American Resources Corporation (AREC) is a producer of metallurgical (met) carbon, which is the primary source of carbon used in steelmaking. The Company is a supplier of raw materials to the rapidly growing global infrastructure marketplace. The Company's primary focus is on the extraction, processing, transportation and selling of metallurgical carbon and pulverized coal injection (PCI) to the steel industry. The Company operations are based in the Central Appalachian basin of eastern Kentucky and southern West Virginia where premium quality metallurgical products are located. In F2019, AREC reported revenues of $24.5 mm compared to $31.5 mm in F2018. The decrease was mainly due to management’s decision to shift away from the thermal coal market to focus on the global metallurgical carbon market. The decision resulted in the expiration of its only thermal coal contract in Q3/F2019, which negatively impacted total revenue. Management believes the transition to become a pure metallurgical carbon producer will position AREC as an emerging leading competitor in this sector.
Fireside Chat Catalysts
As economies worldwide commence their recovery after the COVID-19 pandemic, governments will likely increase their investments in infrastructure. American Resources Corporation stands to take advantage of a potential increase in infrastructure investing. With three active sites and a portfolio of 24 sites, AREC is set to grow by gaining market share, especially given the Company’s relatively high margins, and relatively low productions costs (20-30% lower than its competitors). Over the last five years, AREC has executed eight acquisitions to strengthen a portfolio of assets (with deposits rich in met carbon), which now amounts to an estimated total of $374 mm. Through organic growth, monetization of non-core assets and industry strategic consolidation trends, management believes it could generate significant value for AREC’s shareholders.
American Resources Corporation (AREC) is a producer of metallurgical (met) carbon, which is the primary source of carbon used in steelmaking. The Company is a supplier of raw materials to the rapidly growing global infrastructure marketplace. The Company's primary focus is on the extraction, processing, transportation and selling of metallurgical carbon and pulverized coal injection (PCI) to the steel industry. The Company operations are based in the Central Appalachian basin of eastern Kentucky and southern West Virginia where premium quality metallurgical products are located. In F2019, AREC reported revenues of $24.5 mm compared to $31.5 mm in F2018. The decrease was mainly due to management’s decision to shift away from the thermal coal market to focus on the global metallurgical carbon market. The decision resulted in the expiration of its only thermal coal contract in Q3/F2019, which negatively impacted total revenue. Management believes the transition to become a pure metallurgical carbon producer will position AREC as an emerging leading competitor in this sector.
Fireside Chat Catalysts
As economies worldwide commence their recovery after the COVID-19 pandemic, governments will likely increase their investments in infrastructure. American Resources Corporation stands to take advantage of a potential increase in infrastructure investing. With three active sites and a portfolio of 24 sites, AREC is set to grow by gaining market share, especially given the Company’s relatively high margins, and relatively low productions costs (20-30% lower than its competitors). Over the last five years, AREC has executed eight acquisitions to strengthen a portfolio of assets (with deposits rich in met carbon), which now amounts to an estimated total of $374 mm. Through organic growth, monetization of non-core assets and industry strategic consolidation trends, management believes it could generate significant value for AREC’s shareholders.
Motus GI Holdings, Inc. is a medical technology company developing proprietary devices to improve clinical outcomes and enhancing cost-efficiency of colonoscopy. The Company’s lead product is the Pure-Vu® System, which is designed to facilitate the cleaning of the colon, improving visualization during the colonoscopy procedure. The Pure-Vu System has been cleared for commercialization by U.S. FDA and has received CE mark approval in Europe. Poor bowel preparation for inpatient colonoscopy affects clinical outcomes and increases the cost of care ($1.7 billion in the U.S.). Annually, there are an estimated 1.5 mm and 4 mm colonoscopies performed in the U.S. and worldwide, respectively. In three clinical trials, Pure-Vu System increased the number of patients achieving adequate cleansing level (BBPS score of more than 6) as demonstrated by “Boston Bowel Preparation Scale Scores” (before/after BBPS scores were 5/8.8, 2.8/8.5 and 3.7/8.9). Pure-Vu System is designed to improve patient outcomes (98% success rate), and lower costs for hospitals reducing the time to successful colonoscopy, minimizing delayed/incomplete procedures.
Fireside Chat Catalysts
In October of 2019, Motus GI commenced the U.S. launch of Pure-Vu System. Since then, the Company has focused on driving adoption at prominent hospitals conducting 500-1,000 inpatient colonoscopy procedures per year. At present, Motus has targeted 150 of such hospitals. Management believes this will provide a strong foundation for future revenue growth. In recent months, Motus has seen the negative impact of COVID-19 pandemic as the number of inpatient colonoscopies has dropped. Motus GI has implemented remote sales and clinical support capabilities, and has taken measures to reduce its quarterly cash burn by 50% ($3 million per quarter), beginning on July 1, 2020. Management believes Motus GI will emerge as a pioneer and key competitor in the gastrointestinal endoscopy markets.
Arch Therapeutics is a biotechnology company developing a self-assembly peptide-based technology designed for wound care, stopping bleeding (hemostasis) and controlling leaking (sealant) from injured tissues. The lead product, AC5, is a medical device consisting of a peptide which self-assemble into a nanofiber network with applications in wound care during surgery, trauma and interventional care. The Company’s commercially available products include AC5 Advanced Wound System, AC5 Topical Hemostat, AC5-G and AC5 Surgical Hemostat. AC5 self-assemble in the presence of ions (presence of charged materials), is cohesive as it interacts with itself, but does not bind or interact with adjacent tissue. AC5 creates an environment where tissue could regenerate, wounds can heal normally, preserving the proper tissue environment without bleeding or leaking. Arch has not generated product revenues yet. Arch has relied on equity investments to fund operations as it has just recently received regulatory clearance to commercialize its products.
Fireside Chat Catalysts
After receiving FDA approval and CE Mark in Europe, Arch is in the process of launching AC5 in the United States and Europe. According to management, initial feedback from product rollout has been positive. Arch continues to ship inventory to Key Opinion Leaders and Centers, and has initiated partnership discussions. Arch plans to commence clinical trials on biosurgical applications of its proprietary AC5 technology. In contrast to competing products, AC5 synthetic peptide is non-animal, inert (non-antigenic), biodegradable, cohesive (not adhesive), ECM-like scaffold permitting cell proliferation and migration. Based on these competitive advantages, management expects to gain market share in the $2.1 billion wound care market, which could potentially generate significant investor appetite for the shares.
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