Q2 2024 TOMI Environmental Solutions Inc Earnings Call
Operator: Good afternoon, everyone, and welcome to the TOMI Environmental Solutions, Inc. second quarter 2024 financial results conference call. At this time, all participants have been placed on a listen-only mode, and we will open the floor for your questions and comments after the presentation.
Good afternoon, everyone and welcome to the tell me Environmental Solutions, Inc. Second quarter 2024 financial results Conference call.
Speaker Change: At this time, all participants have been placed on a listen only mode and we will open the floor for your questions and comments after the presentation.
Speaker Change: It is now my pleasure to turn the floor over to your host John Nesbit of IMS, Sir the floor is yours.
John Nelson: Thank you for joining us today for the TOMI Environmental Solutions Investor Update call, www.steromist.com. Please note that information contained within this presentation is relevant only to the date on which it was recorded, August 1, 2024, and you are therefore advised that time-sensitive information may no longer be accurate at the time of any replay. Certain written or oral statements made by management of TOMI may constitute forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995.
Speaker Change: Thank you for joining us today for Tommy Environmental solutions Investor update call.
Speaker Change: On today's call is Tony <unk>, Chief Executive Officer, and Chairman of the Board Dr. Hulton, Shane tell me as Chief operating Officer, EJ Shan and Thomas Chief Financial Officer, Joe <unk>.
Speaker Change: Dr. Shane will provide an overview of recent business highlights you Jay will report on future plans, Joe will provide the financials and all will be available for the Q&A a telephone replay of today's call will be available through August 15th 2020 for the details of which are included in the company's press release dated August one 2024.
Speaker Change: A webcast replay will also be available on Tommy's website.
Speaker Change: Ww dot steroid missed dot com. Please note that information contained within this presentation is relevant only to the date, which would be recorded August 1st 2024.
Speaker Change: We're therefore advised the time sensitive information may no longer be accurate at the time of any replay certain written or oral statements made by management of telling me may constitute forward looking statements as defined in the private Securities Litigation Reform Act of 1995. These forward looking statements can be evaluated I'm sorry, it should be evaluated in light of important risk factors that could cause actual.
John Nelson: These forward-looking statements should be evaluated in light of important risk factors that could cause actual results to differ materially from our anticipated results. The information provided in this conference call is based upon the facts and circumstances known at this time. The company undertakes no obligation to update these forward-looking statements after the date of this call. In addition, TOMI will discuss certain non-GAAP financial measures during this call. The company uses non-GAAP measures because it believes they provide useful information about operating performance that should be considered by investors in conjunction with GAAP measures.
Speaker Change: <unk> to differ materially from our anticipated results. The information provided in this conference call is based upon the facts and circumstances known at this time.
And it takes no obligation to update these forward looking statements. After the date of this call. In addition, Tony will discuss certain non-GAAP financial measures. During this call. The company uses non-GAAP measures because it believes they provide useful information about the operating performance that should be considered by investors in conjunction with the GAAP measures a reconciliation of these non <unk>.
Speaker Change: GAAP measures is.
Tony: To comparable GAAP measures is included in the earnings release dated August one 2024, I will now turn the call over to tell me as chairman and CEO Doctor Holinshed. Please go ahead. Thank.
Elissa Shane: Thank you, John. And good afternoon, everyone.
Tony Holinshed: Thank you John and good afternoon, everyone and thank you for joining us today to discuss told me environmental solutions second quarter 2024 financial results.
Elissa Shane: And thank you for joining us today to discuss TOMI Environmental Solutions' second quarter 2024 financial results. Our revenue for the quarter exceeded $3 million, representing a 170% sequential increase compared to the previous quarter. BitSolution sales increased by approximately 171% over the first quarter. We also saw strong demand, with more projects expected to close soon, from customers this quarter. Third, we continue to expand our global footprint with new customers in Canada. We have maintained an active focus on digital marketing initiatives and business development plans with existing customers. To optimize our budget, we reduced our participation in trade shows and redirected resources towards more effective lead generation strategies such as referrals and references.
Doctor Holinshed: Today I am pleased to announce that told me has achieved significant milestone by returning to profitability in quarter two of 2024.
Doctor Holinshed: This achievement is a testament to the resilience and dedication of our team the support of key long term partners as well as the strength of our business model.
Doctor Holinshed: Our revenue for the quarter exceeded $3 million, representing 170% sequential increase compared to the previous quarter.
Doctor Holinshed: This growth was primarily driven by strong demand for our mobile equipment, which accounted for over 60% of our total revenue and indicated we have not seen since the 2022 year bet.
