that we will see any major progress anytime soon.

I am concerned about the comments re staffing issues. I get that some of the staff who left very shortly after starting, may simply have been ticking boxes for WINZ, as implied, BUT what exactly is the company doing to attract people and motivate them to want to work there? Are they paying employees appropriately? Are they taking advantage of apprenticeship schemes etc? It just makes me wonder what the real issues are.

I may of course, be misunderstanding/misinterpreting - but my gut feeling is that my investment in PAZ is pretty much a "bottom drawer" write off now (only a very small holding which I brought at close to $1).

Sorry Percy :(


Thanks justakiwi for that p. Knew something I meant to do today and only remembered when out with Speedy after he nagged me for a walk.

So it wasn’t an exciting great rave sort of meeting then (in your eyes anyway)

Suppose some will be super excited about what was said and the future.

Bottom drawer eh …hope it turns out OK eventually.

[justakiwi]

Yeah he did say that, and commented that he thought they are now probably over staffed. It did seem to me though, that he was presenting the "lazy, unwilling to work" narrative, rather than looking at why they are not attracting the type of employee they want. Maybe some staff were leaving due to the pressure of having to constantly work extra hours because they were understaffed? I know what that is like. Who knows.

Either way, my overall feeling is one of disappointment. I no longer feel a connection to the company.


I was only half watching due to work commitments, but did they not say they are fully staffed as of April/may? Hopefully they are on top of this issue now. Certainly seems to have caused some problems though, lots of new gear with noone to run it for a few months.

[blackcap]

Either way, my overall feeling is one of disappointment. I no longer feel a connection to the company.

Some would argue that that is a good thing. It is never good to get emotionally attached to investments. That is a mistake many (including myself) make.

[justakiwi]

I get that. Not really what I meant though - more like I have lost "interest" in the company.

I am probably being unfair.


Some would argue that that is a good thing. It is never good to get emotionally attached to investments. That is a mistake many (including myself) make.

[Sideshow Bob]

Had a meeting, so missed the meeting.

Look forward to further reports/comments.

[percy]

The factory tour was incredible.

[whatsup]

Hybrid Annual Meeting

This is a reminder that the Annual Meeting of PharmaZen Limited will be held at the Te Pae Christchurch Convention Centre, 188 Oxford Terrace in the Bealey 3 Room and online at www.virtualmeeting.co.nz/paz23 at 12:30pm (New Zealand time) on Monday, June 19, 2023.

If attending online, Shareholders will be able to hear and view the meeting, vote on resolutions and ask questions. If you will attend the Annual Meeting online, you will require your CSN/Holder Number for verification purposes.

More information regarding online attendance at the meeting (including how to vote and ask questions virtually during the meeting) is available in the Virtual Annual Meeting Online Guide available here.

Shareholders who wish to participate in the online Annual Meeting are recommended to log-in to the online portal at least 15 minutes prior to the scheduled start time for the meeting.

P is there any link available for those of us who were not able to participate in todays meeting ?

[percy]

I do not know,sorry.

[Southern Lad]

AGM Presentation now posted on Unlisted

pharmazen (usx.co.nz) (https://usx.co.nz/uploads/paperclip/documents/2844/original/PharmaZen9_2023_FINAL_AS_PRESENTED.pdf?1687153171)

[justakiwi]

OK, I was clearly off base with my previous comments so my apologies to anyone who was offended by my post. My situation is vastly different from everyone else's - my comments were based on my own scenario, as I only have 1000 shares.

Just ignore me.

