STIRLING PRODUCTS LIMITED Audio Webcast

STIRLING PRODUCTS LIMITED (STI)

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STIRLING PRODUCTS LIMITED (STI) Events

Company (Stock Code)	Date/Time	Event	Timezone: Australia/NSW
STIRLING PRODUCTS LIMITED (STI) New Opportunities and Markets for Provale	Wed, 6 Aug 2008 11:30AM	STI - Shareholder Update 2nd Quarter 2008 - Dr Calvin London, MD
STIRLING PRODUCTS LIMITED (STI)	Wed, 23 Apr 2008 04:00PM	Excellence in Biotechnology Investment - Dr Calvin London, MD, Stirling Products Ltd
STIRLING PRODUCTS LIMITED (STI) Commercial progress expands international shareholder base	Tue, 22 Apr 2008 10:30AM	STI - Shareholder Update 1st Quarter 2008 - Dr Calvin London, MD
STIRLING PRODUCTS LIMITED (STI)	Fri, 23 Nov 2007 01:00PM	STI - 2007 Annual General Meeting - Dr Calvin London, MD
STIRLING PRODUCTS LIMITED (STI)	Fri, 12 Oct 2007 05:00PM	STI - Activities Update - Dr Calvin London, MD
STIRLING PRODUCTS LIMITED (STI)	Tue, 31 Jul 2007 10:00AM	STI - Activities Update - Dr Calvin London, MD
STIRLING PRODUCTS LIMITED (STI)	Tue, 24 Apr 2007 02:00PM	STI - First Quarter CY 2007 Market Update - Dr Calvin London, MD
STIRLING PRODUCTS LIMITED (STI)	Wed, 7 Feb 2007 12:00PM	STI - Agreement Signed with North American Bioscience Company - Dr Calvin London, MD
STIRLING PRODUCTS LIMITED (STI)	Thu, 23 Nov 2006 09:30AM	STI - Annual General Meeting - Dr Calvin London CEO
STIRLING PRODUCTS LIMITED (STI)	Tue, 10 Oct 2006 11:00AM	STI - Update on the Commencement of Several Trials - Dr Calvin London, MD and CEO
STIRLING PRODUCTS LIMITED (STI)	Mon, 28 Aug 2006 04:00PM	STI - R-Salbutamol Adds Substantial Weight Gain to Lambs - Dr Calvin London, Managing Director
STIRLING PRODUCTS LIMITED (STI)	Mon, 17 Jul 2006 03:00PM	STI - European Joint Venture - Dr Calvin London, MD & CEO
STIRLING PRODUCTS LIMITED (STI)	Fri, 26 May 2006 10:30AM	STI - Animal Growth Promoters - Dr Calvin London, Managing Director and CEO
STIRLING PRODUCTS LIMITED (STI)	Fri, 29 Aug 2008	Full Year Results
STIRLING PRODUCTS LIMITED (STI)	Fri, 29 Feb 2008	Interim Results
STIRLING PRODUCTS LIMITED (STI)	Fri, 23 Nov 2007 10:00AM	Annual General Meeting BGC Centre, 28 The Esplanade Perth WA
STIRLING PRODUCTS LIMITED (STI)	Wed, 29 Aug 2007	Full Year Results
STIRLING PRODUCTS LIMITED (STI)	Fri, 23 Feb 2007	Interim Results
STIRLING PRODUCTS LIMITED (STI)	Wed, 22 Nov 2006 11:00AM	Annual General Meeting Mezzanine Level, BGC Centre, 28 The Esplinade Perth WA
STIRLING PRODUCTS LIMITED (STI)	Fri, 8 Sep 2006	Full Year Results
STIRLING PRODUCTS LIMITED (STI)	Fri, 31 Mar 2006	Date Payable
STIRLING PRODUCTS LIMITED (STI)	Thu, 16 Mar 2006	Interim Results
STIRLING PRODUCTS LIMITED (STI)	Thu, 24 Nov 2005 10:00AM 07:00AM Australia/West	Annual General Meeting
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STIRLING PRODUCTS LIMITED (STI)

