Bluechiip Ltd (BCT.AX) Quarterly Report
Melbourne, Australia, Oct 29, 2020 - (ABN Newswire) - Bluechiip Limited (ASX:BCT) today released its quarterly cash flow report for the quarter ended 30 September 2020.
Corporate and Business highlights
- Progressed negotiations with potential OEMs including in the IVF market, Cell Therapy and target Biobanking space which have seen market building interest for the Company's products and solutions;
- Focused on building a direct to market portfolio of products for the Biobanking market especially in North America with end customer engagement including delivery of a Bluechip system in China during the quarter;
- The Company is financially well positioned with cash and cash equivalents of $6.6m as at 30 September 2020, with no borrowings;
- Since the lawsuit filed against Labcon on 29 July 2020, Bluechiip has been working with its legal counsel in the US pursuing its full rights and remedies under the rescinded Agreement and has rejected a counterclaim by Labcon. Both parties have agreed to pursue private mediation to seek a resolution;
- The Company continues to receive financial support from Federal Government incentives through Cashflow Boost and JobKeeper Payment. Also benefited from the Victorian Business Support Fund - Expansion program intended to support businesses through renewed COVID-19 restrictions;
- Company continues to progress delivery of product despite challenges with marketing progress and activities hampered by the impact of the global coronavirus (COVID-19) pandemic; and
- Company successfully completed its Implementation and received certification of ISO 9001 Quality Systems compliance.
Sales during the September 20 quarter continue to be adversely affected by the global COVID-19 pandemic, nonetheless, the Company successfully delivered sales of $24K in developer kits. This together with prior quarters sales delivered a sales receipts of $47K for the quarter ended 30 September 2020.
Cash outflow during June and September 2020 quarter has predominantly focused on ongoing improvements to the chip performance and efficiency. R&D and staff cost continue to be amongst the major cash outflow items - $748K and $536K respectively, both activities for which the company expects to receive a refund of 43.5% in the form of R&D Tax Incentive from the Australian Government. The Overall, net operating cash outflow for the quarter increased from $962K in previous quarter to $1,281K.
The Company continues to respond to market conditions by progressively reviewing several measures implemented including:
- Executing on potential opportunities in the US including evaluation systems into customer sites;
- Progressing negotiations with potential OEMs including in the IVF market, Cell Therapy and target Biobanking space which have seen market interest for the Company's products and solutions;
- Lodging the registration of 2019/2020 R&D Tax Incentive refund with anticipated receipt in excess of $1m from the Australian Government;
- Focusing R&D activities on improving the quality, performance, and scalability of chips. This is expected to attain higher quality and yield with the aim of achieving economies of scale and lowering production costs as the Company approaches full volume production;
- Reallocating the technical sales team resources to R&D activities with the aim of further improving our products; for example, improving our multi vial readers functionality by addressing market feedback to meet current and potential OEM partners' requirements arising from the sales of developer kits in previous quarters. The developer kits enable potential OEM partners to integrate Bluechiip's technology into their own products;
- While the Company anticipates that it will continue with more R&D activities over the coming quarters, it intends to carefully manage its existing cash reserves in line with overall strategy;
- Reducing, temporarily, the scale of production in response to the slowdown in sales activity, while continuing to build stocks with the expectation that when markets normalise, Bluechiip is well positioned for a return to growth; and
- Working on further patent applications to add to Bluechiip's existing 9 patent families comprising 25 granted patents.
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About Bluechiip Ltd:
Bluechiip Ltd (ASX:BCT) has developed a wireless tracking solution for the healthcare and life science, security, defence and manufacturing industries which represents a generational change from current methods such as labels (hand-written and pre-printed), barcodes (linear and 2D) and microelectronic integrated circuit (IC)-based RFID (Radio Frequency Identification).
The unique tag is based on MEMS technology and contains no electronics. The tag can either be embedded or manufactured into a storage product, such as vials or bags. Easy identification, along with any associated information from the tag such as temperature can be detected by a reader, which can also sense the temperature of the tagged items. The traditional identification technologies have significant limitations. Whereas a barcode requires a visible tag or line-of-sight optical scan, bluechiip(R) technology does not. Unlike labels, barcodes and RFID, the bluechiip(R) technology can sense the temperature of each item a tag is attached to, or embedded in.
The bluechiip(R) technology has initial applications in the healthcare industry particularly those businesses which require cryogenic storage facilities (biobanks and biorepositories). bluechiip(R) offers the only technology that enables accurate and reliable tracking of products including stem cells, cord blood, and other biospecimens. In addition to functioning in extreme temperatures, the bluechiip(R) tracking solution can survive autoclaving, gamma irradiation sterilization, humidification, centrifuging, cryogenic storage and frosting.
The bluechiip(R) technology has other healthcare applications in pathology, clinical trials and forensics. Several other key markets outside of healthcare include cold-chain logistics/supply chain, security/defence, industrial/manufacturing and aerospace/aviation.
Further information is available at http://www.bluechiip.com
T: +61 (0) 3 9640 0400
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