TOMI Environmental Solutions, Inc. (OTCQX: TOMZ) reported a strong financial performance in its Third Quarter 2024 Financial Results Call on October 30, 2024. CEO Dr. Halden Shane announced a second consecutive profitable quarter, with a significant revenue increase and profitable net earnings.
The company is experiencing robust sales growth, particularly in its mobile equipment and IHP service segments, and is pursuing aggressive expansion strategies both domestically and internationally.
Key Takeaways
- TOMI Environmental Solutions, Inc. achieved its second consecutive profitable quarter.
- Revenues rose to approximately $2.5 million, a 73% increase year-over-year.
- Mobile equipment sales surged by 90%, and IHP service revenue hit a record $650,000.
- Gross profit margin was strong at 61.4%, with a consolidated net profit of $59,000.
- International sales grew by 82% year-to-date.
- Significant new client acquisitions include Pfizer (NYSE:PFE) and Thermo Fisher Scientific (NYSE:TMO).
- Future plans focus on international growth, new products, and expanding service offerings with the SteraMist Pro Certified program.
Company Outlook
- TOMI is optimistic about future growth with a focus on international expansion and new product launches.
- The company aims to exceed $10 million in revenues for the upcoming year.
- Growth strategies include enhancing marketing in the food processing sector and leveraging innovative contamination control technologies.
- New partnerships and studies are targeted at the sizable food industry market.
Bearish Highlights
- TOMI acknowledged challenges in the food market but is partnering with industry players to provide tailored disinfection solutions.
Bullish Highlights
- TOMI has seen a 288% increase in engagement in food safety since 2021.
- The company is confident in the broad applicability of its technology across various industries.
Misses
- There were no specific financial misses reported in the earnings call.
Q&A highlights
- The company discussed its SteraMist Pro Certified program's role in disaster situations, such as hurricane-induced mold issues.
- The potential of the new stand-alone SIS product for biological safety cabinets was highlighted.
- Confidentiality challenges with naming customer partnerships were acknowledged.
TOMI Environmental Solutions is capitalizing on the demand for advanced decontamination solutions, reflected in its substantial year-over-year revenue growth.
The company's financial health is further evidenced by its positive net profit, in contrast to the net loss reported in the previous year. TOMI's strategic partnerships and international sales efforts are contributing to its strong performance.
The company's optimism is underlined by its active pursuit of opportunities in the food processing market, estimated to be worth tens of billions of dollars. TOMI's technology, known for combating airborne diseases and its potential role in ethylene oxide replacement, positions it favorably in various sectors.
With a focus on sustained growth and innovation, TOMI Environmental Solutions continues to strengthen its market position and expand its reach, as it prepares to build on its success in the coming year.
InvestingPro Insights
TOMI Environmental Solutions, Inc. (OTCQX: TOMZ) has shown impressive financial performance in its recent earnings report, and InvestingPro data provides additional context to the company's current position and future prospects.
According to InvestingPro data, TOMZ has a market capitalization of $17.01 million, reflecting its status as a small-cap company in the environmental solutions sector. The company's revenue for the last twelve months as of Q3 2024 stands at $8.2 million, which aligns with the company's goal to exceed $10 million in revenues for the upcoming year as mentioned in their outlook.
One of the most notable InvestingPro Tips is that TOMZ has impressive gross profit margins. This is corroborated by the InvestingPro data showing a gross profit margin of 60.08% for the last twelve months as of Q3 2024, which is consistent with the strong 61.4% gross profit margin reported in the recent earnings call.
Another relevant InvestingPro Tip indicates that net income is expected to grow this year. This expectation aligns well with the company's reported second consecutive profitable quarter and the positive outlook provided by management.
It's worth noting that TOMZ has shown strong returns over the last three and six months, with price total returns of 26.87% and 49.75% respectively. This performance reflects the market's positive reaction to the company's improving financial results and growth strategies.
For investors seeking more comprehensive analysis, InvestingPro offers 12 additional tips for TOMZ, providing a deeper understanding of the company's financial health and market position.