[percy]

I attended yesterday's AGM and also went on the factory tour.
I was very disappointed that their first quarter was very poor.I had expected great trading with the new two huge freeze dryers now operating.
I was also expecting discussions on the change of auditor,the debt level ,and the very slow progress on the equipment installations .Thought there would be some angry shareholders.
Yet all resolutions were passed without any decent.
I was lucky to be seated next to PAZ largest shareholder,and former long term Chaiman,Max Shepherd.He is very excited that the Rolleston build is taking place,and the extremely bright future PAZ has.
Although I found hearing the speakers at the meeting hard,it was a very different matter at Rolleston.
MD Craig McIntosh answered all questions.If he was unsure of the facts he asked the two very capable staff who then answered.
The factory is not like buying a new engine for your car and fitting it.It is very complex.Chemicals at -40 degrees, then heat generated.The Stainless Steel equipment is huge.Huge freeze dryers,huge stainless steel tanks and mixing bowls.Huge stainless steel pipes everywhere.At lot of welding required.
Getting the power from the transformer to their switch board cost $110,000 and wiring the building approx $250,000.
When PAZ first installed a freeze dryer at Port Hills Road ,30 Chinese technicians came here and installed it.
Covid put paid to them coming back,therefore PAZ have had to do the work themselves.
The heat recovery plant is also big and complex.
I know the shareholders who went on the factory tour were impressed and excited at what they saw.

[whatsup]

I attended yesterday's AGM and also went on the factory tour.
I was very disappointed that their first quarter was very poor.I had expected great trading with the new two huge freeze dryers now operating.
I was also expecting discussions on the change of auditor,the debt level ,and the very slow progress on the equipment installations .Thought there would be some angry shareholders.
Yet all resolutions were passed without any decent.
I was lucky to be seated next to PAZ largest shareholder,and former long term Chaiman,Max Shepherd.He is very excited that the Rolleston build is taking place,and the extremely bright future PAZ has.
Although I found hearing the speakers at the meeting hard,it was a very different matter at Rolleston.
MD Craig McIntosh answered all questions.If he was unsure of the facts he asked the two very capable staff who then answered.
The factory is not like buying a new engine for your car and fitting it.It is very complex.Chemicals at -40 degrees, then heat generated.The Stainless Steel equipment is huge.Huge freeze dryers,huge stainless steel tanks and mixing bowls.Huge stainless steel pipes everywhere.At lot of welding required.
Getting the power from the transformer to their switch board cost $110,000 and wiring the building approx $250,000.
When PAZ first installed a freeze dryer at Port Hills Road ,30 Chinese technicians came here and installed it.
Covid put paid to them coming back,therefore PAZ have had to do the work themselves.
The heat recovery plant is also big and complex.
I know the shareholders who went on the factory tour were impressed and excited at what they saw.

P thank you for the headsup, always positive and to the point.

[Sideshow Bob]

Couldn't make the meeting but just had a read through the preso deck.

Echo Percy's comments - very disappointing to hear of a poor FH23. I had also expected some good flow-through from new freeze-dryers, but staffing has seemed to be a handbrake.

Having visited the Port Hills plant previously, from a layman's perspective it is some achievement what they've done, especially with Covid/lack of expertise from overseas in installing and commissioning equipment. They now have that capability in-house, but expect has taken longer, cost more than what was originally foreseen. There is little doubt that technically PAZ can produce these products.

Good they have their Chinese listing/approval for pet treats - which will be a key aspect for the new plant. My concern is that they are a little late to the party. My understanding is a bit of the gloss is coming off that Chinese business, and established brands are having to work harder to maintain sales - plus already lots of new entrants. It has attracted alot of investment in NZ already in recent years, and the market is maturing. The boom times or easy wins seem to have gone? Economic conditions and drop in consumer spending meaning less on treats?? Don't know. I would see treats as more discretionary, vs food as a 'need to have'.

The last couple of slides touch on the crux for me (page 31) - tolling compared to own ingredients is a 1 to 7 multiplier. Ingredient to consumer 1 to 4 multiplier. ie the closer you get to the consumer, the more the margin.

I would expect much of the capacity would be for tolling initially (??). Nothing wrong with that as it provides a return - but not what it was invested for.

The key is to move up the value chain and get close to the consumer. Ingredients are a big step for this, but PAZ's own brand is the key. This is a long, difficult journey which takes time, (alot of) money and expertise. But to me the jury is still out whether they can execute on this. Alot of PAZ's stuff is specialised, but freeze-drying is pretty common and not proprietary - expect PAZ have some advantages with capital & running costs of freeze-dryers.

