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It has been posted there.
myself , aqa and others have been telling the board this was going to happen for a while... This is going back to 1c and beyond, who wants a ride? lol
Conference Call Notes:
General Company and Revenue
1) Pzoo company e-commerce platform on its website is being updated to be more user friendly. Products to represent pzoo are available for purchase
2) Revenue Verticals
a. Company website (currently producing)
i. Ad revenue, merchandise, etc
b. MA& Associates Nevada lab (open, not testing yet)
i. Testing pending confirmation of the state pesticide requirements
ii. Secured letters of intent 150,000 sqft of grow space
1. 70,000 committed for 2 years
c. Harris Lee Oregon lab (not currently open)
i. Signed lease is in place, meeting with architects is already occurring
ii. Building requires very little buildout (planning phase now)
iii. Already secured some grower letters of intent
d. Harris Lee Colorado lab (open, testing and generating revenue already)
i. The final stage getting Marijuanna Enforcement Division approval of license transfer
ii. Date has been secured, but Pazoo is trying to move this up (not noted on the call)
iii. Purchased a functional lab
e. Cannabis King (revenue generating beginning this quarter)
i. Accuvape sales have begun bringing in revenue in 4 states and the sales force is being expanded to capture more of the market
ii. A referral came from a shareholder after reading the accuvape press release which resulted in a $3500
iii. Other products: just added a water conservation product
f. All of the labs should be testing in the 4th quarter, starting with CO
3) Based on current information, all 3 labs will be profitable starting with the first quarter 2016.
4) Cannabis King revenue projection for 2016 (too early to tell)
a. Tough to tell because this is our first quarter
b. Accuvape reorder rates have been 90%+ most being larger orders
c. MJ Payments- multiple clients in several states awaiting setup
d. Anti-Microbial product- marketing labels have been approved by the states where it will be sold
e. Water conservation product- patented and only product of its kind with very wide usage range (large buildings, plant nurseries, grow operations, etc)
f. New products are being considered and will be added going forward
g. Currently NO extra staff has been added on payroll (only commission), so no additional expenses have been incurred other than commissions
5) Fundamental Valuation
a. IN THEIR OPINION, Highly undervalued in comparison to our main competitors and their stock prices
i. Substantial cost barriers to entry in the MJ market, specifically in testing
b. Timeline of accomplishments this year
i. January 2015- acquired 100% interest in Harris Lee
ii. March 2015- Master agreement with Steep Hill including first right of refusal for the remaining states in the US
iii. March 2015- Harris Lee signed binding agreement to purchase Front Range facility in Colorado
iv. May 2015- Cannabis King formed to sell non-hemp related products; company was created out of demand and relationship with Steep Hill
v. June 2015- acquired 100% interest in MA & Associates
vi. July 2015- Legal documents with Front Range Labs completed for purchase of the CO facility
vii. July 2015- Cannabis King signed 3 different products to distribute
viii. August- Oregon facility lease signed and buildout planning begun
6) Reporting
a. Annual reports are audited
b. Quarterly reports are reviewed (slightly less aggressive than an audit)
7) Uplisting
a. Goal is to be listed on the NASDAQ
8) Paid Promotion
a. Paid promo was not for dilution and there were no shares converted at that time
b. Closing price on Thursday and Friday was nearly the same
c. Over 30 new members were added to the FB page, new shareholders were gained, there was a substantial amount of visibility and networking connections, and most importantly it brought in a direct investment into the company
9) Preferred share conversions
a. 1.1m shares were converted last quarter and more info can be found in Q2 financials
10) 728 million shares float is 645 million shares
Financing
11) There have been many accusations regarding substantial dilution. OS at the end of June was roughly 670 M and now it is at 730M. There has been approximately 40M shares added to OS since the end of Q2.
12) The funding for the rest of the year will be provided from direct investments into the company. No more convertible debt will be issued!
