Q2 2021 Milestone Scientific Inc Earnings Call
[music].
Good day, ladies and gentlemen, and welcome to the milestone scientific second quarter 2021 business update call.
Lines have been placed on a listen only mode and the floor will be opened for questions and comments following the presentation.
You should require assistance throughout the conference. Please press star zero on your telephone keypad to reach a live operator at this time. It is my pleasure to turn the floor over to your host Natalya Rudman ma'am the floor is yours.
Thank you good morning, and thank you everyone for joining milestone Scientifics second quarter 2021 financial results conference call on the call with US today are Ari on hotter Howe, Chief Executive Officer, and keeps you hark on control of milestone scientific the company issued a press release today Monday August 16th containing second quarter two.
2021 financial results, which is also posted on the company's website. If you have any questions. After the call or would like any additional information about the company. Please contact crescendo communications at 21267110 to zero. The Companys management will now provide prepared remarks, reviewing the financial and operational results for the second quarter.
<unk> 30 of 2021 before we get started we would like to remind everyone that during this conference call. We may make forward looking statements regarding timing and financial impact of milestones ability to implement its business plan expected revenues and future success. These statements involve a number of risks and uncertainties and are based on assumptions involving judgments with respect to the future economic.
Competitive market conditions, and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond mussel control. Some of the important risk factors that could actual results to differ materially from those indicated by the forward looking statements are general economic conditions failure to achieve expected revenue growth changes in our operating.
Senses adverse patent rulings FDA or legal developments competitive pressures changes in customer and market requirements.
And standards and the risk factors detailed from time to time in milestones periodic filings within the Securities and Exchange Commission, including without limitation milestones report on Form 10-K for the year ended December 31, 2020, and milestones report on Form 10-Q for the second quarter ended June 32021, and forward looking statements made during this call are based upon management's reasonable belief.
As of todays date August 16th 2021 milestone undertakes no obligation to revise or update publicly any forward looking statements for any reason without out of the way I will now turn the call over to Orient Our Hall Chief Executive Officer. Please go ahead.
Thank you and Italian and thanks to everyone for joining us today.
I'm pleased to report that our revenue for the second quarter of 2021.
Increased more than 14 falls to $2.4 million. If it was just under $68000 for the same period last year.
Our dental business continues to generate strong cash flow as a result of dental offices reopening across the country and around the world Mauro.
Moreover, we have and ourselves and marketing activities, which should support sales over dental instruments and help drive high margin recurring handpiece sales.
We believe our progress illustrates the positive response and growing market demand for our dental products.
Through our new decentralized dental sales strategy, we are working towards our goal of building a robust distribution network in the United States and Canada.
In parallel we are focusing our efforts into new global markets, while supporting our present distributors.
Overall, we are encouraged by the growing interest in our dental technology, our dental business continues to generate positive cash flow on a standalone basis and as we continue to grow this business, we expect to benefit from high recurring margins on our disposables.
Turning now to our medical instruments in the first half of 'twenty 'twenty. One we began selling complete flow epidural and cast Jack disposables to four medical centers in the United States and one in Europe.
<unk> recently reported that the University of Texas Medical Branch Health Clearly campus Hospital has initiated use of a comfy flow epidural instrument, which follows the successful use of the instrument and disposables <unk> Galveston campus Hospital.
This expansion within the U T M. B Health network is a validation of the favorable response to our technology by anesthesiologists.
Purchase orders received from these medical centers reinforces our confidence in the outlook for both cat check and come Q flow and the value proposition to all the health care assistance as we strive to become the new standard of care in epidural procedures and the testing of cats It took place.
Right.
We believe these expanded orders a confirmation that our technology provides a level of safety and efficiency not currently available to medical professionals using conventional standard of care.
Clinical and safety benefits of the comps slow epidural systems are backed by extensive published clinical data demonstrating significant reductions in epidural punctures and complication rates.
We expect to announce several additional publications that further reinforce the clinical benefits of our technology.
In addition, the concrete slow instrument has been shown to significantly reduce the total cost for a hospital stay providing a direct economic benefit to healthcare institutions.
Since joining milestone and subsequently taking over as CEO, we have embarked on a number of initiatives to move the company from an R&D focus to a sales focused sales organization.
We will continue the development of the instruments for additional areas of drug delivery in diverse areas of medicine.
Bear in mind during the peak of the pandemic our primary consideration was preservation of capital.
