We are very proud of the financial results achieved for Q3 with both EnWave and NutraDried reporting strength in margins and positive adjusted EBITDA. Last quarter, we communicated our intention to significantly cut spending and turnaround NutraDried and we followed through with that plan. Our results in Q3 reflect a nice combination of revenue growth at NutraDried and a reduction in SG&A spending. In Q3, we reported consolidated net income after taxes of $670,000, marking our highest ever quarterly consolidated net income. For reference, our consolidated net loss for Q2 was $2.2 million and $1.1 million for Q3 2020. There is still plenty of runway for us to continue to grow both business units into consistent profitability. But this makes us very confident in the merits of our business model.
The financial performance in Q3 is attributable to three main trends. First, EnWave’s REV machine sales continue to expand and our margins from selling machines improved with a lower manufacturing cost structure. Second, NutraDried’s revenues rebounded after securing new opportunities to sell bulk product, improved grocery distribution, and co-manufacturing opportunities. And third, we significantly reduced SG&A expenses at NutraDried as part of the restructuring announced in February. We have got the full benefit in Q3 after reducing staffing and purging non-essential spending on consultants and agencies hired by former management.
I will now take you through some of the highlights from our Q3 2021 financial results. Consolidated revenues in Q3 were $7.3 million, with $3.5 million coming from EnWave’s technology business and $3.8 million from NutraDried’s product sales. Overall, revenues were $1.3 million higher in Q3 2021 relative to Q3 2020 and $2.7 million higher than Q2 2021, a nice improvement. EnWave’s quarterly revenues of $3.5 million for Q3 2021 were higher when compared to Q3 2020 by $1.9 million and higher than Q2 by $1.2 million. In Q3, our machinery sales grew with revenue from 3 new large scale machine orders as well as 3 smaller scale machines. We continue to see growth in the frequency of machine orders from both new licensees and repeat orders from existing licensees adding capacity, an encouraging trend.
NutraDried’s revenue was $3.8 million for Q3 relative to $2.3 million for Q2, an increase of $1.5 million. Our sales at NutraDried improved relative to Q2 due to the addition of several new bulk B2B product sales opportunities, an incremental new channel, NutraDried has began to aggressively pursue. Over the coming quarters, we expect to continue to grow our bulk sales from our dried cheese products going to complement our branded business. We really liked the bulk channel as it yields strong clean margins for us. We are also pursuing a number of co-manufacturing opportunities at NutraDried as part of a new growth strategy that’s in place.
Our royalties for Q3 were $191,000 compared to $144,000 per Q3 of 2020, an increase of $47,000. With 2 large machines recently installed and 3 underway, we expect our royalties to continue to grow as our licensees build commercial momentum with their different products. In Q3, we reported a consolidated gross margin of 36%, up from 26% reported in Q3 2020 and just 10% in Q2 2021. Our consolidated gross margin lift in Q3 was driven by higher margins at EnWave and NutraDried. We took significant steps in NutraDried to get costs under control and properly aligned manufacturing resources with demand. And the benefit of these cost controls improved our gross margin in Q3. The addition of bulk ingredients sales at NutraDried creates incremental sales volume and that added to our margin as well.
Over the coming quarters, our objective is to grow NutraDried margins through the use of installed plant capacity, growing the bulk and co-manufacturing revenue streams and expanding the distribution points and sales for our branded Moon Cheese. The new management team at NutraDried is now laser focused on managing our production costs and inventories. EnWave’s margin profile in Q3 continued to benefit from our lower and variablized cost structure to manufacture and deploy REV machines. We redeployed 2 large scale machines originally purchased by cannabis customers into new royalty partners for higher margins. And in the near-term, we expect our cost structure at EnWave to remain at current levels and are focused on driving margin growth through the sale of additional REV machinery and growing our royalties.
Now, turning to SG&A expenses, we told you in February when we announced the restructuring of NutraDried that we significantly lower SG&A spending in that business unit. Our combined SG&A expenses, inclusive of R&D for Q3 was $2.2 million compared to $2.9 million in Q2, a total reduction of $700,000 in the quarter. We were serious when we said we drive unnecessary expenses and staffing out of NutraDried. And we gained the full 3-month benefit of these reductions in Q3. We reported G&A expense of a $1 million in Q3 2021 compared to $1.2 million in Q3 2020, a reduction of $200,000. Relative to Q2, our G&A expenses were lower by $179,000. We do not anticipate significant increases to G&A expenses over the near-term and now have a sustainable cost structure in place in both business segments.