13) No private placement is being offered, only direct investment
14) Dilution for the rest of the year
a. Convertible notes due in the 4th quarter, but the plan is to pay them off prior to conversion; just like they did previously
Lab Operation
1) LV lab has 4 employees, CO lab has 5 employees, OR has 1 employee who is waiting to be put on payroll
2) All employees who are going to use the testing lab equipment are required to have a bachelor’s degree and 4 years of experience or master’s degree and 2 years. Most of the employees have substantial testing experience on top of the requirements. Lab directors that are hired have experience setting a up lab from scratch
3) Tests by lab
a. LV - 6 different tests required by the state
b. CO- 4 tests
c. OR- 5 tests
4) LV lab
a. Only 1 dispensary open, not much testing that can be done and it’s not worth the cost to do those couple tests
b. Need certificate of occupancy
c. Waiting for one more piece of equipment and equipment calibrations
5) Lab testing is mandatory for all 3 states
6) $1,000,000 per 100,000 of growspace
a. This number is based off of lab projections in Nevada (which has the most stringent testing requirements)
b. 6 tests per sample, per every 5 lbs
c. 1/3 lb per sqft, per crop, 4-5 crops per year
7) Revenue per sample is lower in CO
8) Charges per sample
a. Depends what you are testing for and how many tests
b. CO per sample- $150-200
c. NV per sample- up to $500
d. OR- tbd in between but would be at least $250
9) Tests per day
a. Depends on amount of equipment, but around 100/day at most
10) Competition
a. CO
i. CanLabs
b. LV
i. Digipath
ii. Ace analytical
iii. G3 Labs
c. OR
i. TBD, but there are no main competitors there yet
11) Market share
a. NV- TBD
b. OR- TBD
c. CO- Canlabs has indicated they have 50%+ of the market share for now
12) Market Size (geographically)
a. CO- 90 mi radius
b. LV- at least 75mi radius
c. OR- at least 60mi radius
13) Market Size
a. A grower can Varies from 3000 sqft to 200,000 sqft
b. A grower with a space between 6,000-20,000 sq ft would make significant revenue
c. As growers are converted from letters of intent to contracts, they will be announced
14) Growing
a. First crop takes 90 days, after that 55 days with some time in between crops
b. Expectation is 4-5 annually
15) Biggest growth will be in Nevada
a. Recreational use is on the ballot and expected to pass
b. Testing regulation is more stringent and testing fees are higher per test
16) Quickest growth CO
a. 350-400 accounts in the territory
b. OR: will be quick and big as they require 5 tests and through Cannabis King contacts there are several growers who want to use the steep hill technology for their testing once we are operational
What can you do to help?
- Refer people to the website, buy merchandise, check out cannabiskinghq.com and MOST importantly be active on social media
- Please feel free to always reach out to the company with any questions that you might have; as well as David will make himself available to do conference calls with shareholders who would like for him to explain Pazoo to other potential new shareholders
- If you have any potential leads for cannabis king, please feel free to email pazoo. I.E. landed a $3500 sale for accuvape based off a referral from a shareholder; landed several letters of intent for MJ payments from a referral from a shareholder.
and I think that's reasonable from an expectation perspective DEPENDING on a few things...
1) What is revenue from each of the labs?
2) What are the profit margins?
3) Is Cannabis King a minimal revenue stream or is it going to be 7 figures/year as well?
Look at their competitors, share prices, etc. With 5+ labs and other revenue streams they could eclipse the minimum requirements in the next 2 years. Is it super likely, no, but it's more than a snowballs chance in hell lol
Brad-
I'm not sure how familiar you are with the requirements, but I've done extensive research and am very comfortable discussing. I personally think they need 5+ labs testing + a strong revenue stream from Cannabis King to have a chance. You're right this isn't going to happen any time soon, but I'd guess there is a chance that we could see that in 12-24 months depending on the political and business developments.
Brad- I took detailed notes during the call and will be posting them shortly. Just cleaning up my shorthand.
Peter- the minimum price required to uplist to the NASDAQ is $4 for a company that has never been on the exchange. The $1 that has been floating is the requirement to stay on the exchange.
Link for conference call. Skip the first 10 minutes as they were just giving people a chance to get on the line.
https://www.freeconferencecall.com/wall/recorded_audio?audioRecordingUrl=https%3A%2F%2Frs0000.freeconferencecall.com%2Fstorage%2FsgetFCC2%2FaR2Jm%2Fy1lPG&subscriptionId=2603264
Remember the conference call with CEO Cunic is today from 12-2 EST. if you need the dial in information, email investor@pazoo.com
Since grower/product related contract information hasn't been released, we have no idea who they are working with and what they are testing other than that they can perform all 4 test types.
At this point, I'm expecting CO to be open and testing first, then NV and OR. OR could be first if NV doesn't get moving with it's pesticide regulation.
Couple quick thoughts
1) Any questions for the conference call need to be submitted to David Cunic today. I can send them to him if you don't have the contact email.
2) Prognosis on the stock:
Until Pzoo opens labs, the stock will probably continue to languish around .004 baring any other very significant events (significant dilution, other huge PRs, etc).
Clearly the stock price is just plummeting because you say so... which is just about the only rational reason you've given thus far.
Looking forward to news dropping and crushing your head as I'm really getting tired of the venom
Weighing in on a few of these issues:
1) Conference call:
It is another positive step made by management to be as forthcoming with shareholders as possible. Does it validate their business- NO. Does it prove anything further than that management wants to communicate directly with their shareholders-NO.
2) Dilution:
For anyone who has traded pennies for any considerable amount of time, you know that when dilution hits, volume is huge, constant selling into the bid, etc. What we've been seeing is scared retail selling and I feel really sorry for them.
