I agree with you, that on growing only the existing markets, we could still be tracking towards a loss but I don't agree with you that Alexium needs another Alexicool to pull off a profit.
Firstly, with your back of the envelope calcs, you estimate $29 million in revenue. However, if you extrapolate the June quarter out to 12 months, Alexium is already at rate of $27 million revenue for the year. So I think your $29 million estimate is a bit low.
Secondly for your calculations, you calculate a $10 million GP, but mention that the loss will still be in the teens? This is completely incorrect as total non-operating costs were only $12.5 million this year, so using your calcs the loss should only be roughly around $2.5 million.
Next as to your revenue assumptions, the revenue from Pegasus will be starting from this half of the year. Company has stated this is worth $10 million in revenue per year, you can add however much discount you want to their estimate but imo they should at least achieve 50% of that this year.
Secondly there's the license deals for Alexiflam. The company says there is interest after they've improved the product and that the potential there is greater than Alexicool. Take all that with a grain of salt as there is no deal yet, but the product has already developed, no need for Bob to pull any rabbits out of the hat.
With just those two alone there's potential to grow revenue more than the $29 million you are assuming for next year.
AJX Price at posting:
44.0¢ Sentiment: Buy Disclosure: Held
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