We reported sales and marketing expenses of $831,000 in Q3 compared to $1.5 million in Q3 2020, a reduction of $618,000. Relative to Q2, our sales and marketing expenses were lowered by $473,000. Our biggest area of cost reductions at NutraDried was reducing the use of expensive marketing agencies, consultants and reducing staffing, focusing our marketing spend on working dollars as opposed to agency fees and managerial costs. We have aligned our sales and marketing budget with the size of our business at NutraDried, providing us with the tools we need to grow the business in a profitable manner. As we launch new products and invest in driving velocities where we have distribution, we will add in marketing dollars where we can generate strong returns. We also told you last May that we right size our SG&A expenses at NutraDried while still investing in areas that will allow us to scale. Now, at both EnWave and NutraDried we have the appropriate infrastructure in place to allow us to scale the businesses while appropriately managing expenses.
Our adjusted EBITDA, a non-IFRS financial measure, so please refer to our MD&A for the reconciliation from GAAP net income to adjusted EBITDA, with a profit of $937,000 for Q3, a substantial improvement compared to a loss of $1.9 million for Q2 and a loss of $1.1 million for Q3 of 2020. We also reported a positive GAAP net income of $670,000 in Q3, our highest quarterly positive net income ever. Both EnWave and NutraDried reported positive adjusted EBITDA in Q3. A stark improvement at NutraDried from where we were just 3 months earlier. There is still a lot of work to do as we grow both businesses, but closely controlling spending will be part of each and every decision we make.
Turning to the balance sheet, our balance sheet and treasury position at the end of Q3 continues to be very strong. We are cash strong and using it to invest in growth and buying back stock. Our cash position was $15.3 million, up from the $14.7 million on September 30, 2020. Notably, we reduced our inventory balance at NutraDried and now have much better control over our inventory relative to product sales, something in the past management neglected. Through the first three quarters of 2021, we generated $3.7 million in cash from operating activities and $780,000 alone in Q3. We are using the cash we generate for growth, including investing $1.8 million into new plant and equipment primarily for the new REVworx toll processing facility.
Our net working capital position is $19.7 million. And our balance sheet remains in practical terms debt free, except for our facility leases and a small low interest COVID-19 relief loan received by NutraDried. In October 2020, we implemented a normal course issuer bid and obtained TSX Venture Exchange approval to repurchase up to 10.9 million common shares. So far this year, we repurchased 279,700 common shares at a weighted average price of $1.16 per share for a total use of 323,000. We continue to use the NCIB well-known blackout conditions to further return stock value to our shareholders.
With that, I’d like to turn it back to Brent for his closing remarks.
Brent Charleton
Thanks, Dan. And I think you’ve made it abundantly clear that we have materially improved our performance in Q3 and have set the table for continued growth. Now given our strong consolidated financial performance in Q3 fiscal ‘21 and anticipated solid consolidated Q4 numbers, we are planning to begin investing again modestly towards Investor Relations to amplify our business progress in the capital markets. We obviously pulled back in a lot of our expenses through COVID to ensure that we have the appropriate cost structure to run our business. We will be conducting several virtual roadshows in September and plan to maintain consistent activity onwards to obviously support the great progress that we hope to be making.
If our marketing efforts in the capital markets combined with much improved financial and commercialization progress don’t stimulate market capitalization improvement and a fair value from the perspective of the EnWave’s executive management and Board, we will consider using our NCIB to purchase back large amounts of stock. EnWave and NutraDried are operating with appropriate cost structures and collaborating to best improve total enterprise value. Our leadership group is collaborating more than ever before and our executive management incentives are well aligned. Further, we have multiple employees from both organizations that are working together on projects to either benefit EnWave’s royalty partners or NutraDried’s product portfolio expansion and sales growth. We have made smart opportunistic business decisions year-to-date fiscal ‘21, which has led to our vastly improved financial performance in Q3. It will take continued prudent management and measured risk to achieve our commercialization goals in fiscal ‘22 and beyond. And we are committed to remain fluid and we will react appropriately to evolving market opportunities.