However, now as things are trending towards normal.
We're investing in marketing and sales towards this end, we have completely overhauled the sales and marketing teams.
I have set ambitious goals for our sales team with very specific near term targets that they are held accountable for it.
That said I've been pleased by the traction we are gaining and the feedback we're receiving from the marketplace.
We now have a direct sales team of 11th sales representatives, including check Tret chalk newly.
Newly appointed Vice President of sales for medical.
Jeff brings an impressive track record in both medical devices and in the fields of epidural drug delivery, which I'm confident will help accelerate our growth and support our expansion initiatives.
In the short time since joining the organization. He has already had a meaningful impact.
Chad brings extensive relationships with key opinion leaders and physicians in the field of epidural drug delivery, which has been extremely helpful in opening doors.
Overall these sales initiatives are taking hold and our sales pipeline is robust.
I know our investors are expecting updates on new hospitals I can reassure you. We are in late stage discussions with a number of hospitals. We are working with large and complex organizations that are also dealing with the global pandemic.
The feedback from both anesthesiologists and health care institutions remains positive given the safety and economic benefits of our instruments.
This feedback that I have witnessed firsthand has only strengthened my conviction that our instruments can in time become the new standard of care.
On the international front, we remain focused on expanding our global footprint earlier. This year, we announced we had commenced sales at the University Hospital of this book in Germany.
They are increasing utilization within the hospital and are now placing repeat orders as one of the leading national hospitals in Germany and highly regarded across Europe.
A great reference a bowl accounts as we seek to bring on new hospitals in Europe.
We are also in the process of adding new international distributors to expand upon our internal efforts.
At this point I'd like to turn the call over to our controller Keisha Hawken to go over the financials in detail. Please go ahead Felicia. Thank you argument total revenue.
Month ended June 32021 was $2.4 million versus 167.
For the same period last year.
Revenue increased by approximately $2.2 million due to the reopening of dental offices throughout the country and the rest of the world Medical revenue for the three months ended June 32.
2021 increased to 21000 as compared to the three months ending June 32020, which reflects initial purchase orders from our new customers.
Revenue for the six months ended June 32021 was $5.4 million versus 2.22 million for the six months ended June 32020.
<unk> revenue increased approximately $3.4 million for the six months ended June 30th 2021, as compared to the six months ending June 32020 medical revenue increased to 92000 compared to the same period.
Gross profit for the three months ending June 32021 was $1.4 million or 50%, 56% of revenue versus 112000.
7% of revenue for the three months ending June 32020.
Gross profit for the six months.
2021 was $3.2 million or 61% of revenue versus $1.4 million or 71% of revenue for the six months ending 2020.
The decrease in March.
Due to an increase in sales to China, which have a lower cost gross margin.
Operating losses for the three months ended June 32020 was approximately $2.9 million.
Approximately $3.2 million.
The three months ended June 32020, operating losses for the six months of 2021 with approximately $3.9 million versus approximately $4.8 million for the same period last year net.
Net losses.
Proximately, $2.7 million or <unk> zero for.
Share of the three months ended June 32021 versus a net loss of $3.2 million or <unk> <unk> per share for the comparable period in 2020.
Net loss for the first six months of 2020 was $3.4 million or neuro five per share versus net loss of $4.8 million or <unk>.
<unk> nine per share for a different power here in 2020.
Now I would like to turn your attention to the liquidity and capital resources at June 32021, the company had cash and cash equivalents of approximately $16 million and working capital of $17.2 million versus working capital of $15.7 million on December 31, 2020 at this point.
Turn the call back over to Arthur.
Thank you Keisha askey.
As Kishore mentioned, we continue to maintain a strong balance sheet with approximately $16 million of cash and cash equivalents as of June 32021.
We are very well funded and have no plans and no need to raise additional capital.
In addition to hiring more salespeople and expanding our sales funnel as I mentioned earlier several trials underway with leading hospitals.
We are witnessing growing interest in our concrete flow epidural instrument and cast check system. Among anesthesiologists in hospitals and believe we are well positioned to take advantage of the growing momentum and adoption of our technologies as we pursue our goal to become the new standard of care for epidural.
Seizures in labor and delivery.
Although we faced challenges during the pandemic, we are back on a strong growth trajectory and diamond encouraged by the outlook for the balance of 2021 and beyond.
We remain committed to driving shareholder value and look forward to providing further updates as developments unfold.