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INTERVIEW WITH DR, CALVIN LONDON, MANAGING DIRECTOR, STIRLING PRODUCTS LIMITED (STI)

“New Opportunities and Markets for Provale”

http://www.brr.com.au/event/48902

 

WEDNESDAY, AUGUST 6, 2008, 11:30 AM

 

            BRR    Today, Boardroomradio will hear from Mr. Calvin London, the managing director and chief executive officer of Stirling Products, to give shareholders

10                    and our listeners an update on operations for the quarter. Over to you, Calvin.

            STI       Thanks very much, Joel. Yes, I'd like to welcome listeners and shareholders to this update for 2008. This is the second update, I think, for this year. Essentially, what I would like to do is to summarize the progress for what will be known as the 2nd quarter of 2008 or the last quarter of the financial year

15                    of 2007/2008. There are a series of slides which you can see this address and I will refer you to the slide numbers as I go through so that listeners can follow in this process.

 

                        The first slide which is Slide No. 2 basically just lists the four objectives that

20                    we have been working towards for 2008. In brief, I think these objectives are fairly clear-cut. They focus around increasing sales revenue primarily through rapid introductions of new market or market-ready products such as those in the Companion animal market and also the expansion of ProVale sales while continuing to support the longer term objectives associated with the

25                    technology platform around the compound R-salbutamol.

 

                        The next slide, Slide 3, addresses the corporate progress. Early this year, we announced that Stirling had attracted considerable interest from overseas investors as part of the placement which was finalized in January of this year.

30                    A large part of this interest is generated from the rising food commodity price index which continues to climb second only to oil. UK investment houses, perhaps unlike some of the Australian market houses, in general, have a strong and genuine interest in the food commodity index as the world enters into a situation of decreased food supply but increased demands and

35                    increased costs. This not only hits the consumers but is also hitting the producer. For example, in the last year the cost of supplying feed to swine has increased by some 35%. The board continues to cultivate this interest as the company moves forward in developing its technical platforms and recent months have seen the top shareholder in the company exit only to be

40                    replaced by one of these London-based investment houses. I've included a copy of the latest share graph for Stirling Products and while this graph perhaps looks more like the Swiss Alps, I can only ask shareholders not to lose faith. Stirling has held its own in a very turbulent stock market. While other bioscience companies have experienced dramatic reductions in their

45                    share price up until the middle of July, Stirling had held its price range in the 6 cents mark for a number of months. Of course, we would like to see this price increase, but it seems that in today's market holding your own is in some way a sign of success. I've included here two rankings, one is from the Laser's Bioforum Report on biotech companies in which Stirling ranked seventh out of 70 listed companies and prior to that is also an index for the Inter-Swiss Report which showed that Stirling had lost 8% of it's share price compared to the biotech average which was almost 24%. It's strange but not even the announcement of a milestone payment for a successful trial of ProVale in

5                      shrimp and its associated potential for worldwide distribution agreement or the announcement of a licensing potential for a product that has projected sales revenue of $25 million over the next five years did anything positive to our share price. To quote one of my favorite American expressions, go figure!

 

10                    Moving on to the commercial aspect with the release of this week the quarterly figures, I think there is... worthy of a couple of comments in relation to this. Shareholders will note that we have reduced the burn rate of expenditure this quarter for general operating costs by some 300,000 from the last quarter and this is mainly in the area of research and development.

15                    The company has, apart from some limited small trials in Canada, essentially not conducted any large scale research and development trials this quarter. This is reflective of the company' s focus on driving improvements in sales revenue and the development of distribution and licensing agreements. There's also been an increasing revenue for the company of 100,000 in the

20                    last quarter bringing the total receipts of year-to-date to 393,000 which is slightly behind the target of generating 1 million in sales for this calendar year. So at the halfway point, one would expect this to be around 500,000 so it's a little bit shy of this mark but I think that certainly from my perspective, I am still confident that we will be able to get close to the target set at the

25                    November shareholder meeting last year. While the spread in the source of revenue has changed slightly because of the lack of sales of R-salbutamol South Africa which I will address in due course, the primary source of revenue to date still remains from ProVale and I am still confident that we can increase the sales target for this by the end of the year. The quarterly report

30                    also reflects the continued support of acquisitions such as PBA in Canada and the sequential payments associated with this and the support of the joint venture subsidiary in Denmark that is developing the equine products on behalf of Stirling Products.