Doctor Holinshed: <unk> solutions sales increased by approximately 171% over the first quarter. We also saw a strong.
Doctor Holinshed: International sales the second quarter marks a record breaking performance suppressing our previous highs since the outlier year of 2020 built.
Doctor Holinshed: Building on this momentum we have secured approximately $5 6 million in sales year to date.
Doctor Holinshed: This figure combines recognized and reported revenue delivered orders for Q3 and open bookings for the remainder of the year we.
Doctor Holinshed: We have nearly matched the total number of mobile equipment sales realized through the entire calendar year of 2023.
Doctor Holinshed: Additionally, we have four active custom installation orders currently underway in our manufacturing production and validation service lines.
Doctor Holinshed: With more projects expected to close soon these trends position us for continued growth and solidify a strong foundation for the balance of the year.
Speaker Change: In addition to increased sales of our mobile equipment, our strong financial performance. This quarter was driven by several key other factors.
Speaker Change: First we partnered with E M, a queue, who purchased over $1 million of equipment to be used for Steri missed I H P service.
Speaker Change: Second we delivered two custom integrations, a fully installed custom engineered system in a hybrid system.
Speaker Change: Two customers this quarter.
Speaker Change: Third we continue to expand our global footprint with new customers in Canada.
Mexico, Philippines and the UAE.
Speaker Change: And lastly, our focus on cost reduction initiatives have yielded positive results, improving our profitability and allowing us to invest in growth opportunities.
Speaker Change: We maintained an active focus on digital marketing initiatives and business development plans with existing customers to optimize our budget, we reduced our participation in trade shows and redirected resources towards more effective lead generation strategies, such as referrals and.
Speaker Change: In addition, Tony will discuss certain non-GAAP.
Speaker Change: Yeah.
Joe: Thank you, Dr. Shane. Good afternoon, everyone.
Tony Holinshed: Thank you Shane and good afternoon, everyone I will provide a brief overview of our financial results for the second quarter of 2024 compared to the same prior year period that would be for the three months ended June 32024 <unk>.
Speaker Change: The June 32023.
Joe: I'll provide a brief overview of our financial results for the second quarter of 2024 compared to the same prior year period. Our consolidated debt revenue was $3,013,000 compared to $2,775,000, increasing approximately 9%. The increase in our gross profit was due to our product mix and sale. The consolidated operating profit was $121,000 compared to an $89,000 loss in the prior year, representing an increase of $211,000 or 237%. The increase in our profit was attributable to higher sales and gross profit in the current year period. Our consolidated net profit was $30,000 or $0 per basic and diluted share compared to a net loss of $89,000 or $0.06 per basic share.
Speaker Change: Our consolidated net revenue was 3.013 million compared to $2 million 775000, increasing approximately 9%.
Speaker Change: Holiday to gross profit was 61, 5% compared to 61, 3%.
Speaker Change: The increase in our gross profit was due to our product mix and sales.
Speaker Change: The consolidated operating profit was 121000 compared to an $89000 loss in the prior year, representing an increase of 211000 or 237% the.
Speaker Change: The increase in our profit was attributable to higher sales and gross profit in the current year period.
Speaker Change: Our consolidated net profit was $30000 or zero dollar per basic and diluted share compared to a net loss of 89000 or six cents per basic share.
Speaker Change: Moving on to the balance sheet as of June $30 to 2024, our cash and cash equivalents were approximately 709000 working capital was $6 8 million and shareholders' equity was $7 3 million.
Speaker Change: Now I'll turn the call over to Jason to provide insight on the current company activities.
unknown: Thank you, Joe. And good afternoon, everyone.
Jason: Thank you Joe and good afternoon, everyone.
Jason: And this quarters results are a direct testament to the strategic initiatives, we have been implementing.
Jason: Haven't stating their effectiveness in driving growth and market penetration.
unknown: These strategic moves are constantly strengthening our sales pipeline and backlog, positioning us for sustained growth, and we remain optimistic for the second half of the year. Currently, for year-to-date, we have recorded almost $1 million in service revenue alone. Our Ceremis integration system, or the SIS product line, is demonstrating a strong launch. A critical component of our SIS launch is our standalone system, which was introduced at Interfax earlier this year and received praise.
Jason: These strategic moves are constantly strengthening our sales pipeline and backlog.
Jason: Positioning us for sustained growth and we remain optimistic for the second half of the year.
