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spk00: Greetings and welcome to the Pressure Biosciences Q1 2023 Investor Call and Business Update. At this time, all participants are on a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Richard Schumacher, President and CEO at Pressure Biosciences. You may begin.
spk04: Thank you, Paul, and welcome, everybody. Seems like we just did this. Welcome to the PBI First Quarter Financial Review Business Update. Before we begin, as always, I need to read a cautionary statement. The following remarks may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results Performance or achievements of the company could be materially different from any future results, performance, or achievement expressed or implied by such forward-looking statements. Such factors include, among others, those detailed from time to time in the company's filings with the Securities and Exchange Commission. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in our expectations or any change in events conditions or circumstances on which any such statement or statements were based. First, I'm pleased to welcome back to the financial review and business update, John Hollister. John is the company's director of marketing and sales. As many of you might remember, John is himself an entrepreneur starting several companies. and also including One Cannabis, one of the first publicly traded cannabis companies. He also has worked in big pharma in the past with budgets I can only dream about sometimes. Welcome, John.
spk03: Thanks, Rick. Appreciate it. And I'm happy to be here today.
spk04: So for today's meeting, we're going to start with a brief discussion of the 2023 first quarter results. Then we're going to highlight some of the successes we achieved during the first quarter and the year to date in 2023, as well as some of our goals for the rest of fiscal year 2023 as part of a general business update. Afterwards, we'll answer a handful of questions that have been sent to us. But we're also going to find time to take some calls from the open lines from everybody that's joined us today. So I'm going to briefly go through the financial review of the first quarter compared to the first quarter of 2022. We're very happy with the first quarter. There are a lot of good things. There are certainly some things you need to improve on. But for the most part, we're pleased with the first quarter. And both financial and operational basis. The first quarter was the first quarter that we've ever had that's broken $700,000. We did $740,000 in revenue. This is going in the right direction. It's certainly not our goal to try to increase revenue by $200,000 a quarter. We need to put some zeros on that $200,000, but it's certainly a step in the right direction. It is a terrific quarter when you think about the sales across the board. Our goal is to have one or more quarters with greater than $1 million in revenue this year. That is our goal. And next year, our goal is to have at least one quarter where every month is a million in revenue. So to reach that, we're going to have to succeed in what we're doing. And our expectation is we are going to succeed and what we're doing, and primarily what that means is commercializing ultra-shear. I'm more stoked about ultra-shear today than I was even a week ago, and I'll talk about that a little bit, and that's an understatement because I'm pretty stoked about ultra-shear to begin with, so for me to be more happy about what we're doing is saying something, but I've had a number of interactions over the past week that that tell me that we are absolutely positively going in the right direction, that we made the right decision a year and a half ago to pivot the company into a majority, vast majority, super majority working on UltraShear. We haven't given up on the other two platforms, but UltraShear is certainly the platform that's going to get us to where we want to go faster. and with more revenue than the other two, and the other two will follow. So we're going to talk about that in a little bit. For right now, what I'd like to talk about is just briefly, everything was spelled out in the press release. Of course, it's in the queue, but it's lost in, you know, 50 pages of a lot of stuff. So total revenue for the first quarter was $740,000. which was an increase of 54% over 480,000 for Q1-22. Instrument sales were up 74% from 245,000 up to 427. Consumable sales were up about 66% from 40,000 to 66,000. Agrochem sales, thank goodness, were up from 83,000 last year, the first quarters of is a good quarter, as is the second, to sell these products, up 57% from last year. The operating loss, as we put out there and we did some explanation, and I'm sure there may be some questions about that, operating loss was $3.6 million compared to $1 million for the same quarter last year. This operating loss increase was pretty much primarily due, if not all due, to two non-cash expense items. One was 1.48 million for stock and warrant issuances to debt holders and professional service groups. And the other was another 1.4, this is 1.43 million for equity-based compensation awards. When stock options are given, which we haven't done very much lately, it's been three and a half years, we have to use black shoals to value the stock options. We have to take a hit This, again, is non-cash. So if you back out the $2.9 million in non-cash items, we actually had operating loss decreased from the first quarter last year, as it should, with this significant increase in sales. And also our cash that was used in operations in the first quarter was down substantially. In the first quarter of 