I've mentioned it before, but the big value is in the brand. Why did PE pay $1.5b for Ziwi? Go Healthy to Nestle for $375m? Wasn't for bricks and mortar. The prize is getting closer to the consumer.

AiOra is relaunched, but doesn't seem to have been an initial success. DOT gone nowhere and logged into their website just now and there isn't a website.

Can PAZ do this? Don't know but sincerely hope so. Time will tell. I just hope they have further updates to the USX through the year to keep SH's updated.

Back to the bottom drawer again......

[Sideshow Bob]

Someone didn't like the AGM update - latest trade through at $0.30.

[Rocky145]

I would have been more impressed if the new factory was operational, yes Percy it was big and lots of expensive stainless steel, electrics and plumbing etc. But still along way from making product/money. And yes good open discussion, but unfortunately didn’t fill me with any more confidence.
Disappointing period the last couple of years has been, they have lost their way with this development at Rolleston.I’m not against the growth, they just have not managed the growth well or in a sustainable manner.
I would guess the past 6-12months they have been heavily constrained by lack of working capital / cashflow. They have been bridging the property sale for most of that period. This would have impacted work at Rolleston and maybe production as well.
They purchased 2ha at Rolleston, “Price was to good” - but really half that would have been enough.
They have started building the second building at Rolleston, yet the first is not operational, “we do not have a set plan for the second building - fluid” . All during high and uncertain building costs.
Selling of the first building is the correct measure to help the balance sheet, but this has been delayed and they were “surprised by council request for development contribution”

The next couple of years are going to be make or break really, continued organic growth will require more skill than they have demonstrated over the past couple of years. 2023 off to a bad start. Probably I would like to see a capital raise reduce debt and get both the Rolleston buildings completed, and see where it takes us, if that demand is really there.
The brand - been well discussed, but was hopeful when that was launched a few years ago But…..

Like most shareholders, my shares will be in the bottom draw for a while.

[Bluebell]

What about all the automation talked about in the previous AGMs presentation? Wasn't this supposed to reduce work load and make the work environment better and more attractive to be in.

[iceman]

Thanks Rocky145 for a well considered post

[percy]

I would have been more impressed if the new factory was operational, yes Percy it was big and lots of expensive stainless steel, electrics and plumbing etc. But still along way from making product/money. And yes good open discussion, but unfortunately didn’t fill me with any more confidence.
Disappointing period the last couple of years has been, they have lost their way with this development at Rolleston.I’m not against the growth, they just have not managed the growth well or in a sustainable manner.
I would guess the past 6-12months they have been heavily constrained by lack of working capital / cashflow. They have been bridging the property sale for most of that period. This would have impacted work at Rolleston and maybe production as well.
They purchased 2ha at Rolleston, “Price was to good” - but really half that would have been enough.
They have started building the second building at Rolleston, yet the first is not operational, “we do not have a set plan for the second building - fluid” . All during high and uncertain building costs.
Selling of the first building is the correct measure to help the balance sheet, but this has been delayed and they were “surprised by council request for development contribution”

The next couple of years are going to be make or break really, continued organic growth will require more skill than they have demonstrated over the past couple of years. 2023 off to a bad start. Probably I would like to see a capital raise reduce debt and get both the Rolleston buildings completed, and see where it takes us, if that demand is really there.
The brand - been well discussed, but was hopeful when that was launched a few years ago But…..

Like most shareholders, my shares will be in the bottom draw for a while.

Wish you posted more often.Your posts are always right on the money.
In PAZ's defence Covid, logistics and their Kril customer's new ship build being behind schedule were beyond their control.
Port Hills Road appears to be now fully operational,and will be very profitable from now on.
All of us want to see the first factory at Rolleston in production as soon as possible.
Port Hills Road and Rolleston One fully operational should see healthy profits.
Then may be the time to develop Rolleston Two and look to list on either ASX or NZX,

[Southern Lad]

Big sell off today with 270,000 shares crossing at 20 cents. Buy side of the order book looking a bit thin so will be interesting to see where the share price settles at. Some larger long term holders appear to be spooked!

