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QUOTE (bloodclot @ Saturday 22/11/08 03:05pm)

bloodclot

 

Clearly you were not at the meeting.

 

Whilst I appreciate that anything that is said in reply to you will become further fuel for your IM...

 

The answers given to the 3 questions specifically directed to the board on approaches to marketing and whether they were skilled enough... included the best answer I have ever heard about being a doctor who does administration and management.

 

Having been to 4 AGM's the Chairman's presentation has year by year been more positive and confident about the success of the company. This year was even better than last.

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In reply to: bloodclot on Saturday 22/11/08 06:05pm

You seem to think that the company is not becoming successful. I won't re iterate the sales numbers , but if you plot them you can see they are going up !

And they have been going up for some time and are expected to keep going up.

 

I strongly disagree with your assertion that the board knows nothing about marketing.

How many times have we been told that the key to marketing is independent peer reviewed studies ? Alot. That is the marketing for this industry. These guys know the marketing for this industry. This isn't consumer marketing, it is highly specialised.I've made this point many times before : this isn't the sale as selling soft drinks or plasma tv's or mobile phones.

This type of marketing is different.

 

The directors and marketing experts within the company know more about marketing than you think. Yes , there are marketing experts in the company.

 

The real challenge for this company has been customers reluctance to change.

In the face of overwhelming evidence that QFT is a better product and gives better outcomes all round , some customers still want to use the old method.

 

I ask you what marketing can get around that sort of issue ?

It takes time , and we have seen that , but we have also seen sales growth. And it continues to grow.

 

If sales keep growing at the current trend then the current SP is actually quite low.

 

 

 

 

 

 

 

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In reply to: bloodclot on Saturday 22/11/08 06:05pm

"The chairman's bizarre comment about M&A"

 

I don't understand what's bizarre about it at all.

The company is growing , it is making profits and one option for spending those profits is to make acquisitions.

 

I think it's bizarre that you think its bizarre. Please explain.

 

 

 

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For those who were able to attend the meeting,

What were your impressions of the progress reported for the Leishmaniasis product? One of the slides mentions a new antigen formulation, implying that the original one was not effective enough. Was there any more discussion of this point? Also, were there any questions about new products such as QF for Lyme disease?

 

Although QFT-TB Gold and IT have additional patents, I note that the BASE Quantiferon technology platform patent starts to expire next year (Canada) and I wonder if this may be a reason why there has been little R&D development in recent years except on the TB front. They do have the money to fund it, they just haven't. I wonder why?

 

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In reply to: sca69001 on Saturday 22/11/08 06:37pm

Leishamaniasis needed a redo with a different antigen - the problem is that it is a seasonal disease so they had to wait until the next sand fly season to validate the new antigen ! I had the impression it was the same problem with Lyme disease - rerunning it in the new season with a different antigen.

 

The QFT patient that expires is not the QFT IT patent... that goes to 2022 - also they have the Tb antigen patent until 2017 or thereabouts.

 

The non IT version really cannot compete with QFT IT - and even if someone wanted to make the test for Tb - they dont have access to the antigens that are proven.

 

They mentioned increasing R and D this year... and also in response to a question (cant recall the question) it is apparent that R and D has increased and will continue to do so. My recollections of the 2 reasons and I am not the most financial person to ask was 1) they said they previously expended some of Radford and Rothel's salary to R and D as they went to the meetings - but now they dont now and 2) they previously had the R and D people doing some of the product support and technical advice - but that was now a whole new division. So my interpretation was that the real R and D expenditure has increased and will continue to do so.

 

In after questions they also talked about new products giving the example of coccidiomycosis or Valley Fever. They had a focus group who wanted the test made.. but it wasnt going to be cost effective - so they supply the platform and the focus group will develop it... More No risk research similar to the Lesihmaniasis development.

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In reply to: onefineday on Saturday 22/11/08 07:12pm

Onefineday,

My view is that criticising the marketing skills of CST management for developing a company that is progressively doubling period v period profit on a regular basis is a difficult thing to support and I don't listen seriously to it.

 

However I do appear to have a differing view to you, and others it seems, about this new M&A disclosure. Why does it concern me?.

I am all long term and have been, like many others, a CST supporter for about a decade now. Many have stayed loyal supporters. It's our funds that supported CST. Not some big pharma with deep pockets. Eventually those many investors need to see some benefit for their years of support and if the only way then can achieve any benefit is by selling the stock, then how does that help long term investors who hope to remain long termers.

 

Imagine those investors were 50+ when they first started supporting CST a decade ago, they are entering a retirement phase now / soon and needing income from investments. They continued to support CST without return even through a mining boom during which large profits were being made. ie continued support = lost opportunity.

So how would those investors feel if the opportunity for CST to start providing returns was deferred a further 5~10 years while CST's management adopts a M&A growth programme.

 

I have never understood companies that fail to reward their backers when they are in a position to do that, and thereby encourage their backers to sell out. So frankly I am a little disturbed by this new development. My view is the boards comments about dividends were badly handled. Their new statements about M&A was badly handled. And these 2 issues will cause some long termers to review their positions.

 

Some will say, so what. When shares are sold a new supporter emerges, but that's not the way I see it. In my view the mgmt of CST is indebted to the long termers who got the company to this stage and when the chance arrives to start gradually rewarding them it should not be easily dismissed. I am not saying we have reached that point yet but anyone who know much about CST knows we are very close to the time it will be possible.

So it disturbs me that at the first opportunity CST has to start considering that option openly with shareholders a vague and unclear barrier appears to make it all hazy and I cannot say it leaves me with a good feeling.

cheers

Ian

 

 

 

 

 

 

 

 

 

 

 

 

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In reply to: sca69001 on Saturday 22/11/08 09:37pm

sca69001

 

apparently Cellestis were not 100% happy with the QFT-Leish in its present form - it picked up old infections - and they want to make it right.

 

The base QFT patent was time restrained wheras the IT technology has a broader application.

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In reply to: Ian on Saturday 22/11/08 11:35pm

My understanding of the dividend issue is that;

 

1) a certain amount of capital was to retained as a buffer against debt and for possible acquisitions

2) dividends would not be paid out of capital but out of earnings

3) dividends would not be paid until all losses were eliminated

4) ultimate goal is fully franked dividends

5) fully franked dividends are dependent on transfer pricing

 

100% growth each year for 4 or 5 years should provide both dividends and an increased share price

 

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