2022, we used $756,000, and in the first quarter of 2023, we used 422,000. So we're heading in the right direction across the board with the exception of ultra-shear, and that is what we expect to be leading the charge from the second quarter on. Basic and diluted loss per share was 46 cents. So as we said in the press release today, we've reduced our burn by 44%. to just 422,000 in the first quarter of 23. We believe this reflects the focus that we have on cash management, on very disciplined cash management. During the first quarter of 23, we issued these one-time stock issuances to certain debt holders and investor relations firms to assist with what we called critical corporate financing development initiatives. We needed to get the word out. We need to let people know that we pivoted. We need to let investors know that we believe that ultra-shear is what we should be doing and putting the vast majority of our efforts into. And we believe we've done that. And we need to proceed through the commercialization of ultra-shear and have investors understand what we're doing. And so we spent money, mainly stock, to bring in additional investor relations and to bring in cash that we needed to try to expand the horizon of UltaShare. And cash is often limited here, so we use stock in place of cash for some of the things that we've needed to do. Also in the quarter, we gave stock options for the first time in I hate to say it in three and a half years, we recognize the importance of what incentive options are to everybody. And because of that, we are very aware that we need to get options out to a number of people and keep them here. We have a very high retention rate. We have the vast majority of our staff and we have 16 members. The vast majority of our staff have been here for much of that 16 years. They're very dedicated to the company. They're very dedicated to the shareholders. And they're extremely dedicated to the technology. And because of that, I'm happy to say that the retention rate is very high. But we do have a lot of competition. We're in the number one biotech area in the world. And we have lost people in the past to other companies. And they do give options, so we need to follow suit. And that we've done, and not enough. And I should also mention that when we gave the options, we gave them above market. So they're well above market now at $1.50, but the stock was in $1.35, $1.40 range when we gave the options, and the board decided we were going to do them above market. So John is... of all of the people, and our sales do touch many of our personnel. We do a lot of things in-house because we can't afford to do them out of house. And we make some of the instruments. We make some of the consumables ourselves. The cost to send them out would be prohibitive. John is the frontline guy. He's the guy that's following up on all the leads. He's also you know, taking charge of a number of things that have to do with ultra sheer, but John is deeply involved in pursuing the, the orders and pursuing the interests from out there. And so, you know, I, I commend John for his hard work for, for getting the first quarter done in a record fashion. And, and John, if you'd like to, you know, talk a little bit about the, about the current business and and and the current uh business that we do and and that that which you know added up to this remarkable 740 000 that as i said we want to turn that into uh seven figures before the year is out uh in a quarter sure rick thank you and uh definitely enjoy the opportunity to share a little bit more detail about what has been happening
spk03: at least as we see it. What I've been seeing in the marketplace is some encouraging signals from grants being authorized and finally funded in the university environment, which has been reflected in some uptick in purchases by the research community, as well as the corporate environment. And while we have continued to enjoy a very significant uptick in service agreements, that is commitments by companies to keep their older units working and operating, which is typically a reflection that they're trying to get a little bit more mileage out of their older devices. We're finally seeing people actually pulling the trigger on buying products across our platforms, and that is our own Vericycler and Hub instruments as well as the products that we distribute for constant systems, all of which saw very strong sales in the first quarter and appear to be continuing and continue to be pretty optimistic about this change in trends. But I also will say that we have decided to get to a few of the trade meetings. Obviously, during the COVID time, We had to pull back from attending in-person meetings. And so we weren't getting ourselves exposed to potential customers. And in the last seven or eight months, we've started doing that. And that's reflecting itself in our sales. And this extends not only to the pressure cycling technologies, but it's also now extending to UST. And we're getting our name out with customers. The reception to UltraShear has been absolutely fabulous, whether it's in the nutraceutical areas, the cosmeceutical areas, or cannabis, and in fact, even the beginnings of interest in the pharmaceutical side. So really all the sectors that we have talked about interest for the potential of UltraShear, we're actually seeing it firsthand. People are coming and finding us at meetings and wanting to learn more about what makes us different to a person. They are just shocked by the improvement in stability, the clarity, and the expectations for much better bioavailability. So with that, I'll pass it back to Rick to extend this meeting.
