Itaconix (LSE:ITX) — Investor Presentation

0:01 Good afternoon, and welcome to the ITACONIX PLC investor presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time via the q and a tab situated on the right hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to John Shaw, CEO.

0:31 Good afternoon, sir. Good afternoon. We're excited to be here. I'm joined by our, chair, doctor Peter Nuhenhuizen. We have Laura Denner. We are coming live from London here. Laura Denner is actually back in our offices, in New Hampshire, so, she won't be live when this woman is present on it. We're here today to talk about some exciting developments that we've had both in our commercial progress last year and then in the last couple of weeks in terms of our capital structure in building for the future. We have a standard disclaimer regarding anything we present today. And, again, it'll be myself, CEO, and then Peter Nuhnnheisen, who's our chair.

1:24 Most important wanted to talk about today is that we did, had our general meeting today. We did complete approval for all the shares that we need, to complete the $10,500,000,000 in gross proceeds fundraise that was announced about an hour and a half ago. The results positive results from it. What we had out of it was two parts. One was an oversubscribed placing for about $10,300,000, I believe, £10,300,000 for both new and existing institutional holders. And we did complete an open offer to make sure that all of our existing shareholders had an opportunity to participate. What it's done for us is really put us in a tremendous position to grow for our next chapter of growth.

2:12 When we talk about kind of completing ITACONIX two point o, when we took our technology one point o was to take our technology and make it into ingredients. We picked out three areas in cleaning, beauty, and hygiene to get to a stable level and growing level of our base revenues of it, which we've achieved. And now we have the funding to be able to move off into even more exciting times and future growth with what we've completed today. Along the way, we've also been able to rebuild our shareholder base. We've now at the end of this, we'll have a significantly larger institutional shareholder base. I think over 40%, maybe about 50% at the end of this will be both new and existing institutions that we've been able to rebuild, which is a key objective for us. So it's a very exciting time for the company to complete this fundraise and position us for future growth.

3:19 The use of proceeds on it in terms of it's a significant amount of money relative to what we've had in the past. It was important for us to do as we our revenues got higher and what our capital needs would be in terms of, most importantly, just working capital. Some of it's just for our I mean, another short period of profit of operating losses for a relatively short period. But even more important, we have the working capital to restructure how we manage our inventories, in our payables and our receivables. One that's most very important for us is that, in the past, we've looked in terms of both our customers vendors in terms of buying around terms, not necessarily always getting the best price, but in terms of what what payable days and receivable days we would have, and we can change that now. And we think that will help our our gross profit margins moving forward.

4:17 Second of all, we've similar to what we talked about last April when we did a relatively small fundraise with IT Group, myself and Laura Denner, Europe is growing significantly for us, and we are going to be repositioning finished goods inventory into Europe so that we can maintain the service levels to our current and future EU customers to maintain shorter delivery times, higher reliability of when we get products into them as they start relying on our ingredients more and more for their products. So first and most important was the increased capital. Second of all area is that we we can increase our customer support for our current ingredients.

5:02 When we approach a customer, there's often a lot of testing, that we need to show that we'd like to show as customers consider our ingredients versus some other alternative ingredients. And the more testing that we can have, the more verified testing in terms of how our how to show why our ingredients work better in their products, the better we can do, and we're going to be able to have a little bit more money to be able to do that. We'll also be able to accelerate some of our revenue development of looking at new applications for our existing ingredients, and more important, to be able to advance further products out of our technology platform into new ingredients and bringing products forward. And that we don't we'll not have any limits there, the limits we've had in the past in terms of how many products we can bring forward on it.

5:53 And last, we will do some slight increase in terms of our capital spending to support our revenue growth. Some improvements, there's continuous improvements to our current production capacity. We are not planning to do any add any production capacity outside of our plant in North America. But within that plant, as we add more products and expand the number of products that we make with our existing production capacity, there are continuous improvements and modifications that we can make to our existing production line to improve the efficiency and improve the capacity of what we have. And then last is that every time we bring a new product forward, whether it be the new products, some of the new products we bring forward in hair care or other areas, usually every new chemistry has some new process, chemical process that we need to do to modify the chemistry beyond just our base production capacity.

7:01 And this will allow this we will be allowed to bring be more aggressive in developing processes for optimizing and controlling more of the production of new products as we go forward, which has been a key constraint for us of bringing new products forward. So all of these are really game changing for us in terms of how we can operate our business with a stronger balance sheet in place from now and well into the future on it.