Here's a question for you guys... Does anyone see the negative, nonsensical posts coming from 4-6 people, all written in a similar manner (like maybe they are from the same person)?
I'm very positive on this stock long and know that dilution is not happening here. Good luck to all and I'll be a buyer again today. I'm pretty sure we saw rock bottom yesterday and it's only up from there.
Saying this trading is dilution just isn't backed by sound logic. Sure, this is ihub so we can all express our opinions, it's just nice when they are valid.
Right now there is a complete lack of faith in management by the shareholders. Many have either sold pieces of their positions or at least decided to wait and see what happens before they buy more.
Let's see what the CEO has to say on the conference call. I know he's taking questions for the call, so feel free to add them on the FB page post.
10m shares at avg .0045 is still only $45,000 in volume. That isn't enough to be conversions even if that was the only thing selling. Financials coming out today or tomorrow should provide a little stability.
PPS longer term will come down to the top line revenue number and margins each of the labs are making as well as any other additional revenue lines (Cannabis King).
With 3 labs testing (even without proven revenues), I think 6-10c by the end of the year is very realistic. Keep in mind Cannabis Labs only has 2 labs which only do 1 out of the 4 tests for cannabis related testing. An equivalent pps for pzoo based on 2 labs testing, share structure, etc would be in that range, but that is a HUGE amount of conjecture. Looking out any further than that is virtually pointless at this juncture. I'm just very envious of the people buying at these prices (either to average down or getting in initially).
Seeing PPS in the 4s is annoying, but doesn't really bother me because I know what the stock is worth as these labs open soon and anyone buying here will triple up fairly quickly.
Are you serious? Volume is so low there is no way that anything other than retail sales are going on right now. I watch L2 very closely and there hasn't been a lot of selling into the bid although it does happen occasionally (just like any other stock).
The initial due date is the 15th, but the extension filed last week gives up to 5 calendar days. Anything filed before EOD on Thursday is on time and after that is late.
Agreed. The stock is also fighting the fact that even not including the summer slowdown, all momentum had halted for a while. Pzoo needs a couple good PRs to get momo back on their side. The top 3 for me (in no particular order) would be CO facility revenues, convertible debt pre-payment, and NV testing beginning.
you're too patient man... We need revenue based PRs (whether they are labs or CannabisKing) in the next 2 months at latest to get momentum going in the right direction to end the summer and position ourselves well for a fall run, then spring push.
Agreed completely. There's a reason "toxic" is the descriptive word.
You seem like a knowledgeable guy... If over the next 2 months pzoo begins testing at their lab and pays down the convertible debt, how do you forsee the future looking for them?
Malc you're absolutely correct that convertible debt is the last financing resort and that most companies who use it don't come out of the potential downward spiral that comes with the converted debt-based share liquidations.
That being said, many of the companies you are referring to were forced to take out convertible debt because of poor credit, sketchy businesses, etc. In this case, the MJ sector cannot obtain traditional financing due to regulatory risk. Making comments indicating you don't think the company is real is fine if you really believe that, but a little asinine given the number of people that have been to the labs.
There is $700,000 of convertible debt that is set to convert in October if not paid off. David Cunic (CEO) has repeatedly said that the majority if not all of that would be prepaid. I've been watching carefully and I believe the reason for the recent S-1 was for alternative financing to toxic debt and I think that is how they will be pre-paid (given that we are still pre-revenue).
yeah.... Volume is so minimal right now. The reality is that pzoo will either get their financials out next week and begin releasing PRs to indicate the progress we've been hoping for or.... this could get nasty as pps is already down close to it's all-time low.
Agreed. The short extension better be enough time to get the financials out or the auditors need to be fired. With big 4 audit and accounting experience, I'm completely baffled by how these auditors are still in business and would recommend their replacement in the 4th quarter if I had any say.
There has been a recurring bid for 5.5mil shares at .0045 that barring anything shockingly bad happening should prevent the stock from slipping any further than that, so I really can't see this hitting the 3s for any reason.
Here's to hoping we get financials and some good news next week.
oh you won't get any disagreement from me there. First steps are financials, then doors open (CO), then grower contracts, turn profits into additional labs, etc. The main point I was trying to make is that there is no way an RS will occur any time soon.
To a certain extent, if the company has made enough progress (ex: revenue values) and it's reflected in PPS, moving to the NAS would be the next logical step. Based on the current share structure and some likely dilution over that kind of time spectrum, my suspicion would be that they would have to do an RS.
That said... Management has specifically stated that no reverse split is on the horizon and until I hear otherwise, I am going with that. More importantly, I agree with you entirely that if an RS was to occur, any shareholders at current pps levels will be ecstatic about their gains (minimum of 1000% from current pps IMO). IF all of those things were to occur, the move to the NAS would be a good thing for the company, increasing visibility, accountability, and certainly opportunity.