spk04: Thanks, John. So wonderful, wonderful news on the financial end. It's got to get better. It's going to get better. Our goal is to get it better. And again, I will say it again, 740, it's great to be a couple hundred thousand more than what we were this time last year. And that quarter was a pretty good quarter when we broke a half a million. But it's not good enough. And so our goal is very clear that in the second half of this year, our goal is to break a million dollars for a quarter at least And our goal next year, at least one quarter, we want to have every month to be a million dollars. And we're trying not to be that, for that not to be the last quarter of the year. I'd like it to be the first quarter of the year, quite frankly, start off with gusto. So we have a lot of goals. We believe they're realistic. We believe we have the technology that can do it. And we believe that the technology has been proven over and over again. And, you know, people are starting to believe out there. As John said, we're finding a great reception. I'm going to talk a little bit about it coming up and when I go over these highlights. First of all, on a press release on May 9th, it was a follow-on press release on the 1 January 17th, where we announced that we We had had a consumer focus group. We had worked with a group in California on both of these. And this group was able to produce THC using a small portable prototype instrument that we had. And they brought in about 15 or so volunteers. And this is for an edible because one of the biggest problems in THC itself is is that you can smoke and vape it and you can get pretty immediate effects. But if you want to not insult your lungs and if you want to take it as an ingestible, as an edible, it's generally accepted that you're going to have 30, 45 or even 60 minutes to wait. Some people get anxious and take a second or third gummy or another bit of the tincture or whatever they're using or another bite of ravioli. and um and they end up getting hit all at once later on and and feeling sorry for that that's for sure so it's a problem that that if you're taking thc to help you sleep or or curb your appetite or or reduce your anxiety which many people use it for um uh besides just getting high uh that if you take it through an edible you're gonna have to wait and so somebody told me you got to reduce the window, Rick. If you can reduce the window, you've got a terrific product. And so we went out to reduce the window. I was told, take it from, you know, 45 minutes to an hour down to 15 minutes, and that would be remarkable. Well, as you know, from reading the two press releases, we nano emulsified THC, or we didn't, but our colleagues did. And they were able at Crème de la Crème in California near Monterey, they were able to make a THC that actually worked in under 10 minutes and the general average was about three to five minutes where the users are starting to feel the effect. And the high that they got was generally in about 15 minutes. And what we found the second time, which we put out on May 9th, was that heavy users, were able, you know, again, N only equals about six or eight here, but heavy users were able to use a much smaller percentage and get the same reaction. And that was very exciting. But what was probably most exciting is that counting both of the study groups of which there were 30, 35 or more people, there were a handful, probably, you know, up to 10, that tried it topically and came back and said, this really worked. I mean, I had a backache. I had inflammation in my knee. I had arthritis in my joints and my fingers. And it really worked. And we've read about it. We know there's receptors in the body. But it's great to hear it coming back. And you don't always hear that. I mean, there's a lot of people that have tried it and failed. that it doesn't work. And I think the key here is that we make nano the right way. Our nano is truly nano. There's a lot of pretenders out there. There's a tremendous number of pretenders. So many that people say don't even call it nano because they'll think it's not nano. But we do it right. We know it works. And we've had feedback from a dozen people that have said, wow, this works topically in addition to to reducing the time on an edible. So that's very exciting. I will say, you know, here, I was at a meeting last week, Thursday and Friday in Brooklyn, New York, of family offices. And I met two people. I met one in person and I met one on the phone. And the one in person said, I'm very interested if you can reduce the window. And I showed him and told him what we had. And he said, you know, if you, if you can prove this, you know, we'd like you to work with a Massachusetts, uh, firm. And if, uh, that has a licensing can use your, your prototype. And, uh, because, because we have friends in Massachusetts that we trust and we'll have them try it. And he said, um, that's the Holy grail for me that, that if you can reduce this to, uh, to 10 minutes or less, you're onto something very big. And this is, this is somebody that I respect a lot. looking at what he's done in the cannabis field. And then later that day, I got on a phone with a fund and it was a cannabis fund. And they said, and I started talking about the reduction in the window. They said, we're really not interested in that. I said, well, what about topical? He said, what do you mean? I said, what about, you know, uses of it topically? He goes, if you've got topical uses that are effective, I'm all ears. I'm all in. Tell me about it. So I told him about the uh the experiences of a dozen people and he was um i'm gonna say he was in awe he basically said you're on to something very big so here i've got two cannabis gurus one of them is really interested in low in reducing the window the other one is interested in the topical use of it so exciting day for me last friday when both of these things uh happened uh moving on um we've uh we've we've let the world know that because it's going to be several years