7:31 When we think about the development of the company, we our roots start around bringing polymers from aducanic acid to market. The roots, remember, start back sixty years ago when Pfizer and then maybe thirty years ago, thirty five years ago when Roman HAS tried to bring polymers of idaconic acid forward. And we had a breakthrough about ten about fourteen years ago when we founded ITACONIX Corporation, that we actually had the economic breakthrough to do it. When I talked about ICONIX one point o is kind of from when we were founded until 2014 was really finding exactly where the chemistry applied to certain types of ingredients of whether we where we could bring performance, safety, cost advantages and sustainability to certain market segments.

8:22 And by 2018, we picked out the areas that are key areas to focus on and rebuilt the company from 2018 forward around cleaning, beauty, and hygiene. And what we've done now is really, with the revenues that we've achieved, now really kind of exiting that phase of where we've now established a very strong base of revenues around those core areas that we focused on over the last four years, and we're now in position to expand out into the much broader areas that we can do with our chemistry software. One of the great exciting parts as we enter what I could call ITACONIX three point o was having doctor Peter Nuhyenhuizen join our board.

9:11 He's one of he's known us for many years. He's been one of the most has an excellent technical mind. He was former CTO of Exxon and Bell Specialty Chemicals and understands our chemistries and shares our excitement around our chemistries. So to have Peter on board starting last summer has been a very important part of how we enter the our next our next stage of growth. Thank you. Thank you, John. And, yeah, just like to tell everybody how excited I am to be here today, today with you as we are closing such an important achievement for for the company. And once again, my appreciation to you personally, John, but also to the entire ITACONIX team that we got here as well as to everybody around us here in London that has helped make this come together. So it's really a special day for all of us ITACONIX investors like yourself and and myself to be to be here.

10:15 And I'd like to just make, you know, with with my chemistry background and having worked in Oxford Nobel for quite a number of years, maybe make two important points and you probably know it, but it's good to emphasize. So first of all, italcoholics and italcolic acid is a platform. It's a platform molecule. It has been identified already quite a number of years ago as one of those, you know, 20 ish molecules that could really become a mainstay of a future bio based or circular chemical industry. And and in in that, ITACONIX has really shown that we have made those steps. It has developed three important technologies already.

11:04 But if you look at how the chemical industry is constructed and if you then look at the addressable market, which we estimate right now at about 20,000,000 predominantly made up of acrylic acid and styrene. You can also see this is a massive market, as I said 20,000,000,000 for sure that we identified. And if you look at the history of those markets, they started like itaconic acid, like itaconics is right now doing. You develop a molecule, you develop a polymer, and then you see, hey. Can I use it in this application, in that application? Once you start to show that you can use it in three applications, you know you can roll this out into the very many applications that you see here on the screen in in food and agriculture, in paints and coatings, and there are literally hundreds of different applications.

12:01 And that is the story of itaconic acid going forward. That is the story of itaconics going forward. We have proven this technology in three applications and going forward, we will roll out quite a number more in this very large market. And it's important when we think about the monomers is that although we talk about it being the aducanic acid is produced as a natural metabolite. Actually, all of our bodies have aducanic acid, and we produce it as enamels on it, but it's also commercial production is by fermentation that it's well established fermentation in it. So that's good. But when when you think about the importance going forward, what I think about and I think what you we we think about is just the safety aspect of it. So when you start looking at acrylic acid applications, styrene applications, and maybe you could describe you know, those pictograms we have up there about the GHS health and safety pictograms, those are really important when you think not just about, you know, the sustainability, but even more important is just the safety that we can bring to the world. Absolutely.

13:14 And the the reality is styrene and acrylic acid truly fossil ingredients derived from from oil and gas, and then there is hazard. There are people in manufacturing plants all around the world that are not imminently, not directly exposed to these ingredients, to these raw materials, but there are always emissions and there's always the the danger of an accident and a leak happening at which point you are exposing humans as well as as well as the planet to these hazardous chemicals, and itaconic acid is an enormous step forward. So if you think about it, it's quite if we had itachronic acid, a little pile of itachronic acid here, no issue. We could sit here. We could eat it. Nothing from it. If you have a bottle of acrylic acid, you'd be running you'd be hitting for the door because of that very bad odor type. And if it was styrene, we'd be running for the door. That's just the nature of the safety of the underlying, underlying problem.

