INBS — Intelligent Bio Solutions Inc.

Summary of INBS Q1 2023 Earnings Call

1. Key Financial Results and Metrics

• Cash Position: As of September 30, 2022, INBS reported cash, cash equivalents, and marketable securities of approximately $5.74 million, down from $8.24 million as of June 30, 2022. This decline is attributed to expenditures related to the pilot manufacturing facility and general overhead costs.
• Net Loss: The company recorded a preliminary net loss of $1.21 million ($0.08 per share) for the year ended September 30, 2022, an improvement from a loss of $1.43 million ($0.10 per share) in the previous year, mainly due to recognized government support income of $0.31 million.
• Cash Runway: Current financial resources are expected to cover expenses into the first half of 2023, excluding revenue from new markets or potential licensing agreements.

2. Strategic Updates and Business Highlights

• Acquisition of Intelligent Fingerprinting Limited (IFP): The acquisition, finalized in October 2022, is a cornerstone for INBS, enhancing its technology platform for on-site diagnostic testing. The company has rebranded to Intelligent Bio Solutions to reflect this strategic shift.
• Product Development: INBS is advancing its non-invasive saliva-based glucose biosensor and has initiated clinical studies to optimize testing methods and assess accuracy.
• Manufacturing Facility: Construction of a state-of-the-art facility in Newcastle, Australia, is underway, aimed at supporting both glucose testing and other potential applications.
• Market Expansion: The company is targeting global expansion, with plans to enter the Australian market in early 2023 and pursue opportunities in the U.S. and other regions.

3. Forward Guidance and Outlook

• U.S. Market Entry: INBS aims to secure FDA approval within two years, which could unlock access to a $3 billion U.S. drug testing market. Initial interactions with the FDA have been positive.
• Revenue Growth: The company anticipates strong growth in client acquisition, particularly in the Australian market, with sales expected in Q1 2023.
• Future Product Lines: INBS is exploring additional applications for its fingerprint testing technology, including diagnostics for various conditions and food safety testing.

4. Bad News, Challenges, or Points of Concern

• Cash Burn: The company’s cash position has decreased, raising concerns about its ability to sustain operations without additional revenue streams or funding.
• Regulatory Risks: The timeline for FDA approval and market entry in the U.S. is uncertain and contingent on regulatory processes, which could delay potential revenue.
• Market Competition: The company faces competition in the drug testing market, and its success will depend on the adoption of its innovative testing methods over traditional approaches.

5. Notable Q&A Insights

• Market Entry in Australia: INBS plans to replicate its U.K. success in Australia, with expectations for initial sales in early 2023. The focus is on providing comprehensive testing solutions.
• U.K. Police Project: There is significant interest from U.K. police forces in drug testing solutions, indicating potential for substantial future revenue.
• Cortisol Testing: The company is assessing the market for cortisol testing, emphasizing the importance of regulatory approval and market demand before proceeding.
• Grant Funding: The timing of cash flows from government grants is milestone-based, with expectations for reimbursements as project milestones are achieved.

Overall, INBS is positioned for growth following its acquisition of IFP, with a focus on expanding its product offerings and entering new markets, though it faces challenges related to cash flow and regulatory approvals.