before we're in the business of, of making machines and, and leasing them and getting them out that we would make five licenses. And we are clearly talking to, uh, six to 10 different people in six to 10 different States that they are interested where they could get an exclusive to our technology, our old this year technology. And we would build them, custom build them a, uh, an instrument, a bearer share instrument, and they would have a leg up for three years. And so we're in excellent discussions with a handful of people about this potential. We've talked last time about the issues we've had in our office park here and that we have a group that's six miles away that we're working with. that we plan, as I said before, plan to move in during the month of May, and we still plan to move in in the month of May to be able to alleviate the problems we have, which are that we can only make so much CBD material here. Of course, we can't make any THC material, but CBD material under license that we have that we can make it, but only a certain amount, and we're really inhibited with that. but that's going to end when we move to this new facility. We've had fresh sales momentum in PBI Agrochem, which is great, over $100,000. We received a $1.5 million contract. That's a contract that we believe will be fulfilled during the year. Everybody we've talked to, and we're expecting new contracts to come in by the week, by the month going forward, but these contracts are from individuals that say, I need a pilot run first. I need hundreds of vials first, then thousands of vials, then tens of thousands of vials. So I'm happy to say that we've made the first 600 vials. They're already made. They're done. They're being labeled. And we have a site in Maryland that is interested in putting this on their website. Keep eyes and ears open. I'm expecting that by this time next week, the first ultra-shear processed nano-CBD will be available. We will certainly put the news out from the company. We'll give the website. I've had probably two dozen calls from people saying that I've sent samples. How do I get this material? Where is it available? It hasn't been available to now, but I believe that by this time next week, By Tuesday or Wednesday, the latest next week, it'll be available from a site in Maryland, and we will get the name and the phone number and the website and the links out to everybody once this is set up and ready to go. So very excited about that. I'll remind everybody that our largest investor agreed to exchange over $10 million of debt into preferred stock and equity. He gave up his rights in debt. He wanted to lead the way. We're asking other investors to do the same to help clean up the balance sheet as we try to get ready and more ready for an up list this fall or later this fall. We had that very large single order from China for 16 pressure cycling technology instruments. And we talked about a great company called One World Products. uh which uh which is developing a sports performance and recovery drink and our discussions with with them and we'll have some some updates on that soon i think just add a couple of things before we uh turn it over or let john see if he wants to add anything and then and turn it over to questions but uh what i'd like to add is that um the uh we are waiting I've mentioned several or we have mentioned several times before that we had a leading academic researcher, a full professor at a wonderful university do a bioavailability study. And we said that we're a little upset that it's taken this long to get it out because we want to get those data out. We have reason to believe that the data are quite good and we're doing everything we can. but it's very important to have the data published in a peer-reviewed journal. And we're hopeful at this point that it will be published in the coming weeks. I've said that before, but this time I have more reason to believe that it will be published in a peer-reviewed journal and an online peer-reviewed journal in the coming weeks. And we're still targeting an up list to NASDAQ and New York Stock Exchange later this year. I went to New York two weeks ago. I met a couple of great bankers at a broker dealer that I liked a lot. I've got another call with them tomorrow. So we're still on board with getting this company listed on a national exchange. John, before we turn it over to any questions, anything you want to add? You don't have to if you don't have, but give you the mic.
spk03: No, I think I'm looking forward to hearing what questions our investors have for us.
spk04: Well, I'm looking forward to hearing some of them, but maybe some of them I'm not. But we'll take all questions. So, Paul, if we could bring you back on and think about opening up the lines for some questions.
spk00: Certainly. Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. The confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once again, please press star 1 on your phone at this time. if you wish to ask a question. And one moment, please, while we poll for questions. And the first question today is coming from Thomas Ellison. Thomas is a private investor. Thomas, your line is live. Thomas Ellison, your line is live if you wish to ask your question.
spk02: I'm on. I'm sorry. I'm here. Okay, I have a tough question. I'm a bit confused. During your November conference call, you basically said you had three $1 million-plus contracts, tolling contracts. You mentioned you could produce the large Tier 3 batches in hours. I'll round up to a week per batch. That was 26 weeks ago, and you only show around $70K of tolling revenue. why can't you show three million in tolling revenue soon since you are now at a new facility or will soon be there in my eyes your local machine has basically been idle for six months our local machine yep yep tough question but uh but a good one and and one that we we need to be uh
spk04: willing to answer. I did answer some of this before, Tom. I'm not sure if you were on the call for the fiscal year.
