Volume Based Pricing Alexium’s Alexicool product was a strong...

Volume Based Pricing Alexium’s Alexicool product was a strong driver for the increases in revenue and gross margin dollars throughout the last year. In order to win these large orders and compete with competitors in the space, Alexium offered some volume based pricing to certain large customers. This had a short-term impact on revenue dollars but has opened doors for Alexium to compete for business outside of its original offering into the treatment of foam.

Product Manufacturing and Operating Costs Raw material purchases and manufacturing expenses drove the 13% increase in payments, and will position the company to fulfill increased customer orders in the coming months. The increase in purchases and production correspond to the balance of inventory on hand at the end of the reporting period which was up 15% at the reporting date. The accumulation of inventory, which was forecast in the previous quarterly report, will support the increased demand for Alexium’s specialty products in the coming quarter and drive gross profits as margins continue to increase.

This in part would explain why revenue was down. We are now supplying to the higher volume lower revenue market.
Which gets our foot in the market. Hence the increase in raw material costs.

Nothing new on this 4c that we were not informed about leading into it. I will now be in the cue for some more " In for a penny in for a pound".

Have a great day all.