Alexium International Group Limited (AJX) Earnings Call Transcript & Summary

Good morning. Welcome to Alexium's mid-quarter update. Today, Billy Blackbum, the company's Chief Executive Officer, will be providing an update across the company's activities and in particular, updating investors on an initiatives that the company has been working on for a number of years, which is now starting to move towards full commercialization. With that, I will hand over to Billy, and thank you again for joining.

Thanks, Simon. Good morning and good evening, everyone, depending on where you are in the world, We really appreciate you joining. Just a few notes, a little housekeeping upfront here. We made a commitment to the investors and our employees and everyone involved in Alexium to give updates more regularly throughout the last fiscal year and then going forward into the next fiscal year. So we're going to keep up the cadence of doing these every 6 to 8 weeks at the latest, typically we'll land around 6 weeks. And that's really dependent on when we do half year, midyear -- excuse me, half year full year and 4C reports. And if they're too close together, we'll just leave it to those formal updates. But any material updates, large ones, we will break in and then give interim updates along the way. And our goal in these updates, especially the interim ones, is not to report things that are redundant to those formal updates, but to really focus on new activities and forward progress and just give you guys a view into developments at the company and things that are moving us forward with our goals. With that, I'll get into the update. Tonight, I'm going to spend a little bit of time on the strategic plan that we've been in. I'm coming up on 2 years in September. And last year, early in the calendar year, we rolled out a new strategy, and we've been refining that since I've been here, and we wrap our business plan around that and budget, but generally, the strategy is the same, and we're executing along that. So I'll give an update there for FY '24. We're going to do a showcase of a product portfolio tonight on flame retardants. And then we'll give a little bit of a sneak peek at the FY '25 plan, which we'll go through in full length in the next update in 6 weeks. So the strategy at Alexium, it does remain the same, and I always get a kick out of this is to grow and diversify revenue, which, on its face, is quite simple, but it's nuance behind that is to grow and diversify our revenue in our core market in bedding, where most of the company's investments and technologies have been positioned over the last several years, and it still remains our largest percentage chance for significant growth in the short term outside of the military. And then secondly, moving our technologies into adjacent markets. And by adjacent markets, just to be crystal clear, we mean anything non-bedding that we're targeting. So growing diversified revenue in the bedding market. We must break new accounts because we have to address the overconcentration with one major brand in North America. And historically, we've been concentrated in that brand. We've been overconcentrated in PCM cells, and we also have been overly concentrated in North America. And we've really made progress along the strategy in all three of those areas and diversifying leading to what we believe is going to be significant revenue growth over the near term. So the whole point is to break up what we're doing in the bedding market and really leverage the relationships there to grow. And again, our technologies are well suited for that market. And the second leg of the strategy is to grow and diversify revenue in adjacent markets. And to do that, we have to break new markets with our existing technologies, not the fastest path to revenue with what we already have moving into new spaces. Behind that, we have to modify the technology to create new market entries, and we'll speak to that as well. But that's new technology into new markets and then focus only on the fastest route to new large reoccurring revenue. So with our technology, especially in the thermal management and FR areas, there're so many things in the market you could chase that if you try to do too much, you end up watering down the efforts and really not getting to any meaningful results. So one of the things, since I've been here, the focus has been to bring focus and to really focus on less at one time. So you'll hear us in the coming months, talk about primary focuses, core focuses. You'll hear terms like parking lot. We use the term parking lot when we park a project that we know is good, but we don't have the resources at the moment to chase it. But -- So we're going to get through what we're working on currently, deliver results there, then move on to the next thing. And that's an operational discipline we're deploying at Alexium now. And it seems to be working and it's evident in the pipeline. So short-term objectives for FY '25 is to create sustained month-over-month cash positive results. And we believe we can achieve this in our core market, so leg 1 of the strategy. Then beyond that, in the medium to longer term objective is significant growth and sustained profits. So combining both of these legs of the strategy, excuse me, if we run these in parallel, that should lead to sustained growth for years to come. So really more of a picture of that getting into a little more detail. The first piece of that is to maintain our PCM sales to bedding. That's foundational. The lion's share of the sales for 2024 were PCM sales in the bedding. We're still in that concentration