Ann: Quarterly Activities/Appendix 4C Cash Flow Report, page-6

Okay first off

- a tick again for the early 4C

- another tick for being Cash flow positive, although I suspect that this was to more to do with the timing of inventory purchases than anything else, but it shows that the company is close to it going forward - if it can increase its sales abit ... maybe $0.3m - 0.4m a quarter could do it. Even without the timing adjustment for inventory they were pretty much cash flow positive this quarter.
" ....The Company experienced a quarter over quarter reduction in raw material purchases and production related costs of US$0.3M due to timing of raw material purchases..."

- I think also another tick for (lack of a better word) "honesty" - for example I appreciate the note about raw inventory purchases above, and also the timing around the US Marines uniforms

I get a sense that the new Financial Year 2023/24 could hold solid promise for the company - if the economy and mattress sales don't worsen further ... and even if they do the new wins should more than offset any potential decline
" ...potential revenue dollars have sharply increased ..."
" ...I am pleased to report that the Alexium team is well-positioned for growth ..."

There's certainly alot of potential coming thru in this new year which should allow them to maintain cash flow positively on a regular quarterly basis

Alexicool®/BioCool® – Bedding
"Q4 marked an uptick in PCM sales to OEM manufacturers ..... Sales were up 11% over Q3.
"The company is in the final stages of trials for its first two placements of Alexicool®/BioCool® products in Europe. Shipments for both are scheduled to commence in Q1 FY24."
"The company also secured two new customers in Q3, both of which are applying our products to foam bedding products.
"New product developments are in late-stage development that will further expand Alexium’s portfolio of PCMbased products. This will allow Alexium to secure new business in foam applications, ..."

DelCool™ – Bedding:
" ...currently working on four active product development projects with four major bedding brands. The projects are for three mattress brand builds and an additional pillow placement for a large national retail chain"

Eclipsys™ – Bedding:
"... the long-awaited Eclipsys™ adoption by a major bedding brand .... remains on track to launch in Q3 FY24 commencing with low initial production rates in Q2 FY24 which then ramp up to full rates at or around launch."

FR NyCo – Military Uniforms
"....participated in a federal request for quotation (“RFQ”) for the US Marine Corps in Q4. The RFQ was for production scale goods of flame-resistant fabric for a next generation fabric at a price point that would afford the Marines adopting it across all enlisted personnel"

Eclipsys™ for Tactical Gear:
"...work and momentum continued throughout Q4 with new orders starting in earnest for one tactical vest customer. The new customer started production of vests with Eclipsys™ in Q4, with the initial sales volumes of the vests to go to retail customers, mostly in e-commerce. We are working with that customer on large-scale international military and federal police tactical vest placements."
"Alexium has added a sales agent in Europe to develop opportunities in the European, Middle East, African and Asian markets and that addition has already led to multiple new opportunities."
"Product development and testing efforts continue with two additional tactical vest producers, both of which sell large volumes to law enforcement and civil servants."

Outlook – FY24
Alexium remains focused on delivering profitable results. The team will utilize contracts to secure supply terms with both customers and vendors. New external legal counsel has been retained that is focused on supporting management in negotiating favourable terms.
"The outlook for the 2024 Financial Year is bright .... with potential for some large new projects in the 2024"


Could 2023/24 mark the turning spot for the company? - I think it could ... there's enough above for the company to turn cash flow positive on an ongoing basis and perhaps as the company has noted ... deliver profitable results. If they can do this in 23/24 and stop the cash drain and instead increase their cash position ... then the 24/25 looks potentially stellar if a Military contract for uniforms is won.
The Marines or Army and potentially both would be a huge win and change the valuation of this company around to multiples of where it is now.

on a final note - the company seems more disciplined now - particularly around its commercial arrangements