Speaker Change: As a result of our efforts to build relationships and increase awareness of scientific studies, which validate our technology and test our latest application methods. We have seen a notable increase in demand for steel MSI H P and more importantly, we are beginning to grow our market share with strong momentum our efforts to expand our market presence well yeah.
Speaker Change: The substantial returns and the long term.
Speaker Change: I would like to touch upon the four key initiatives our sales pipeline for the custom engineered system. Our CES. The progress made regarding the launch of Sterling integrated system, where our SaaS performance of IH be service revenue and the impact of our worldwide distribution network and mobile equipment sales and the plans ahead.
Speaker Change: For this call I will begin with our IHT service revenue initiatives.
Speaker Change: As stated there was a significant shift in the decontamination service market as a leading competitor dropped out of the market early this year presenting us with a substantial amount of opportunities to grow our market share, particularly in the life Sciences sector.
Speaker Change: Currently for a year to date, we have recorded almost $1 million and service revenue alone.
Speaker Change: Yeah.
Speaker Change: Additionally, as Dr. St reported we formalized the partnership with <unk> to head our West Coast IHT services.
Speaker Change: The collaboration with <unk> into our service offers offerings will significantly expand our geographic reach and operational efficiency.
Speaker Change: By handling the volume of West Coast Ihop's service requests.
Speaker Change: <unk> allows us to optimize our resources and focus on higher profit margin opportunities.
This strategic partnership not only ensures customer satisfaction, but also drive increased sales of capital equipment by those who receive our services.
Speaker Change: We are also pleased to announce that makes you kind of have the newly secured three year contract with a major pharmaceutical company.
Speaker Change: The agreement between told me an email to you not only contributed $1 million for sales recorded too, but it will generate approximately $60000 of annual bid solution sales for tell me moving forward. It also.
Speaker Change: The utilization of our <unk> technology within a globally recognized organization.
Speaker Change: To date, we currently have an in house sales pipeline amounting to approximately $700000 for IHT services.
Speaker Change: Moreover, our enhanced validation packages are gaining traction within the life sciences sector.
Speaker Change: By offering a comprehensive suite of services, which includes validation, we are able to accelerate equipment operation and solidify our position as a preferred partner over other third party consultants for these services.
Speaker Change: A full comprehensive validation package service starts at $30000 for a standard full room area Fogging.
Speaker Change: All of these services typically offer a clear revenue forecast.
Speaker Change: As a follow up to a previous call I am pleased to report that one of the two anticipated CES contract has now confirmed and is in the design phase.
Speaker Change: This brings our total current active C. S. At CES is two four.
Speaker Change: We remain optimistic about closing the second contract this year, which is projected for Q2 2025 installation.
Speaker Change: Additionally, we anticipate four more C E S contracts in the near future with deliverables at different times.
Speaker Change: While the CES sales cycles are typically lengthy our persistence is paying off as reflected by the CEO of contracts closed this year.
Speaker Change: We are currently negotiating approximately 50 potential deals many of which we have been cultivating over the past few years.
Speaker Change: The difference now is many of these deals are maturing and we anticipate a more consistent closing rate.
Speaker Change: Our service integration system or the SaaS product line is demonstrating a strong launch.
Speaker Change: As a reminder, the S. I S. As our enclosure based C. E S solution, which offers a shorter sales cycle and streamline purchasing process compared to the traditional CES borders while still generating the valuable validation service revenue I just mentioned.
Speaker Change: Our proprietary Starbucks is gaining significant traction as well and we are actively collaborating with key enclosure manufacturers to establish long term partnerships.
Speaker Change: Of the four manufacturers reported one is selling and integrating our cold plasma applicator to remain in the design phase and the fourth is about to undergo cycle testing.
Speaker Change: Well this has been a substantial undertaking we anticipate returns once these partnerships are fully established.
Speaker Change: A critical component of our S. I S lunch as our Standalone system, which was introduced that intersects earlier this year and received crazy.
Ej: After finalizing the delivery system, we are now in full production and have a robust pipeline of potential customers. We are confident about the entry of this specific delivery system into our markets. Notably, our TOMI Service Network, or TSN, is being integrated into the Commercial Division moving forward. TOMI penetrated the coffee industry by bringing on Mayorga Coffee and a few others, and it onboarded clients such as Lakeview Farms and Crank & Boom in the dip, desserts, and ice cream industry.
Speaker Change: Finalizing the delivery system, we are now in full production and have a robust pipeline of potential customers.