I'd like to thank you for joining the call today.
At this point, we would like to open the call up to questions operator.
Thank you the floor is now open for questions. If you do have a question. Please press star one on your telephone keypad at this time questions will be taken in the order they want to see if that anytime you question has been answered you can't remove yourself from the queue by pressing one.
Again, ladies and gentlemen, if you do have a question. Please press <unk>.
One on your telephone keypad at this time, our first question comes from.
Anthony Vendetti State your question.
Sure.
Hi, This is Anthony Vendetti from Maxim Group.
Good morning, Anthony I just wanted to.
How are you.
You mentioned that.
11 sales reps.
I was wondering if you could if you could talk about what they are are they.
Please be trained.
To do a couple of them still need to be trained and once they're trained has.
Been a sales quota set for them at this point and then I have a couple of follow ups.
Yes, very good question and I think you ask a couple of questions within their centers. So let me let me go one step back and ask the sales force been trained absolutely.
At the beginning of the quarter April as you know and as we commented on in previous calls.
I would say we had a handful of sales representatives and then in the second quarter.
<unk> was more clarity about the pandemic in terms of the increase in vaccinations, we aggressively started by recruiting more.
Sales representative that all culminated in.
In an in depth.
Very fast track Onboarding program.
And as of today, all the sales reps have been trained.
Equipped with the right tools to be successful in the marketplace.
So that's.
Thats a continuous process so to say as we speak. This week. There is a specific three day sales meeting for the sales rep to make sure that everybody is aligned for the goals that are set for the second half of this year. So yes, the sales reps have been appropriately trained.
Yes, they also do get.
Targets in terms of quotes I will not go into detail how many quotes per sales rep. It also depends a little bit on the territory in the presence of the hospitals that are within the territory, but rest assured that yes. The sales representatives they do get.
Quotes in terms of targets in terms of hospitals that they have to.
Having their portfolio to be able to.
To come up with new opportunities for the company.
No.
The results of that and also I would say also with <unk> in combination with the experience that Chad brings us.
His coaching his salesman ship.
His mentorship.
That is very encouraging for me is I have seen.
An immediate effect and an increase in the number of demos and trials.
Numerous accounts that we're currently active in does that answer your question Anthony.
Yes. Thank you very much and then just just as a follow up you said you were in late stage discussions with a number of hospitals.
Sure.
Our number is obviously a relative term is that a handful four or five or is that.
10 or more or.
Is this is I was just trying to get a better sense of that and then and then just in terms of the.
There's late stage discussions and then there's a pipeline of.
What you would consider reasonable targets, maybe you've had you've reached out you said early stage discussions how would you how would you quantify those two categories.
Again, a very good question.
At the same time I'm afraid.
I cannot share and detailed the number of hospitals because it will first that will create some.
Some false expectations or expectations.
This update call as an update call on the results for the second quarter.
But again.
Would like to reiterate and reassure you that the targets have been set.
We have seen a number of hospitals, where we actually went through the value assessment Committee. So that is short to midterm opportunities for us and then to your point, yes. The pipeline is of course.
Completely focused and targeted on the period between now and the end of the year like I said in earlier calls as well.
This year is so important for the company because we are we are in a turning point, we want to create that baseline with.
With a number of hospitals during the course of this year from which we then can build further on.
In 2022 in terms of recurring revenues of dose initial hospitals and in addition, then of course.
Continuing our hunting activities at the same time.
Could be another question and perhaps I'm preempting on that.
For the time being.
With the 11 sales representatives that we have.
Our organization I do not have immediate plans to further expand on that sales organization because at the same time I'm still focusing very much so on having our cost under control.
Understood understood and then maybe just.
And maybe it's hard to and each hospital is different I know some are dealing with the surge in COVID-19 cases.
If you looked at in a normalized environment.
What what is the sales cycles from first reach out to interest to closing is it. This is a three to six months cycle.
Is it six months or more.
In general and I know it varies but if you kind of a range on average.
Yeah, I think my reply would be to your to your question would be the following it completely depends on the type and the magnitude of a hospital, let's say for example, if we would go to Harvard in Boston, that's definitely going to be a longer cycle then.
The hospitals that we already have been engaged with so what we are doing is providing the right mix from a strategic.
Important level to have derived hospitals, but also the smaller hospitals zero. So hospitals that do not necessarily have to go to through a value assessment committee, but we also are doing it.
