investor update , page-75

Been out all day - so missed the update.

All looks pretty solid to me. And most hot copperites (other than a couple of obvious exceptions) seemed to agree.

What I particularly liked was:

1. The substantial quarter to quarter INCREASE in US sales in what can only be described as a 'trashed' economy

2. Mexican import license decision in NEAR FUTURE

3. Russian sub-distribution agreements CURRENTLY being developed (note the plural - agreements)

4. Completion of MPS field trials and receipt of trial reports from cities by END OF MARCH 2009 (Trial completion date is new info, not included in SiYi announcement)

5. Bioscreens urine cup still on schedule

6. Oraline 8 development on schedule

7. Further Latvian Police orders EXPECTED

8. Probeline - commercial launch expected early 2009

9. The 'admission' that Oraline 8 was initially developed to address shortcomings in Oraline iv's suitability for roadside testing. (This is a 'telling' comment given SBN's renewed interest in finding a partner to address this opportunity).

10. Appointment of new research scientist "to concentrate on the launch of Oraline VIII and the development of NEW PRODUCTS IN 2009 AND BEYOND".

There was a bit of discussion about the China project timing. I think BBaron suggested that large volumes in China are at least a year off due to the requirement for lengthy approvals processes in the 2nd half of 2009.

In my view, this is a misinterpretation.

What is clear is that the field trials are expected to be completed by the end of March. At that point, the approvals processes are virtually complete - after 16 months (since Dec 2007) of close scrutiny.

I think the company is not entirely certain that the Chinese Government will provide final approvals in the Apr - June 2009 period (i.e. following completion of the field trials) and is saying 'second half' of 2009 to cover themselves.

I think there is a good chance of final approvals before the end of June 2009 (the MPS want to get on with it) unless something goes wrong in the trials that requires further adjustments.

The update needs to be read in conjunction with the recent SiYi announcement that said "at this stage, SBN anticipates that the final product approval will be received in the second half of calendar year 2009". It's not at all suggesting the 'end' of the 2nd half - it's any time from 1st July to 31 Dec).

The reality is that all testing and trials will be completed by the end of March 2009. How much time is required to approve/sign off the final paper work - especially when the main client is also part of the Government? Not much, in my view.