Speaker Change: This versatile system offers significant flexibility for decontamination protocols catering the both enclosures and smaller room, while maintaining strict adherence to GMP and Anna annex one guideline.
Speaker Change: We are confident about the entry of this specific delivery system to our market base.
Speaker Change: Well tell me if I H P services, CES and SaaS operations I. Just mentioned are primarily focused around our life Sciences Division. We are also strategically investing in our other divisions food safety health care and commercial.
Speaker Change: Notably our told me service network or T. S. N is being integrated into the commercial division moving forward.
Speaker Change: To drive company growth and expand our market presence. We are excited to announce the launch of the service pro certified or S. P. C program open to all customers customer segments globally.
Speaker Change: This initiative offers significant opportunities for revenue growth and increased market penetration by enhancing our proactive approach to worldwide disinfection.
Speaker Change: The SPC program and educational platform, mainly for our service providers and health care facilities departments aims to expedite the adoption of our technology and resources.
Speaker Change: They position by positioning the SPC program as a key component for our growth strategy. We are confident it will expand our market footprint.
Speaker Change: Tell me, it's consistently broadening its deramous presence and client base within the food industry challenging traditional methods and introducing innovative disinfection procedures.
Speaker Change: Tony penetrated the coffee industry by bringing on Mayorga coffee and a few others and on boarded clients such as Lake view farms, and cranking boom and the depth desserts and ice cream industry.
Speaker Change: Tony has also integrated deramus into standard operating procedures, and the egg white food manufacturing pet food production and packaging meat production and agribusiness sector of the market.
Speaker Change: The sterile pack is their preferred product for becoming accustomed with HP technology.
Speaker Change: To further demonstrate the effectiveness of service in the food industry tell me is excited to announce collaborative efforts with several major establishment on new studies that explore the broader applications and benefits that IHG has to offer.
Ej: We are working with a production company in Spain directly applying IHP on spices such as pepper, thyme, paprika, and peppercorns to reduce salmonella. TOMI is developing a specialized application of spraying on their conveyor belts, simplifying the decontamination of packaged items against salmonella and listeria. Our key distributors are actively expanding their market presence, and we continue to provide them with support. Our distribution network has been instrumental in the successful launch of our SIS product line, contributing significantly to both the integration and standalone system sales pipeline. We are optimistic about a strong 2024 close.
Speaker Change: We are working with a production company on Spain directly applying IH P on spices, such as Pepper time, Pepper Rica, and peppercorns to reduce salmonella.
Speaker Change: A multinational corporation and food and beverage processing is operating IH P. At two of their international sites.
Speaker Change: And preliminary results show no contamination after treatment with HP. We are hopeful that continued youth will lead the company wide acceptance.
Speaker Change: These studies have also created further opportunities through introduction to their suppliers.
Speaker Change: A third new initiative is one with a leader in consumer goods production of health hygiene and nutrition products.
Speaker Change: <unk> is developing a specialized application of spraying there conveyor belt simplifying the decontamination of packaged items against Salmonella and listeria.
Speaker Change: Our key distributors are actively expanding their market presence and we continue to provide them support our distribution network has been instrumental in the successful launch of our SaaS product line contributing significantly to both the integration and Standalone system sales pipeline.
Speaker Change: We are also actively exploring new partnership opportunities in South Africa, Japan, Puerto Rico in Indonesia to further expand our global reach.
Speaker Change: In conclusion, we are pleased with our progress across all business segments.
Speaker Change: Our IHG service continues to expand.
Speaker Change: E S. S. I S product lines are gaining the traction they deserve and the STC program is poised to drive further growth.
Speaker Change: The foundation built throughout the past few years with our customer relationships and partnerships is propelling us forward.
Speaker Change: We are optimistic about a strong 2020 for clothes.
Speaker Change: I will now turn the call back to Dr. Shane for closure.
John Nelson: Splendid. Thank you, EJ and Joe. Given our relatively small size, since the founding of this business, I have never been more excited about the prospects for TOMI.
Dr. Shane: Splendid thank you Vijay and Joe.
Dr. Shane: As we reflect on our accomplishments this quarter. It is clear that told me is well positioned for sustained growth and continued market expansion are.
Speaker Change: Our return to profitability in this quarter strong.
Speaker Change: Strong revenue growth and strategic initiatives underscore our ability to adapt and thrive in a dynamic market environment.
Dr. Shane: Given our relatively small size.
Dr. Shane: Our historical results have been lumpy.
Dr. Shane: This is not lost on US we are laser focused on capturing the very real market opportunities in front of us and scaling the business to drive more sustained revenue growth.