spk02: No, I did. I did. But I'm just saying that you're talking about $1 million a quarter. You threw out $3 million, and you said there would be follow-ons. And there will be.
spk04: And there will be, Tom. $70,000 is crazy.
spk02: It's crazily small. Tom, may I answer the question? Yes, I'm quiet.
spk04: Yeah, thank you. So what I said before, I'll say again, uh, we moved into an office park 10 years ago. Uh, we renovated, uh, the, the warehouse downstairs into a facility that could generate, um, that, that has an ultra sheer machine. Uh, we started, we, we started working on this, uh, and, and the renovations a year ago, and we were expecting to be able to do that downstairs. Two things happen. Number one is there's now a state regulation that limits the amount of water that we can put into the septic system. So the most we can do is kind of what we did for the 600 vials that's done. And that will be shipped by Friday and that will be available next week. So we're limited to about 600 vials every other week. That's the most we can do here. That's not going to get us to the promised land. So we have negotiated a deal. The deal is for us to, we have to finish one more thing before we can move there. And we're working on that diligently. It's a contract we have to work on. And when we get that done, we'll move the machine downstairs and everything else over to this site, which is called Artisans. I gave that name in the press release. And that will be hopefully in the next two weeks, we'll have it completed and we'll move over. They have everything that we need. We don't need to use water. They have a massive commercial chiller that will take the place of the water. They have the electricity that we need. They have everything that we need. So we'll no longer be encumbered. And so I've asked John and Ken, our two guys that are in marketing and sales, to do everything they can to start going out there and closing on those deals. So the first thing is the machine is able to do a lot more than we can do, but we're not able to do it here. Number two, when we made that statement in November or whenever that was, it was absolutely positively true. One of those $1.5 million contracts is the one that we're working on. And one of those 1.5 million contracts came from a gentleman in Colorado who is now in sanctioned by the state in the last couple of months to, uh, for payment of, or lack of payment of, of his taxes. And so unfortunately, uh, we have to replace him because he's no longer in business. Uh, and the third one is the group that we had out in Montana. that we shipped a pilot lot to. And they are meeting this week to talk about the, they use the samples to talk about whether or not they're going to continue with CBD or not. And if they do, we expect it will be with us. So at the time, there was a contract for the, an agreement for what would be a million and a half and a contract. uh for that we also have a gentleman uh who we think the world of named john westlake who is a guru in cannabis and he is a fourth guy who is um also working on our behalf and we're working on a contract for uh for him and as soon as that's signed we expect this his figure will be turned on so um i know you don't want to hear tom these aren't excuses these are things that have happened We're working past them. We found this additional $1.5 million contract. We have a potential contract from a gentleman right here in Massachusetts, number two, and we're going to replace the gentleman in Colorado, I think, pretty quickly. Now that we have a facility that 30 days from now, 20 days from now, we should be up and running in.
spk02: Well, I know they want sample quantities, but in theory, you just mentioned that you have potentially two $1.5 million contracts. Why can't they be done by the end of this quarter, which would be June 30th?
spk04: Well, none of them are going to be done, even if I were in the space. I never said these are one point. Nobody's going to take $1.5 million of a brand new contract. You test drive the car before you drive it. So he's test driving. We made 600 vials and we got his labels. We're shipping them down or we're bringing them down to him and they will be available online. I've told him that I believe he will sell out in a matter of a couple of weeks. He's not sure. He said, if I sell out in a couple of weeks, Rick, the next one, I want the next pilot. The next pilot is 10 times the first one. So, you know, if he's getting he's getting two, 300 vial and the first one I might myself bring down, and then he's got a second one coming. I think he'll sell out of that first one in a couple of weeks. He'll start selling the second one, and we'll start making the next vial, which I believe is 3,500. I think we'll be working on that in June. So, Tom, maybe that 3,500, we can do 3,500 in a new facility. I couldn't do it here, but we can do it in a new facility. So maybe we ship the 3,500 in June, That $1.5 million is for a year. And I believe, however, I believe that it's a very good possibility that the whole thing will be shipped before this year is out, even though that would only be about eight months.
