BLT - Blis Technologies

[psychic]

.....always a tough one NQ, as per usual it's up to the market to decide that.....but if sentiment continues to swing positive then so should the SP. It has traded a few times above 3c in the last couple of years and significantly higher (7-10c) going back 5yrs. Personally I believe that based on this current news and now solid prospects the company should value out at a Market Cap of $35m plus (equal to 3.5c plus per share?)...which aint much for a Listed co. of any size or sector......let alone one tracking north nicely thank you very much?

So Revenue 100% growth in 2015, they say min 75% 2016 (but Q1 113% up on same period last year so think being typically conservative)

Hard graft done?
Distribution sorted US and EU and enjoying strong sales
Good mix Consumer products and ingredient sales
China - Sinopharm in commercialisation stage. Testing market launch, addressing access issues. But once there , this bit could fly -yes?

Patents in place, so barriers to entry.

For arguments sake:
-Revenue multiple of 10 on 2015 Sales - would give $26m m/cap
-on conservative 2016 est revenue m/cap $46m,
-your $35m nicely in between Gr8day. They've spent about that much getting here so why not?

[GR8DAY]

.....thanks PSY, yes your figures dont look too far wrong. So conservative sales for 2016 are looking like around $100k per week now.....not too shabby but not before time. Profit cant be too far off now surely? I agree with previous poster in that sales t/over revenue are now growing exponentially and combined with a lower dollar, the prospects for returning a profit to shareholders must surely be increasing exponentially also!!?

[Arthur]

In my opinion the Canadian announcement is very significant. It allows them to make claims, not just waffle about how it might help. As far as I know this is a first, the regulator would have looked at all of the evidence before granting this status. If Canada gets to use the product with the same market share they have in NZ the company could be quite profitable. If other countries climb on board as well we could run out of tax losses within a few years. The FMA/NZX regulators have many companies running scared about making announcements at meetings and not directly to NZX first. I expect more frequent NZX announcements.

[simla]

What would you say was a fair price given the current information available?

I think the answer is completely psychological at this point. If the thrust of this news comes true, we might hope for a transition to PE pricing over the next year or two, but there is no guarantee of profit yet. But even then there would be no guessing what PE might be in use. Until then, I think people can only guess. Of course, people could forward project their growth estimates and then use the gross margin and assumed PE to arrive at a price in 2 or 3 years, then discount back. But I doubt anyone is doing that personally.

But I don't personally think any mathematics can provide any real certainty at this stage. How long is a piece of string. Until regular profits appear, the price could be anything. Of course, we'd all like to know the answer!

[simla]

In my opinion the Canadian announcement is very significant.

Completely agree. My understanding of the Canadians is that they will like this sort of product and health claim. Very interesting to follow.

Also, did people notice the BK18 product in the presentation (p5), which I found here. http://www.globaltreasure.com.ph/bk18/ Also here, http://bk18.weebly.com/our-product.html

"Just add water", so it contains dairy ingredients and as such is surely a genuine functional food with Blis? (Or it seems to be dairy, the blurbs are so new that they aren't 100% clear on that.)

"Your Success Starts with BK18™ – Every Morning."

"The development of BK18 has resulted in the most nutritionally bioactive powdered drink available."

"BK18 has been developed to build strong and healthy bodies for children while providing optimal physical and mental health, stamina and performance for adults who lead busy lives. We developed the BioKinetic activity in BK18 for serious people, who need energy and stamina throughout the day and simply can not afford downtime due to illness or being unwell. BK18 has a nutritional profile that would allow for it to be used to supplement the daily diet or replace a meal such as breakfast. [my stress] Taken daily; BK18 is Guaranteed to Build, Protect and Optimize one’s health and the health of the entire Family – We call it “BPO” to Build, Protect and Optimize."

The Contact page lists Philippines, Malaysia and NZ. It seems to have just got off the ground, so I suppose we shouldn't expect too much traction on this for the next year. Looks promising though, and good to see functional food getting up some speed.

[blissfool]

In my opinion the Canadian announcement is very significant. It allows them to make claims, not just waffle about how it might help. As far as I know this is a first, the regulator would have looked at all of the evidence before granting this status. If Canada gets to use the product with the same market share they have in NZ the company could be quite profitable. If other countries climb on board as well we could run out of tax losses within a few years. The FMA/NZX regulators have many companies running scared about making announcements at meetings and not directly to NZX first. I expect more frequent NZX announcements.

A good day for a company with a great product and a solid plan. Some would even say a great day for a company who has traditionally underwhelmed. Interesting to see that the market factors in false starts, something blis is notorious for. A continuous improvement on the gains made in recent years. Well done Barry and the board, I think they are now a good balance of industry savvy and business skills.

Great to see you back Simla

[simla]

Well, thanks Blissfool.

I chewed over that news overnight, and it seems to me to boil down to this: we might now reasonably assume (but not know) that Blis does indeed have a trading future now (and that would be for the first time that we might assume that up to now, I would say) but we still have to wait to find out how good a future.

By predicting revenue to "comfortably exceed $4.5 million" (press release) while also expecting operating deficit in EDITDA to "largely be eliminated" this year (presentation) we might assume (but not know) that somewhere around 4-4.5m is breakeven. Why only assume that breakeven? Because the press release said there are one-off costs in the current half year. That implies two possibilities. Firstly, that the breakeven is lower than that, depending on how big the one-off costs are. And secondly that the second half could actually be a profit - because if one off costs lead to a neutral EBITDA then wouldn't that imply that it would actually be positive except for the one-off costs, in which case the second half (without those costs) could be positive? And also a neutral whole year with a negative first half would mathematically seem to require some sort of positive second half? All just guessing, I'm afraid.