Dr. Shane: Realize the power of our razor razor blade model with growing high margin sales and delivering to shareholders consistent and growing profitability.
Dr. Shane: The team has made great progress laying the groundwork for this and we saw some of the fruits of our strategy come through in the quarter. We are on the way to building a much larger and more valuable business for stakeholders.
Speaker Change: Since the founding of this business I have never been more excited about the prospects for tell me. Thank you for your continued support and confidence and Tony Environmental solutions, operator, let's open to calls.
Speaker Change: <unk>.
Speaker Change: Certainly everyone. At this time will be conducting a question and answer session. If you have any questions or comments. Please press star one on your phone at this time.
Speaker Change: We do ask that we're posing your question. Please pick up your handset if you're listening on speaker phone to provide optimum sound quality.
Dr. Shane: Once again, if you have any questions or comments. Please press star one on your phone.
Speaker Change: Your first question is coming from Amit Dayal from H C. Wainwright Your line is live.
Amit Dayal: Thank you and good afternoon, everyone.
Dr. Shane: So with respect to sort of you know the.
Speaker Change: Mobile equipment sales.
Dr. Shane:
Dr. Shane: Just wanted to see how you get visibility. So this segment you know you get.
Dr. Shane: Orders during the quarter that you can fulfill or are these part of your pipeline and you know these orders are placed in advance and then.
Dr. Shane: These orders accordingly.
Dr. Shane: Okay.
Dr. Shane: Hey, Jay do you want to take that.
Speaker Change: Yes of course on the mobile equipment sales. It is a more of an immediate delivery for all our handheld and full room area Fogging.
Speaker Change: The order comes in and we're able to deliver those immediately to our customers.
Jay: Understood. So in that context, I'm, just trying to get a sense of you know how much inventory you need to keep it.
Speaker Change: And you know.
Speaker Change: Whether the balance sheet at this point do not support all of these initiatives that you have going on you know do match or does that.
Speaker Change: Coming on the sport and new kind of loosen those accordingly.
Speaker Change: Okay.
Speaker Change: I'm, sorry, you broke out a little bit on our end.
Speaker Change: Got it so we have an inventory a little over $4 million and it's composed mostly of equipment that would be mobile.
Chip: Okay perfect. Thank you chip.
Speaker Change: <unk>.
Speaker Change: And then you know with respect to the.
Speaker Change: The food safety opportunity you highlighted a whole spectrum of potential customers.
Unknown Shareholder: Is there any particular, you know, segment within sort of that industry, like grocery chains?
Speaker Change: Oh yeah.
Speaker Change: Did you learn you know segment within sort of you know that.
Speaker Change: Industries like grocery genes.
Speaker Change: Sure.
Speaker Change: We'll close with Ob agricultural value chain that you were seeing you know.
Speaker Change: Faster adoption for this.
John Nelson: I don't know faster. I think they're all in play. I think anything from grocery markets to transportation of groceries to markets to storage of produce and various other foods along with the use of it in the production line, and it's endless as far as the potential possibilities of what our product can do in the food safety end, and as we all know, because of the high costs of food that we're currently all experiencing, it is becoming more in demand each day, especially in the preservation of the storage and transportation of food.
Speaker Change: I don't know.
Speaker Change: Faster I think they are all in play.
Anything from grocery markets to transportation of groceries to market to storage of produce and various other foods.
Along with the use of it in the production line and.
Speaker Change: Endless as far as the potential possibilities of what our product can do in the food safety and <unk>.
Speaker Change: And as we all know because of the high cost of food that we're currently all experiencing it becomes more in demand each day, especially in the presentation.
Speaker Change: Storage and transportation of food.
Wanted to see what makes sense.
And then you highlighted sort of the lumpiness in the past.
Speaker Change:
John Nelson: All of these initiatives now in play, you know, the sales pipeline sort of now starting to come through. Should we expect, you know, at least for the remainder of 2024, sequential improvements? I don't know if you have that level of visibility, but just trying to get a sense of how the next two quarters might shape up for you.
Speaker Change: All of these initiatives now in place.
Speaker Change: This is my plane sort of now starting to come through.
Speaker Change: Should we expect you know at least for the remainder of Bernie Bernie for sequential improvements I don't know if you.
Speaker Change: We have that level of visibility, but just don't lose get a sense of how.
Speaker Change: The next two quarters might.
Bob: Sure Bob.