 

35                    Turning our attention now to partnerships. This quarter has been characterized by some very successful foundations in the areas of partnership for the company. The end of the first quarter was the time indicated for commercial decision on two current material transfer agreements, one with Merial Animal Health, currently the second largest

40                    animal health company in the word and the other with the top five animal health company that at this stage we cannot name due to exclusivity and confidentiality reasons. The MTA with Merial relates to the use of R-salbutamol with sheep and was combined with technology that Merial had; as I mentioned, delivering R-salbutamol to the sheep, the second one related to

45                    the use of ProVale for shrimp farming. Now feedback indicates that it is unlikely at this stage that the commercial arrangement will result in the material transfer agreement with Merial based on the trial work that is being done in sheep although aspects of this trial conducted reflect that the previous good results of R-salbutamol, the commercial realization may not be sufficient to proceed at this stage. We will update the market in due course on this progress.

 

                        The second agreement is far more positive and as announced on June 9th,

5                      has matured and resulted in a mass downpayment for a successful set of trial results. As a result, the company is now under a period of exclusivity and negotiations for the rights to a worldwide distribution agreement for the use of ProVale in commercial sheep production. It's important for shareholders to grasp the significance of this potential. The worldwide production of shrimp is

10                    currently about 5 million tons per annum and if we were to capture 10% of this market through this distribution agreement would add some $5 to 10 million of gross revenue to Stirling's bottom line. The second and perhaps equally more important point is that this agreement will give the company valuable third party endorsement for its technology. Even if this agreement

15                    doesn't eventuate, and at this stage I am confident that it will, we have several other regional companies that are interested in this technology for this particular application. So the outlook for advanced sales and revenue potential from this application is particularly promising. Stirling is finalizing the terms of agreement for three other exciting licensing opportunities. The first is

20                    to do with rapid detection of early respiratory problems in horses. This diagnostic device has a number of features that fit with Stirling’s licensing philosophy. It has a short time to market, international appeal, a good revenue potential and is complimentary to our current technologies. We hope to be able to announce to the market in the very near future the completion of

25                    successful negotiations and suitable terms for licensing of this device and based on this would anticipate that the device will be available to the market in early 2009.

 

                        The second and most recent if PetQuench which is an exciting new

30                    opportunity to introduce a product already on the market in North America into the Australian market. This has projected sales of over 25 million for the next five years, requires minimum registration to bring it to the market and is a product that is a prime candidate as a launching pad for Stirling's Animal Health Division which will concentrate primarily on companion animal

35                    products. The pet food market in Australia, modest by international standards, is still valued at over $2 billion and pet foods and companion animal products in general are the fastest climbing area of livestock and animal health.

 

                        The third agreement is for a product called Jonotol and this has been

40                    announced to the market and is currently being discussed. It is a novel insecticidal treatment primarily for livestock products. Collectively, these opportunities represent significant upsides to Stirling Products and have the potential of changing the look of Stirling from an R&D focus to a company that has matured with products on the market. We look forward in the near future

45                    to updating shareholders on these opportunities.