14:18 Now, again, we're making polymers out of it, and certainly polymers of acrylic acid, once it's polymerized, the safety aspect, once the styrene is polymerized into a product is different. We but underlying it, the the fundamental safety that we have to build off of, I think, is a huge advantage and would be taken account of for it. So it is around the performance that we can have relative to acrylic and styrene. It's the safety that we can have relative, and there's the sustainability of it. So, again, what we are doing, and this is one of the most core parts, is we just have a wonderful technology platform. I think we have 15 different patent portfolio, families of patents around protecting it. That's what we own as a company. And as we go forward, we've already pulled three areas out of it. And as we go forward particularly with the kind of funding that we have, our ability to continue to pull products out, you know, we have ten or twenty years' worth of work to continue pulling new opportunities out of this area. And just like the acrylic acid industry, which took twenty five years to reach the size that it has today, that's also the path that I I'd see ahead of us for ITACONIX.

15:34 So it's a pretty exciting part, and I think there's something with the success that we've had in commercializing, we're able to bring to show new shareholders coming in of what the potential could be there. In terms of so we have this great technology platform with hundreds of opportunities about it. The way we go about creating a new ingredient, I think, is I've done it for many years in many different industries, but the way that that Yvonne doctor Yvonne Durant and I and and and particularly Laura Danner over the few years have figured out how do we bring them forward? How do we make sure that we get really good ingredients that come forward that are gonna bring you performance, safety, cost improvement, and sustainability, is a process that we're we're actually going to be getting some we have gotten recognition from in terms of a kind of kind of a unique way we go about it.

16:32 There is a special sauce around how we go about doing it. What we start with is an unmet need. We identify an unmet need. For example, in detergents, there was non phosphate detergents. We look at what our, whether or not idaconic acid and the polymers we can make from it have some unique capability, to address it. We go out and we find we go into the ignition stage to find get the first three or four customers. We think that if we put this ingredient in, we can go get a consumer product that has these claims that are gonna be customer facing claims that are gonna make a difference for how successful that product is gonna be on the shelf, and we want to go prove to make sure that that's true. Once we prove that that's true, we then can expand and get more brands using it who want those claims on their product.

17:26 And then when we get through the traction side of it, now it becomes almost competitive pressure that if you aren't using our ingredient, you're at risk of the consumer the downstream consumer product is at risk of losing market share. And if you think about where we are right now and the results that we have for our revenues, what you're seeing is that our in automatic dish detergent in certain regions for certain segments of the market, we're entering takeoff stage there after many years of working our way through the ignition and traction area. You won't see it on the revenue side of it, but in the beauty and in the hygiene area, we are working our way through the ignition and traction area. We are getting formulators going through. We are getting claims on end market products that are making a difference that are tied to our ingredients.

18:15 So this will be a continuous process for many years as we continue to look at our technology platform, what we can do, make sure we identify a very important market need for it, connect the two and roll it out into it. And what you're seeing today in terms of our revenue results is that we finally have a company have our lead ingredient, our ITACONIX TSI-three twenty two entering the takeoff stage. I think we've we've talked a lot about, you know, the, you know, the advantages we bring, but just to be clear about it, of what we can do, the functionality that our polymer brings in automatic dish is that when you take out the phosphates, there was a lot of extra materials that were put in to replace the functionality of managing water hardness so you don't have any spots or films on a glass.

19:08 And what we're able to do is is take those formula and reformulate and take a substantial amount of volume out of those products. So we're replacing maybe two, three, four grams of material with 1.5, maybe 1.5 of our material so that we get the dosage to have excellent performance down. Along the way, we're increasing the percentage of plant based ingredients along the way, but what we really did is we got the dosage down on it. That dosage translates into a lower cost per dose of the ingredient cost. So when you're buying a product maybe for 20¢ or 30¢ on the shelf, remember the underlying ingredients really only cost 3 or 4 or 5¢.

19:55 So what we've done is we've been able to bring that portion of what we do in the formula, bring that cost down, and that gives the cost advantages. So in North America right now, if you're a consumer and you go to the retail shelf and you think, oh, I'm going to get going to buy a I want to buy a sustainable product. I'm going to buy palm olive, or I want to buy a really high performing product. I'm going to buy Clorox, Or, you know, I wanna save 30 to 40%, I'm gonna buy the private label brand. We're in all three of them. So regardless of what choice the consumer thinks they're making around sustainability, we're bringing sustainability to all three categories because of the performance and cost that we bring to it. And I think that's one of the most powerful parts in terms of truly bringing sustainability into the world and advancing the world to the low carbon economy is to be able to do it with performance performance and cost. John, if I may add there. So this goes back to your the way that ITACONIX develops products.