in the bedding market with PCM in North America, but we've made significant strides to grow beyond that and diversifying it. Next is the gross -- grow and diversify the revenue in the bedding market and that means selling more of the PCM. That's DelCool, our dehumidifier fabric, Eclipsys, our heat dissipation, nonwoven material and then also FR, we've had a lot of new demand for FR over the last 6 months and even more so in the last few weeks. And then behind that is growing and diversifying the revenue in adjacent markets, nonbedding. So if we can execute the three of these with the primary focus in the near term in the core market of bedding, that's going to lead to us hitting the results this year and then continued growth, building momentum beyond that. So really, the pathway we've been on since I joined, I won't belabor the FY '23. And just for everyone, we will post this to the website and to the ASX. You'll have access to this. So if you come back and read it later and want to send in questions, we're happy to address them if we don't capture that tonight. But for FY '24, it was diversify. And over the last several months, we have added new team members to the sales team, and we've added some adviser and marketing horsepower to the team to drive our products into the market and help us break new ground. The culture continues to turn at Alexium, and I'm just happy to report that pretty much everyone at Alexium understands that we all serve the customer. We are all in sales, no matter your role. It doesn't matter if you're a chemist, an accountant or an actual salesperson, we all serve the customer. Growth is us diversifying. It was a 70%, 20%, 10% if you guys recall in the past, and that was 70% in the bedding core market, 20% into some adjacent and 10% into some breakthrough markets. We're now shifting and we're not quite there, but we will be, in '25, shifting to a 40%, 20%, 40% focus. And that's, in general, over the average, but that is us now keeping a focus in the bedding market and delivering on our existing products and technologies, but also running a parallel path to innovate and break new ground with those technologies into new spaces. That involves core bedding market, AlexiCool, BioCool DelCool and Eclipsys for thermal management in the bedding space, continued down the path with our flame-resistant nylon cotton fabrics for the military, and we will be positioning that for Workwear in FY '25, commercializing Eclipsys for tactical gear. That was a miss this year, but it's not off the list for us. It was in the parking lot for a little while, while we work through some improvements to the material and the go-to-market plan, which really revolved around adding the sales team and some horsepower to start chasing public dollars and going after large population bases for that tactical gear. So we will be renewing the energy around that sales effort in the coming month. And then commercializing Eclipsys and FR in new markets, and that was shoes, cold chain and workwear. Again, none of those are off the drawing board for us, but we did park them. And you'll hear a lot of why we did that as I expand tonight on what's been going on recently, but we've shifted focus to some near-term opportunities, and those had to wait a little while until we circle back to them to pick up those growth strategies. Operations, we have secured the supply chain to ensure resiliency. We're too deep on key raw material supplies in too deep on tolling operations. And as we move to make Alexiflam, we will have a secondary production site for Alexiflam. And that's one of the more complex chemistries that we make that require synthesis and reactors, and it's less of a formulation and more of a reaction chemistry. So a shorter list of people around the world, especially in the Southern United States that can make that. We've now got two, and so we believe we've got that ready should we need to scale up quickly to respond to a military request. Financial, cash and commercial discipline. On the cash side, we've been very disciplined with our expenditures. Cash flow positive, not quite there yet, but on approach. And then funding, we were successful in '24 recapitalizing the business. We now have a clean balance sheet. We have ample cash to deliver the goals we needed in the near term. And it's a new day. We're focused on execution and thank you to all that participated in that recapitalization. So going forward into FY '25, we will bolster our operations team and let the sales teams, the new executives mature into their role. Likely going to be adding another by the end of this calendar year. On the operations side, it's really simple as we pool sales volume, operations has to beef up to be able to support the increased sales volumes. And we are tolling in a number of sites around the South United States and a few out towards Colorado and Ohio, and that's going to require more bandwidth to manage all that activity. Again, the culture is one team, everyone's culture is customer-centric. And we believe, going forward, as we hit these milestones, momentum comes from success breeding success. Again, we'll be in that 40%, 20% focus. Focusing more on globalization of the products. And we have been successful moving to new developments in the Australia and New Zealand region. And we're in development with a few different brands down there right now. And it's interesting, we've learned that a lot of those brands. The Australia, New Zealand region is only a certain size. It's not big, and we certainly want to capture those sales in that region, but we're learning the players in that