[whatsup]

Back to where I bought my last shares right on 4 years ago, if it goes too much lower I will double my 250 k holding !

[Sideshow Bob]

A trade last week back up at 25c, but someone wanted out first thing this morning with 130k through at $0.20.....

[winner69]

A trade last week back up at 25c, but someone wanted out first thing this morning with 130k through at $0.20.....

Plenty of loyalists just waiting to pick up more cheap shares from disillusioned sellers

[whatsup]

Back to where I bought my last shares right on 4 years ago, if it goes too much lower I will double my 250 k holding !

Look like someone beat me to it, good luck with that one.

[iceman]

Back to where I bought my last shares right on 4 years ago, if it goes too much lower I will double my 250 k holding !

You may well have a fight on your hands ! At 20c I have become an "interested party" even though I am way overweight already !

[percy]

https://usx.co.nz/uploads/paperclip/documents/2860/original/ASM_Presentation_Notes_from_Craig_McIntosh.pdf?168 8361498

[winner69]

How much will current shareholders be diluted I wonder?

[Even after the Tawhiri 1 sale and lease back we still have a book value in excess of $20m in land and buildings. Until interest rates reduce, it’s not a great time for selling property, so we are not considering a sale of any further land and building to fund expansion at this stage. However, we maintain dialogue with Cibus regarding getting any additional funding from them. They have their share options, however price performance isn’t where they would want to exercise those options. We also regularly talk with strategic partners that might be worthwhile bringing in however we have as much debt as we would like to carry, so the future direction is more likely to be from equity introduction or sale and lease back rather than debt.

[Southern Lad]

Half year results to June 2023 down to an underlying EBITDA level have been released:

30 September 2005 (usx.co.nz) (https://usx.co.nz/uploads/paperclip/documents/2894/original/PharmaZen_1H_2023_results_release_final.pdf?169198 9940)

The struggles continue!

Would be good to understand the unadjusted EBITDA or even the actual NPAT.

[stoploss]

Half year results to June 2023 down to an underlying EBITDA level have been released:

30 September 2005 (usx.co.nz) (https://usx.co.nz/uploads/paperclip/documents/2894/original/PharmaZen_1H_2023_results_release_final.pdf?169198 9940)

The struggles continue!

Would be good to understand the unadjusted EBITDA or even the actual NPAT.
Thanks Sthn L, I have clarified with the company . The damaged freeze dryer was insured .

[winner69]

PAZ not a very ‘lucky’ company are they

Always dogged by bad fortune

Hope they not one of these forever unlucky outfits

[Baa_Baa]

PAZ not a very ‘lucky’ company are they

Always dogged by bad fortune

Hope they not one of these forever unlucky outfits

20 cents on the bid, 25 on the offer. Ridiculous spread. That's a very long way down from recent times, the hype valuation has all but been crushed, although it should have been obvious that it was massively over extended on all metrics.

PAZ will imo do very well in the long run, but do we all have the long runway to realise that? Best thing this company could do imo is list on the NZX and let the market liquidity decide.

Languishing on the USX with its illiquidity could bring this down under the 0.10's as all the hyped punters exit. You'd have to ask yourself who is priming the ask, they're either happy to take a loss and get out, or are still taking profit after having got in earlier.

[Sideshow Bob]

A half year result!! Excuse formatting as copy and paste.....

https://www.usx.co.nz/uploads/paperclip/documents/2894/original/PharmaZen_1H_2023_results_release_final.pdf?169198 9940 (https://www.usx.co.nz/uploads/paperclip/documents/2894/original/PharmaZen_1H_2023_results_release_final.pdf?169198 9940)

Continuing strong demand but staffing issues generate a disappointing result Christchurch biotechnology company PharmaZen (USX.PAZ) today reports a disappointing result forthe six months to 30 June 2023.

