I apologize if some of this has already been posted but this is my summary of what transpired today: Unfortunately because of work pressures I don't have the time to read all the comments
For the record I was disappointed by the sales recognized during this quarter. Revenue for the first quarter of Fiscal Year 2015 was $3.4 million, this was later changed to: Revenue for the first quarter of Fiscal Year 2015 was $1.4 million. Deferred revenue was $15.6 million, which is expected to be recognized within 24 months.
Then I listened to the earnings conference, everyone who invest in UNIS should do the same and Alan said: "Today, our discussions are about the multiple cornerstone commercial supply deals we have already executed.Each one of these deals can sustain a company on its own. They have already started to generate revenue"
Then he spoke about the Sanofi agreement and added:There is significant upside to this agreement. Based upon conservative industry assumptions, the average molecule at commercial volumes is expected to require a nominal five million wearable injector units per year. It might take an average of three years for a drug to reach peak commercial volumes after its approval and launch. We expect to generate approximately $50 million in revenue from customization programs across the five to 10 target drugs. (Note: I am using selective quotes from his discussion, read the whole report if you want to hear/read everything). So in summary, that's an estimated five to 10 biologics, five million units per year per drug, an ASP per device of $25, exclusive supply for all applicable drugs over a minimum of 15 years plus additional meaningful revenue from customization programs and preclinical and clinical device sales. This is a contract that can extend up until 2024, with a minimum 150 million units per year to be purchased after a four year ramp plan.
the second deal Hikma will purchase a minimum 175 million units per year after the initial ramp plan.
In addition to Sanofi and MedImmune, there are several other wearable injector programs that are either already underway or about to commence. We expect many of these programs will also accumulate in long-term supply agreements.
The average customers have between several to a dozen or more molecules in their pipeline that will require wearable injectors. Many of these drugs will end up having more than one indication. So you should not be surprised if some of these upcoming agreements are of similar magnitude to those we have already signed. Some may even be greater in size.
"Based upon the minimum unit volume requirements under the agreement with Sanofi and Hikma alone, we are scaling up over the next few years to have a manufacturing capacity of at least 400 million Unifill syringes per year."
There are other deals they are working on but are not finalized
"We are on track to generate at least an additional $30 million in cash receipts from customers during the final three quarters of fiscal year 2015 and these are programs which are already committed to.. There is significant upside potential beyond this range as we look to finalize a number of additional new agreements between now and the end of this fiscal year."
"In summary, we continue to execute in all areas. Year-on-year revenue will increase. Losses will narrow. Sales will accelerate. Production capacities will expand. Deals will continue."
from the Q&A
But I can tell you, when you look at the blended picture, you can see the beginning of that ramp significantly and meaningfully in 2016 and beyond.
The reason why we can generate such attractive operating margins, expected north of 40% blended is because it's really the uniqueness of our business model and the annuity type of business that it is. Such as with the agreement with Sanofi for a 15 year contract, our sales and marketing costs are pretty much negligible. We have got that deal in the back pocket now. But I just want to reiterate, we will never rely on the contractual obligation of our customers and accept that we have that 15 years just locked in. We will continue to outperform our customers' expectations and that's how we will continue to grow our business. But the operating margins can be rather attractive because of the uniqueness of our business model.
The covenants on the amended agreement with OrbiMed is $20 million by the end of December 31 cash receipt. We have already basically got $18 million of the $20 million for this year, and we are very confident we will have no problem with those covenants. After the results were announced I bought a 1000 shares at $3.50 and plan to buy more, finances permitting, if the stock drops further. I expect some profit taking but as I have said before this is a buy and hold stock. I plan to keep this, at least through 2020 http://seekingalpha.com/article/266...l-on-q1-2015-results-earnings-call-transcript
I am a bigger believer now than I was before the investor conference call but I do expect some volatility during the next week as some profit taking takes place. However, I will be a buyer of this stock at 65 cents Aussie and plan to retire by 2020 on my UNIS UNS investment alone!! This is a Disallowed plus stock
As usual my 2 cents but please do your own due diligence.
