annual report and advertiser article, page-4

The way I see it PPY have two ways forward.

Method 1: A deal of some sort- the only one that seems likely is the Egyptian deal, probably some Egyptian mates of Ramy. There would need to be significant cash payment to keep PPY afloat in the meantime. Cash burn is about $1 million a quarter before you look at substantial capital outlays on new machines. (Ramy gets 300k pa in wages on his own!!). The deal needs to be quick as there is only $1 million cash left so they will be flat broke in February- and no cash spend to access the engineering matching grant.

Because the Beta machine is such a lemon, I dont know how they can inspire a good deal without proving the technology actually works by building a better gamma machine, but I dont know how they can build a new machine without the money.

Method 2: a substantial capital raising to get through 2012. With the current share price malaise I predict say 20 million shares at 10-12c and the share price trending down towards that level. An extra $2 million would get them a shiny new machine and hopefully a viable process------ and a deal????

Im not holding my breath however. Sales revenue of $2,500 for the quarter in total is hardly inspiring! Furthermore stock on hand figures remain laughable. There is 1396 m of material at 30 September compared with 600 sq m of material on hand at 31 August (from last newsletter). So a net increase of 796 sq m of material (less Sept sales if any) which is a piddling amount really- probably several MINUTES of production (yes I said minutes).

Total stock on hand in SURFACE AREA equates to 45 reams of A4 office paper.think of a stack of 9 x 5 ream boxes of office paper- theres more than that stored next to the photocopier where I work! Of course the banana ply is thicker than office paper and takes up more space but you probably get the idea.

They also claimed to have sold 965 sq m in August (Q newsletter) which presumably contributed to the Q3 sales of $2,511. If they sold nothing more (so we get the best price we can) you can value the stock on hand at a massive $6000. WOW. (The June 30 Balance Sheet has a no inventory / stock value included)

Aaaaahhhh I had such high hopes for PPY, oh well..