As flagged at the Annual Shareholder Meeting the company faced significant staffing issues in the first quarter which resulted in an extremely poor first three months of the year, despite the continuing strong demand and additional installed capacity. These challenges resulted in some significant changes in structure and approach to recruitment and by the end of March the number of process workers had increased by 50% to be in line with required levels.

May and June both operated at just under 90% dryer utilisation enabling the company to post a halfyear $410k underlying EBITDA2 on sales of $10.3m. This was down on the prior year underlying EBITDAof $1.8m on sales of $12.8m.The additional capacity and an improvement in supply for the extraction business will see the trendshown in May and June continue and, despite the poor start to the year, the company expects the fullyear result to be at least in line with 2022.

Given the poor first half, and the significant upturn which commenced in May, the company is looking to post an update with unaudited third quarter results in the fourth week of October. PharmaZen Chair Ken Fergus said: “The first quarter was clearly not the way we wanted to start the year and created several challenges for us. The changes implemented have been successful with the speed of the correction being extremely pleasing.

Changes in management, structure and a total of18 new staff is no small achievement.”“The labour market is easing and the changes we have made internally are all looking like long-term solutions. What is particularly pleasing is the continued growth in demand. The additional freeze dryers in place are all but fully committed through till the end of the year”.

The continued growth in demand is making the commissioning of Tawhiri critical as it is clear we will be going into next year needing further capacity. Tawhiri is running late as a result of cash constraints from the first half performance but has been further set back by damage to the third freeze dryer delivered in the last week of July. The 35mt unit came off its transportation rack in transit and effectively rolled around in the hold causing irreparable damage.

This will need replacing and we are looking at options for how we can commission the other units and install the third unit at a later date. The original plan required all three to be in place to complete the plant room and building structure.

Outlook
The increase in capacity the company has put in place and the continuing strong demand we are seeing from our customers puts the company in a great position to achieve increased sales and profitability in the second half and into next financial year and beyond. The company is confident the utilisation issues are resolved, and the focus returns to increasing capacity.

Ken Fergus commented that “Our traditional challenge has always been increasing capacity to meet demand and that remains the case. Interest for pet product since obtaining the China license has been extremely encouraging and we will be working hard to make sure we can service what will be an exceptional opportunity”.

[percy]

Thanks Sthn L, I have clarified with the company . The damaged freeze dryer was insured .

Thank goodness.
Thanks for checking with PAZ, and sharing.

[winner69]

Thank goodness.
Thanks for checking with PAZ, and sharing.

Maybe they have a case for a consequential loss claim as well

Excuse my ignorance but that asset up for sale ($8m) is it surplus to requirements or just selling and leaseback to get funds in the bank?

[iceman]

Maybe they have a case for a consequential loss claim as well

Excuse my ignorance but that asset up for sale ($8m) is it surplus to requirements or just selling and leaseback to get funds in the bank?

The latter and funding the next one

[Sideshow Bob]

https://www.usx.co.nz/uploads/paperclip/documents/2911/original/20230829_Board_regisnation_and_announcement.pdf?16 93261525

We have some important news to share regarding changes to our board of directors.Damon Petrie has tendered his resignation from the board.

The Board thanks Damon for his contribution to the governance of PharmaZen Limited and wishes him all the best for the future.

I am pleased to announce the appointment of Vincent Pooch to our board of directors,effective 1 September 2023. Vincent is a very experienced director and the board is lookingforward to the contribution that Vincent will be able to make.For a more detailed overview of Vincent's qualifications and background, you can find hisbio attached to this announcement.

[Sideshow Bob]

Vincent is a Professional Director and Consultant based in Christchurch. Qualified as aMechanical Engineer and Chartered Accountant, he founded his consulting practice in1992 after working in finance and banking.In the decades since then, he has worked with a diverse customer base spanning cementmanufacturing, quarrying, logistics and primary industries both in NZ and internationally.