Full transcript - TOMI Environmental Solutions Inc (TOMZ) Q3 2024:
Operator: Good day, ladies and gentlemen, and welcome to the TOMI Environmental Solutions, Incorporated Third Quarter 2024 Financial Results Call. At this time all participants are in a listen-only mode. And a question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to your host, Rosalyn Christian from IMS Investor Relations. Ma'am, the floor is yours.
Rosalyn Christian: Thank you, and thank you for joining us today for the TOMI Environmental Solutions Investor Update Conference Call. On today's call is TOMI's CEO and Chairman of the Board, Dr. Halden Shane; TOMI's COO, E. J. Shane; and TOMI's CFO, Joe Rzepka. Dr. Shane will provide an overview of recent business highlights. E. J will report on future plans. Joe will provide the financials and all will be available for the Q&A. A telephone replay of today's call will be available through November 6, 2024, the details of which are included in the company's press release dated October 24, 2024. A webcast replay will also be available at TOMI's website, www.steramist.com. Please note that information contained within this presentation is relevant only to the date which recorded October 30, 2024, and you are therefore advised that time sensitive information may no longer be accurate at the time of any replay. Certain written or oral statements made by management of TOMI may constitute forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These forward looking statements could be evaluated in light of important risk factors that could cause our actual results to differ materially from our anticipated results. The information provided in this conference call is based upon the facts and circumstances known at this time. The company undertakes no obligation to update these forward-looking statements after the date of this call. In addition, TOMI will discuss certain non-GAAP financial measures during this call. The company uses non-GAAP measures because it believes they provide useful information about operating performance that should be considered by investors in conjunction with the GAAP measures. A reconciliation of these non-GAAP measures to comparable GAAP measures is included in the earnings release dated October 30, 2024. I will now turn the call over to TOMI's Chairman and CEO, Dr. Halden Shane.
Halden Shane: Thank you, Ros, and good afternoon, everyone. Thank you for joining us today to discuss TOMI Environmental Solutions' third quarter 2024 financial results. With me today is our CFO, Joe Rzepka, who will provide a detailed financial overview, followed by E.J. Shane, our COO, with the company's update on its strategic direction and growth potential. I am pleased to report that TOMI achieved another milestone, making our second consecutive profitable quarter for the 2024 calendar year. This performance reflects higher revenue, improved gross margins and carefully executed reductions in operating expense. In addition, we achieved positive cash flow this quarter, driven by stronger accounts receivable turnover and tighter control of our outgoing cash through disciplined management of expenditures. Our momentum continues as we broaden our customer base and secure new strategic agreements and partnerships. These achievements are a direct result of the resilience and commitment of our team, the support of our long-term partners and the strength of our business model. Our revenue for the quarter was approximately $2.5 million, representing a 73% increase compared to the third quarter of the prior year. This growth was primarily driven by strong demand for our mobile equipment, which has increased by 90% in 2024 compared to 2023 and our IHP service revenue, which recognized revenues of approximately $650,000, making a record for the division's quarterly performance surpassing historical averages of approximately $250,000 per quarter. We continue to see strong international sales for this year. The first nine months of 2024 shows international sales growth at 82% when compared to 2023. And BIT Solution sales have also increased by 13% year-to-date. While our partnership with EMAQ announced in the second quarter continues to grow, effectively leveraging combined strengths and resources to accelerate business development and expand opportunities. The third quarter delivered support to key clients such as Pfizer and Thermo Fisher Scientific, while successfully onboarding new customers, including Integra LifeSciences, Curia and multiple smaller engagements within the food safety sector. These new relationships are expected to drive sustained growth through both capital equipment sales and recurring service contracts. The addition of these valued clients further reinforces IHP's leadership in advanced decontamination solutions, extending our presence across the life science industry and other markets. We remain on track with the times for our ongoing custom integrations. The California-based company contracted in February is nearing acceptance and will soon be operational. Additionally, the system designed for the global leader in advanced laboratory services contracted in June has been accepted and is now in the manufacturing phase. TOMI is making significant strides into the consumer health care market through partnerships with industry leaders such as Edgewell Personal Care (NYSE:EPC) and Reckitt, Benckiser Group plc. These collaborations highlight the versatility of SteraMist's technology across multiple industries, enabling us to unlock new markets while continuing to support our core segments. Looking ahead, we remain focused on accelerating international growth, launching new products and programs and carefully managing expenses. This disciplined approach has strengthened our performance this quarter, and we remain committed to delivering sustainable organic growth and profitability moving forward. I'll now turn the call over to Joe.
