BluGlass Limited (ASX:BLG) Managing Director and CEO,Giles Bourne, talks about the company's 1:1 non-renounceable rights issue, the need to fund its technology through to commercialisation, independent validation of its RPCVD technology and its response to COVID-19.Rachael Jones:
Hello. I'm Rachael Jones for the Finance News Network. Joining me today from BluGlass (ASX:BLG)
is Managing Director Giles Bourne. Giles, welcome back to FNN.Giles Bourne:
Thank you, Rachael.Rachael Jones:
Now, during these tough times, how is your company reacting to the impact of COVID-19?Giles Bourne:
When we realised the severity of it, we immediately swung into action as a lot of businesses have. Now, we're a manufacturing and a science research organisation, so we have to have people at the facility all the time. So what we did is immediately split into dual shifts. We have duplicated skills at the back-end and the front-end of the day, and we have them totally isolated, the two shifts. So. we've extended our working hours, and we start the first shift at 5:30 in the morning and we run that through to sort of one o'clock, and then we have another shift that comes in and does the evening, and then we deep-clean the facilities in between.
First and foremost is the health and safety of our staff, and so we had a lot of consultation with HR, with safety, with our staff. They are fully aware of what their responsibilities were, but making sure they're comfortable with that environment, and those who weren't essential or not essential to the manufacturing process, allowing them to work from home.
But all the key science and research team are there operating, and it's been a seamless transition. Our staff have been absolutely wonderful in taking that on board. And we've now been operating like that for over a week, and it's working really well, and we're as productive as ever.
We're managing the process very well. We've got these contingencies in place, and every day our health and safety committee monitors all the updates from the New South Wales government, the Federal government. We look at all the things that we need to be doing and go over and above that. So, I'm really happy with the way it's sort of seamlessly transitioned into this new system.
And clearly, as a business, we're really conscious of the needs to people to assist others in this. We run cleanrooms in our facility and we have all the cleanroom garments, the HAZMAT equipment, so we have excess of that. So, we've made sure that we've given that to the New South Wales health authority so they can use it. They're in desperate need of PPE equipment, and we have excess of that equipment. So, we're working as close as we can with both State and Federal government to help them where we can.Rachael Jones:
And you've announced a rights issue for eligible shareholders. Now, in this challenging time, what can you tell me about that initiative?Giles Bourne:
Rachael, we've got some great technology. We've talked about it a lot over the years and specifically, most recently, we talked about our laser diode initiative, where it's a direct-to-market product. So, taking all the technology we've developed over the years, specifically from the LED, it's this tunnel junction technology, taking it into a direct product.
And so we've got a very clear product roadmap, we've got a revenue roadmap which we've shared it with the shareholders, and we need to make sure that's properly funded so we can get there. And so we're a nimble organisation. We're running relatively lean, and we need to make sure it's properly funded because this market is going to continue. When we come through this current crisis we're all in at the moment, there remains an opportunity for technology like ours, a big opportunity, and we need to make sure we're geared up to enter the market.
So, right now, we have a very clear road map. All our supply chain remains in place. There's been no slippage in our supply chain. All the people working in that, they're partly in Australia, partly overseas, are continuing to operate as normal. Most of them are key manufacturing type businesses. So, for them, staying open is important. They're enabled, they're allowed to stay open. They continue to work on our roadmap. So, we're really comfortable with the way that it's going.
But, to fund this, we need to issue rights to our shareholders, to give the opportunity for our shareholders to buy one-for-one shares in our business, to make sure we're properly funded through to our revenue targets.
So, we launched our rights issue this week on Tuesday, and it's open till about 16th April, and so there's plenty of time over the Easter break for our shareholders to understand the paperwork and know what rights they have and for them to actually participate in it. We're looking to raise enough money for our business to make sure we get through to revenue targets, so we can raise up to about $8 million in our business, and we'll be managing that process over the coming weeks.Rachael Jones:
And, Giles, last week you published an independent expert report on BluGlass's RPCVD technology. What can you tell me about this report?Giles Bourne:
We've had a technology expert looking at our technology for a while. In fact, one of our investors was keen to drive this project forward. So. this person who is an expert, Dominique Morrison over in the UK, who has a deep expertise in our sector, did an analysis of our technology readiness levels, looked across the board at all the application of where we're going, and did a review of it, and came out with a report saying, from her perspective, how the technology fitted into the market, what the opportunity is, where she sees us in terms of entering into the market, and there's a lot of emphasis obviously on the laser diode as an immediate market opportunity.
So, that's just been published, and that can be found on our website. But it's a really good independent analysis of what we're up to. And coincidentally, at the same time, one of the key publications in our sector called Compound Semiconductor Magazine featured a really interesting spread on BluGlass's laser diode technology. And that's also on our website and just came out this week.Rachael Jones:
And to the last question now, Giles. We've already spoken about your laser diode technology. Can you tell us about your dual commercialisation strategy?Giles Bourne:
Sure. Obviously, laser diodes, we talked about quite a bit. I mean, that's been front and centre of our communication with investors recently. That's our product we have direct control over, and, as I say, supply chain is in place there. We've got some clear technology and revenue targets there. But we haven't stopped our work on these other technologies as well, most notably LEDs and microLEDs. So, the strategy there is one of licensing, so collaborating with key partners, where they're funding our research. Ultimately, when it hits the technology goals, then it gets to a licensing arrangement with these players.
So, we've talked about this before, companies like Bridgelux in the LED space, who are working with us very closely about getting high-performing LEDs, to give them a commercial advantage in the market, and customers such as XDisplay, who are working on microLED displays, and they've been working with us on high-performance, small LEDs that go into display technology. In fact, XDisplay, most of their LEDs that they have in their prototypes are LEDs made by BluGlass.
So, those continue to operate alongside our laser diode one, but we'll be working very closely with both those, and there's a high degree of overlap on the technology, both laser diodes, microLEDs and LEDs.Rachael Jones:
Giles Bourne, thanks for the update, and best of luck during this challenging time.Giles Bourne:
Thank you, Rachael.Ends