He has significant and diverse board experience including at Port Otago, DynesTransport, Smith Cranes and manufacturer Patchell Industries.Vincent is a Chartered Fellow of the Institute of Directors in New Zealand and served ontheir National Council.He brings a strong financial focus, along with a particular interest in risk management,strategy and leadership development.

[percy]

I am very disappointed to see Cibus's Damon Petrie resign.
Raises a very large question mark about Cibus's intentions.

[Sideshow Bob]

I am very disappointed to see Cibus's Damon Petrie resign.
Raises a very large question mark about Cibus's intentions.

Would have thought Cibus would nominate a replacement........??

[whatsup]

I am very disappointed to see Cibus's Damon Petrie resign.
Raises a very large question mark about Cibus's intentions.

P, Cibus is the O S investor, right ?

[percy]

Yes.
Citibank is Director Wayne Burt's.
Dalamore Trust is Chairman Ken Fergus.
Nimrod Trust is CEO Craig McIntosh family.

Total Number of Shares:254493482 Extensive Shareholding:Yes
Shareholders in Allocation:
Allocation 1:35092204 shares (13.79%)

M G Shepherd & L A Shepherd & Downie Stewart Trustee Limited (Maxwell Gilbert & Laraine Alice Shepherd Family)
43 Ridgecrest, Wanaka, Wanaka, 9305 , New Zealand
Allocation 2:35000000 shares (13.75%)

Cibus Oscar Limited
12 Phillimore Walk, London, W8 7RX , United Kingdom
Allocation 3:20536000 shares (8.07%)

Nimrod Trust
Unit 4, 414 Curraghs Road, Rd 6, West Melton, 7676 , New Zealand
Allocation 4:14500000 shares (5.70%)

BNP PARIBAS NOMINEES (NZ) LIMITED
Bell Gully, Level 22, Vero Centre, 48 Shortland Street, Auckland, 1010 , New Zealand
Allocation 5:14500000 shares (5.70%)

CITIBANK NOMINEES NEW ZEALAND LTD
6 Queens Avenue,, Villa Shambhala,, Vaucluse Nsw, 2030 , Australia
Allocation 6:11557312 shares (4.54%)

LEE PATERSON FAMILY TRUST COMPANY LIMITED
Van Aart Sycamore Lawyers, Level 1, 205 Princes Street, Dunedin, 9016 , New Zealand
Allocation 7:9010020 shares (3.54%)

Lee Joanne PATERSON
197 Mcgrath Road, Rd1 Waikouaiti 9471 , New Zealand

Peter Austin GOWING
157 Plantation Road, Wanaka , New Zealand

Richard Grant PATERSON
10 Upland Street, Dunedin 9010 , New Zealand
Allocation 8:8727602 shares (3.43%)

Leveraged Equities Finance Limited
157 Lambton Quay, Level 21, Wellington, 6140 , New Zealand
Allocation 9:8000000 shares (3.14%)

DALMORE TRUSTEES LIMITED
30 Kinleys Lane, Saint Albans, Christchurch, 8014 , New Zealand
Allocation 10:7480000 shares (2.94%)

Craig Lachlan MCINTOSH
4/414 Curraghs Road, West Melton, Christchurch, 7676 , New Zealand

[Sideshow Bob]

Can't see you in the top 10 shareholders Percy?? :p

[whatsup]

Yes.
Citibank is Director Wayne Burt's.
Dalamore Trust is Chairman Ken Fergus.
Nimrod Trust is CEO Craig McIntosh family.

