RE: All about the numbers.26 Mar 2026 13:48
Here's my figures - worked on both low end sales price of $100 and high end of $300
It's all about the royalty payments imo. The volume of sales Bio achieves has a massive impact on their bottom line. I'm sure they know what they are doing and have assessed the market correctly. It all comes down to how quickly they can get it to market and ramp up the volumes. As most are aware the potential audience for this test is mind boggling. Bio do still have to penetrate the market and gain traction and potentially deal with the backend lab work - make sure that the labs have capacity to deal with the flow of work. This is probably why they are all over the conferences and seminars - networking and casting a wide net.
The royalty set up however is leveraged in our favor if they can get the volume ramped to their targets.
According the the last RNS there is a $2.4m upfront royalty due by 2026 year end.... approx 600k has been paid to date. Leaving a 1.8m overhang. This overhang is upfront debt to Bio. There is an additional rolling royalty of C. 500k per year. MINIMUM! The minimum is the important bit. This rolls for 7 years, totaling $3.5m over the period MINIMUM.
The way I'm reading it - If bio only ever sell one test the royalty due is still $3.5m spread over 7 years. The flip side of the coin is there is a 10% minimum royalty on sales of tests.
Working on $100 per test, royalties are $10 ea. To hit the 500k they need to move 50,000 to be at break even. Any less, then a greater % of the sales revenue would need to be funneled to CIZ to hit the minimum payment. Anymore is a bonus boosting the 500k obviously. 50,000 kits per annum is approx 200 per day (working day) every day every week. This gives Bio a gross revenue from kit sales of $5m
At $300 test price the numbers obviously drop - 16,666 tests per year, 64 per day. Gross sales remain at $5m
On their website (thanks Thinshins) Https://invest.cizzlebio.com/ there is however a target figure for sales revenue for year 3 of $33.8m. At a 10% royalty this gives Ciz $3.4m p.a. Depending on the sales price Bio would need to be running at 112,600 kits per annum ($300 price tag ) or 338,000 per annum ($100 price tag).
The point here is at the lower sales price, 338,000 tests is 1300 per day and at the higher advertised $300 price it's only 430 per day.
Personally I think these numbers look very conservative. 430 tests per day after 3 years setup - over the entire catchment N. America, Canada and Caribbean sounds LOW. All hinges on them getting market traction.
The 1.8m still needs paying on top of this. Bio have done well with the crowd fund and have a separate 5m from private placements I believe. In any case BB has previously loaned Bio money (evidence of this is in the circular in thinshins link above) So although there are disclaimers about needing to raise if Bio default I don't think it will come to that.
AIMO. DYOR . Please fact check and calculate.
ATB LB
Sign In
Follow the stocks
