We know we have a product that sells

Hi all

Apologies for the late post re-capping the AGM but spent some very valuable time at the post AGM….beer and chocolate has never tasted so sweet!!

The main points I took out of the AGM were:

• Cash flow management is biggest challenge with YOW having to produce the product on a large scale and not receiving payment for up to nine months after production.
• 12m sales = breakeven. YOW list price is $1.73 and can take that down to around $1.60 based on volume of order. YOW is exceeding margins of $0.30.
• YOW has a list of 85 companies (All in US) that they will to approach to sell the product. At this stage approached 25 with 19 having signed and 6 to sign in the coming months. The 85 companies represent a total of around 250,000 stores in the US!
• A tier 1 has unofficially agreed to proceed straight to a national rollout, this is not Walmart.
• Production is not an issue. Two wrappers are ready and production rate of 40million unit’s p/annum will be achieved within 4 months. Capacity for a further 90million unit’s p/annum has been negotiated.
• YOW have received results for weeks 1-3 of the Walmart trial and are very happy and awaiting weeks 4 & 5 results. YOW will sit down and discuss the next step with Walmart in the next 2-4 weeks. Target is to be in store in the March 2015 Planogram cycle therefore receive purchase order in Jan/Feb 2015. Walmart target for YOW was 40 p/store p/week and performance has been between 80-120 p/store p/week.
• Targeting supply to the Military through Dixon marketing…this is a big account.
• YOW is set to enter other markets imminently….that word again!! In discussions with a European chain in a $6Billion market!!
• Will have seasonal ranges and this is huge in the US. Brand needs to stay fresh and will licence products in line with the demands of children…Disney was mentioned!!
• National social media program will commence in 1st Q 2015. Program has already been developed but cannot rollout until consumers can readily access the product. This will outline all stores that stock Yowies.
• What YOW has achieved in the last 6 months should have taken around 2 years. The market does not understand this!
• YOW will be back in Aus. sooner rather than later. Container is still here in Aus. and product has a life of 18 months. Will not be with Coles or Woolworths…the company needs to make money and will be with a smaller chain for an extensive national rollout.
• Yowie World’s will be a profit centre for the company. Modelled on Moshi Monsters which generates annual revenue of around $10mil
• The animated film may have taken a big step forward yesterday with Keith (Phil) Hudson informing Wayne that there are already two completed scripts.  
• Sweets & Snack expo has been booked for 2015
• The next twelve months must see a strengthening of the board and different skill sets so that YOW can expand globally.

I expect a capital raise to US institutions in February/March 2015 and having approved the 10% placement capacity the company will now move to bring in the right investors

New wrapping machines that produce 600 units per minute are available and this will not be far away for YOW!!