Cxbladder royalty (PEB HY result), page-2

Promising revenue growth from Pacific Edge Osi, although your calculation of Cellmid’s likely royalty share may be optimistic.

Of the $1.598 million revenue reported for the 6 month period, only $1.011 million is operating revenue (up from $100K the year before). The $587K remainder is described as ‘Other (including interest and foreign exchange gains)’, which should not relate to Cellmid.

Note 6 to the PEB Financial Statements shows the operating revenue broken down into three segments, as described by the CEO.

“The Chief Executive Officer considers the business to be three operating segments at balance date. These segments being the research and development of diagnostic and prognostic products for human cancer and the operator of the laboratories in New Zealand and the United States used for the detection of bladder cancer.”

Revenue attributable to the three segments is shown as:

R&D (NZ & Aus) $480K
Laboratory (NZ) $71K
Laboratory (US) $460K

The laboratory-based revenue (totalling $531K) obviously derives from CxBladder test analyses, and would be included in the calculation of royalties. The source of the R&D revenue is not obvious from my reading of the accounts, so that same assumption may not be made. In any case, R&D would relate to the development products other than CxBladder.

So assuming a 4% rate, Cellmid’s initial PEB royalty payment may not be much above NZ$20K. At least it’s a start.

Cheers