PIL
28/08/2015 16:38
HALFYR
PRICE SENSITIVE
REL: 1638 HRS Promisia Integrative Limited
HALFYR: PIL: Half Year Unaudited Accounts 2015
REPORT OF THE CHAIRMAN AND CHIEF EXECUTIVE
Market Developments
Sales in New Zealand are exceeding budgets and growing. There has been a
large increase in the average monthly sales since May 2015 when the company
announced the positive preliminary clinical trial findings. Sales of the
company's flagship product Arthrem(R) have increased by more than 150%
compared to the previous 12 month average monthly sales.
The company has had some sales success in the United States but is awaiting
publication of its clinical trial results before embarking on a concerted
public relations campaign. The US e-commerce platform is fully operational
and a soft launch in June exceeded budget. Promisia is testing various
offerings in an effort to determine the most effective sales strategy. The US
market represents the greatest opportunity for Promisia to increase revenues.
The market is approximately 90 times larger than New Zealand and it carries
with it a higher level of discretionary spending.
Promisia respects the size of the market and has developed a path to market
that will not drain cash. Through its automated e-commerce platform all
forms of digital marketing can be measured and resources directed accordingly
so that the cost acquisition of each customer produces the best return.
A launch into Australia as a complementary medicine will occur towards the
end of 2015 once the clinical trial results have been published.
Each market has different regulatory requirements and making sure that we
comply with those market requirements is a key part of any product launch.
Specific market regulations can actually assist a product launch if executed
in a careful and disciplined manner.
Half Year Results
Promisia Integrative Limited recorded an unaudited EBITDA loss for the six
month period to 30 June 2015 of $504,000 and net loss of $575,000, including
interest and an exchange loss on translation of foreign operations.
One off costs which contributed to the loss consisted of:
- A randomized, double blind clinical trial
- Production costs of TV ads and other digital marketing collateral
Research Update
The company achieved a number of significant milestones during the period
under review. In January, Promisia announced the publication of an article in
a peer-reviewed journal confirming that the primary ingredient of Arthrem(R),
Promisia's proprietary extract from the plant Artemisia annua, had potent
anti-inflammatory activity in-vitro.
On 28 May 2015 the company announced positive preliminary findings from its
randomised, double blind, placebo controlled trial conducted at Otago
University. Associate Professor Simon Stebbings, who oversaw the trial, will
present the findings at the New Zealand Rheumatology Association's Annual
Scientific Meeting in Queenstown in September. The trial investigated the
efficacy and safety of Arthrem(R) for managing pain, stiffness and reduction
in physical function associated with osteoarthritis of the hip and knee. The
clinical trial results will also be submitted for publication in a
peer-reviewed journal.
Outlook
Arthrem(R) is currently capturing 1% of the potential market in NZ and is
expected to secure 3% of the market in 2016 growing to 5% through 2017.
Proceeds from this market growth alone will mean the company achieves a cash
positive position by the 4th quarter of 2016. This is a major milestone
considering the large investment the company makes continuously into the
scientific research required to back its products.
Any company can pay a celebrity to endorse their product, but very few can
actually make substantiated claims backed by robust scientific research. Our
company's growth is built on a sustainable model supported by credible
research.
Promisia also has 3 new products in the pipeline for launching in the next 12
months and looks forward to announcing them to the markets as soon as they
have been through the same rigorous scientific testing as Arthrem(R).
The Board and management share a common vision and are excited about the
company's prospects. We look forward to reporting on further substantive
progress in the second half of the financial year.
Capital Raising
In order to implement the company's marketing strategy, a capital raising
will be undertaken. Details will be released shortly.
For further information please contact:
Mr. Charles Daily, Chief Executive (04) 894 8524 or
Mr. Malcolm Johnson, Chairman (04) 479 3377
ENDS
End CA:00269300 For:PIL Type:HALFYR Time:2015-08-28 16:38:44
