It seems to me that we don't know enough about the Sales...

It seems to me that we don't know enough about the Sales Estimates, or Revenue Projection. Both descriptions are applied on the same page ( CEO's Presentation, page 11.)

This is not helpful!

I understand that the low end estimate of the total market is now $30B, in $US. The current range is thought to be $30B - $40B, so we'll take $30B, which is a shade over the year 2008 figure of $14B compounded at 15% annually. Let's accept it.

Since the TIS treatment appears to be some 40% cheaper, on average, compared to existing treatments this reduces the market in $ terms. The UK and Europe account for 22% of the market, say 20% for convenience, which is $6B at current values. Reduced by 40% this becomes $3.6B. 10% of this is $360M. Here we are talking gross sales, not net revenue.

Now, TIS projections do not reach this figure until calendar 2017, the fifth year of sales, when sales are projected to be in all markets. I repeat, this figure represents just 10% of the UK and European market alone. So, if the TIS figures are for gross sales then their sales forecasts are, not to put too fine a point on it, pathetic. They will not survive without a significant capital raising.

I must query the "muddy" nature of the CEO's presentation. It is in dire need of clarification.

Do the Sales Estimates charts in fact show the net revenue (not gross sales) accruing to TIS in Australia, after deducting the product costs and all other costs and profit shares relating to Quintiles, Movianto, Eurogentec and Catalent? Other agents will presumably be involved in the US and elsewhere, likewise to be deducted appropriately. If so, then the figures shown become the remaining balance of revenue available solely to cover TIS costs in Australia ( Head Office costs, if you like), anything left over being pure profit before tax. In this circumstance it would be helpful to know three things:

1. What % of gross sales do these revenue figures represent and is this % reliable (more or less fixed) or is it unstable and subject to matters beyond the control of TIS? If so, what?

2. What % is the Royalty payable to Queensland University of Technology, and presumably this is a % of gross sales?

3. Is this Royalty deducted in arriving at the revenue shown, or is it yet to be deducted? In which case how much is yet to be deducted from the figures shown, year by year?

My own view is that TIS should capture the equivalent to 10% at least of the UK/ Europe market by the end of the first twelve months. The Governments concerned are cash strapped and desperate to save money wherever they can. It beggars belief that a vastly superior treatment which also provides major cost savings to Public Health systems would not "take off like a rocket". Any sales force would love such a product. This naturally leads to the question 'How will TIS finance the necessary inventory'? Also 'Who finances the debtors'? It's called 'Working Capital", where is it coming from?

I think TIS should provide proper and complete clarification of the situation. The CEO's presentation is best described as woeful. Shareholders are entitled to expect a professional approach from Management in explaining the Company's present position and future challenges. Answers to my questions would be a good place to start.