Speaker Change: Well, we were very encouraged with what we have in our pipeline and what we have on the drawing boards for units, especially custom units. So it is hard and you know I don't want to just put in this box again, but I mean, I think we're going to have a really strong second half of this year.
Speaker Change: And we see it going further into 2025 and 2026.
Speaker Change: And just last one for me.
Speaker Change: With all of the bird flu related headlines over the last quarter.
Speaker Change: Has that just hoped you know create more awareness about your products.
Speaker Change: And just more visibility in the industry.
John Nelson: I think the professionals in the industry are slowly becoming more aware of the product, and we're getting a lot of questions, but I'm not too sure the general public is yet over the emotional and stress results of the pandemic. You know, we're hearing different things about this specific bird flu and how it relates to human passage. But it is moving on into other animal kingdoms, including squirrels and raccoons and things that you usually don't hear about. So it's here, and it's going to potentially increase the product, and the usage going forward in the right situations.
Speaker Change: I think the professionals in the industry are slowly becoming more aware of the product and we're getting a lot of questions, but I'm not too sure. The general public it yet is over the promotional and stress.
Speaker Change: Results of the pandemic.
Speaker Change: You know, we're hearing different things about this specific bird flu and how it relates to human passage.
Speaker Change: But it is moving on into other animal kingdom's, including you know the squirrels raccoons and things that you usually don't hear about.
Speaker Change: So it's here and it's gonna only potentially increase.
Speaker Change: Product usage going forward are.
Speaker Change: In the right situations.
Speaker Change: That's all I had guys. Thank you so much. Thank you so much for your questions.
Speaker Change: Thank you. Your next question is coming from Jack Lago from Longbow Capital Management. Your line is live.
Operator: Alright, thanks for tuning in.
Jack Lago: Hi, Thanks for taking the question just talk a little bit more about the growth in bit solution sales. Obviously this was a high margin portion of the business saw good performance in the quarters. So could you kind of just talk bit more about how this plays into the model as business skills.
Speaker Change: Sure. So I mean, you know the concept and the model for the company as a razor razor blade or printer printer cartridge and the <unk>.
Speaker Change: More raise as we get out in the more printers, we get out the more utilization of those cartridges are blades.
Jack Lago: So I think that we're starting to see.
Jack Lago: Some return on some of these large units that we've put in within the last couple of years, they've spent a long time through the validation process and now they're starting to utilize them on a consistent basis and I think this will be good for financial projections going forward and obviously the more equipment we get.
Out there you know the greater.
Jack Lago: Usage and the because they are high margin.
Speaker Change: So the company, that's going to make a much better profitability going forward. So.
Speaker Change: More pieces of equipment more solution to greater profit.
Speaker Change: Got it sounds good. Thank you that's all from me Okay. Thank you for the question.
Speaker Change: Yeah.
Speaker Change: Thank you once again, everyone. If you have any questions or comments. Please press star then one on your phone.
Speaker Change: Your next question is coming from John Nelson Your line is live.
unknown: Hi.
Speaker Change: Hi.
John Nelson: Grants to you and Hilton and the team on reaching profitability I'm.
John Nelson: Very impressed with the the results to date. Thank you.
Thank you for that.
Speaker Change: We are.
Speaker Change: [laughter] I am first question is on <unk>.
Speaker Change: The ethylene oxide.
Speaker Change: Market.
Speaker Change: I know you've applied for a B M. D. Grant is there any progress on that.
Speaker Change: No. The the grant was given to <unk>.
Speaker Change: Fighting up against the H P type.
Speaker Change: People and are there on the committee so we didn't make it under this grant.
Speaker Change: Not because were not better and quicker, but it's just the politics. However, it is opening up the various avenues of companies that are using it privately and I think we'll be able to.
Speaker Change: Effectively use our project much quicker than the <unk> grant.
unknown: Yes, I've seen articles on a growing number of lawsuits.
Speaker Change: Yes, I've seen the article on the growing number of lawsuits from the release of gas during production storage and transport.
Speaker Change:
Speaker Change: So I was kind of curious if you were getting more and more inquiries on.
Speaker Change: The substitution.
Speaker Change: For Oh Starer missed.
Speaker Change: For ethylene oxide.
unknown: Yeah, I think everybody is concerned and especially since the EPA is marketing it as a carcinogenetic material, I think that in the future, there should be a lot more interest. The problem that I saw initially, and it just was part of the grant, was that we couldn't give a substitute for ethylene oxide. They wouldn't allow that.
Speaker Change: Yeah, I think everybody is concerned and especially since the EPA is marketing it is of course, a genetic material.
