Company websites mentioning use of Zoono, page-1871

I suspect we were overly optimistic and extrapolated a quarter where they were significant inventory fill by new distributors signing up (4Q FY20) and they were making large initial purchases. Some never reordered. EHH for example and many distributors who coughed up an order upfront but never established their own channels to sell the product.

Market expectations of $15m (broker consensus was $13m) for Q1 was spot on. The market is wrong at times but has proven good at humbling us too.

The current quarter is likely more reflective of the current sales run rate of the business. We know Amazon, UK trains, airports etc are now established clients that reorder regularly. This is corroborated with 3rd party evidence via social media etc.

United airlines has probably not commenced their ordering yet.

The pipeline is likely solid off the back of the United win so there’s scope for optimism. Zoono is also only 3 months in after taking over the US operations. But regulatory approvals may take time - they are slow.

In summary this quarters results has no doubt been difficult to swallow even for many investors with a longer term mindset.

I’d be more cautious going forward to assume that more clients on social media translates to significantly higher sales. This is partly because the product is so efficient, clients don’t need to spend much to get results.

For context, the 600 pharmacies that Canada has recently won would equate to only ~$200k per year based on usage rates assuming 200m2 per pharmacy.