As we look forward to fiscal ‘22, both NutraDried and EnWave share strong optimism regarding continued growth and improved financial performance. Our leadership group will continue to execute on our business plans to further expand and accelerate the commercialization of REV technology through machine sales, royalty generation, toll manufacturing, and branded consumer packaged goods product sales.
With that, I’d now like to open the call for your questions. Operator, please provide the appropriate instructions.
Question-and-Answer Session
Operator
Thank you. [Operator Instructions] Our first question is coming from Steve Hansen of Raymond James. Please go ahead.
Steve Hansen
Hello. Hey, guys. Congratulations on the great results quite the turnaround. Just a couple for me to start with. Brent, can you just reiterate I think you said in your prepared remarks that you are expecting machine sales to double over the current year with 1 more large one to come and was also wanting to ask you just to clarify from your comments on the cannabis opportunity? I think you said the 6 largest prospects represented potential opportunity back, but I missed it in the commentary so I apologize?
Brent Charleton
Yes, no problem at all, Steve. So in terms of performance through the end of Q4 here, we have not just one, but a handful of large scale sales opportunities, which we are hoping to obviously complete to hit the mark which we provided as guidance for fiscal ‘21 of 5 large scale and 10 kilowatts. We have clearly surpassed the 10-kilowatt mark and hope to obviously meet and/or exceed the large scale guidance we provided. For fiscal ‘22 based on the pipeline of anticipated upscaling from several of our current royalty brand licensees as well as new license partners from both the cannabis and food space that we are working a realistic target that our entire group is focused on hitting these 10 large machines and on the small scale we will likely increase that internally to 15 based on the cadence of sales that we are seeing to-date. In terms of the companies that we have signed NDAs with and are actively corking in the U.S. cannabis space, I mentioned that they had 70 or more than 70 facilities collectively that they are operating through and that it would take more than 20 large scale 120-kilowatt machines to satisfy that infrastructure. That’s obviously assuming, 100% saturation, but that’s certainly part of what’s played into our guidance for fiscal ‘22.
Steve Hansen
Very helpful. That’s great to clarify. And just if we wanted to I guess step back then and think about that the cannabis opportunity near-term, is there you describe the you could see some sort of step change in the acceleration of adoption. But I mean, just thus far as you look at the benefits, is it – is it a specific, what has been the trigger point on the sales, is this a new data that’s come through, you describe a 30% to 50% increase, I think in terpene retention, for example, like what is it that’s really catalyzing the sales in that space right now from your perspective?
Brent Charleton
I think seeing is believing and the ability to collaborate with several of our current license partners in that vertical and allowing prospects to come and see large scale machinery in operation and run trials themselves on our 10-kilowatt units and collecting the data that proves out what we are telling them and when we provide our sales pitch is key. I mean, it’s almost too good to be true when we are saying okay, yes, 30% to 50% more terpenes, typically and better THC and CBD and the smoke is still as good as it would be if it is room Iraq [ph] dried. That’s all great to say, but you have to prove it. And we now have all the tools to prove that and I think that’s why we feel confident that once we can push over the next few dominoes that it will become an effect in the U.S., especially with the companies that we are in active dialogue with.
Steve Hansen
Okay, helpful. And then just quickly on the Dole relationship, because that is the new one that seems to be quite significant. Can you maybe just describe what the milestones are that you expect to see under this new arrangement that will allow them to accelerate that product opportunity for themselves and then ultimately translate into additional machine sales?
Brent Charleton
Sure. I have to keep it very high level given the confidentiality requirements between our two companies. But I will be forthright in saying that I think that this relationship be evolved into something significantly material for EnWave within the next 12 months. They purchased a 10-kilowatt replacement at one of their facilities to allow for production of smaller amounts of product to trial in several different countries globally. And the purpose of that obviously is to gain enough confidence to then acquire to be multiple large scale lines to satisfy the manufacturing capacity that will be demanded for entering those markets. They have a huge internal push here to diversify into shelf-stable, better for you snacks. And beyond the snacking project which we will hope hopefully some of their products in the market actually in the North American geography soon, they are interested in ingredient processing too. So, of course, part of our sales pitch to food – or sorry, fruit and vegetable market is the ability to dry B and C grade materials or off cuts and then convert that into functional ingredients. And so I really do believe that this Dole relationship has massive potential not only on the snack side, but expanding into the ingredient space.