Total Number of Shares:254493482 Extensive Shareholding:Yes
Shareholders in Allocation:
Allocation 1:35092204 shares (13.79%)

M G Shepherd & L A Shepherd & Downie Stewart Trustee Limited (Maxwell Gilbert & Laraine Alice Shepherd Family)
43 Ridgecrest, Wanaka, Wanaka, 9305 , New Zealand
Allocation 2:35000000 shares (13.75%)

Cibus Oscar Limited
12 Phillimore Walk, London, W8 7RX , United Kingdom
Allocation 3:20536000 shares (8.07%)

Nimrod Trust
Unit 4, 414 Curraghs Road, Rd 6, West Melton, 7676 , New Zealand
Allocation 4:14500000 shares (5.70%)

BNP PARIBAS NOMINEES (NZ) LIMITED
Bell Gully, Level 22, Vero Centre, 48 Shortland Street, Auckland, 1010 , New Zealand
Allocation 5:14500000 shares (5.70%)

CITIBANK NOMINEES NEW ZEALAND LTD
6 Queens Avenue,, Villa Shambhala,, Vaucluse Nsw, 2030 , Australia
Allocation 6:11557312 shares (4.54%)

LEE PATERSON FAMILY TRUST COMPANY LIMITED
Van Aart Sycamore Lawyers, Level 1, 205 Princes Street, Dunedin, 9016 , New Zealand
Allocation 7:9010020 shares (3.54%)

Lee Joanne PATERSON
197 Mcgrath Road, Rd1 Waikouaiti 9471 , New Zealand

Peter Austin GOWING
157 Plantation Road, Wanaka , New Zealand

Richard Grant PATERSON
10 Upland Street, Dunedin 9010 , New Zealand
Allocation 8:8727602 shares (3.43%)

Leveraged Equities Finance Limited
157 Lambton Quay, Level 21, Wellington, 6140 , New Zealand
Allocation 9:8000000 shares (3.14%)

DALMORE TRUSTEES LIMITED
30 Kinleys Lane, Saint Albans, Christchurch, 8014 , New Zealand
Allocation 10:7480000 shares (2.94%)

Craig Lachlan MCINTOSH
4/414 Curraghs Road, West Melton, Christchurch, 7676 , New Zealand

Leverage Equities isnt that Paul Collins of BIL fame ?

[winner69]

Leverage Equities isnt that aul Collins of BIL fame ?

Forsythe Barr outfit I think

[Sideshow Bob]

Forsythe Barr outfit I think

Yep, ForBar's

https://app.companiesoffice.govt.nz/companies/app/ui/pages/companies/968533/directors

[blackcap]

Leverage Equities isnt that Paul Collins of BIL fame ?

I believe it is Eion Edgar and family. I could be wrong, but you can call the company and they will confirm that.

[Bluebell]

I am very disappointed to see Cibus's Damon Petrie resign.
Raises a very large question mark about Cibus's intentions.

Yes, this is concerning news and begs the question if this is the commencement of their withdrawal.

I've been away from the forum for a number of weeks and have gone back to the posts after the AGM to refresh. Sideshow Bob and Rocky45 summed up PAZ situation very well I believe. We have heard much about the impacts of Covid in stalling progress....time that excuse stopped being used. We heard over staff situations now understaffed - what is it that makes it so hard to retain staff at this company? The new capacity projects seem to be a disaster with new ones bolting ahead before others are complete and making money, that smarts of overly ambitious intentions, poor capex expenditure and projects management.

They are prepared to sell further land and buildings if the conditions are better, so how about further investment from CIBUS, surely they wouldn't want to stall progress but perhaps they've completely lost their appetite given poor use of funds to date?

It was reported that the Tawhiri site couldn't be completed due to performance on the first half of the year- I would suggest cash constraints must have been tight well before this.

I would have thought that the new driers could have been commissioned in stages at the new site, first one (or 2) go in, start generating revenue. Seems the set up they've purchased needed to have the 3rd drier in place before the go button on the other
2 could be pressed. I get the sense the drier damaged in transit is serving as a convenient excuse for further delays.

I don't like the contradiction in the reports, don't feel like we are getting a straight story

Lost confidence in PAZ, like others will be parking these shares in the bottom drawer and keeping fingers crossed for a longer term recovery

[percy]

Given the poor first half, and the significant upturn which commenced in May, the company is looking
to post an update with unaudited third quarter results in the fourth week of October.

