Member Info for Leapfroggy

At one of the investor meets Ashman showed a mock up of three products including Rosacea

Whoops, hopefully one day google will recognise Zenakine and correct my spelling!

A carefully thought out marketing strategy is required for a product that takes three months to prove its efficacy and where there is no direct contact with the customer. This will require initial discounting to ensure at least a two month initial spend. As has been commented before Axis PS is not suited to retail marketing. SBTX has demonstrated woeful marketing and has yet to appoint a senior marketing manager so I expect they will appoint an agency to market the Superdrug products.I have hope that the Acne product will sell well but was disappointed the Rosacea product was not taken on by Superdrug which would have given a more impressive shelf space. Cannot yet see a reason for buying any shares. I am now wondering (hopefully) whether it was true that VIPs ever received Zenaidane samples 17 months ago!

ITM have every chance of seeing the SP move slowly but steadily forward. Like Rolls Royce they were a basket case but now are on the road to profitability. They have excellent technology and blue chip partners and customers.

Not sure why Axisbiotix is being sold at a two thirds of the retail price on ebay through Meerkat Cosmetics just before its Superdrug launch. Apparently the boxes are a “little tatty”. Maybe stock that is near its sell by date/ damaged boxes?

https://www.ebay.co.uk/itm/197523166813?itmmeta=01K3TBJY5V9JY97534KPCVR83Z&hash=item2dfd4c565d:g:bd8AAeSwwlxocu5l

Over the this year, I have continuously sold over £100k of SBTX and put the proceeds into EEE and to a lesser degree ITM. As I stated previously, I would sell up if Zenakine wasn’t on the shelves by the end of June. Still holding 185,000 SBTX and selling 10,000 a day, maybe FOMO but in retrospect selling shares that keep on dropping whilst your other shares keep ongoing up, has made this an easy decision. Surely 14p is the bottom so I will keep 100,000 shares but investing in SBTX is pure speculation and I have no confidence that Ashman and co can market the Superdrug products. Both ITM and EEE have a very long way to reach historic highs.

In the Investor presentation it is pointed out the stacks can be updated without any other changes to the on-site machinery/equipment/housings

Very impressed by the management team. A strong strategic and practical approach. They are driving forward best in market development, ease of implementation and customer financing. Resolving legacy issues provides customers with surety that the designed performance and cost base will not only be maintained but future improvements can be incorporated into existing designs.

Completely agree. Substantial fundraising and loans without any indication of returns indicates a board and CEO operating without due diligence. Still no proper detailed breakdown of what the £4.1m will be spent on apart some vague statement about how this means the Superdrug launch is a year early when in fact investors were expecting a 2025 launch anyway.

The fact that it was easy to raise money in a difficult market is not in itself a basis for an investment decision though it does indicate confidence. All anyone is asking for is the information these companies investors received in order to justify their investment. Ash man seems to indicate it was a few calls and top the deal was done, he must think we are idiots to buy that!

On a conservative basis in year 1 - item cost is £25, profit after Vat and costs/Superdrug profit =35% - £8.75. 200 stores sell 35 items a month. 200 stores x 35 sales x£8.75 x 12 months= £735000. Add in 200 items per month online for Superdrug and SBTX at an average £10 profit - 400 items x £12 profit x 12 months = £57,600. Total £792,600

800 stores = £2.94m in store profit with potential to easily double sales in year 2 giving £5.88m plus online profit of +£250k

Four times the sales of Superdrug!

The fact that Superdrug has a younger sales profile doesn’t mean that it was a better choice than Boots. He is wrong to say that Superdrug was the obvious choice. Not true. Boots has twice the internet traffic of Superdrug. Young people tend to buy online. Boots and Superdrug’s main customer base are women 25 to 50 and both are trying to get more younger customers. Boots have a very successful beauty brand targeted at younger customers. Boots simply has more customers and will reach more younger people because it has four times the sales of Boots.

And why after all this time it appears that the Rosacea product has now been dropped? I thought that we were selling a range of skin care products to indicate our professional approach?

Phrases if I hear repeated will cause me to puke:

Of course I will RNS this as soon as possible ( no you won’t because progress is slower than a snail with a broken leg)

We are no longer a one trick pony so we will be attractive to a multinational (we had a deal for Axisbiotix but decided to go it alone as the margins were better, though sales so bad we had to dump the product as it had past its sell by date)

The average takeover bid price is only 36% above the SP. If there is going to be a bid, it is going to happen in the next few weeks as we are holding a very decent cash prize thanks to the recent raise of £4.1m.

The interview was more of a ramp (as have been recent articles) than a serious interview putting forward investor concerns. Quite bizarre flying of a kite regarding share buy backs (based apparently on 5000 phone calls) because the company would have so much money, it wouldn’t know what to do with it! In the Spring Investor Meet the presumption was of an imminent UK retail launch. Now apparently it was all lined up for Summer 2026 not 2025. If we had been told that at the time, Ashman’s credibility would have been shot. I admit to being an Elrico subscriber but certainly won’t be renewing.

The NPF site lists products alphabetically which is good news. There is a link to buy the product and I presume the text below which is on their site could be lifted and used as an endorsement.

‘This next-generation approach targets the gut–skin axis to address skin issues at their root. Each daily sachet helps reduce pro-inflammatory chemicals known to impact skin health, including those linked to psoriasis flare-ups’.

I agree that the most compelling reason to buy is that most existing major existing investors were willing to put up more money when asked and must see a return on their investment. Elrico only had one job in the interview with Ashman which was to obtain a breakdown of what the £4.1m was going to be spent on and he failed to achieve this. We do know SA said the machinery at BTS didnt cost much, there is money for more trials/testing (presumably of the acne product, hopefully a blind testing), Superdrug stocking and advertising. I would have thought £2m would have done it?

I suspect that we had to pay Superdrug for prominent positioning of our products, a guaranteed marketing budget, customer emailing etc. Without substantial Zenakine income, we would be headed for another big loss, hence the fundraise. That they have exclusivity for two years is not good if that means we cannot sell the product ourselves or through pharmacies

Difficult to make an investment decision. Superdrug is good but Boots was the much better option and SA indicated that this was possible but failed to get them over the line which again points to a serious lack of marketing expertise. I am hoping an external marketing agency has been appointed as we can’t afford another disastrous soft launch. I can see the psoriasis community challenge any NPF endorsement through ASA as it could be reasonably assumed the endorsement is for a product that alleviates psoriasis. That existing investors are backing the company is a big plus but SA continues to draw a huge salary for few achievements, over promising, poor RNS and some dodgy decisions like chewing gum. It’s all on Zenakine!

We were told break even including the Superdrug deal and no need to fundraise. Then we need £4million to get the current deals over the line. Ridiculous idea of putting acne treatment into a gum put that launch back a year and the NPA endorsement doesn’t actually endorse the product as reducing psoriasis.