Steve Hansen
Okay, great. And then just one last one for me and I will jump back into queue, but just on the consolidated financial performance again obviously a strong performance on EBITDA and net income side. But is that a trend that can continue here, you are describing growth, but you are also describing some added investment. So I am just trying to get a sense for whether we can continue to see positive EBITDA equipped going forward?
Dan Henriques
Yes. I will take that one, Steve. So, we have a very strong Q3. We got the full benefit of the cost reductions we made at NutraDried. So we really pulled out the unnecessary expenses that weren’t creating returns on investment. And so we don’t intend to add any of those back over the next coming quarter in NutraDried. So that should continue to support strong consolidated financial performance in the next quarters here. We added in the new channels for sales at NutraDried also. So, we started selling our product in bulk format to be used as ingredients and inclusions in other snack items, trail mixes and things like that. And we are continuing to get new wins in that channel. So, we expect that turnaround at NutraDried to continue and we don’t need to increase spending at NutraDried to achieve growth. We have the tools that we need to go out and address the market opportunity. So, short answer I think we are not entirely around the corner at NutraDried, but we are 80% there. There is still some more work to be done, but we can expect better performance in the next few quarters here.
Steve Hansen
Okay, great. Appreciate the time. Thanks.
Brent Charleton
Thanks, Steve.
Operator
Thank you. [Operator Instructions] Our next question is coming from Joseph Silla, a Private Investor. Please go ahead.
Joseph Silla
Yes. Hi, I’d like to know about your finished goods inventory, it seems that sales are made and then it takes months to install the machine. Do you – can you give any shed any light on your finished – current finished goods inventory and what your prospects off the building, especially if you are expecting to double your machine sales next year? Thank you.
Dan Henriques
Sure. I will answer that one for you. Our revenue recognition policies for machine sales are for large machine orders. We record revenue over time using percentage of completion. So, as soon as we get an order and start making progress towards delivering machine revenue start to appear and cost of goods in our P&L. On the 10-kilowatt machines, we get an order and then we recognize the revenue once we finish installing and training the machine for our partners. So sometimes that can take a couple of months depending on delays in either installation of the machine, facility readiness and things like that. So, sometimes we will announce machine orders that we don’t book the revenue on for one quarter or maybe even two quarters for 10-kilowatt machines. So, it can take some time. Those machines will stay in our finished goods until they are installed and the operators trained on how to use them.
Joseph Silla
Okay, thank you.
Operator
Thank you. Our next question is coming from Neil Linsdell of iA Capital Markets. Please go ahead.
Neil Linsdell
Yes, good morning, guys and yes, great, congratulations on a fantastic quarter. I am trying to unpack how well you did on the NutraDried side obviously with the loss of cost the year-over-year numbers are down, but it was kind of a surprising increase even if I back out the bulk cheese sales. It looks like on Moon Cheese you probably had – do you want to share your percentage improvement?
Brent Charleton
We don’t break it down by percentage. But I will tell you that our velocities in regular grocery distribution are improving. The conditions that we had in Q2 in the marketplace have improved head into Q3. So, we are seeing shoppers go back to normal, go to multiple stores to get the goods they want. And that’s helping improve our velocities in the grocery channel. So yes, we added the bulk channel to our sales, which helped in the quarter, obviously. But if you back that out, we are still seeing velocity improvements. So, like the units per store per week are going back up to where they were pre-COVID. So, that’s an encouraging trend, Neil.
Neil Linsdell
Okay. That’s great to hear.
Dan Henriques
Yes. And then on the bulk, sorry, Brent go ahead.