That should give us confidence PAZ are back on track.

[iceman]

Given the poor first half, and the significant upturn which commenced in May, the company is looking
to post an update with unaudited third quarter results in the fourth week of October.

That should give us confidence PAZ are back on track.

This is positive to hear from the “coalface”. PAZ has really let down the shareholders in the last couple of years with its lacklustre performance, continuous excuses and lack of shareholder communications. It’s great to hear we may get an update in October. Hopefully this will be the start of them upping their game with real information sharing.

[whatsup]

Yes, this is concerning news and begs the question if this is the commencement of their withdrawal.

I've been away from the forum for a number of weeks and have gone back to the posts after the AGM to refresh. Sideshow Bob and Rocky45 summed up PAZ situation very well I believe. We have heard much about the impacts of Covid in stalling progress....time that excuse stopped being used. We heard over staff situations now understaffed - what is it that makes it so hard to retain staff at this company? The new capacity projects seem to be a disaster with new ones bolting ahead before others are complete and making money, that smarts of overly ambitious intentions, poor capex expenditure and projects management.

They are prepared to sell further land and buildings if the conditions are better, so how about further investment from CIBUS, surely they wouldn't want to stall progress but perhaps they've completely lost their appetite given poor use of funds to date?

It was reported that the Tawhiri site couldn't be completed due to performance on the first half of the year- I would suggest cash constraints must have been tight well before this.

I would have thought that the new driers could have been commissioned in stages at the new site, first one (or 2) go in, start generating revenue. Seems the set up they've purchased needed to have the 3rd drier in place before the go button on the other
2 could be pressed. I get the sense the drier damaged in transit is serving as a convenient excuse for further delays.

I don't like the contradiction in the reports, don't feel like we are getting a straight story

Lost confidence in PAZ, like others will be parking these shares in the bottom drawer and keeping fingers crossed for a longer term recovery

What is a long term recovery, 1,2,3 or more years?

[Sideshow Bob]

Nice! :cool:

https://prod-trade.usx.co.nz/api/file/653040d24ac115c57999c2a0.pdf (https://prod-trade.usx.co.nz/api/file/653040d24ac115c57999c2a0.pdf)

Shareholder Update – 19 October 2023

PharmaZen confirms record sales quarter of $8.3m and Underlying EBITDA1 of $1.85m for Q3As indicated at the release of our half-year result, we are pleased to be able to report on significantly improved third quarter sales and Underlying EBITDA results.

The improvements seen in Q2, (after a very poor first quarter due to challenges addressed at half year), continued into a very pleasing Q3 - resulting in sales of $8.3m and $1.85m of Underlying EBITDA for the quarter.

The record Q3 sales result improves the year-to-date sales and Underlying EBITDA from the half-year result of $10.3m and $410k to $18.6m and $2.26m respectively.

The Company is tracking well to produce another very positive result for Q4 - albeit with the December shorter month and year-end cut-off challenges.

Demand continues to be very strong for the company’s products and now that the staffing and operational issues the company experienced in Q1 are resolved we are looking forward to ongoing growth and reaping the benefit of the increased capacity we have put in place.

We will continue to update the shareholders on the Company’s progress and expect to provide another update in early December.

[iceman]

Good to see a positive announcement and the commitment to provide another one in December. I would however have liked to see a comment on how the replacement for the freezer dryer is going and the effect it has on Tawhiri.

[RTM]

Nice! :cool:

https://prod-trade.usx.co.nz/api/file/653040d24ac115c57999c2a0.pdf (https://prod-trade.usx.co.nz/api/file/653040d24ac115c57999c2a0.pdf)

Shareholder Update – 19 October 2023

PharmaZen confirms record sales quarter of $8.3m and Underlying EBITDA1 of $1.85m for Q3As indicated at the release of our half-year result, we are pleased to be able to report on significantly improved third quarter sales and Underlying EBITDA results.


Yes, thanks. I would have missed it.