Joe Rzepka: Thank you, Dr. Shane, and good afternoon, everyone. I'll provide a brief overview of our financial results for the third quarter of 2024 compared to the same prior year period. Our consolidated net revenue was $2,542, million compared to $1,470 million, increasing approximately 73%. Consolidated gross profit margin was 61.4% compared to 55% attributable to our product mix and sales and the increased demand for our mobile equipment. The consolidated operating profit was $149,000 compared to a loss of $901,000, representing an increase of $1,050 million or 117%. The increase in our profit was attributable to higher sales and gross profit in the current year period. Our consolidated net profit was $59,000 or $0 per basic and diluted share compared to a net loss of $901,000 or a loss of $0.05 per basic share. Moving on to the balance sheet. As of September 30, 2024, our cash and cash equivalents were approximately $809,000, working capital was $6.9 million, and our shareholders' equity was $7.4 million. TOMI was cash flow positive for Q3, driven by increased revenue and the cost reduction efforts mentioned in the June 6th press release. Now I turn the call over to E. J. to provide insight on current company activities.
Elissa Shane: Thank you, Joe, and good afternoon, everyone. As part of our budget optimization, we have scaled back on trade show activity and reallocated resources towards more effective lead generation strategies such as referrals and client references. While trade shows, like the upcoming AALAS events offer valuable networking opportunity, our strong reputation has enabled us to effectively attract new business and expand the customer base. Recently, we launched a targeted outreach campaign focused on domestic manufacturers of clean room construction and general building companies to incorporate our decontamination builds into their project bids for awareness of our custom engineered system and hybrid. This campaign engages both existing partners and new prospects across sectors, including prefabricated clean rooms, construction design firms and mobile health care products. Our current CES and hybrid projects are at various stages of manufacturing and acceptance, we are optimistic about securing additional CES and hybrid contracts before the year-end. These new contracts are currently scheduled for installations beginning in Q2 and extending through Q4 of the year 2025. In parallel, we are collaborating with existing customers such as ITH Pharma in the United Kingdom and Soli Organic, a leading national grower of fresh and organic produce in the states, on expanding with SteraMist iHP on additional automated systems. While discussions are still in the early stages, these developments highlight the value our iHP technology provides to customers. As our current channel of projects continue to reach maturity, waiting on customer and partner decisions and timelines for the estimated $8 million in active proposals, we remain focused on proactive strategies to build our installation pipeline. Efforts such as the mentioned targeted outreach to contractors and designers and maintaining close relationship with key contacts are instrumental in sustaining our momentum with these product lines. As Dr. Shane highlighted on today's call, a key achievement this year has been the strong performance of our iHP Corporate Service and international revenues, both of which we continue to demonstrate solid growth as we close out this year. Our iHP service revenue pipeline currently exceeds $1 million, and these opportunities typically display shorter sales cycle. Further, this amount does not include our contracted relationships, which we have fulfilled for the 2024 year and will restart in 2025 with an initial value of $600,000. While some deployments in the pipeline are scheduled for early Q1, several opportunities remain on track to close by year-end. As recently announced, SteraMist successfully entered into India, a key focus of TOMI's growth strategy. We will be exhibiting our technology with our new partner, STS Technocrat from this November and already have a pipeline building via demonstrations and trials with end users in the region. We also reached a major milestone with Fresenius Kabi that expanded in the use of SteraMist iHP to a facility in South Africa. This marks their fourth location adopting our technology, following successful deployments in Chile, Portugal and Brazil, totaling over $1 million in sales to date in SteraMist iHP equipment for Fresenius. And they continue to increase awareness among many other locations. These global implementations reflect the growing trust in SteraMist and our ability to meet the diverse needs of clients across multiple continents. We anticipate further international growth by year-end, including a new partnership in South Africa with a company specializing in clean room and controlled environments. In Switzerland, we expect our full room fogging device to be integrated into the operations