region. Actually, the bigger part of their business is in Asia, and there's a large volume to be had in Asia by basically partnering with the brands and innovating and offering them upgrades to the products coming out of that region into Asia. So we've had some gains there. Commercializing key product platforms in international markets. In the short term, we believe that's going to be face change materials, microencapsulated face change materials, Eclipsys and DelCool in the bedding space. But we have had some interest in FR non-bedding. Not many of those other countries are using FR in mattresses, but it would be FR workwear and other applications and home goods, and then expanding our product application range into larger markets. And that could be outdoor apparel, shoes, automotive, electronics. It's a pretty big market where we can start to play from there. And then we're going to leverage our scale as we grow. And then financially, that's material growth in earnings, cash flow and share price should result from all of that activity. So the strategic plan from '24 an update, we did build out the sales team. We've added direct marketing expertise, and we've bolstered our product development. We've had a new director joined the team, who's a former CEO in the thermal management space and was very successful and has the track record of moving thermal management technologies into multiple markets. So he's joined the Board. You would have seen the announcement over the last week. He's also advising the team on where to start placing the markets and how to place the technologies and how to position them. So a lot of depth of knowledge has been added from that move. Two new sales execs on board, direct marketing and to run marketing campaigns. And when I mean direct marketing, I don't mean branding and websites, I mean direct marketing campaigns, canvassing actual targeted buyers of our products, generating leads for our sales teams to pursue through classic sales funnel activity for marketing. And then, as I mentioned, the PCM industry expert has now joined the team. For the culture, again, sales and marketing centric. We're highly motivated to drive the full commercialization of all of our technologies. So we're very excited to have these new team members on board so they can support the strategy, and they know the phrase well, which I've already quoted. But really, what I would tell you is the step change for me, and I've been the interim sales manager as we grow and before we add another layer of management and all of the overhead that goes with it, and I work very closely with our sales team every day. And it's a brand new day at Alexium, I can tell you that. These guys are very professional, very motivated, and they're already getting results. So growth in the diversifying of our focused activities, all these key initiatives are on track and progressing. So we kept the focus on our short-term gains in bedding. While we've been disciplined around new developments in non-bedding markets. So you'll hear that as a lesser percentage of what we report, and you'll hear our heavy -- heavier dose of bedding updates. And that's because we are still focused on that core market. But we know that we have to run a parallel path, bedding being up higher percentage and the parallel path of innovating a lesser percentage, but you have to do both. And to do that, it takes discipline because it's a small company, and there's a lot of intertwined activity going on. So we're putting in processes right now and generally firewalls between the more pragmatic side of the business, which is sell it, manufacture it, ship it, bill it, collect it away from the innovative side where it's easy to get involved in the innovation and kind of fall in love with new ideas and start chasing those and take your eye off the primary focus. So we're encouraging Dr. [ Brookins ] and his team to innovate and do all the R&D work to continue to prove out technologies and advancements with our existing products into adjacent markets, while the rest of the team needs to focus on delivering short-term success from our proven product suites. So year-over-year growth in our core market will come from AlexiCool, BioCool, DelCool, Eclipsys and then adding new sales from our FR suite, Alexiguard Alexishield. Should have mentioned there Alexiflam as well, which is the legacy FR product. We have made significant progress with the military, and that is moving along the testing track now. I'll give further updates later. We've commercialized Eclipsys for tactical gear, but we'll be making a new sales push with a different strategy, go-to-market strategy for that going forward. PCM has been commercialized. Eclipsys, we are just now going live in a mattress for a TV network that will show in July, but that didn't happen in FY '24, just on the front end of '25, and the new FR placements are going into the market as we speak. From the operations side, we've secured the supply chain. We've added a textile engineer to the team over the last year. He has been integral in us locking down textile suppliers and places to make our products. And we're looking for folks that have financial health and longevity and capacity to meet our growth goals. So when we select them now, we're going through a little more rigor upfront to qualify the vendors, and part of this has been driven by the bedding market has been soft since early 2022. Other markets have been soft in that window as well. And there's been a lot of pressure on U.S. textile capacity and there's been a lot of exits of companies in there. So there's a bit of a kink in the supply