21:04 You identify that unmet need and then actually the secret is when you identify where can ITACONIC acid, where can our technology make a difference, and that's when you progress into the next into the next stage. And the beauty of isochronic acid is, of course, that you have various ways to then tune that chemistry to reach that performance improvement, to reach that cost improvement with the inherently built in sustainability. Exactly. Another area in beauty is the ability to have a hair fixed and to to have fix the hair into a curl for curl and hairstyling.

21:50 We actually hold the hair through the kind of internal structure of the hair due to the chemistry that we have, so you do not you're not creating the traditional film on the outside of the hair that makes the the curl kinda crusty. So what you get is obviously excellent curl retention, competitive to any of the other technologies out there, but you get this soft feel called weightless hairstyling or nude hairstyling, and on top of it, it's 100% plant based. So if you want that soft, natural feeling curl with excellent performance, you need to be using our ingredient in it. We've had a little bit of a delay here, the COVID caused a little bit of a delay in terms of how the hair market progressed. We expect that to be coming back on it. But again, if you want that effect, if the brand wants that effect, that claim, they need to be using our ingredient on it.

22:46 And lastly, the odor control area, again, what we're doing is zinc has been used for odor neutralization for many years. It's been well established. There's a product out there called zinc rinsinolate, which very effective in neutralizing odors, but it's fairly hard to formulate with. Each pH range, you go from a product that might have a pH of four to five to six to seven to eight to nine. You have to work it very hard to go into formulation, and it also will leave a residue on any substrate on a fabric or on a carpet or somewhere. So what we do is it's a very good delivery system for zinc odor neutralization.

23:32 It's fast acting. It has comparable performance to the zinc rich and oleate, but it has the advantages of no residue. It's easy to formulate into. And on top of it, it's plant based. So, it's the there's other attributes to it. We supply Crota's been out there in the home care area doing very well with Xenador. We also market ourselves directly under our Bella Fresh product line. You'll find it in carpet cleaning products, air freshening products. We have it in aluminum free underarm deodorants, pet care products, tremendous advantages that we have that we think will grow forward. But so three examples of how we did see a market opportunity, tied it to our unique chemistry to bring products forward with claims on a consumer product brand that other ingredients can't bring.

24:31 What we've had what's great in terms of building a great specialty chemical company is you keep building up, you get formulated, and you just keep on building up more and more brands that are using it. And we have advanced, you know, we're in a broad range of of automatic dish brands, both branded and private label ones. We're in air fresheners, carpet cleaners, hairsprays, dog sprays, all sorts of one. But now, the total, we're we believe we're over a 100 we can identify a 145, I think, that we're in. We're probably in a few more than that. It's it's a little hard to keep track of all of it. But most important to creating a successful company is have a diversified base of formulations where you're where you're you're used in it and you're a critical ingredient to the success of that brand.

25:22 And that's what we've done here. Those brands, once you get into it, when you really get the revenue growth is when those brands, progress out into the marketplace and get more market share. And where you really see it is that they get more and more listings at more and more retailers. So now in North America, when you go into pretty much every major retailer, you are going to find multiple products that have our ingredients sitting on the retail shelf. And we use North America as a leading indicator for us, not because we're our operations there, it's just the structure of the formulation market. They use third party formulators a little bit more, so it's a little bit easier for access.

26:07 So we can establish success in North America and then transfer that into other regions of the world. So we look at North America as a leading indicator for growth. So over the last and we look at kind of what's the revenue per thousand homes and make sure we're penetrating the household in terms of usage. We've been running almost 70% compound annual growth in North America, and that's translating to about 60% compound annual growth across Europe and Europe and North America. And in major brand, major retailers throughout, you'll see that we're getting into more and more EU based retailers, Carrefour, Tesco, Rosspins.

26:52 And then as you get into North America, pretty much every major retailer, we have some presence there. So that's really the secondary growth as you get into the formula of a product, and then that product continues to grow by getting into more and more

27:13 The combined effect of that is the tremendous growth that we've seen. You can see on a half to half basis is a little bit of a we had that little bit of a bump in the second half of twenty twenty two. But remember, underlying, there was an inventory adjustment, but underlying growth, 63% compound annual growth over the last four years, really a breakthrough years in terms of overall revenues for us, mainly in cleaning, as I said before,

27:45 that this is a very high quality base of revenues, of recurring revenues that we're going to continue to build on into the future of it. So it's got buried a little bit in the fundraising side, it's just how well 2022 went for us in terms of commercial progress of it.