of an international firm with a presence across the Americas, Asia Pacific and Europe. This organization's core business spans solutions for semiconductors, life sciences and data centers. Additionally, we are in early discussions to onboard a third partner in Australia, a second partner in South Korea focused on emergency services. We are also working with the occupational safety equipment distributor in Hungary and have revised conversations with the company leading productivity and validation projects in the United States territory of Puerto Rico and the neighboring Caribbean islands for the pharmaceutical and food industries. As recently announced this quarter, we successfully deployed our new SteraMist Integrated System, or SIS, at the National Institute of Forensic Medicine in Malaysia for approximately $133,000. We currently have four pending proposals in the region with key partners and are optimistic about securing the next award by the end of the year for a similar amount. The SIS product line now available for sale has generated strong interest and the SIS standalone or SISSA, aligns well with our SteraBox, which is also gaining market traction. The standalone may become our highest rated product offering. The combination of this delivery system is valuable across the life sciences, but other sectors as well, including medical devices, sensors and commercial applications for refurbished items. The SteraBox is customized in material and size to meet specific customer needs and budgets and the capabilities and versatility in the application alone of the standalone sets it up for success. We remain committed to our ongoing collaboration with enclosure manufacturers to support the full SIS product line and anticipate receiving our first order by the end of the year. TOMI's manufacturing team is working closely with an Italian manufacturer to deliver a streamlined iHP isolator to the Virginia Commonwealth University, a long-time user of technology. We also want to highlight our awareness of the various challenges currently affecting the food market. In response, we have proactively partnered with industry players and researchers to provide tailored solutions and support, ensuring we meet their evolving needs during critical times and in order to prevent contamination. The SteraMist Pro Certified or SPC program is designed to ensure certified NCs are fully equipped to deliver disinfection and decontamination services with a focus on public health, safety and environmental sustainability. As part of this strategic shift, we will no longer maintain the TOMI Service Network or TSN in its current structure. Instead, we have launched SPC, a new and on-demand program available to all customers across key sectors, including life sciences, health care, food safety and commercial markets. This initiative reflects our proactive approach by harnessing the expertise of our partners and key relationships to enhance TOMI's brand and expand our global footprint. Together with industry experts, we continue to drive innovation in contamination control and validation practices. With SteraMist iHP, we now offer transformative technology that serves four critical industries, supporting everything from routine cleaning and complex clean room decontamination to patient health care environments, biohazard management and border control operations, along with an educational platform. Our network of domestic and international service providers plays a crucial role in advancing this mission and broadening our impact worldwide across a diverse list of markets available for iHP. Our expanded product offerings and scalable solutions position us very well for sustained growth across all four of our divisions. Thank you, everyone, and I will turn the call back over to Dr. Shane for closure.
Halden Shane: Thank you, E.J. and Joe. TOMI's performance continues to reflect the quality and diversity of our products that are all driven by our patented BIT platform. We had good growth driving across all businesses with particular strength internationally, our iHP or in-house service and our mobile products. And we see an opportunity to drive considerable operating leverage in the business as we grow. Looking ahead, we remain well positioned to execute on our next phase of growth going into 2025 and beyond. As TOMI continues to innovate for a safer world, I want to thank you for your continued support and confidence in TOMI Environmental Solutions. And also don't forget to go out and vote next Tuesday. Good luck to everybody. Operator, you can open the call to questions.
Operator: Thank you, sir. Ladies and gentlemen at this time we will be conducting our question-and-answer session. [Operator Instructions] Our first question is coming from Sameer Joshi with H.C. Wainwright. Your line is live.
Sameer Joshi: Great. Thanks. Doc, E.J., Joe, congratulations on the positive cash flow and positive net income quarter. Good to see the progress here.
Halden Shane: Thanks, Sameer.