Besides, the time frame for them to actually have the revenue for that would likely be 2-3 years down the road. Let's see the financials out on time (or at least before the 20th), labs opened, revenues coming in, etc, before there is even a concern that anything like an RS could occur.
I'm sure he meant reverse split.
Agree on all counts that if you are looking into the long term future (12-24mo) a lot of things are in play. If the company is successful and has good profit margins with the testing labs, paired with solid growth in those labs and increasing their lab count, there are 2 fairly obvious outcomes.
1) They will want to get uplisted to the NASDAQ. They would need to reduce share count if this were the case.
2) Acquisition- As the markets become more stable and the risk of federal intervention decreases, the interest in acquiring a company like pazoo will increase substantially.
And yeah... given their difficulties with their auditors missing timelines in the past, I'm really hoping we get these financials out in the next week.
That is correct. The bigger one on that topic is that they are helping the state of California with their regulatory standards as well... That will pay enormous dividends in the longer term.
Thoughts on a few of the posts as most here are way to high or low on the topic of pzoo direction.
1) CANL is the best competitor that I have found (feel free to correct me if someone else has a better baseline) to use as a basis because they have the same number of facilities in the same states (NV and CO). They have had testing related revenue for about 6 quarters if my memory is correct, so their market cap being more than 10x pzoo's makes sense.
2) Peter's comment about no testing lab coming close to pzoo is true in a couple of specific ways.
A) Steephill equipment has been independently validated as superior through research in NV.
B) CANL only does 1 type of test out of the 4. PZOO will be doing all 4 types of tests in both labs. Capacity constraints will come into play, but I'm assuming that capability will translate to more revenue.
3) Decreasing volume is almost never a positive thing, but completely understandable with the summer slowdown and relatively quiet period regarding PRs released by management. There has been some pretty strong support in the .005 area and the all time low for the stock is .004. With revenue around the corner, I'd be surprised to see it drop any lower than that unless there is some really bad news that comes out from management.
4) PPS.. It's fun to think about what this could go to, but the reality is without a lot more eyes and investors jumping in (which they may as PRs are released), profit taking may slow the runs down. That said, it went to 6c about a year ago without testing licenses, facilities, etc. Feel free to PM me if you would like to discuss that further.
yeah, but unlikely...
Someone is sitting on .0050 with almost 2m shares on the ask. We would have to eat through all of those and then some.
The sale that took it to the 4s was someone selling $100 of the stock... Even if you have free trades, that makes very little sense if you are not trying to influence the pps.
Management has been very quiet and there is absolutely (IMO) some manipulation going on right now to pull the pps down, but I don't think they care and neither do I because when they start dropping news, it really won't matter.
Factually incorrect again Flet. Nevada is equipped to complete all 4 test types. "Most" from Peter's post should be "one of the most" as I'm not sure whether any of the current acting labs have that capability. I know CANL specifically is only testing 1/4 and is sitting on a 60mil ish market cap.
I certainly agree with you that there are a lot of important pieces of information that will be coming out over the coming months. I'm also disappointed that things have been held up as much as they've been, but that hasn't been in management's hands. The legal process has been the holdup in all instances (including financials).
You are incorrect from a practical perspective regarding grower contract announcement because until final pesticide regulation has been passed in NV, the growers cannot be implicated in contracts. In CO, it is not in PZOO's interest to announce grower contracts until after approved for operation in the sate by the MED.
Congrats on your massive accumulation if that is legitimate fact. Given the negative posts over the last 6 months, I don't buy it...
I sympathize with management regarding PRs and your response. Many on this board and others have been asking for PRs and progress. Just because it wasn't CO or NV beginning testing doesn't demean the fact that one huge step towards getting OR open and delivering on management's commitments has occurred.
Agree that tomorrow will probably be another weak day of trading and that we won't get any more PRs IMO, but the anemic trading you referred to have more to do with the sector being slow at the end of the summer than anything else. With revenue days to weeks away, I'm not sure what your definition of long time is, but best of luck.
I'm on the same page. PPS right now is almost irrelevant and ironically so are most PRs. The company needs testing revenue and/or other financing soon. The biggest PRs the company could put out include beginning testing (revenue), financing obtained, and grower contracts.
PZOO has been very quiet about grower contracts for months. Other members on a the board can freely call me a fool, but I'm certain they are just waiting to announce grower contracts until after they open the facilities.
Lol tiller... I hope for your sake it hits the 4s before it takes off. I wouldn't hold your breath though...
oh right and it's easy to see. I'm just surprised we have people dropping their shares at these prices. If pzoo misses their Q2 date, then yeah I see a drop coming, but we've been told that won't happen again. It remains to be seen if management will follow through on their commitments.