28:12 In terms of what happened in the second half, we had continued reorder volumes. We were able to get, some recovery in our gross profit margins, not all the way that we'd like to, but we significant recovery in it. We put some price increases through. We've put in another price increase through fairly recently, so to make sure that we are getting towards our target gross profit margin. Vastly different world in terms of the stability of material of our raw material costs. They've stabilized significantly And the supply chain, the shipping the shipping times and the shipping costs for both incoming and outgoing materials have substantially improved. So we're facing a much more stable world in terms of our supply chain, incoming and outgoing.

29:03 The next major area for growth for us is in Europe. We have new cleaning customers that did advance to launches and are now into recurring orders, and we have some initial traction on some major new projects in Europe that will be coming through the first half of this year. Also last year, we renewed some important agreements that we had with both Croda and Neurion, and we added Brenntag North America. So we're continuing to increase our market reach into both cleaning, beauty, and hygiene. That now now that you know you have this positive effect, now you go out and you have that confidence is to go out into more and more channels to be able to grab more revenues out of it.

29:53 What we look for, in 2023, we're going to continue to gain market share in dishwashing detergents. We'll have more North American volumes, more traction in Europe, and we're already working on the next generation, even the early generation of North American automatic dish formulations that we hope to roll out in 2024 with some new customers on it. We are bringing new hygiene products and beauty products to the market. We have a in the next few months, we'll be launching VeloSoft BR 300, which is a new polymer for us. This is used for preventing and repairing hair damage. We actually were able to go in and restore the bonds, the protein bonds in the hair to get much healthier healthier, softer hair on it.

30:45 That will be coming out. It's the beginning of some new technologies we're gonna bring into hair care. We have some new beauty products in in the in the odor control, some new forms that we're gonna come to the market with and to go out into new marketing channels for it. One area that is you know, continues to progress not quite as fast as I would like, but I think the fundraiser will help us is that we need a little bit more equipment to get our super absorbent, to make some additional modifications to our super absorbent to get to the competitive performance level that we're looking for. So we will be using some of our fundraising, bringing in some equipment for that, and we think that will allow us to make commercial progress in 2024.

31:32 And then also in our composites, the patent that we have in the composites area, we expect to be we are seeking partners there and hope to make some progress there. So another another good year in terms of commercial progress coming up ahead. When we think about how our how our revenues develop, the most important area of growth that we have this year will be our existing customers. Any particular year, our biggest growth is just from the products that are out there just being more successful out in the marketplace. The second area of growth is the new accounts that we brought on in 2022. We'll actually get a full year's revenue out of them, and that will give us kind of locked in growth. And the last pit is our $30,000,000 customer project pipeline of getting some wins there. And we have some very nice wins, potentials there, some new North American detergent accounts that could be quite large, some new European detergent accounts, and then we have a number of smaller ones, both in the detergent areas and in new odor control ones that are sizable ones. So we expect to get continued success in our custom product pipeline, but in terms of relying on those to hit our 2023 numbers, most of it's already baked into our existing customer structure.

33:03 So we arrived at just a a very exciting stage of development for the company. We with revenue growth with with the kind of revenue growth we have relative to our cost, our operating cost basis, you can see the path that we have towards profitability. We continue to bring our we don't lose a lot of money in the first place, and we continue to bring those down, and those lines will cross. And it's all around that bringing the performance cost sustainability to it, developing that large customer base of recurring high quality revenues, having a large proprietary technology base to continue to over the next ten to twenty years, we're going to continue to go back and use that our new product development process to bring new highly valuable ingredients forward, and we're doing that with no very almost no direct no direct competition of anybody making our exact polymers in it. In each formulation area, you're competing against another a particular other technology in it. But in terms of someone actually making our polymers, we're not aware of that nor do we ever see it in the marketplace.

34:21 We're doing low capital intensity with our existing plant. We have, as I stated many times, ability to go to $15,000,000 $20,000,000 over $20,000,000 in revenues just with the plant that we have. We're going to continue to build off of that and improve our ability to run that plant on it. So low capital needs going forward of it, and again, just this wonderful base of recurring revenues to build off of. So it's an exciting time for our existing shareholders that have us in such a strong place with a strong balance sheet. It's an exciting time for our new shareholders who've come on board, very exciting to have them on board, to rebuild our institutional shareholder base, and just to be able to have the resources that we need for many years going forward to continue to build out a large, highly profitable specialty ingredients company.