Speaker Change: I think that in the future there should be a lot more interest.
Speaker Change: The problem that I see initially is and it.
Speaker Change: It just was part of the grant was we couldn't give a substitute for ethylene oxide. They wouldn't allow that so what they wanted was just somebody to come in and after they use of ethylene oxide to mitigate it.
John Nelson: So what they wanted was just somebody to come in after they used the ethylene oxide to mitigate it. But they spend millions of dollars on these sterilizers in buildings and large, you know, hundreds of thousands of square feet. And they don't want to throw out their equipment, even though we could retrofit our product into it, which I'm hoping that some of these private companies realize.
Speaker Change: Okay.
Speaker Change: Spend millions of dollars on on these sterilizers and buildings and large.
Speaker Change: Hundreds of thousands of square feet and they don't want to throw out their equipment, even though we could retrofit our product into it which I'm, hoping with some of these private companies realize that in the future.
Speaker Change: Hey man.
Sure.
Speaker Change: So John also for your knowledge the company I referenced that we're working with on conducting the studies with Spice production. Their main goal is to replace E. T O and we're gathering the formal study is to be able to share that with the public and move forward with other facilities and doing so.
Speaker Change: Excellent. Thank you.
Speaker Change: My second question is related to our.
Speaker Change: I know one of your projects.
Speaker Change: In recent years.
Speaker Change: Ambulance market can you.
Speaker Change: Tell me if there is any progress being made on hum penetrating that.
Speaker Change: But there is we continue to work with our I grew up in tech the amount and in Canada on BMS they have quite a few.
Speaker Change: Large manufacturers of ambulances, where we're trying to be able to become a full turnover package of ambulance and decon system.
Speaker Change: It's a long term process of course, we used to have to start at the education process.
Speaker Change: Process and now we are running the tests and finding ways to work with them and using our transport.
Speaker Change: So it is in process and still very active.
Speaker Change: Okay, Great I have a brother who's a doctor who's talked to they are.
Speaker Change: The ambulance crew in his hospital and ER.
Speaker Change: Hum.
Speaker Change: They sounded like they were very enthusiastic about some type of a product like that being available. So.
Speaker Change: I hope it comes to fruition.
Speaker Change: For your company.
unknown: Yeah, it will, John, and if you send us any information, we'll be more than glad to have our sales team contact them.
Speaker Change: It will China, and if you send any information it will be more yeah, I've ever salesmen to contact them.
Speaker Change: Okay.
Speaker Change: Great.
Speaker Change: Third question is.
Speaker Change: The you had a big jump in accounts receivable. This quarter is the are the receivables.
Speaker Change: Turnover cycle.
Speaker Change:
Unknown Shareholder: fast, slow? Can you give me some kind of indication of how soon you expect to realize the receivables on average?
Speaker Change: Fair enough.
unknown: [inaudible]
Speaker Change: So.
Speaker Change: Can you give me some kind of indication on it.
Speaker Change: Hmm.
Speaker Change: How soon do you expect to on average realize the receivables.
Speaker Change: Yeah.
Speaker Change: I met her.
Speaker Change: Defer that to Joe It depends I think on the receivable in the market, but Joe go ahead.
Joe: Yes, I mean, the big Spike in revenue was for the large.
Speaker Change:
Speaker Change: And receivables due to the large increase in revenue for the quarter.
Joe: And some of those customers had upfront payment terms, we've already collected and most of the others are either net $30 60, So we should realize the collections on those receivables this quarter.
Ed: Thanks, Ed.
Speaker Change: Let's see.
Speaker Change:
Speaker Change: Yeah.
Speaker Change: And that's been a big recall.
Speaker Change: The board has had.
Speaker Change: And the Deli meats.
Speaker Change:
Speaker Change: Section of the food industry. So I was wondering if you have.
Speaker Change: Any specific.
Speaker Change: You mentioned meat packing is one market but.
Speaker Change: Have you been.
Speaker Change: Focusing at all on that or any I would think that they work with a good contact for potential business. Given this how much it's going to cost them and lawsuit.
Speaker Change: <unk>.
Speaker Change: So just an idea, but can you respond to that.
unknown: Well, I mean, we would be good in different areas of that, but the listeria that they're having the recall over is the reason why none of us can find boar's head at the deli counter.
Speaker Change: Well I mean, it would be good in different areas of that but the listeria that theyre, having the recall over is the reason why none of us can find boars head in the deli counter so.
Speaker Change: I think I don't know if Vijay has any update as anybody from bores had reached out to us or have we reached out to them.