Sameer Joshi: Yes. And E.J. thanks for providing a good – very good lay of the land and overview of the business. It was really helpful. Yes, just diving a little bit on that front. On the iHP recurring revenues, how do you see – like what kind of visibility do you have? I know you mentioned that you have like $600,000 in the pipeline starting from next year. But can you just let us know like how long these contracts are? What is the visibility and repeatability of this?
Elissa Shane: Certainly. So that $600,000 that is projected is alone for our custom engineered systems. And now that the latest long-term ones that we've been waiting for that we'll be using it 8x or so times a day would be the two installations at Merck, and that will be a real game changer in our solution model, and that will start fresh next year. And then that as we continue to build on the CES will become much easier to continue projecting in terms of solution use. I say that knowing that some facilities, it will depend upon their production lines. So for instance, the partner in ICH will use their system every time they change production on a new drug. So that varies based on their business model, but that is on the solution.
Sameer Joshi: Okay. So I think the bottom line is that probably your 650 during this quarter is repeatable and expected to grow over the next few quarters? Or how should we look at it?
Elissa Shane: On service, absolutely. That will continue to grow on the contracts that we do reoccurring. Now those are ones that, again, get contracted for the twice-a-year shutdowns required for them. I was referring to a PR we did on the solution for the 600,000 on CES. So that maintains as well. So you got two answers.
Sameer Joshi: Yes. No, this is good because as you increase your installed base, so to speak, you are likely to get higher and higher kind of contracts, which are more repeatable over the next few quarters.
Elissa Shane: Correct.
Sameer Joshi: On the food safety, good to see that your efforts are ongoing on that. In terms of revenue potential in during, say, during 2025, how do you see that industry developing for you?
Halden Shane: What was the last part?
Sameer Joshi: Just like outlook for – maybe a qualitative outlook for the food safety industry in 2025 as far as your products?
Halden Shane: Yes. We're really excited about this industry. There's a significant increase in the ready-to-eat food market. And we're continuing with many food safety organizations, including the FDA and the USDA, Purdue University. And we're engaging with industry conferences to network our food industry professionals. And I believe at the end, this is going to be a huge industry for our product as we move forward. So we've increased it quite a bit since 2021. I think if I remember right, the percentage was like 288%, which is a lot, but it's also not as much as in comparison to our other markets. But it looks very bright for us, Sameer.
Sameer Joshi: Understood. And then just for the near-term sort of we are already in the fourth quarter. Should we expect sequential revenues to increase from this $2.5 million levels, maybe get back to the June quarter level in the fourth quarter?
Halden Shane: It's hard to tell, but I believe we should. We're hoping to do over $10 million for the year.
Sameer Joshi: Okay. Sounds good. And then just a few questions on the balance sheet. The accounts receivables, I saw it's nicely I think it's around $600,000, $700,000 came in from that working capital. How do you see the – or let me rephrase, like what are the terms that you are looking at in terms of AR days on hand? And how is the recovery process?
Halden Shane: Joe?
Joe Rzepka: The majority of our customers are net 30 for regular orders, equipment orders. The custom-engineered systems have like four payments as the projects progress.
Sameer Joshi: Okay. Thanks for that color. And last one, the inventory levels, does this include mostly equipment or solution? And also, is it work in progress? Or is it finished goods mostly?
Joe Rzepka: It's mostly equipment and bit solution in inventory.
Sameer Joshi: And meaning that it is mostly finished goods, right?
Joe Rzepka: Yes.
Sameer Joshi: Okay. Good. Great. Thanks a lot for taking my questions and good luck.
Joe Rzepka: Thanks, Sameer. Thank you so much.
Elissa Shane: Thanks, Sameer.
Halden Shane: Thank you.
Operator: Thank you. Our next question is coming from [John Nelson], who is a private investor. Your line is live.
Unidentified Analyst: Hi. Doc and team, congrats again on the excellent results and the wonderful progress that you've made over the last couple of quarters.
Halden Shane: Thanks, John.
Unidentified Analyst: Questions. Can you give me an idea as to what kind of lag times we're talking about from hardware sales to the bit solution sales?
Halden Shane: I'll ask Joe that question. I think we've had like a 13% increase in our solution sales, which is good for our model going forward as far as the razor-razor blade. Hardware sales include service. I don't know, Joe, do you want to give some color on that a little?
