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clock Created with Sketch. 26/02/16
12:30
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Originally posted by cadrifter
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From what I posted on Yahoo --Let’s see if I can answer that question for you. The CFO stated in the Q4 FY 2015 EC “We expect that as a result of this initiative, R&D expense in fiscal 2016 is anticipated to decrease by 25% to 30% and SG&A expense by approximately 20% compared to the annualized run rate in the fourth quarter of fiscal year 2015. Importantly, these reductions for operating expenses will start to have effect beginning in the second quarter of fiscal 2016.” So that would reduce R&D to 47.5MM and SG&A to 26.4 on an annualized basis. If you take 13.5MM in revenue (using the revenue $$$ from 2015) and you subtract R&D and SG&A you end up with a loss for 2016 of 60.4MM. UNS has 20MM in the bank at the end of 2015 and if you add the 30MM from the AMGN note and 20MM from the AMGN license fee that leave UNIS with enough capital for 5 quarters give or take. As noted I’m using the same revenue from 2015. That estimate is of today. However under R&D UNIS is expensing their manufacturing plant along with staff. Part of the reason UNIS’s R&D exploded last year was because they were hiring for the plant. I estimate they have around 180 people involved in manufacturing. The reason they expense it under R&D because developing the manufacturing lines is considered R&D. As commercial scale product shipments begin to occur UNIS will be able to recapture those expenses through COGS (Cost of Goods Sold) hence moving a HUGE expense out of R&D. Over the next year R&D expense should significantly reduce while COGS will increase. This will have a big impact on cash burn. Their gross profit margin pays the SG&A part. I’m not looking including depreciation or the deferred interest payments to Orbimed. The finesse video posted on their site states that 30MM capacity will be available in 2016 and 100MM capacity will be available in 2017. That video was updated on 09/11/2015 after the MS review was announced. I believe those numbers were vetted by MS and most probably by AMGN. Even at 30MM UNIS’s cash burn will diminish greatly and at 100MM units they approach cash flow breakeven. There are also potential other contracts such as AbbVie that could provide more cash for UNIS over the next couple of years. There are ongoing programs as well that could supply additional cash. Hope this helps.
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Please note that capacity does not mean production. It only means capacity. No body pays for capacity. The company has in no way given guidance which IMO means production. So be careful with your analysis...it might just disappoint you. Have we not had capacity of 60 million for Unifill for a few years? And how many produced for COGS and not R&D?