spk02: Okay. Well, it's good to hear that the customer is slowing the process versus, you know, I yeah so if it's really um you know throttled by the customers seeing sample sample samples before you give them a large batch then okay well then i'll just paying for the pilots uh too tom so when we send them three to six hundred they're paying for those who pay them 3 500 they're paying for those but
spk04: They just don't want to take 25 or 30,000 vials on something that they've never tried to sell. But this is a brand new product that doesn't exist in this world that I'm aware of. This is an all plant based, no preservative 40 mid per mil CBD product. There is nothing like this in the world that I'm aware of. And I'm very excited about it. And the feedback we get, I'll turn it over to John. Because John has been right on the front lines of this and is talking to people now about contracts and he sent samples out to a number of people. John?
spk03: Yeah, Tom, it's a great question. I'm glad you heard from Rick that the announcements of $1.5 million contracts are the year projection of that and that it actually builds into that. And obviously we ran into a very disappointing learning in terms of the cooling necessary for production. And that's even on small-level production. But in large-scale production for our big lots, which are going to be rolling out over the course of the year, those reflect large volumes that the septic tank systems just couldn't take. So we've had to pivot from that. You know, I've just gotten back from a meeting in Las Vegas last week, and literally people were seeking samples from us for all sorts of products, whether it was CBD or other essential oils, because they're looking for ways to get higher bioavailability, reduce their costs of goods in terms of the cost per dose, which they can do with us. And they're just, one after another, just one startled by the clarity of our products. So they're investigating putting this into beverages for different products and just endless enthusiasm. And then yesterday I received a call from somebody who had participated in in the THC studies that Rick mentioned. And he wanted to report that one of the people who had been there, an older woman who had knee pains, reported that she had put the product on her knee and really almost a disability that keeps her from walking and is very, very uncomfortable. She said that within minutes she was able to walk around. Really remarkable. And And he was just calling to say that he had been a skeptic about this particular topical use and wanted to report how excited he was about learning this. So I'm confident that we will have a number of different contracts in the near term to be able to report that will overlay on top of the three that Rick was discussing. So these will all layer on top of each other and build towards the exit of this year's in the entry into 2024. So with that, I'll turn it back over to Rick. And I'll turn it to Paul.
spk00: Okay. Once again, ladies and gentlemen, you can press star 1 on your phone if you wish to enter the queue. The next question is coming from Gary Swechenbaum from Plum Tree Consulting. Gary, your line is live.
spk01: Thank you, Rick and John. Congratulations, gentlemen. $740,000 for a quarter, 54% increase. Rick, you mentioned that the quarter we're half in, you're looking for seven figures, which is over a million dollars. I wanted to see if we could focus. I noticed that you said the cash burn for the quarter was reduced by 44%. So you were in 740, your burn was only 422. I think that's reflective of discipline cash management. I wanted to ask you guys, John, in particular, on one area, the agri camp. If I'm not mistaken, John, you can help me, but we did 130,000 in the previous quarter. And if I'm not mistaken, we are sitting with inventory currently over a half a million dollars worth. I wanted to get an understanding of what it looks like we could do in sales For the rest of the year, John, we had had conversations about it. It might be more than $500,000. Could you just give me a little input on what's happening on that side and where you're selling it? $130,000 was phenomenal. And if we have inventory over $500,000 or $600,000, that's a lot of money for revenue. And if you could talk about that, I'd appreciate it.
spk03: Yeah, sure. And I appreciate the question. So, last year, we were, as I think everybody knows, California was deeply affected by the drought, which impacted particularly the San Joaquin Valley, which is historically where materials like this get sold in great volume, and the distributors in the San Joaquin Valley became very conservative, and they drew back, and they stopped looking for new materials. They were buying materials as needed, which was very limited. Of course, we've had kind of the opposite end of the blessing, if you will. I actually live in California, and I'm in the heart of it all. We got a lot more water than the annual 240%. which is having kind of an interesting opposite effect. A lot of the San Joaquin Valley is underwater, and a lot of places are too saturated. But having said that, we are beginning to see the return of growing seasons, and the person who is the primary sales person for us in the San Joaquin Valley area one reports that our products are the best in the business. There's nothing quite like them. He is an incredible champion for it. And we're rebuilding a market that has, that this product line has not been in the market for a while. So it takes a little to reestablish, but we're encouraged with his initial uptake. We're hearing positive comments and I certainly am hoping that we continue to pull some inventory that, We have sitting in our warehouse up in the Reno area that is paid for material. And so I think to your point, we should look to some more positive results from that. I'm not going to forecast exactly what that is because I don't think we've stated anything publicly, but we definitely are looking to have more contributions from our ag chem side over the course of these next three quarters.