Going into asc's or private clinics.
Because there we do not necessarily need any value assessment committee approval whatsoever. So.
At the same time.
In this stage in this transition like I said, we are trying to change the company from an R&D focused organization to a more sales driven organization. We are also looking into other areas.
For private practices, where our technology definitely can be used today.
Sure understood and then just the last question on publications I know Theres been.
A drive to.
Published the results which from the.
Early studies and it <unk>.
Have indicated obviously.
A huge decrease in.
And complications.
Particularly.
Epidural punctures using comp you flow versus.
Versus the traditional.
We say needle stick.
Do you have any.
Expectation of any other publications, showing the safety and efficacy and superiority of the coffee flow system.
Yes, there will be publications like I said coming our way in particular from our group.
Italy.
There is also further confirmation and validation of what we already have seen and reported.
<unk> said on previous calls we also have.
Publications in the area of peripheral nerve block, which is in potential new.
Yeah area for us as well.
Globally, there are about 41 million procedures.
Of course, we need to.
To make some developments on the on the product as well.
And also what we are working on.
Is it the indications for thoracic indications.
<unk> injection.
Of the drug as you know it has been approved in Europe, and it's also important that we get approval for that indication in the United States.
Because even into thoracic indication, where the space is smaller and narrower.
The immediate need for an injection technology like ours.
Evident.
Okay excellent.
I'll hop back in the queue. Thank you very much.
Thank you.
Okay. Our next question comes from.
James Terwilliger. Please state your question.
Good morning can you hear me okay.
<unk> good morning.
Okay excellent. Thank you for taking my questions very quickly.
You said previously 11 sales reps on the medical side.
Are all of those in the United States.
That's correct yeah. So the way it is constructed.
So within the 11 medical Representatives one.
This president of sales.
One senior director of sales and then nine territory managers.
Whereas 10 dose 10.
The people that I just mentioned all have their individual quote quota sales quotas in the United States.
The next question could be where are they situated in the United States. So I can share that with you we have.
Corporate the greater Chicago area, Boston, Connecticut, New York.
Texas, California, North, Florida, South Florida.
Other than North Carolina, South Carolina.
I think thats, if I count as quickly.
It should be the correct number so dose territories.
Ben initially selected by US as you know.
Yes, they represent those states, where the majority of it.
Important to hospitals are or even larger.
And of course, we also take the benefit still what.
What we are continuously doing taking the benefit of the GPO agreement that we have with the Premier group. So that's important for a targeting as well and then on the international platform sales strategy is.
Morris through distributors.
Although we do have a dedicated.
Sales person, but that is on a on a contract basis, because we do not have in a legal entity yet in Europe.
Where we can.
People are not payroll so that something on the subcontracting basis, but that person also has experience within the medical device industry and.
And his responsibility is to assist and help us food or.
In all the business development and sales developments in Europe, Middle East and Africa.
Excellent. Thank you for all that clarity.
My next question is as we spoke about the medical can you remind me.
Your distribution strategy is on the dental side.
Yes, absolutely.
So I go I go one step back.
At the beginning of the year, we announced that we moved away from our dependency of Henry Schein and.
Our exclusive distributor.
And we changed it into a multi distribution channel strategy and the main reason is the following.
If you look back and I always move back to the revenues of 2019, if you look back to the revenues in 2019, which were about $8.4 million in total revenue reported dental business $7 million of that eight four is come from consumables alone.
If we want to grow the business exponentially in the dental segment.
Needs to have additional placements of units, what I always call new customer acquisition right because that's the only way that.
That we can grow the dental business instead of taking the benefit of the recurrent revenue stream only.
So that.
Decided us to make a move so we changed the exclusive distribution agreement with Henry Schein into a non exclusive one and then at the same time, we were able to appoint.
Seven distributors.
In the United States.
And one in Canada and for the reason of growing the business, but we also go one step further.
<unk>.
As you know probably from managing distributors, they always need help and they need strong help from an organization like ours as well personally.
I handled the distributors as an extension of my Salesforce. So that means that we as a company have a responsibility to provide them with the right marketing tools the sales tools.
Strategic initiatives for them to be successful as well as.
Providing.
Services in terms of field sales trips or co visits.
For their representatives, and we have a very well experienced salesperson.
Our organization in the United States, which is.
Mr Del Johnson, who also take those initiatives to two.
To help the distributors.
If we go one step further.
