Excellent news from the AGM today.
https://nzx.com/files/attachments/197397.pdf
But they are STILL talking of profitable operation during this year. Yay!
But still ambiguous on some important fronts.
"our expectations remain for doubling revenue in the current financial year and a move to profitable operations during the year." Okay, some figures at last. Now a doubling of revenue by my VERY rough spreadsheet (do your own) suggests to me that that would make a profit before R&D, and amortisation and depreciation. So a talk of moving to profitable operations this year could mean: (a) my spreadsheet is wrong; (b) they know of costs and income I can't guess at (such as their contract work); (c) the words "move to" mean they will be there by the end, but not necessarily as a bottom line of the year; (d) they mean operating profit, not net profit; (e) ??
"Market access issues in US: previous inventory issues in US now resolved but North American sales not yet delivering to expectations." So does this mean the doors are open in the US again? Seems so. But now need to pick up pace again? "Resolved" sounds like things are ready to go again here?
"Current business strategy will lead to a much broader base of consumer product sales and include contract packing." This innocuous sentence strikes me as great news. This means the company should be much less vulnerable to setbacks, and compound growth should be the norm now? If so, then Blis finally achieved a safe future? Views on this anyone? Seems a pretty important question to me.
"BLIS has approval of its production facilities as a dairy exporter. Also need country specific approvals – such as Taiwan, Malaysia and China. China takes longer. Approvals completed for NZ and Australia." Again, what does this mean. On the face of it, sales could commence now in Australasia of food-related products. But then it did not say they would. Not sure what to take from this. However, Chinese approval not yet achieved. But then neither has Synl. got that yet, and they are sounding confident.
"The nutritional formulations are intended for Australasia and Asian markets." and "Products will include ice cream powders, yoghurt powders, beverage and functional foods." What are nutritional formulations? Does that just mean, "not tablets of Blis" or specifically food-related? Certainly bold target markets, but no idea of timing from this? Sounds imminent but is it?
"Sinopharm (the largest pharmaceutical company in China) is currently test-marketing consumer products with BLIS oral probiotics in 3 major cities through 30 pharmacies" 30 is good. And there is a photo of Blis very prominently displayed on a counter at one. Good partner to have, and they sound keen.
"Asia Pacific Partners is an important strategic partner with extensive business connections in Asia/Pacific and the Middle East. The first of their consumer products is close to launch." Close to launch? More news soon? Sounds good.
"New facility in the early stages of commercial production." Does that mean the factory is starting to fire on revenue? Or something else? Sounds like the former.
Bad news? None really, just that things have still been delayed?
Overall, this is a picture in line with my recent comments on compound growth. The company has got more channels in play now, and all channels seem to be doing just fine generally. China remains a slightly slow start, but obviously is still proceeding nicely anyway so far. The US appears to be open for business again (I think) but now has to regain momentum. Sales everywhere seem to be growing. New products. New markets.
All very rosy from where I'm sitting. Views?
And profit? Well, we still have to wait to see. The sales for the first 3 months have not propelled forward strongly, but we knew that the factory was awaiting approvals, that China wasn't really open yet and same US, so no surprise there? Seemingly those should be okay now or soon?
For profit update, we probably need to wait for the November update on sales. Hopefully they will announce Chinese approval before then, and maybe opening in new markets as well?
In general, the news continues to get better. Of course, some would say I'm always seeing the bright side! Nevertheless, I thought that sounded fairly healthy, all round.
Well done, Dunedin.
Discl: Obviously I own BLT shares.
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