What are your thoughts on the perfect storm letter from CEO
LA JOLLA, Calif., Sept. 21, 2016 (GLOBE NEWSWIRE) -- MyDx, Inc. (OTCQB:MYDX), a rapidly growing chemical detection company and the makers of MyDx®, the first multi-use hand-held chemical analyzer for consumers, today announced that in response to numerous shareholder inquiries about volatility in the market for its common stock, the Company is reporting its business, sales and new product launches are all on track and on plan.
MyDx expects to report solid revenue for the current, third quarter ending September 30, 2016 while expenses are in line with recent trends as it targets profitability. Its launch of the AquaDxTM Sensor Chip is on schedule with the build-up of inventory on plan for its December 15, 2016 general availability and shipping date.
Previously in 2015 and earlier in 2016, MyDx raised growth capital with convertible debentures, a form of debt which is convertible into common stock. With the Company’s fundamentals better today than ever before and trending toward profitability, debenture holders are inclined to convert now to maximize the number of shares they receive before the MyDx third quarter and fiscal year results are posted. Most debenture holders convert and immediately sell their common stock into the market and when too many sellers try to exit at the same time, the supply can temporarily overwhelm normal demand.
As of September 20, 2016, 52,939,410 common shares were reported to be issued and outstanding, and approximately $500,000 in convertible debt remaining on its balance sheet. Once that debt is converted, its balance sheet will be strengthened with minimal long term debt remaining.
“Regrettably, it’s a perfect storm, but a temporary one,” said Daniel R. Yazbeck, MyDx Chairman and CEO. “Convertible debenture investors generally are risk adverse and sell immediately upon conversion, creating far more supply than demand for a short time. As the Company’s largest shareholder, I fully understand the concern of our many loyal shareholders.
“Reflecting the gross market distortion, OTC Markets reported that as of September 20, 2016 our Company’s market capitalization, or equity value, is only $714,682 which is equal to the price of a good, publicly traded OTCQB shell company with no operations, products, services, IP or any other assets. One year ago today, as we were just starting to launch the CannaDxTM product line and prior to securing world-class manufacturing, supply chain management and a major US distribution deal, our market cap was approximately $28 million -- or about 40 times that of yesterday’s closing value.
“Today,” Mr. Yazbeck concluded, “CannaDx is a proven seller with a clear ramp up. AquaDx is in launch phase, while the OrganaDxTM and AeroDxTMproduct lines are being readied for launch shortly. Further, MyDx has been working for months on several major new business and marketing initiatives that we anticipate closing and announcing shortly.”
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