chain on the textile side. So we've been very diligent in finding folks that are solid, secure and financially up to the challenge that also have the capacity to scale up with us. Key [indiscernible] raw material backups. Again, like I said, we've gone two, sometimes 3 [ -D] for long supply chain materials with long lead times, and specifically looking at anything that might come under a trade war or tariff and become difficult again to get into the states. And then adding new toll manufacturers for our FR products is also becoming one of the main pushes right now. And for Alexiflam, we've found significant cost reductions in that supply chain, thus making it more competitive and improving our position for the military apparel and workwear. Financially, commercial discipline. We are right in the middle of that now, and cash. We are managing a very tight expense column and then cash flow positive is forthcoming in FY '25. We have a very robust pipeline right now with ample opportunities, enough to deliver the short-term results that we'll be forecasting and budgeting. And again, the new team members are on board. And then funding, after the recapitalization, we've been very judicious with the funds, and we continue that practice going into FY '25. And really, the majority of the funding will be adding the key personnel to execute the plan to deliver results. We don't have any major capital expenditures planned as Alexium runs a fairly capital-light model and we use total manufacturing and the capacity and capital investments of others to make our products. Here's the product suites. We not going to focus much tonight on our microencapsulated PCMs, AlexiCool and BioCool. Those are in our core market area. DelCool and Eclipsys also are significant opportunities for growth. And we've had a little bit of a slow start to getting those to the market, but we've got a lot of interest right now, and we're continuing to work the projects, many of them are in a long development cycle for mattresses and those are anywhere from 18- to 32-month cycles. We're in those in a few areas in the pipeline now that won't be realized really until second half of next calendar year. So we'll spend much time there. Tonight we're going to showcase our flame retard technologies, Alexiflam and Alexiguard, and we're going to roll out a new product here in a moment. So a little background just for our new friends joining us. And for those who have been with us for a long time, you'll be quite familiar with the Alexiflam. It's the legacy flame retardant technology of Alexium, and it goes deep back into the company's roots and it was really the early product for targeting military apparel, namely the Air Force back in the original days. But it's a flame retardant for cotton and cotton rich fabric blends. So formulations that use Alexiflam offer great flame [ retardancy]. And the key with this one is why we position it for those types of fabric brands is the wash durability. Some of the applications for the military, we have to hit wash cycles as many as 50 wash cycles and still pass the stringent burn test, and workwear is very similar. The difference between the military, apparel and workwear is actually workwear has to be even more wash durable because many of the industrial laundering scenarios for the workwear are using harsh chemistries to wash those products so they can get them back to plant workers and steel mills and chemical factories and refineries. So they work in a very harsh environment. So they use a lot of chemistry to get the oil and other chemicals off of those uniforms and back to the workers in clean form. So wash durability is something you're going to hear a lot about. We've had some nice breakthroughs on that. Just as a reminder, we did pass the more stringent test for the military last fall, which is the Power Man. We passed the 4-second Power Man burn test, which has led to even more development work with the military. Behind that, our other legacy product is Alexiguard, and that's flame-retardant emulsion. It's used on 100% synthetic, which is mostly polyester fabrics. It's an aqueous-based solution. It's free from halogen, antimony, formaldehyde and phosphate salts and it's basically a nontoxic material that's ahead of the regulatory curve for a lot of the substances that are being banned out of FR chemistries. We originally developed it as a complementary product to alexiflam, but we found other placements for it. It's also a very nice softener in other FR chemistries. So it's got a dual purpose for its flame resistant nature and for softening. And most FR treatments actually stiffen products and make them more stiff. This one does the opposite, giving it a bit of a competitive advantage. So in this past fiscal year, we made great progress on our FR opportunities. The Alexiflam developments we're focused on advancing our FR nylon cotton fabric. You'll hear often FR [indiscernible] nickname and the military loves their acronyms. So we've fallen right into that with them. But for military, apparel fabric and early-stage work on we're adapting the chemistry for wash durability for workwear. And the workwear space is a very large, but very competitive space, but we believe we have a nice offering there, not only being ahead of the regulatory curve, but from a cost standpoint and certainly from a performance standpoint, especially with the recent developments in wash durability. So we're now adapting that for multiple fabric types, more than just nylon cotton, but other cotton poly blends, rayons and other types of materials that are used widely across the workwear space, also