Speaker Change: They have investigated in us and they were certainly on our website and we've reached out to.
Speaker Change: A few parties are in the company, hoping to hear back that we are on top of this top of it we heard the same news or them.
Speaker Change: We do have current users on her backpack in the meat production to be able to get on the phone with them as referrals them. So we are.
Speaker Change: On top of that.
Speaker Change: Okay very good.
Speaker Change: Be careful with deliver wrist.
Speaker Change: No.
Speaker Change: [laughter] good one.
Speaker Change: Oh.
Speaker Change: And then my next question.
Speaker Change: You mentioned in the prior quarter.
Speaker Change: Transcript and called the Hum biofuel industry was also an area to target and that Ah.
Speaker Change: Ah I H P is known to be the fastest and second strongest oxidizing yeah.
Speaker Change: Ancient no one.
Speaker Change: To mankind.
Speaker Change: Has there been anything any new developments in that particular area.
Speaker Change: Not yet we are looking at some grant proposals, which I think we could possibly qualify for but the you know again being so busy and it being a small company and there's just so much applecare. So many different applications for this product worldwide.
Speaker Change: We're starting to handle and take calls from the ones that I think are going to be immediate utilizes.
Speaker Change: Utilize there's an long term clients.
Speaker Change: This is a great opportunity and Biofuels and it's going to take a long time and some really good research and we do have identified a partner that is willing to do the research and it's just getting the parties together and having that time and.
Speaker Change: You know, which we've been focusing on revenue production.
unknown: Okay, good. And the data centers, any update there?
Speaker Change: Okay. Good.
Speaker Change: Data centers any update there.
Speaker Change: The same thing there with the amount of new data centers being built.
Speaker Change: They're they're a little hesitant to use a product like this because they don't truly understand the fact that we are non caustic and we don't damage.
Speaker Change: But it's going to require some testing on a smaller scale first to make sure and long term testing so it's something that.
Speaker Change: And I am agreement with you they all should be interested in utilizing it in the data center industry.
Speaker Change: It's finding the right partner to attempt to try it on their test and to to go ahead and validates the positive effects of using a product that's IH P and doesn't have the cost stickiness and it has some phenomenal material compatibility.
Speaker Change: Okay. Thanks.
Speaker Change: And then on.
Speaker Change: On the SaaS products.
Speaker Change: Uh huh.
unknown: It is fairly new, at least the market for those kinds of products, especially in
Speaker Change: Fairly new.
Speaker Change: On that.
Speaker Change: At least.
Speaker Change: The market for those kinds of products, especially in.
Speaker Change: Biological safety and.
Speaker Change: Other decontamination chambers seems to be.
Speaker Change: Enormous.
Speaker Change: How are you.
Speaker Change: Getting the word out on.
Speaker Change: This newer area of your product line.
Speaker Change: I'm going to let Eric answer that.
Speaker Change: Yes, that's a shame.
Eric: So it's truly a very exciting project, we have established relationships with enclosure manufacturers through the multiple shows interest throughout the years and it's now moving very fast.
Eric: Fast with a lot of them are.
Eric: To kind of turn over this package and and more importantly, once we are able to use their customer base as well and selling and closures with I H P. It provides us an entry into a wide range of facilities, who get familiar with it and then wanting our other systems for you know other area at the time and that's starting to come.
Speaker Change: To light and and more frequent real time.
Eric:
Eric: So it's it's now turning into a turnkey integration.
Speaker Change: And then a quick sale after that so.
Eric: Hmm.
Speaker Change: We have some very familiar well recognized partners in the industry.
Speaker Change: Okay very good that so thanks.
Speaker Change: Thanks very much.
Speaker Change: Thank you John Thank you.
Speaker Change: Yeah.
Speaker Change: Operator.
Speaker Change: Thank you there are no further questions in the queue I'll now hand, the conference back to management for closing remarks. Please go ahead.
Operator: I just want to thank everybody once again for joining us, and I hope you all, wherever you are in the world, have a pleasant day or evening and tune in for our next conference call coming up at the end of the quarter. Thank you all. Be safe.
Speaker Change: I just wanted to thank everybody once again for joining and I Hope you. All wherever you are in the world have a pleasant day or evening.
Speaker Change: And tune in for our next conference call coming up at the end of the quarter. Thank you all.
Speaker Change: Safe.
Speaker Change: Thank you everyone. This concludes today's event you may disconnect at this time and have a wonderful day. Thank you for your participation.