As I am a strong believer in the pyramid to triangle, which is marketing sales on education.
We also recently have entered into other type of quality.
Quality agreements partnerships, where we support these distributors with other organizations like.
Practice management organizations.
Dsos.
That gives us then the opportunity to have direct access to.
To a number of.
If I combined the two companies or organizations.
Direct access to 2100 dental clinics and that gives US then a more.
Targeted specified approach through our marketing and sales efforts, but also through these DSO and that practice management institution to continuously tell the clinicians what are the benefits of our dental solution.
And the story that I, perhaps take a little bit time, but I think it is important for everybody to understand the changes that we have made within the dental approach.
Historically, we focused.
I would say on the clinical outcome in terms of comfort and.
For the avoidance of side effects or adverse events for the patients like like nothing as a.
Our collateral.
With numbers.
But recently, we just have launched a campaign, which is much more focused on.
The dentists and their practice growth in that campaign is entitled.
How to increase your bottom line.
Because for the dentist, we need to help the dentist.
Bill.
Business and as you probably know.
Our technology provides a unique opportunity for a dentist to.
In a way increased its piece to the to their patients not to Exorbitantly high levels.
But we have enough concept all the possibilities for the dentist to increase that pitch because.
The determination for doing so is that it has to be a new technology.
The dentist need to invest in its own technology, but also of his own education and he is able to increase those fees. If there is.
Consumable or in.
Our single use patient disposable in play all those three elements come without a solution and that is definitely.
Important for the dentist. So in other words, what were trying to say is that if you look on the cost of the disposable for the dentist, which is depending on the distributor on the end market price and additional $2.50.
But if you if you do the following math seven to eight injections per day times to under 20 days a year.
And if the dentist would increase his fee for Crown and bridge work.
By $20, let's say that is a guaranteed additional income of $35400. So what I'm trying to say is that instead of the densest things every time he opens a consumable.
Oh this is approximately $2.50.
Want to give them the feeling I have to open more of those disposables because I can make is the minimum $35000.400 during the year in addition to <unk>.
Avoidance or.
The increase in.
In additional patient throughput.
And of course, yes.
The differentiation opportunities.
For the dental clinic.
And for growing as practices. So that's the change that we're making and of course everything is strongly supported by the safety features.
Dental value proposition.
Excellent. Thank you for all of that additional comment I've got two very quick questions.
One when I look at.
The balance sheet and the inventories the inventory levels dropped a little bit are you, having any supply issues I know a lot of companies are having issues with their supply chain.
Is are you, having any supply issues as it relates to inventories.
No we do not have any supply issues to that extent that it is a dangerous for our for our business at all.
The debt to the two issues of course.
Based on raw materials, which are normally the census.
And the chips, but we advocated for that the only reason why you see a drop in the inventory is primarily related to the difficulties of getting the containers that are shipping routes between China and the U S.
There is a shortage of that there is no manufacturing issue whatsoever, so as we speak.
<unk> already has taken measures to increase further to buildup of our inventory inventory sorry.
Okay, Great and then the last one in the previous remarks I'll jump back in queue did they say did I get this correct of the medical business was approximately 21000 in the quarter at 92000 for the first half of 'twenty. One are those numbers to correct number Ed.
Yes, we said that the the medical revenue in the first quarter increased to $21000 compared to the same period last year and for the first six months of the year the medical revenue increased to $92000.
Compared to the same period last year that's correct.
Excellent. Thank you very much for taking my questions and providing all of that Taylor and I will jump back in queue. Thank you very much.
Youre welcome. Thank you.
Okay. Our next question comes from last chronic please state your question.
Yes.
To know when do you expect to see milestones become profitable on a sustainable basis.
Yeah.
But that's a very good question everything depends of course on the on.
The uptake of the medical businesses, we have.
That many many times.
As we are.
Looking at the.
The current business in both dental and medical and I do not.
We believe that the cash positive will be.
Possible this year.
But we are doing our utmost to turned it into cash positive operations.
The year 2022.
Yes.
Thank you very much I appreciate your answer.
Again, ladies and gentlemen, if you would like to ask a question. Please press star one on your telephone keypad at this time.
Our next question comes from Michael Morton. Please state your question.
Yes.
Yes, Thank you for taking my call.
I'm kind of caught up because obviously the technology is.
I believe fantastic.
Yes.
If you just view things.
Based on what's been going on.