home goods as well. And again, we keep our eye on the -- basically what's being proposed to be banned. And it's been very active over recent years in the United States of what can and cannot be used in consumer products. And there's been seen -- it goes back to PFAS. It goes back to formaldehyde and other toxic species that are bad for humans essentially. And that's created an onslaught of looking at every type of molecule that's used in these and a lot of testing and a lot of questions. So there are some materials being proposed out there that aren't quite past yet, but we've gone ahead and started working on formulas to get us ahead of that. And that's what brings us to the third product, which is Alexishield. So for the FR product suite, Alexiflam, again, organophosphorus aqueous flame retardant for cotton and cotton rich blends, wash durable and great on warm weather and lower cost fabrics for military apparel and workwear. Alexiguard intermediate, and that's the original Alexiguard. That's a robust FR chemistry. We use it as a component in our microencapsulated PCM to offset any fuel load that PCM might add to mattresses. It also acts a softener in that. It's also in our Alexiflam, which is wash durable and is utilized often at the dual-purpose component for flame resistance and softening again. Alexiguard FP, not very creative, but finished product, but that's specialty formulation using the intermediate and it has robust applications and FR barrier fabrics for mattresses. And I'll pause there because we've seen a shift in demand, and we're highly active on a number of projects right now in the bedding industry. And what happened that really created a shift over the last 12 months is fiberglass was banned from use in masters in the United States and they're on the clock now to remove fiberglass from all the beds in production. So we're in a bit of a footrace with a lot of customers right now to treat other components of the mattresses and the technologies and the mattresses to make those effective FR barriers that are fiberglass free. And that plays right into our hands with our chemistries because obviously, we use no fiberglass, and we were already ahead of many of the banned substances, the regulations coming down the pipe. So we've gotten a lot of recent demand around FR in mattresses and mattress foundations. So with that, this formulation that we're doing, the FP, it's an add-on to the barrier fabrics. And those fabrics typically, the ones that are called FR are typically using rayon or other inherently FR properties. We found that many of them have marginal performance. They will typically have a certain failure percentage in the mattresses that they're willing to accept, but it's really too close to the brink too risky. And now that they've taken fiberglass out, it's put the risk profile much higher. So we're active in a lot of fabric projects right now in mattresses and mattress foundations. And if you like me from the good old United States, we call the foundation Box Springs. And then Alexishield, we rolled out over the last 9 months, and it was in our development queue in our lab. And the challenge was for us to come with a formulation that was free of any current or proposed banned substances. And so we do now have a new formulation Alexiguard, and there are some proposed bands coming down the pipe that would ban other substances in widely used FR and Alexiguard is well ahead of that. And we are working on an active project for a large placement for it, which I'll detail in a moment. alexiflam, there's two main channels where we're pushing that into the market now, as you've heard a lot about over the years, military FR fabric. We're continuing our efforts to develop the cost effective warm weather nylon cotton fabric for the military. Alexium continue to partner with the military, but we're now well aligned around our supply chain with well-trusted U.S.-based military textile producers for manufacturing readiness. And we're running small trials and getting fabrics ready for more testing and another round of Power Man with the enhancements that I mentioned earlier for Alexiflam around the was durability, and then going back for another round of testing where we'll cut and sell uniforms and burn more uniforms in the second half of this calendar year. We do expect this to be a large opportunity. It is competitive, so oftentimes, we're very careful about forecasting and budgeting around the military because it will come to a competitive public money bid. But the opportunity for us on the conservative side in the near term, we believe, is in the $5 million to $11 million per annum range, which would be a significant jump in revenue. And that's really on the low end of the volume just assuming that we're in a competitive situation where we would be one of multiple producers picked. The up channel we're pushing is workwear for fabrics, and in FY '25, we're going to commence the development work around this. We've already started in earnest. We're working with some textile producers in South Carolina, moving to plant trial phase on this. And we're going to use the -- we're going to use various fabric types that are organic, synthetic and blends thereof, and run multiple trials, trying to pinpoint really tear strength, breathability, weight, cost and flame resistance, and that's really the four pillars of a successful product. So we'll be reporting in the coming months on breakthroughs in that space. For Alexiguard, again, recent regulations of banned substances from FR chemistries and materials created some near-term opportunities for us. So in the North