 

                        Very briefly, in terms of the technology update, Slide 6, there has been little change in the technology position to say that we have progressed the registration in South Africa having submitted documentation to address the requirements that were presented to the company through its exclusive distribution arm on behalf of the Medical Control Council in South Africa. We are confident that these responses that have been provided will facilitate a resolution to the issues that were raised last year. Once again, while not

5                      wanting to make excuses, it does reflect the uncertainties of dealing with regulatory bodies and as a flow in on projecting times to market. We continue to push our partners in South Africa to bring this to resolution in order to put the product on the market as quickly as possible in South Africa. We are still intending to submit plans for the development of the heaves application for R-

10                    salbutamol to the FDA in the third quarter of this year and are currently awaiting the results of our first trial with the steroid to be used as an adjunct treatment for heaves. The planned submission for the product development plan related to the obesity treatment in dogs will be deferred until we can complete some novel formulation work which at this stage is in the planning

15                    stage. The reasons for this is that we believe we will strengthen our position and that the product will be much improved with some formulation improvement that will further add to the effectiveness of our R-salbutamol. The delays in this are only expected to take this into the  first quarter of next year.

20

                        The remaining four or five slides, I thought, would be valuable to share with shareholders and new listeners alike in that I have tried to take some of slides that have been used previously, invest the presentations and presentations to the general public in order to highlight the excellent opportunities that Stirling

25                    Products present moving forward.

 

                        First of the slides, Slide 7, relates to livestock applications and presents the most recent forward projections concerning potential market release dates for the products related to R-salbutamol which is now known as the trademark

30                    Ralbomax, ProVale which is to be the glucan from the acquisition last year and Jonotol which is the novel insecticide assuming that a successful license negotiation can be completed. These reflect the complexity of R-salbutamol registration in both regulated and for that matter in less regulated markets, the more moderately positioned regulatory process for Jonotol and the

35                    reduced requirements for ProVale as a non-regulated product.

 

                        In Slide 8, the anticipated revenue build as it relates to Stirling's products livestock technology platform is shown, and as can be seen, this starts to take significant effect roundabout 2010/2011. Similarly, in the area of companion

40                    animals, Stirling announced recently that it had set up an individual subsidiary, Stirling Animal Health, to manage the range of products that the company is looking to put into companion animal markets and the effect of this is shown in Slides 9 and 10.

 

45                    In Slide 9, I have shown the revenue build for products and the newly formed Animal Health subsidiary. All products with the exception of the treatment for obesity are characterized as having either low or non-regulated market entry. This reinforces the concentration that the company has made on these products in the first six months of this year, once again, to achieve that objective of getting and increasing revenue sales coming back into the company. A special interest is the contribution of the potential revenue for PetQuench which I mentioned in the previous slide and this is specifically isolated in Slide 10 both for the North American market and also for the

5                      Australian and New Zealand markets. I should also add that the company is engaged in discussions in several other geographical jurisdictions in relation to this product.

 

                        To complete the set, Slide 11 looks at the combined total revenue projections

10                    that are possible from the equine developments; the equine developments being done through Stirling's joint venture company called Pulmovet and begins with the introduction of devices and leading up to the introduction of the drug device combinations in the time period of 2010/2012.

 

15                    Each of these particular technology platforms offers different characteristics but collectively lead to a progressive and what I would consider to be relatively risk adverse technology development process which is summarized in Slide 12. The progressive strategy for revenue build is clearly shown starting with those that are the easiest market entries progressing through

20                    those which have a more complex regulatory process but arguably equally, if not greater, revenue returns. The directors believe that this ramp strategy is the best adaptation to a market which has become very much results-focused and in recognition, the Vanguard technology has the most complex regulatory process.

25

                        Finally, in Slide 13, I have captured some of the key points that I think are still up and pertinent to Stirling Product as a progressive company that is moving out of its initial platform into one that is now starting to generate revenues and will continue to expand on this revenue generation. In essence, Stirling's

30                    forward philosophy and strategic direction serves as a pertinent reminder to shareholders of their continued interest.

 

                        Finally, I would like to thank the shareholders for their continued support through what can only be described as difficult times and I hope that this

35                    presentation in some way sparks the interest of other non-shareholder listeners. Further information can be found on the company's website or by contacting me directly. I thank you for your time.

 

INTERVIEW CONCLUDED

 

 

 

 

Contact brr@brr.com.au for more information

 

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