The first quarter of 2020 seems to be flat or down.
From an average quarter in 2019.
With of course, no COVID-19 around in the first quarter of last year.
And then this year, although of course the numbers quite.
So to say eccentric 14 times I mean, the reality is that.
You grew revenues by about 33%.
And I'm, just wondering I mean, I don't know, how big or what the sales force was like in 19, but.
We've increased it and improve it so much.
Shouldn't we be seeing a much larger number of growth.
But more importantly, I mean.
What are we going to see $25 million to $50 million.
This is a great product and it seems like it's only going out to a few hospitals.
And I'm just wondering is that an insurance thing I mean.
What seems to be the problem. This type of growth I don't know, if we'll ever get profitable with that being the case.
Yeah. That's a very good question. So let me let me comment on that.
If you look at the revenues in 2019.
2020 and 2021.
The revenues reported in 19 in 2020, one major revenue contributions from the dental business right.
And that's independent of having a direct sales force or not having a direct sales force because the direct sales force.
Is primarily responsible for the medical business.
The first quarter this year, Unfortunately, and I've mentioned that on previous calls as well. Unfortunately, we had a little setback.
Firstly.
Because of the sudden passing of vice president of sales.
Okay, Eric Gilbert and also the departure of another sales person. So at the end of the quarter, we had two salespeople.
Then at that time, it didnt make any sense for the company to invest money in food sales force expansion because the situation with Covid was unclear why should reinvest.
In building up a sales force in the first quarter, knowing that they are knocking on doors that are closed.
I E. The pandemic when we saw in the second quarter, a change in that economic and environment that we all have faced business wise.
Private wise personal lives.
That's what we decided then in the midst of the quarter to accelerate the recruitment and the expansion of the sales force.
We should not forget that.
We started the commercial activities with a sales team in the beginning of 2020 and then Covid came.
Hospitals close the doors hospitals did not invite.
Representatives of the vendors at the hospitals.
Capital equipment budgets were.
Frozen and that's slightly changed in Q3 Q4 last year that made us possible with those three people to have a number of hospitals at the end of last year and beginning of this year to actually provide to a change order for this technology, then you're right we had a setback.
In Q1 as I explained to you then we reacted and third are investing aggressively in our sales team and that's where we are now.
And like I said.
I am very encouraged about the increase in demos and trials that I see.
And I am also encouraged and positive with the outlook now the question that you have when are we going to be.
When do we see the revenues of $25 million to $50 million. That's a very good question because that's the question that I raised myself and asked myself every every day and that should be embedded indirect strategy for the company to reach those numbers in the.
In the coming years.
Well at $92000 of medical right now with the increased sales force it could take forever I don't know if I'll be alive.
And.
Again, it's just it's shocking.
Because I mean, this company should be growing in leaps and bounds.
And I'm wondering why you know mckesson or someone in that nature hasnt, even looked into you know distributing or.
Even considered violent themselves because of the technology yet.
I don't even see a site yet sequentially for Tenda.
And we've got additional shares out right now I think there's a number of.
But let's call it a 40.
49 million $50 million.
That certainly of course may have to increase because at this rate.
With continued hiring and expansion of the force that's only growing in baby steps. It's it's just hard to believe.
For my clients to continue to hold.
With that we're going to see I mean, even the market. It was 194. This morning, it's not 167, obviously people are questioning it stifling what I see.
Which is you know it shouldn't be way way further than where it's at.
But that's my opinion.
Certainly I'm not in your shoes.
But if you've got this great Salesforce I mean.
Let me ask you this are they selling both of the products are.
And trained to do so or these guys just doing the medical that really hasn't went anywhere.
So again, let me let me, perhaps it wasn't clear in my statements.
We only have the direct sales force for the medical business. So only 40 comfy flow epidural.
<unk> check and compute right and the reason for that is.
It's in its.
Pretty intensive sales process, because you have to do demos and trials now with all due respect I don't think the.
92000 can be directly linked to having.
Having a sales force being successful or not successful as these people come on.
And came on in the Middle of June the 92000 in the first six months, 88% is coming from I think the international business. So that has nothing to do yet with the with the expansion of the sales force.
I repeat again that where we are to date, we are building that creating that baseline to benefit and to harvest from all these activities that we have undertaken a sim.
Since the end of June and throughout the month of July to have more hospitals adopting in buying our technology.
During the course of this year, so I think that that's what I would like to.