American bedding market it's the majority of the work we're doing right now. And again, that's in line with our strategy in our core market in bedding. We have several new opportunities we're working right now for placements in the North American market. And again, we found certain markets like Australia don't have FR requirements in the mattress, so a lion's share of what we work on is going to be North American for this one. Many of the opportunities are for rayon and poly-based materials, fabrics. You'll hear barrier fabric, you will hear sidewall fabrics, foundation fabrics and you'll hear the term FR socks. We're working on all of those and variations of blended materials for those to create effective FR barriers for fabrics and fibers that are marginal on the FR side. We've been through multiple fabric lab-scale burns and we passed the indicative treatment. So in those scenarios, we bring in the customers target fabric. We do the finishing in our product development lab, and then we do the tests in our lab. From there, we move to pilot scale production at our finishing partners, typically are OEM, Tier 1 suppliers of fabric to mattress manufacturers. We're moving to that phase now to produce pilot-scale fabric to make the materials to build test beds. And so we'll be reporting all mattress burn tests over the next quarter. But so far, all the results are extremely promising. And we're expecting this to be one of the growth vehicles for FY '25 for us meeting some of the short-term goals. We're also in discussion working through an agreement right now in contractual partnership with an international supplier to bring a cost-effective FR sock to the U.S. market. So it's a high-quality sock produced offshore. It will be treated with our Alexiguard, giving it superior performance at a cost-effective price, and the market is right for that. And there would be a buy-sell scenario where they may use our finishing old socks they sell or we may use their socks and finish them and then sell the socks ourselves, but that presents a nice opportunity in the near term. And the revenue opportunities in the near term, which will be budgeted for the year, are into $1 million to $3 million range. Then beyond that, as this ramps up, it gets significantly larger. Continuing with growth in the core market. Beyond those advancements, we've now perfected the chemistry, and we are rolling out Alexishield. And again, it's ahead of the regulatory curve, so kind of a bleeding edge FR chemistry, and it's positioned for the bedding space as well. We have entered an agreement with a top 3 worldwide brand for exclusive use of Alexisheild and FR barrier fabrics for many of its high-end mattress lines. This exclusivity runs into next year or half two for FY '25. And then the obligation is in parallel as we're doing the development work now to work together to deliver passing mattress burns. So starting to build the fabric for those now. And we use the Alexisheild barrier fabrics. Once we have those passing results, the obligation is to negotiate supply terms for an adoption, and we'll be reporting on that agreement and those test results as we move forward and get basically everything that indicates it's going to work. So the agreement is we proved the concept, show them successful burns and they'll make a running change on existing mattress lines. So it's not a long development cycle targeted for a new innovative mattress, it's a solution for mattresses that are already in the market that need a better barrier for materials that have been regulated out. All right. And then looking ahead into FY '25, and like I said earlier, we're going to roll out the full business plan with the budget and the year-end results in the 4C in the next investor webinar. So we'll go deep there. But tonight, we're just a little bit of a precursor for that. So we're moving into the next phase and executing the strategy. We want to grow revenues aggressively in our core market while also working as a secondary focus through breakthrough markets and adjacent. We've been successful in getting the new team members on now that they're coming up to speed. They're going to mature in their role, and we're expecting significant results out of that. So the four main focuses are maintaining our key accounts and sales in North America, and that's foundational, and that's really what this year was even in a down market saturating the North American bedding market and by diversifying the product and customer mix, we're deep into that. Sales growth through breaking new accounts abroad, Asia Pacific, Latin America and European bedding markets. And the diversified revenue growth from our existing technologies into those adjacent markets. And you'll see that coming from Eclipsys, DelCool, Alexiflam, Alexiguard and now Alexisheild. Each team member in the business side is responsible for driving development activity, proposing terms and closing sales across all of these areas. We're going to position each member where their skill set is leveraged. We've got one of the new business members is a chemist by training and been in the business side for years, also very astute in technical developments. So we have him positioned very close with a lot of our textile and finishing partners to see a lot of the short-term activities to a close. And then another one of our team members is, it sells more at corporate level and it's going to be pushing agreements and globalization of a lot of our products to the other continents mentioned here. And then we're going to cross-sell across that. And for a small company and me as CEO, I'm very involved