PEB - Pacific Edge Ltd

[blobbles]

The shareprice fell 20% on news of the rights issue. Granted, it's clawed a lot of that back, but can we now assume that the dilution is now priced in and we won't see a drop ex-rights? Opinions?

I don't agree, the price was heading down and the rights issue appeared to turn it around.

Digesting the information from todays release...

The purpose of the rights issue is to "boost CxBladder rollout in the US". What does this actually mean?

I am guessing they are going to do any one or more of the following:

1. Hire some more people especially sales people.
2. Build a new/extend their current lab. I believe they are more likely to put in a new lab on the West Coast, particularly now that they have signed agreements which if fully realised will fully utilise their current lab (and is probably why they had to get their Dunedin lab registered for US overflow).
3. Use the money for lobbying the big providers into agreements to stock/sell CxBladder
4. Do some sort of big road show where they go around convincing doctors of its benefits or hold an all expenses paid type conference for urologists.
5. Do a huge marketing campaign - doctor journals/television/radio, who knows?

[MAC]

I don't agree, the price was heading down and the rights issue appeared to turn it around.

Digesting the information from todays release...

The purpose of the rights issue is to "boost CxBladder rollout in the US". What does this actually means?

I am guessing they are going to do any one or more of the following:

1. Hire some more people especially sales people.
2. Build a new/extend their current lab. I believe they are more likely to put in a new lab on the West Coast, particularly now that they have signed agreements which if fully realised will fully utilise their current lab (and is probably why they had to get their Dunedin lab registered for US overflow).
3. Use the money for lobbying the big providers into agreements to stock/sell CxBladder
4. Do some sort of big road show where they go around convincing doctors of its benefits or hold an all expenses paid type conference for urologists.
5. Do a huge marketing campaign - doctor journals/television/radio, who knows?

Agree, when the market digests the news and appreciates the extent to which this capital raising will bring cashflow's forward and that it will further raise fundamental valuations, it will put even further upward pressure on the SP over coming weeks/months.

[benjitara]

The issue of rights will only effect the share price as much as shareholders believe the issue to be positive or negative for the company in the future. Yes it's in theory weakening the SP but this company has far to many positive avenues of direction than dead ends at the moment. I believe there will be some leaking of the share price by traders after the issue but the days of getting this stock at below $1 (excluding issue price) may well be gone for good.

[blobbles]

I see the big seller of the past few days was probably Harbour Asset Management...

https://www.nzx.com/companies/PEB/announcements/242778

Offloaded 2.8 million shares...

[blobbles]

Oh - for anyone who has kept up but not realised what their sales potential is, they now have roughly 17% of the US market covered in terms of POTENTIAL sales for CxBladder. That means POTENTIAL sales of 320k CxBladder kits, when they only have the ability to process 260k tests, within the US. Most likely they had to ensure that they could cover their sales potential, which means registration of their lab in NZ, which was done.

In light of that, I think it might be obvious what they need the extra $$ for. I feel it will almost certainly be used, at least in part, to either extend or build another lab in the US. Does anybody know if their CLIA approval is reliant on their ability to process a certain amount of expected market share? Or to be able to handle sudden pulses in demand? If so then it bodes well for expected sales.

[tunsbro]

Oh - for anyone who has kept up but not realised what their sales potential is, they now have roughly 17% of the US market covered in terms of POTENTIAL sales for CxBladder. That means POTENTIAL sales of 320k CxBladder kits, when they only have the ability to process 260k tests, within the US. Most likely they had to ensure that they could cover their sales potential, which means registration of their lab in NZ, which was done.

In light of that, I think it might be obvious what they need the extra $$ for. I feel it will almost certainly be used, at least in part, to either extend or build another lab in the US. Does anybody know if their CLIA approval is reliant on their ability to process a certain amount of expected market share? Or to be able to handle sudden pulses in demand? If so then it bodes well for expected sales.

I like your thinking.

[blobbles]

http://www.nzherald.co.nz/business/n...ectid=11144960

So that looks like $6.6 million for "operational expenditure" at their labs... lab extension anyone? Not sure how their Hersheys lab is set up, but its entirely possible they will just take over another floor or area in their current building if they need to expand.

I also like Davids comment on the $100 million revenue target: "It's a very doable target, and could come sooner". Generally I have found he says stuff like this when other people would say "We will definitely do that in less than the time stated.". So 2-3 years then?

[Nigel]

And more coverage on Larry Williams' Newstalk ZB show just now.

[barney]

PEDUSA’s sales force was on the ground at the start of July, seeking to build relationships with targeted LUG practices
•Several of these have now successfully completed their User Programmes and have made their first commercial orders

So it looks like some of the LUGs are now on board.

Found it hard to get a good nights sleep last night. It was a bit like being an exited kid on Christmas eve.

[Xerof]

I see the big seller of the past few days was probably Harbour Asset Management...

Was that them offloading at 49 last Thursday?