Onwards and Upwards...

Consumer Health Division Sales Revenue

1st Quarter 2014 $188k
2nd Quarter 2014 $247k (+34%)
3rd Quarter 2014 $390k (+58%)
4th Quarter 2014: Assumptions set out below

From the 3rd Quarter 2014: The cash receipts from customers do not reflect this increase as distributors have various trading terms from COD to 90 day accounts.

From the 3rd Quarter 2014: Our new distribution arrangements signed between September 2013 and February 2014 are expected to result in increased sales activity from mid-2014 onwards.

From the 3rd Quarter 2014: The company has made strong progress in this business and the associated cash requirements continue to account for the majority of the spending as the program is getting closer to clinical studies.

From 2nd Quarter 2014: Customer cash receipts from sales of Cellmid’s hair growth products have been steady during the quarter at $170,000. However, orders have increased significantly in Japan, with Natural Garden placing the first of their three 10,000 unit orders in September, payable on delivery in December. Australian sales have also increased during the quarter from around $58,000 to $68,000 (13%).

From Asx Announcement September 2013: (ASX: CDY) is pleased to advise that it has signed an agreement with Natural Garden Co Ltd (Chiba, Japan), one of the largest Japanese private direct marketing companies, for the supply of 30,000 units of the Company’s FGF-5 inhibitor hair growth lotions. In 2012, the Japanese haircare market had total revenues of $5.9 billion and it is expected to reach the market value of $6.3 billion by the end of 2017. 1 A significant component of that spending is for hair growth products.

From Rm Research Report 3rd February 2014: We currently value Cellmid’s consumer healthcare business at 3.9c (vs. 2.7c previously) as we include the Advangen Inc. acquisition and update our estimates for its Australian subsidiary. In our view, investors underestimate the fact that Advangen has a global consumer health brand and with management taking all necessary steps to increase the brand equity, it’s just a matter of time until it becomes a very significant business.

From Rm Research Report 3rd February 2014: Wholesale Unit Cost in Japan is $80
Joining the dots: 10,000 units sold to Natural Garden Co @ wholesale rate of $80 = $800,000 plus other sales in Japan, Australia and China.

If these assumptions are correct we could expect a 100% increase in sales revenue just with Natural Garden Co 1st of three 10,000 unit orders that must be within a 12 month period.

Plus any R & D Tax rebates
Plus any royalties and licensing fees
Plus sales of MK Elisa Kits

If the numbers come anywhere within a 15% range of the assumptions made above, I have little doubt the company will be rerated as per research report published by Baillieu Holst which was authored by Stuart Roberts