But yet, even if we assume all that positivity, where does that get us? Well, reported revenues for 2014 and 2015 were 1263k and 2523k. Now we are looking at at least 4500k (if it happens). If that trend continues, then obviously we are looking at some pretty impressive possibilities. But were those just "recovery" figures after the problems stemming from 2011/12? Will that rate of growth now evaporate and slow down to a mild growth rate again? Or, more positively, does all of this indeed finally represent unimpeded growth in many markets at once, and therefore a very promising future?

Unfortunately we cannot possibly know without the passage of more time - as I see it anyway. Every half year report will be interesting now though. So, great news, but I'm not sure we're a lot wiser as to the future yet?

[GR8DAY]

Kiaora Simla and thanks for your input as per usual......I was beginning to think you had abandoned this ship completely ........so great to find you are still onboard. The more of us to debate, examine , encourage and now get excited with......the better in my opinion!

And on that note I do wonder (with the greatest of respect) wether you are now erring too far on the side of caution......and Im referring to the business prospects and growth forcasts etc.... Sure no-one knows 100% what lies ahead, but that can be said for any company cant it? I personally can see nothing but strong compounding growth ahead now for BLIS. I say that with all sincerity as we have seen this come together now over many many years......without any question I believe the time has arrived for BLIS as many factors have finally lined up and while this continued growth factor is not guaranteed......Im certain it's inevitable, all things being equal. We have now experienced at least 3 yrs in a row of what can only be described as exponential growth and if this was to continue (albeit at a slow downed rate).......a $10,000,000plus turnover may come about sooner than some here expect.....maybe within 3 or 4 years?? I do believe that by the very nature of the product alone ( unique, world first in the health industry), and the simple fact that people talk and like to share positive health related stories......this will come about. "Word of Mouth" (pun intended) advertising is a powerful thing and FREE!!

I dont think Im alone (in fact clearly Im not) in stating my well founded optimism and look forward to a strong and exciting future through sustainable growth.

Anyway that's how I see things at present......so lets get behind our directors and encourage them to maintain this ships mometumn....full steam ahead!!

[simla]

Hey, I'm always cautious Gr8day - I can't help myself! But take your $10m turnover, which I agree is a plausible possibility under current news.

Great news for the company because it would surely represent good positive cash flow, and thus a pretty secure future. Let it happen.

But for shareholders, take away overheads, reduce by gross margin and tax, and then divide by 1.1 billion shares ... well, I think we'd be happier to sail beyond 10m if we could. But I don't think we have enough information yet to judge what might happen after 10m, we're not there yet, so I remain unsure. That's all. More half year reports will help me. Or a dividend, but that may be a while yet! I'm not expecting bad news, just being unsure of a still unknown future. That's all.

[psychic]

Completely agree. My understanding of the Canadians is that they will like this sort of product and health claim. Very interesting to follow.

Also, did people notice the BK18 product in the presentation (p5), which I found here. http://www.globaltreasure.com.ph/bk18/ Also here, http://bk18.weebly.com/our-product.html

"Just add water", so it contains dairy ingredients and as such is surely a genuine functional food with Blis? (Or it seems to be dairy, the blurbs are so new that they aren't 100% clear on that.)

"Your Success Starts with BK18™ – Every Morning."

"The development of BK18 has resulted in the most nutritionally bioactive powdered drink available."

"BK18 has been developed to build strong and healthy bodies for children while providing optimal physical and mental health, stamina and performance for adults who lead busy lives. We developed the BioKinetic activity in BK18 for serious people, who need energy and stamina throughout the day and simply can not afford downtime due to illness or being unwell. BK18 has a nutritional profile that would allow for it to be used to supplement the daily diet or replace a meal such as breakfast. [my stress] Taken daily; BK18 is Guaranteed to Build, Protect and Optimize one’s health and the health of the entire Family – We call it “BPO” to Build, Protect and Optimize."

The Contact page lists Philippines, Malaysia and NZ. It seems to have just got off the ground, so I suppose we shouldn't expect too much traction on this for the next year. Looks promising though, and good to see functional food getting up some speed.

Thanks for highlighting this Simla. Agree - "meal in a drink" a successful and growth concept - just look at Sanitarium and their "up & go". So not new, but is this the first to include probiotics? Clever idea, particularly if it can be produced and marketed at the right price.

Have to wonder why the likes of Fonterra haven't come up with it - I'll ask. Particularly given the flak they have recently taken about not value adding. I mean, some whey protein, BK18, flavouring . All you need to get going I imagine.

Instead, it is this Global Treasure NZ marketing it. Here's a wee vid with NZ Director Washington-Smith, talking about Blis and MK18

https://www.youtube.com/watch?v=TN5pZexaYkI

So, GTNZ. and presumably GT Phillipines and GT Malaysia, now owned by a couple of Malaysian dudes. Washington-Smith of Palmerston North had a shareholding, but no more. Registered address of GTNZ is Grant Thornton Accountants - another GT. Coincidence or maybe they just never got around to changing a shelf Co name. Too much detail sorry, but I was interested in who GT were.

Trusting that there is nothing exclusive in the deal with GT. Clearly they need to run with the big boys with this. Even something the the A2 guys should be going with .

Potential for Blis well understated I reckon.