Joe Rzepka: Yes. Food Solutions sales were up 13% as we reported and mobile equipment was up 90% year-over-year…
Unidentified Analyst: Right. So I guess what I'm trying to get at is the amount of equipment sales? Is there some percentage correlation I should use as far as my calculations as far as your hardware sales resulting in x percent increase in solution sales? Those two percentage increases.
Halden Shane: Yes, it's hard to do that because sometimes we'll sell a piece of hardware, and it will take like a year for them to integrate it into their systems and be functional and operational. So I mean, it would be great. And soon, we'll probably have something like that, that will give us a KPI that makes sense. But at the moment, I think next year, we should have it in relationships to some of our bigger pharmaceutical companies.
Unidentified Analyst: Okay. Great. And the – at least in my opinion, TOMI has the best product on the market servicing various specialty markets. Any more details on how you're increasing the – moving to increase the awareness and educate potential customers on the products that you have?
Halden Shane: So I mean, from a marketing standpoint, we're moving forward in many markets. When you just close your eyes and think about the application of this technology, it's so bright in relationship to what is available, and it can be applied almost in any industry or vertical. So we're working with the size of our company, we're working at the lower-hanging fruit. I personally believe the food market processing is going to be terrific. And it's going to be huge. There's a large need for it. It's, I want to say, a $52 billion to $70 billion market. And we're focusing on that. We're advertising for that. We're doing many studies in relationship for that. So once these studies start coming in and the larger companies start using it, then we'll have some really good news on that.
Unidentified Analyst: Okay. Would your product be useful for somebody like the McDonald's (NYSE:MCD) suppliers and the TreeHouse Foods (NYSE:THS) and the Boar's Head?
Halden Shane: Yes. It would. I mean, there are lots of recalls going on, and we're – I'm working on a piece that's going to go out social media soon. Yes, it would be. We reach out to all these companies and many of them are just shut their plants. And it's a long process for them to go through and realize they need to disinfect or buy new equipment and/or wipe it down properly and use SteraMist to reopen. So as soon as we hear about this news and we're involved with as many federal organizations getting response, we go out and try to service them and educate them. And it's a process, but we're doing it.
Unidentified Analyst: Okay. Great. And just as kind of a real-world example, there's an IV plant in North Carolina that was damaged by the hurricane. How will or how would SteraMist be used in the decontamination efforts I guess what areas would it be applied?
Halden Shane: I'm going to let E.J. answer that because I think we have a little color on that maybe. E.J.?
Elissa Shane: We are in touch with two plants actually that were damaged due to the hurricane in North Carolina. They will be using and calling us in for our services, but they have to do some reconstruction on their own first before we can come in. We're kind of the last step to commission to get them back into production.
Unidentified Analyst: Okay. Great. Thanks. And then I know that there's a number of huge GLP-1 plants that are in the production phase. Is that an opportunity that you're working towards for SteraMist?
Halden Shane: It could be. It's the type of thing that we look into and all these hormone type plants and production plants, it's a big phase going forward and definitely could use our product and should use our product. Again, it's another market, it's another vertical in the life sciences that makes complete sense to go ahead to use SteraMist.
Unidentified Analyst: Okay. And then on using the social media and things like Google (NASDAQ:GOOGL) and Perplexity and other AI searches, are you trying to position TOMI at the top of the queue for answers on disinfection issues?
Halden Shane: E.J.?
Elissa Shane: Yes, absolutely. We do a lot of work on our Google and SEO and certainly on social media. We routinely blast. And even on the urgency of some of the contamination recalls we've seen to date, we stay on top of it and it is mostly via the social media platforms.
Unidentified Analyst: Okay. Good. And let's see. Any additional color you can provide me with on how the transport is being received? And is it a have you had much in the way of sales of the transport?
Elissa Shane: So the transport product line, we did sell our initial production of that unit, and we're going into kind of a bit of a redesigner model too on it. It received good feedback, but there's a third option in terms of powering it that we'd like to make sure the second round incurs. So we're working in tandem still with our Canadian distributors on providing that for their contracts that we see coming up in the near future.
