BLT - Blis Technologies

[emearg]

One very interesting future development - I am sure I read that Blis referred to the application of K12 (or maybe it is a related strain of streptococcus) for treating skin infections (??impetigo maybe??) but I have not heard further about this. Does anyone have further information? If this proved successful there could be a huge market for this type of product.

It is Micrococcus luteus (Q24). They have a patent for it in NZ. They say it has potential uses in key topical applications. In the rights document in March 2009 they said "most of these developments are in the early phase of commercialisation, but they represent the future product 'pipeline' of the Company". Another of the developments they were referring to was S. Salivarius Mia (now branded Blis M18) and that started appearing in products only six months later so it is hard to know where this one is at. Gut feeling is it won't be here anytime soon as they don't have wide patent coverage and it isn't a food ingredient so it is quite different from their other two probiotics and will therefore need quite a different distribution model. But who knows?

Blis has made it clear that once they become profitable they will invest more on bringing other products to market. How long that will take is unknown. Whether they will succeed or not is unknown.

Until they announce a market is available and the first sales have been made I think it is best not to get too excited!

Check this out for a little history that shows many things that were planned haven't eventuated, and those that have have taken much longer than planned:
http://www.sharechat.co.nz/search.ht...s+technologies

The good news is that under Barry's leadership much more is happening, and it is happening much quicker...

It is good to know they don't plan on being a one product company. Or even two now that Blis M18 is getting going.

[brucea]

.... the power of Google ....for those of you who wish to read a scientific article update on S salivarius check out the link http://www.springerlink.com/content/1274504582628341/ Dated 21 Nov 2009, it costs $US34 to download.
I have downloaded the article this morning - very interesting piece at the end (quote) "The potential for application of BLIS producing probiotics which are available right now for the control of streptococcal infections, is immense. The bacterial interference approach to infection control can be applied to a wide range of common bacterial infections such as dental caries, periodontal (gum) disease, vaginal infections and acne. This natural approach to infection control is cost effective, easily implemented ...etc"

[brucea]

Thanks Emearg for the link ...esp to read about the heady days when Blis shares reached $2.20 ..if that happens again I'll be retired and lying on a tropical beach somewhere, sipping a cocktail and logging in to www.sharetrader to see what you guys are up to ....

[emearg]

$2.20 would value Blis at over 300 million. Taking the preference shares into account bumps the figure to a total of 470 million.

I'm not holding my breath :-)

[simla]

So the upper limit of your profit forecast for the full year is "less than $20m", Emearg! At a PE of 15, $2.20 would be reached with a profit of about $20m on the existing 138m shares.

In my printed copy of the Notice of Special Meeting for 8 November 2007 about the rights issue (I can't find a copy on the internet), it says on page 16, under "Future Direction of the Company", "to achieve an annual turnover of more than $25m within the next 5 to 10 years." Well, nobody could possibly hold them to such a vague objective, of course, but it does illustrate that the company thinks big numbers are possible. They just turned out a half year revenue of $1m, but there isn't any suggestion of slowing down, rather of just beginning.

I read something about the investor John Templeton once. He had congratulated himself on selling his $1 shares for $5, only to watch them go to $100, as I recall it. Brucea, perhaps when you log in from your tropical beach, will you be wondering why you sold out at $2.20!

As always, though, we must wait for the future to see what Blis's actual potential is. Fun to think big numbers, but we're nowhere near that now. Some readers will be cross, correctly remembering for how many years Blis investors have been imagining bright futures. Are things finally coming into line? And what revenue levels are actually possible in the end? Only time will tell, as usual.

[emearg]

So the upper limit of your profit forecast for the full year is "less than $20m", Emearg! At a PE of 15, $2.20 would be reached with a profit of about $20m on the existing 138m shares.

