Well, despite my pessimism over world markets, I'm picking a higher share price than that.
Things were really quiet last January, too. The share price dropped from 6 cents in December to 5 in January to 4 in March. It then bottomed for several months, as the first new US product only appeared 3 months before those March results.
For a share price of 15 cents, BLT probably has to make about 1 cent a share, or $1.38m on current ordinaries. Add in an optimism factor, and it probably only has to make maybe $700-$800,000. Well, that is certainly possible by March if the second half matches the first, and could be exceeded if there is any noticeable growth as well - which there could be considering the winter in the US, and the market development of Blis there. Yes, it may be less than that, too, obviously.
Which makes it perfectly possible the share is fairly underpriced even now for the period ending 8 weeks from now. As usual, I think there is room for surprise on the upside too.
But then step forward 6 more months or so to the following half results. For a starter, we might reasonably expect there to be more growth in existing product lines, especially since so many products have still only come out recently. Against that, it will not have been winter in the northern hemisphere. However, the Japanese sales so far are built on bad breath and will presumably continue anyway, with a population verging on half that of the US. And Tooth Fairy should continue to grow regardless of winter.
But then you would add in the expectation of progress in other countries. The last report said, "In conjunction with Frutarom, the Company is also developing other business opportunities identified in Europe, Taiwan, Japan, Korea, South East Asia and Australia, which it anticipates will generate initial sales in the current financial year." Should we not expect some reasonable result from that by the November report? And the last full year report in June said, "Following the appointment of Frutarom as a distributor for BLIS and the FSANZ ruling on the use of K12 in foods, BLIS is now actively working with Frutarom to develop new commercial opportunities in Australia."
Then add in M18. The last half report also said, "The Company expects to formally launch the BLIS M18 to the broader dietary supplements market early in 2010." Well, that's bound to add up.
Then add in the whole chewing gum bit. K12 has got to have a fair chance of doing well, and then add in M18 ...
Next, the GRAS application is thought to be coming through "in 2010".
And the AGM presentation in July 09 stated that regulatory approval is being sought in China, Indonesia, Malaysia, and Taiwan and Korea. Any one of these coming through would be a big development too.
Then there is Nestle. The full year report reminded us that, "subject to a successful outcome it is anticipated that royalty payments could be generated in 2011 with the commercial launch of an infant formula product containing BLIS K12 as an ingredient." And, last half report again: "BLIS Technologies remains in close contact with its European research partner Nestle Nutritional and is focused on future commercial opportunities that may evolve from this relationship." Now, progress on that will likely be mentioned in detail by the November report, if not before? Would that not affect the share price, even without the revenue at that time?
Then, too, there was the fascinating sentence in the last half report about Costco, "This and similar developments with other companies ..."
Then, too, we have the usual wildcard of new product formats. The full year report said, for example, "Using the principles and approaches described here we are developing novel anti-infective therapeutics that can stimulate protective immunity while suppressing potentially harmful inflammation."
Finally, consider this from the last report: "We are extremely encouraged by the significant investments that third parties are making in development and marketing of products based on our proprietary ingredients."
Add bits of this together, let alone all of it, and surely we might hope for quite significant growth in revenue during 2010, plus a fair dollop of good forward news by the end of the year too. Then might we not hope for a share price somewhat north of 25 cents by then, which is only 70% up on a price that may already be justified today?
Or not. As usual, only time will tell. First, let's have a maiden profit.