Unidentified Analyst: Okay. And I'm guessing that's a longer sales cycle than the other product line items. The environment system, which decontaminates both air and surface and you have on your website safe and effective for air disinfection. I wondered if have you gotten any orders for that in dealing with some of the airborne diseases like COVID and now the number one killer, which is tuberculosis?
Halden Shane: Yes. We use it – I mean, our clients use it all the time for that. It's very effective against almost everything. There's some more deadly pathogens that are starting to surface. And I don't know if it's just a timing issue because of certain events happening in the U.S. or if it's a real problem, but the Malburg and Ebola-type diseases are starting to show in different parts of the United States, one specifically in the Midwest. And I think that if there is any serious problem, a lot of the people that have this for preventiveness will continue to use the product and protect their states. So there's no question that they can throw a lot at us, and we're very effective against everything.
Unidentified Analyst: Great. Okay. And kind of an area that may or may not progress, but I wanted to just check if there's any progress on the ethylene oxide replacement market and certification?
Halden Shane: We know that there are companies that have used ethylene oxide that are reaching out to us, but it would be premature for me to discuss any detail on it.
Unidentified Analyst: Got it. Okay. The website has also an interesting case study on Soma, and it's a mold remediation case study. And just thinking about that, you had an earlier relationship possibly a partnership with [indiscernible]. Has that developed into anything significant? Or does that have the potential to move forward in a manner that's significant to the company?
Halden Shane: Yes. I mean, not naming specific companies, I believe the old TSN, which is being modified into a much larger SteraMist Pro certified program or our SPC program will include people from all of them. I mean, the top five remediators. So it's a great product. It's the only product they should really have in their toolkit outside of a hand apply product. But yes, we see tremendous potential going forward, especially with all these hurricanes and disasters we know that there will be mold in most of these structures, whether they're commercial or residential, and our product is ideal.
Unidentified Analyst: Okay. And then I've been able to figure out a number of your customers and partnership members that you're not able to name. I was wondering if it would be useful to give a discount to them in order for them to let you use their name customers.
Halden Shane: John, we do. We do our best. And that's why when I go through the report just now, I don't name people, but they just don't want us to. I mean, we don't want to spend more time trying to get a press release out using their name than we do selling the product, building the product, and delivering it. But ultimately, they will when they start seeing it work like we have been doing with the big pharmaceutical companies and some of the food safety companies. So probably it will get better. Again, a lot of them are large, large public companies, and they don't want to endorse a product. This is just their nature.
Unidentified Analyst: Okay. And finally, I am really impressed that you've come out with this SIS stand-alone for the biological safety cabinets. I think that's going to be just a fabulous market. How would you come up with that?
Halden Shane: Well, I'm going to let E.J. answer that. I think it was demand, but go ahead.
Elissa Shane: It is demand. It is a very exciting product that we just launched. And you are absolutely correct. It was ideal for BSCs and other enclosures, but there is a market for that system across all our industries. So it's great with our SteraBox for our medical device initiative with 510(k) and even on the commercial end for refurbished items. It's one applicator fogger, it does it all. It's going to be as popular, if not more than our environment system. So it's been in the making, and it does everything it says it does. We're very excited...
Unidentified Analyst: Great work. Thank you.
Elissa Shane: Thank you.
Unidentified Analyst: Yes. That’s all my questions. Good job.
Halden Shane: Thanks, John. Thanks for everything. Operator?
Operator: Apologies, my line was on mute, I do apologize.
Halden Shane: No, no problem. Is that it? I think the question answered.
Operator: Yes. We have no further questions on the line at this time, sir. So I'll hand it back over to you for any closing remarks you may have.
Halden Shane: Thank you all. Just once again, I want to thank our team for the great work and our long-term investors for continuing to believe in our company and its beautiful high-tech disinfection decontamination products and wherever you are, have a wonderful day and a great evening, and we'll be talking shortly. Thank you.
Operator: Thank you so much, ladies and gentlemen. This does conclude today's conference, and you may disconnect your lines at this time, and we thank you for your participation.
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