In my printed copy of the Notice of Special Meeting for 8 November 2007 about the rights issue (I can't find a copy on the internet), it says on page 16, under "Future Direction of the Company", "to achieve an annual turnover of more than $25m within the next 5 to 10 years." Well, nobody could possibly hold them to such a vague objective, of course, but it does illustrate that the company thinks big numbers are possible. They just turned out a half year revenue of $1m, but there isn't any suggestion of slowing down, rather of just beginning

I suspect their profit will be less than 20 million. Approximately 20 million less actually...

2007 was a long time ago now. The only have 2 -7 years left to achieve that goal. Big difference between that revenue and making enough money to justify a share price of $2.20. And of course by the time revenues are anywhere near that target the preference shares will have converted into ordinaries meaning the profit will need to be even greater to achieve a PE of 15.

Anyone else listening to Matinee Idle? I keep expecting them to play California Dreaming for some reason?

[simla]

Fair comment, of course. But consider this history of aspartame (nutrasweet). It is of course one of the all time top selling ingredients ever, and even my optimism doesn't come close to Blis doing this well, but it is nevertheless illustrative of how ingredients are a bigger market than they might look.

http://www.fundinguniverse.com/compa...y-History.html :

"Aspartame was discovered in 1965"
"aspartame finally received FDA approval in 1981."
"Sales of aspartame reached $74 million in 1982, when Searle decided to create the NutraSweet brand name."
"The big money in sweeteners was in low-calorie drinks, however, and Searle received approval to include aspartame in carbonated beverages in 1983."
"In the meantime, Searle worked to increase aspartame production, which could not meet demand anyway. In 1983 construction began on a $100 million aspartame plant in Georgia."
"Sales of low-calorie powdered drink mixes using NutraSweet were booming as the entire diet foods sector grew dramatically. "

"When it created the name NutraSweet in 1983, a logo--a red and white swirl--was designed to go along with it. Searle spent $40 million advertising NutraSweet, and got food manufacturers to display the NutraSweet logo on products that used it. The trademark demand was initially unpopular with retailers of products made with Nutrasweet, though some changed their minds when they found that promoting NutraSweet as an ingredient increased demand for their products. Searle's initial ad campaign focused on the number and variety of products that used NutraSweet and the fact that they displayed the red swirl. The move was partly designed to put pressure on soft drink manufacturers and others that used a blend of NutraSweet and saccharin. The firm also wanted to lock up the artificial sweetener market for NutraSweet before its aspartame patent expired in 1992.

"NutraSweet sales amounted to over $700 million in 1985."

Of course, this was a product whose time had most assuredly come, and with serious money behind it. But it does illustrate that ingredients can quickly grow in market size. And interesting, too, that Blis don't seem to have missed any of the morals in this story. Of course, it was a different product, different times, different financial backing (but "Frutarom sales in the third quarter of 2009 totaled US$ 111.6 M", a few posts back?)

Now I'm not personally expecting Blis to reach these very heady heights, as nutrasweet is a very special product indeed, but it does nevertheless seem to illustrate that there might be quite a bit of room for growth yet? Apologies to those long suffering shareholders for whom such optimism seems just a huge tease. It may be, but the Blis story has a long way to unfold yet from where I'm sitting. We'll see.

[simla]

In case anyone takes this optimism too much to heart, I remind you that I also think 2010 (at least) will probably be a very challenging year for the world economy, and therefore for any company trading in it.

[Cannibal]

Video here on K12. It's a bit dry but informative. The speaker is from Frutarom.

http://www.ihealthtube.com/aspx/view...1363f72e1bb865

More vids here -

http://www.ihealthtube.com/aspx/search.aspx?s=k12

[brucea]

Blis is one of the few shares that I follow that is really interesting, but I wont be too worried if the share price does not reach it's prior highs! I think the future prospects for skin creams for acne and skin complaints is very exciting. I still have this hunch (nothing more) that the share price might reach the low 20c region by the end of 2010 - so plan B might be a case of a diet coke at Mission Bay for me instead of the tropical beach setting ....