To reiterate.
And again I remain positive I can understand that perhaps you think it takes longer time than you anticipate but I.
I always say again nothing has changed with the company we are.
In a very strong financial position I believe that we are taking the right decisions of where to make the investments.
And let me take one concern away are we only focusing on the direct sales force absolutely not.
As we speak we also have discussions in particular in those areas, where we currently are not present.
We have already initiatives.
With.
Local.
More local regionalized distributors that will assist support and helped us enter into sales of the epidural.
Instruments.
Andy epidural consumables into capture consumables.
Well.
Obviously, I'm a salesman for 36 years and I can tell you that if I was only doing those type of increases I wouldn't survive.
And I'm only myself.
So maybe I I expect a lot more people and myself, but.
You know I, just I'm, hoping that the second half of this year is more like something in the neighborhood of $5 million.
Because thats really where it should be in.
Certainly look like where it was starting in 19, although I wasn't aware of the company at.
At that time and I only started participating.
We did the offering of $2 or so.
Back in October.
But I do believe in the technology and I hope to see you know certainly the.
With <unk> at the helm certainly the burn rate was.
Very low end.
I saw a lot of it and.
That's something that I'm, certainly going to keep an eye on going forward because some.
We certainly need to get to profitability, but it's the leaps and bounds of the product, especially.
Two of the products, so probably the golden rule in the industry.
So I wonder I mean, it doesn't have to do with insurance I mean are people like.
That.
Aesthetic that they're stepping over hundreds to picked up you know <unk>.
It just doesn't make sense because of.
I haven't used the product.
Went out and endeavored to try it but I didn't find the right.
Certainly of course.
I believe in it and if it's the way it is.
I really think it should be moving a lot faster.
And it just doesn't seem to be catching the momentum.
And I believe the product.
So on that note look it up.
Unless they have a house it's it's.
It's certainly never an easy task, especially when you got what youre up against but.
This you've got a great product that you've gotta Goldman some little product it really it should be multiplying in much bigger ways and.
Again now were back into something different with the Covid again, so I don't know how bad or good that'll be but.
And the hospitals babies are still being born in an epidural they still needed in EMEA.
And if it is what it was said to be and I believe that it is.
Certainly thank you.
That business should be doing a lot better than what we're seeing although it's kind of new.
That should be a multimillion dollar business with the stuff from Europe.
But then again it may be there I don't know I'm hopeful.
No.
I can agree with your outlook and your expectations I think the only eh.
Yes, I would say, where we perhaps have not.
Not the same opinion at the time.
Yes.
We can achieve those numbers and also your comment.
The dental business that you expect.
<unk>.
A faster uptake or a faster development.
If I look back at the first half 2019, I know that.
On this call.
Direct lead to reporting and comparing the results of this year versus previous years, but I do just for my own sake.
It was a year prior to the pandemic.
Then in the first.
Last year, we have achieved a growth rate of 27% now.
Is it good news that that I'd, rather be happy to see that the.
The initiatives that we are undertaking.
That they show its effect and of course to your point it can always be better.
But we are working hard on that to get the numbers.
But we would like to have.
Okay.
Well I wish you a lot of luck with that and I hope that we get there.
No again, I I believe in the product and the <unk>.
Technology and I think it's something that's just not.
I don't know.
My opinion I I'm, just thinking explosive this when I first unit.
I'm not catching up but of course again, it's a situation right now that's unprecedented.
I'm not an easy thing to be up against so I do wish you well and I hope for the best and.
Now, let's get to $25 million. This year I'm sure we won't be looking at a $2 stock or $1.70 stuff that's for sure.
Yeah, well, thank you for your questions and perhaps the model to the other people.
Underlying that wants to ask some questions.
Yeah.
Okay.
Okay.
Yeah.
Okay, and it looks like that with our final question and I'll turn it back over to <unk> for closing remarks.
Yes.
Well. Thank you. Thank you for your time.
And the interest in our company and.
And your support also for a company that you see.
We believe in our technology, we believe.
Having and doing.
<unk> initiatives in terms of marketing itself also.
<unk> and other areas where our.
Technology can be employed in.
In the medical industry and.
We remain very positive and are encouraged to to follow up with you in future calls so thank.
Thank you again and stay safe all of.
Best.
Thank you. This concludes today's conference.
You for your participation you may disconnect your lines at this time and have a.
Yeah.
Oh.
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