35:28 If I may add there, John, is to to to share, you know, what what has driven my enthusiasm amongst others about this technology is two things on this on this chart. So the first of all first one is the the low capital intensity, and I've I've seen very many scale ups, startups in the industry almost inevitably. You need a lot of money to build a commercial a commercial facility. It is absolutely unique to see what what you and what what Yvonne and the team have pulled off in this in this sense. And this this should be a unique strength going forward.

36:16 The other one which is actually related to the inherent quality of that of that technology, which was developed, of course, by von der Rand, doctor von der Rand, is the low level of direct competition. I think I know of no plant based ingredient company that is actually alone in bringing this technology to market. So these are two really big strengths and on top of that there is the large market that you can grow into. There is indeed the stickiness of sales. Once you have achieved sales in the chemical industry, they're very sticky. But these two things from a very early day really caught my eye and I believe that will be pillars for future growth.

37:06 Excellent. So we will, want to make sure we get to everybody's questions and be able to address everyone's questions. I think, Lou, I can move to the q and a on it, I believe. John, Peter, thank you very much for your presentation this afternoon. Ladies and gentlemen, please do continue to submit your questions using the Q and A tab situated on the top right corner of your screen. Just while the company take a few moments to review those questions submitted today, I'd like to remind you that a recording of this presentation along with a copy of the slides and the published Q and A can be accessed via investor dashboard. John, Peter, as you can see, we have received a number of questions throughout today's presentation, and thank you to all investors for submitting their questions. Could I please ask you to read out the questions and give responses where appropriate to do so? And I'll pick up from you at the end.

37:53 Great. We'll start at the top. In the past, John has talked about one day having a biorefinery. Are there now plans to take this forward? Or alternatively, are there any plans to invest in a new production facility in Europe? I have said that my vision, it's many years out, is that we will have a fully integrated plant of an idaconic acid plant, probably that we partner with, not that we own, and we will have our facility tied to that producing a broad range of high value added ingredients. My hope and dream is that there'll eventually be one in North America and one in Europe. That's a very long time horizon on it. That is not within any of our immediate plans right now, nor does it fall into any of the money that we raise today.

38:46 In terms of a new production facility in Europe, we have we're still operating at 20% of capacity in our North American plant. One of our biggest opportunities to increase our profit margins is to run that plant at a higher utilization rate. So we are not planning any new production facility in Europe at this time. What we are looking at is ways to continue to improve the hourly throughput rate and uptime of our existing plant and using some capital to do that. And we can expand the capacity there for relatively small amount. Second question is within with the recent appointment of Paul LeBlanc, will there be a direct or indirect working relationship with Bemis?

39:38 Paul LeBlanc is the CFO of Bemis. Wonderful experience there. He took it from a relatively small company to a very major player, and he is on our our board and specifically head of our audit community because of his experience as an operating CFO of the phase the challenges that a company goes as they go from five to 10 to 20 to 50. This you know, growth growth can be very challenging in terms of the systems you have in place. Paul is a excellent operating CFO with that kind of experience of it, and that's why he's on our board. Bemis, the company he works for, is an excellent excellent company. They their applications in our technology do not have any direct apparent ties, but, you know, but excellent companies, you know, will always be on the lookout for opportunities. But there's nothing related to his appointment in terms of any relationship between the company other than Paul was by far the best candidate for what our needs are going forward.

40:49 Next, would you describe your private label versus branded mix where your products are being used as ingredients. Please share data for different product lines. Within I can really only speak to in our cleaning area, remember, a lot of the brands that happen that Nurion gets in hairstyling and that Croda gets in home care, we don't have direct access to that. And even some of we work through some distributors, we don't see direct access to it. Where I can speak to is in the automatic disc detergent area, we are bringing low cost, high performing, sustainable ingredients in that area, and it works both branded and for private label.

41:36 I the specific counts, a lot of these products get produced at the one or two facilities. Usually, use all these brands use third party contract manufacturers, so exactly how it end how the volumes that we end up go up into different areas. But in terms of the efficacy that we have and the competitive advantage that we give, it works equally in private label and in branded areas of it. And I think the example I gave earlier of a consumer sitting in front of the retail shelf and the types of choices they think they're making, we're in all three of them. So it doesn't make almost we we wanna be in every category, that the customer makes because of the capabilities that our chemistry has.