spk01: I wanted to ask if this is, you mentioned inventory we already have. If we sold the full amount of inventory that we've already paid for, we're talking about, can you give me more than $500,000 or $600,000 at the current prices that we're paying, whether it took three months, six months, or nine months, isn't this quite a bit of inventory that we have?
spk03: Yes. So certainly in that range or even a little higher than that in terms of the full value of sales of that material.
spk04: That's great. But in California, John, you might talk about you can't. I couldn't go there. You couldn't go there and sell it. It has to be sold from a licensed person to a licensed person.
spk03: Yeah, so the technical term is a PCA. So these are people who are professionally trained, licensed by the state and are authorized to sell pesticide products, which covers herbicides. It also covers all sorts of different categories. But these licensed people are the only people that can actually sell to the farmer's So in essence, what they're saying is this material is the appropriate material and is safe for you to use given all of the many rules and regs that exist in the agribusiness world. So it's something I can't run out as much as I grew up on a farm, so I'm very familiar with this, but I couldn't actually go sell these materials. You actually have to have licensed people who do that.
spk01: But John, if I'm not mistaken, you've met in person with this gentleman and he was responsible for making the sale of the $130,000. You met with him in person recently in the past few weeks or months. Am I correct?
spk03: I have met with him and he's, as I mentioned, he's an absolute champion for the product and he has great credibility. He's a very senior person in this environment and and has a great reputation. So we have a lot of confidence in what he's going to be able to achieve for us.
spk01: Great. We'll look forward to more sales in the coming quarters. Thank you, guys. Greatly appreciate it.
spk03: Thank you.
spk04: I do want to, I'm not quite sure, but Gary was going to a certain place. I want to clear that up. It may sound like I was predicting a million dollar quarter for the second quarter. I wasn't. Our goal, our goal this year is to have one of the remaining three quarters be a million dollar quarter. That's our goal. And our goal next year is to have every month of at least one quarter to be a million dollar month times three for the quarter. So these are lofty goals when you look back at our sales, but we think they're achievable. We think they're achievable and it'll tell the whole world we're moving in the right direction. So Paul, any other questions?
spk00: Richard, there were no other questions at this time. I'd like to hand the call back to you now for closing remarks.
spk04: Sure. Well, John, thank you for joining me. And everybody, thanks for taking the time to come here and listen. And some of you asked questions, and you know you can always call. There's a lot of good things that are happening. I mean, we had a good quarter. We expect to have great quarters going forward. We have a lot of things I said in the press release. We've had people talk about immune boosters. We've had people talk about sleep, help for sleep. We've had people talk about anti-aging creams and serums. And we have a play in all of these. We can't do it all, but we have a play in all of them. We are still talking to two major multimillion dollar firms. that I have said I expect to get a deal done with one or both this year, and I still do. We're talking to people about some of these other compounds that are way outside of cannabis. The cannabis market is huge. It's huge, but it's a drop in a bucket to some of the other markets that we're going to be going into. And we've proven ourselves over and over again. You know, if you can get CBD out and into the bloodstream, if you can get THC out of oil and into the bloodstream, very quickly it stands the reason that you can get almost any if not any active ingredient out of oil we don't touch what's inside the oil we break down the oil this is the difference between us and many others we don't adversely affect we don't positively affect we don't touch the active ingredient inside the oil we break the oil down so that it's in it's in hundreds of millions or billions of nano-sized oil droplets which makes it far more available, far more soluble and far more bioavailable. So that's what we do. And, and it doesn't, to me, it doesn't matter whether that's prednisone or, or retinol or curcumin or astaxanthin or THC. It doesn't matter what's in the oil. I believe that we're onto something very, very big. And, and I believe that we've we've started to see it. And next week's going to be a great week because next week, will be the first time we've made and shipped a product that's actually going to be for sale. It's going to be on a website nationwide. My family in Washington State, my family in Florida can all just dial in and go online and buy the product. And they're asking for it because they've had some free samples. And this is for CBD, not THC, of course. There's a limit there. So anyway, I'm excited about the past. I'm very excited about the future. I'm looking forward to every day. I'm looking forward to next week seeing our product, you know, on a website where it says made by Ultra Shear, because it will say that on a label, processed by Ultra Shear. So thanks again, everybody. I look forward to the next time we're on a call, which is going to be right around mid-August. Thanks again, and God bless everyone.
spk00: Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.
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