in the sales process and very involved with the customers, and I don't see that changing for any near-term season. So I'm going to continue to promote the company, meet with customers and drive sales and terms myself as well. So for the FY '25 plan, a little background and the sales approach and some of the objectives. In late '23, after a 2-year slump in revenues from a weak bedding market, we had to pivot and change our approach to sales. So this led to the recruiting and adding the new team members. We also added the industry adviser, as I mentioned earlier, and we went to a researcher late last calendar year and to get a list of names of folks that we could recruit that were industry professionals. Also, that list contains certain vendors that we could go to with our products that could possibly make them and then also a target list of customers in adjacent markets. And we use the researcher to do our own recruiting. One way was to get a wider swath of the market and players out there that we could connect with. Also, the lower cost not using headhunters to recruit, but also using it to generate leads for adjacent markets. So it proved to be very effective, and it's gotten us to the point where we are now. It's probably a technique we'll continue to use. And really, what we did is we used the researcher that came out of a research department from a headhunter. So we skipped the headhunter part and use the research part ourselves. So I thought it's a very efficient way to broaden our network. For the sales approach, we've hired, now we're training, experienced sales execs to do the following: sell our products to our current core market, bedding, and then further saturate North American -- our North American customer base. That's the lowest-hanging fruit for us right now. Beyond that, diversify the product offering in our core market with the other products, so DelCool, Eclipsys and all the FR product suite we just mentioned. Breaking new accounts globally and repeating that same multiproduct offering to the core market. In parallel, but a lesser percentage, this comes to the discipline. Sales will work on selling our existing technologies to nonbeddng markets, again, adjacencies. And then the company will leverage the skill sets and relationships with all stakeholders to open doors for top-down sales in all areas. And our Board has been very active recently in opening doors and networking and making an introduction for us to top executives in our markets, and it's been very helpful. Beyond that, the new team [ went through up ] speed and getting meaningful results. We're going to continue to add to that team and bolster our activity to drive more sales into the adjacent markets. Key objectives, double our month-over-month sales volume from '24 from $500,000 to $1 million per month. And that thereabout is the cash positive threshold as long as we control our overhead, which we will. Then beyond that reach a sustained minimum month-over-month contracted sales volume of $1 million minimum. And that's a permanent cash flow position -- cash flow positive position. We'll secure long-term high-volume supply agreements to shore up sustained revenues. In the last several months, you heard multiple agreements get announced. We'll continue announcing those agreements as we sign them and their material. We'll update the ASX regularly and all investors on our successful milestones and reinforce our progress with you all and the market. We'll leverage that momentum and reinvest in the business to grow Alexium to maximum earnings and a valuation that supports the share price that rewards everyone here. And that's the plan. And just to put a bow on what we've said tonight, watch what we're doing over the coming FY '25 season and what we're doing in FR. We're quite excited about it, and we've got some nice tailwinds in that market that are leading to a lot of activity for short-term adoption. And that's because folks have been regulated into a problem, and we have a solution for it. So very fortunate that our past developments position us this way. With that, I'll turn it over to Simon to close, and then we'll take questions. Actually, we'll just move to question, Simon, I guess, and then we'll close.

Yes, please, Bill.

Yes, I think you were fielding the question, so I'll have...

Yes. We really only have one question, and it's a question on Slide 5 for the strategic pathway. It's where has cash flow positive gone on the strategic pathway for 2025 to '27 given it's not achieved at either FY '23 or '24? I think the answer there is just that we're not saying we're dropping it. It just wasn't achieved in the target year. So we will carry that forward into FY '25.

That's exactly right.

Anything you want to add there?

No, it's going to stay on the goal until it's achieved and sustained and no longer a topic as simple as that.

Yes. And there weren't any other real questions, just comments on little disappointment and the progress we've made to date.

Yes. Well, sorry for the disappointment. I can assure you the team here is given it everything we have. It's a small team, it's a lean team. The plan and the strategy change that's come over the last 20 months since I've been here, is working. It is moving us forward. You're not seeing it in the numbers yet, but I can promise you that's coming. And we're doing everything we can to deliver those results. We haven't let up at all, and we remain committed to deliver the results for all the shareholders and the employees. So we all have the same goal to make this company a wild success and to deliver the return on your investment.