42:25 Next question, could you give some sense of the number of brands that are currently evaluating your products to use as their ingredients? Our customer pipeline is about $30,000,000 It may even be a little bit higher now. We've had some very good progress, I think, going out in some of the efforts that we did in the last six months to expand our channels is bringing in some very good opportunities. In terms of the actual number of products, I don't know. I'm a numbers guy, so I think about revenues more than I think about products. So, it's $30,000,000 plus in terms of intentions, terms of active projects that we have. Next, are you prioritizing breakeven or faster growth?

43:16 It is there's always a balance between it. I think that I don't like I would like to be profitable of it. I think we have the revenue growth that we have should get us to profitability on it, and we should get there as soon as we can without cutting off our faster growth. Where we are right now is our existing business of the cleaning, beauty, and hygiene, we're going to be a very profitable some size company. I don't know if it's, you know, 20,000,000 or 25 or 30. I I don't I can't tell you, but it's gonna be it's a highly profitable business that we've already built and are operating.

44:01 What the next one to do is our next goal is to be a $100,000,000 company, and that's what we're going to be looking at in our product in our project pipeline, new products that we're bringing forward is now we need some bigger swings out there. I think we can do that. We're going to do that within the context of what are available of our operating structure that we have now. And I don't I really do not want to be deferring off breakeven that much terms of that. We'll be hovering right around there in the next couple of years on it. But the remember, the underlying ambition is to make sure that we're a $100,000,000 company and that we do bring product opportunities forward to do that.

44:50 Dave, you said last year that a quote on NASDAQ or other U. S. Market was scheduled. You were talking of a shareholder consolidation to facilitate this. Where are we with this? We talked about a share consolidation for the purpose that our existing we still have a significant base of shares held in The U. S, myself included. And one of the issues we have with our share price right now is that our U. S. Shareholders cannot hold their shares the brokerage firms will not hold our shares in a brokerage account. That's a major issue for us on it. So we are looking at share consolidation. We did a we made some assumptions about kind of where what price we needed to get to in dollar terms and where our share price would be in terms of what we had approved last year. Now that we're through the fundraise, we'll go have a chance to go back and revisit that.

45:51 I don't think I said anything about I don't think I've ever said anything about quoting on Nasdaq. We already are in the OTC market, so we are quoted on the OTC market as it stands. I don't recall saying anything about NASDAQ on that one, But on we have talked about so the share consolidation, we still expect it to happen. I think it'll be a discussion that we take under consideration over the next few months on it. Next question, which is the most popular alternative to ITACONIX ingredients being used in your customer markets? Good question. It varies dramatically from every product area, it varies. In automatic dish detergents, there's tends the the the formulations we're competing against is there tends to be a small molecule chelate and an acrylate polymer that are used, and we're taking out both of those and replacing it with just our polymer.

46:57 In hairstyling, we're replacing film former traditional film formers, which are tend to be fossil based products, traditional film former ones, and we're substituting it with a product that has a different functionality to hold the hair on it. So there and then in odor control, there's all sorts probably the biggest thing we do in odor control is people are using fragrances to mask odors as opposed to actually neutralizing them. Because I actually think the zinc rinsanolia market has been growing, we're growing in it. So I think that probably the biggest competitor in that is people trying to reduce the amount of fragrance they're using to mask odors and actually neutralizing them.

47:46 So again, just note, every segment that we go into, there's a slightly, we're up against a competing formula with some competing ingredients used to it. There's no one there's no one alternative that goes across all of our platforms. And add to that, so this is actually a feature of the ingredients industry, lots of them chemical companies, very many different applications. You go into one application, you'll find four competitors. You go into another application, you'll find three different competitors. Sometimes there are overlap, sometimes there are not. So you have to take it application by application. That's great. Can you please talk about your competitors and their strengths and effects on your business? I would say the biggest when you get up into the largest brand, there's two segments of kind of ingredient brand market. There's the smaller brands where ingredients come out, formulas try all sorts of different ingredients, they and and, you know, it's just how well it performs. At some of the highest levels, when you get up into some of the the the global brands, they tend to have they continue to have a five year development project with one of the majors, with the you know, one of the the the really large global chemical companies, and they will actually develop a new chemistry with the brand.

49:16 And as part of that, when the chemistry company actually goes and builds the plant, they'll get a long term contract. So when you look at our product list, you can see our brands, our ability to break into the very high very largest global brands can be quite challenging in terms of the relationships and how those relationships work and the amount of resources that you have to do it and the contractual obligations that they have that go over many years. So I would say that's the biggest one in terms of, you know, our ability to break into that next tier is that you really you know, you have to be in business for quite a number of years for them to come in to to to put you into that category on it. John, so just to talk to you also in light of in light of time.

