G'day Kenny,I am not newry or alpha and don't know a Fibonacci...

G'day Kenny,

I am not newry or alpha and don't know a Fibonacci from a Bar Stool but I thought I'd throw in my perspective, for what it's worth.

In simple terms, CST has been range trading for nigh on twelve months now. (You can ignore the recent excursion down to $1 - that was just an opprtunity for the savvy amongst us to top up at bargain prices). To my mind, this means that whilst CST is still a speculative stock, it is largely held by informed sepculators (uninformed ones would have lost patience a long time ago).

What this means is that untill we get some concrete news, CST will continue to wander around these levels. Of course, if the news never comes (or. god forbid, it is bad news) then the obvious will happen.

There are two items of news that we are awaiting in the short term.

The first is the Third Quarter Cash Flow report. This may or may not provide us with some guidance as to how sales are going. It is seen by many as the earliest that we may see some financials that have been affcted by the CDC guidelines that were released at the very end of the Second Quarter. An optimist would hope that we may see some indication of the commencement of sales to some of the US penitentiaries.

Various sources have suggested that CST will be cashflow positive sometime in the First Quarter 03/04 (July-Sep 03). If this is to be the case then we may well see some reduction of cash burn in this quarter. A rough estimate puts breakeven at sales in the order of 500k tests per annum.

The second (and more important) piece of news that we are awaiting is the AFEB recommendations.

[apologies for the c&p of mypost in another place]

The AFEB is the US Armed Forces Epidemiology Board. They make recommendations to the US military Authorities on all things medical. Their recommendations, whilst not binding, are generally well respected and subsequently enforced. The Board meets thrice per year (Feb, May, Sep). At the February meeting they received presentations on and discussed the use of Quantiferon in the military. Subsequent to the meeting Cellestis indicated that they were very happy with the meeting and that we could expect the AFEB recommendations in six to nine weeks (around now). Of course a small matter of a war in between may stretch that schedule. The transcript of the AFEB meeting was made available a couple of weeks ago and supports Cellestis' comments.

The AFEB recommendations are important to us because the military is one of the stated early target markets for QFT (along with penitentiaries and immigration). A positive recommendation from the AFEB would be the first solid evidence that QFT has received acceptance and will ultimately replace TST testing in these target markets, at least. It is worth noting that the CDC guidelines released in December 02 specifically nominate the military as one of the areas that will benefit from the advantages of of QFT over TST.


Hope the above is of interest.