I love the general positivity that is being maintained by the OBJ Shareholders here on HC. It is definitely a positive that revenues are beginning to flow from P&G but I'm sure that the numbers (even with late payments included) must continue to disappoint. They are certainly a far cry from the hyped-up millions (or hundreds of millions according to some) that were predicted almost four years ago. The fact remains that this financial year OBJ will remain cashflow negative. There are no guarantees that this sad situation will alter in FY2019. Is OBJ still a fledgling company? After years of "promise" the economic fundamentals indicate that this company is STILL grossly overvalued. At an SP of 3.7 cents this company has a Market Cap of over $70 million. OBJ has had over four years to justify its inflated Market Cap but has yet to show any signs of demonstrating any justification in the foreseeable future. Frankly, I am amazed that the SP has held up as well as it has - there is no doubting the patience of existing Shareholders. Will that patience be rewarded? Well, not this year.
This thread title, "encouraging report", is indicative of the rose-tinted attitude maintained by the faithful. Perhaps I read things differently but I find it far from "encouraging". As usual it is full of "discussions", "trials", "potential revenues" and hints of "going-it-alone". The fact that the "exclusive sectors" have been "released" back to OBJ smacks of rejection. It is worrying that the rejected sectors include hair care and shaving products, especially given the speculation about the HUGE potential discussed ad nauseam here on these threads. Ominously, there is no longer any mention of dental care, another sector that was supposed to make Shareholders into millionaires. But of greater concern must be this: "This has been negotiated as part of the Company’s strategy to develop its own products for Distributors to the market." Really? With no profit likely for some time and only $4.7 million in cash how is this development and distribution going to take place? It will need a substantial injection of cash to enact this "strategy" so expect another CR if that is the direction in which they are headed. Furthermore, if P&G have rejected, sorry, "released", these sectors what makes the board think that they are better than P&G (with its global reach) and can produce "far greater potential revenues to the Company" if they produce and distribute products themselves? It really looks like the board is running out of ideas.
As for BodyGuard/BodyCare, I think the "encouraging report" says it all (nothing!!):
"The above trials demonstrate the intention of the BodyGuard/BodyCare product range to deliver a wide range of active ingredients to service the raft of market sectors that exist for the overall program using multiple distribution channels. In the coming period, meetings are expected to take place in Melbourne with OBJ’s manufacturing partner with regard to intended next steps. The partner have first right of refusal to manufacture and a non-exclusive right to distribute BodyGuard products via the Collaboration Agreement executed in 2017."
BodyGuard was another area that was going to produce millions in revenue, however, there seem to be more discussions, trials and "partners" in the mix. Same old, same old. The same can be said for Surface Hygiene.
So, how one can conclude from this update that it is an "encouraging report" is beyond me. The so-called updates about new product developments are hardly an update at all. All of the first part is just existing information as far as I can see. The rest simply contains elements that should be of great concern to Shareholders. On a positive note I do believe that P&G revenues will show moderate increases that will make OBJ cashflow positive by 2020 but it is a very uneven relationship OBJ has with P&G. If sales begin to slip then P&G will drop the OBJ technology a lot quicker than it pays its bills (valued partner awards notwithstanding). This "encouraging report" almost appears to acknowledged the poor deal OBJ is getting from P&G....the rhetoric suggests that the board seems to think that going it alone is the strategy of the future. Does this board have the necessary skills to pursue such a strategy? I doubt it. GLTAH.
Expand
(20min delay)