50:05 So there's quite a few questions of David and Siddharth, and we cannot see if there are others that have questions that we would like to pick first. I can And I think this session I can go stops at the hour, is it not? What time is it? We have ten minutes less than ten minutes. I'm sorry. Are your core patents, Corey? We have 15 product cat we have 15 categories. They they're you know, we still have a life on on all of them. It's a it's a it's a broad range of product families of it. It's hard to say, each one of them are stacked on top of each other. So we think we have patent protection for many, many years to come. If you see any plant based competitor on the horizon, Again, it kinda goes back to there is no one competitor.

50:58 Every every product category has a different set of competitors in it, so it's hard to make a a blanket statement on that one. And just to emphasize there, in itaconic acid, there is no competitor at this level of development. Yeah. John, this technology here is great, but should this not be advertised more widely for exposure? Again, we our best advertisement is the success of the brands that we get into. Formulators keep a very close track of other formulations. You know, we can do more. We'll have the resources to do a little bit more. But in general, we're pretty well known.

51:46 Within a a class of formulators for a certain type or product, we're usually pretty well known. I wouldn't say lack of awareness is a problem that we have on it. When are we going to see ITACONIX on the list of ingredients on the products I buy? They are listed on it. I mean, there are people keep track of it. We have inky names. So when you see sodium polyatoconate, iodiconate, sulfonated copolymer, we are every customer has to list us our ingredient on their ingredient list. What percentage of your products are I can't quite what percentage of your product base has reached the takeoff phase, and what percentage are almost there? We are our our in North America, in the North American automatic discharge market, we're in takeoff stage.

52:48 We're still in the traction stage in Europe for that. And then in the other two are in the traction ignition area on that. Next is what sales revenues and time scales do you envision to be net profitable? And secondly, what is your gross profit percent targets? Our goal is to be well above is above 35% gross profit margin overall. Our revenues are growing. You can see when the revenues and our cost basis revenues are growing faster than our cost base, so you can expect to see that in the coming years on it. It's not going to be indefinite.

53:39 I think we already talked about the competitive strength effects on the business. Adrian, can you ensure supply chain stability through global diversity given the changing geopolitical ones? The only source of itaconic acid right now is out of China. You know, I think there are people looking at it, and we'll see we'll keep we keep very close tabs, and everybody wants to talk to me about it, talk to us about it. You say there's currently a low level of turn. Do you anticipate this session to be in five years' time? We don't see anybody in terms of someone making itaconates like we make, we don't expect that in the next five years. In superabsorb, how big is the revenue opportunity for ITACONIX? Which end products drive it? We're in the early stages of that. Superabsorbance is a huge market on it.

54:31 So that's a very there's lots of opportunity in there. When will you hit 20,000,000 revenues? That's sometime in the future, we're growing fast. Does something like the mass recall of Fabuloso Cleaner Impact? No, it does not. I don't not not familiar with that one. We are not in Fabuloso. We do not have any product recalls I know that affect us. Can you confirm that all excess applications from existing qualifying shareholders have been accepted? I believe so, yes. And thank you for answering my questions.

55:18 Thank you. Wow. We hit we got all the questions. Alright. That's, you know, on it. Those are great questions. So thank you, guys. John, Peter, thank you. And I think you've addressed all those questions you have from investors. And, of course, the company will review all questions submitted today, and we will publish those responses on the Investor Meet company platform. Before redirecting investors to provide you with their feedback, which I know is particularly important to the company, John, could I please just ask you for a few closing comments? It's just the the so the the excitement that we have of entering a new phase of growth with a strong balance sheet, with the commercial success that we have, with the commercial pipeline that we customer pipeline we have in front of us.

56:05 You know, I've always been enthusiastic about it. I've I've known this was coming, but to be able to show the outside world exactly what we're doing with this kind of success and show the outside world and to get investor you know, new institutions coming in to invest behind it is just a you know, it's just a both a validation of what we've done and a and a a very good indication of what we're gonna do in the future. It's been a very exciting a very exciting couple months for us, and we look forward to continuing to show the steady progress that we've had. John p John Peter, thank you for updating investors today. Can I please ask investors not to close this session as you'll now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations?

56:57 This will only take a few moments to complete, and I'm sure will be greatly valued by the company. On behalf of the management team of ITACONIX PLC, we'd like to thank you for attending today's presentation. Good afternoon to you all.