Brent Charleton
I was going to say just about margin improvement, too. So, here is a dramatic improvement from Q2 to Q3 to 20% gross margin. But when we see that business normalizing and hitting, what we expect as being a modest manufacturing capacity increase, the gross margins should be somewhere in the range of 30% to 35%. So, there is still obviously great room for improvement, both on the operational side and performance side. And we talked about performance, just a couple of a – couple of details to add. We got our first purchase order from Lidl for 10-ounce cheddar, which is a good sign getting into that style of distribution sort of focused on club area. And then, one caveat to this growth prospects with NutraDried is hopefully that fourth wave of COVID does install a lot of these means that have already been setup and the momentum that we are currently generating. That would be the one caveat. Other than that, we are incredibly optimistic about NutraDried’s future and continued turnaround.
Neil Linsdell
That sounds good. Would you at some point be thinking about breaking out the bulk cheese sales in your revenue breakdown, or can you give us an idea? Is that really going to be a new stable business that’s going to continue and grow or is it more lumpy do you think?
Brent Charleton
It’s absolutely going to be a new channel that we continue to sell into. In terms of the quantum, we may have ups and downs, just like any other channel. But because of the volume going to specific customers and their ordering patterns. So in this quarter, we had four big customers that were doing most of the buying. And so if one of those changes that can affect quarter-to-quarter results in bulk, but over time, if you would add that all up, we expect the channel to grow. And we are just starting to scratch the surface. There is a lot of interest in the snack marketplace to have healthy inclusions and innovation in things like trail mix and those types of products has been fairly stale over time. And so this brings something new that’s starting to generate some interest. So, I think we expect it to grow over time. We will have – we may have good quarters and bad quarters in terms of bulk, like any other businesses, but as we add more customers, it will begin to stabilize and will become more predictable.
Neil Linsdell
Okay. Great. And then with Walmart, specifically, you talked about that. Could you just explain the number of stores you are going into now and/or what happened in Q3 versus what’s going to happen in Q4 on going forward with Walmart? And does that include Sam’s Club or…?
Brent Charleton
Yes. So, we got two items or one-ounce format into about 400 stores right now. It’s going into the checkout lane. So, it’s at the front of the store. We have been told by the broker that if it’s successful, it could expand into 1,300 stores in the U.S. So, we have already received the orders and we expect that stuff to be on shelf here in the next, call it six weeks to eight weeks. And if it does, well, we hope it will expand into more parts of the store. And it’s a good toehold into that retailer, because ultimately, we want to get to the centre of the store at Walmart. So, we want to be in the snack aisle. And so we are hoping this first entry point could lead to more growth with that retailer.
Neil Linsdell
Okay, I understand. Thanks. And for the SG&A, you kind of surprised me and talking about you are not going to see increases in SG&A go from Q3 into Q4, into Q1, despite all this kind of ramp up in activity or the new product sales. Is it because we are still not seeing those tradeshows or travel that you might otherwise do, or you just feel like you have got a great platform here and you can really leverage it up?
Brent Charleton
Yes. And we are going to attend tradeshows where we can. We have got Expo East coming up at the end of September that by – what we are being told now it’s still going ahead in Philadelphia. We don’t expect travel to increase over the near-term just yet. We still have a lot of buyers in the U.S. doing things over the phone. They are still taking meetings, which is a good step towards reopening. But they are not going to places physically, like they used to flying around and our sales team will be flying around. So, we have been doing this kind of stuff for the last year anyways. So, I don’t think that we need to add in much more expenses to fuel growth. What – the expenses we have pulled out, aren’t things we plan to add back.
Neil Linsdell
Okay. Any thoughts about putting another unit into NutraDried?
Brent Charleton
Well, there are some opportunities on the horizon that could lead to co-manufacturing growth that could require a third machine. And obviously, if those opportunities materialize, we will install the capacity we need. But it’s contingent on growth. So, as we continue to grow and win more distribution, and grow the co-manufacturing in bulk channel, we will add in that machine when we need it.
Neil Linsdell
Okay.
Dan Henriques
But then, short, maybe for ‘22, given some large, large opportunities that will obviously confirm when they are signed, if they are signed.
Neil Linsdell
Okay, just going back to the Dole, again, just want to make sure I understand the – it looks like it could be a potentially huge relationship there going forward, starting off pretty small with the 10,000 unit. Is it all dependent on new products or new channels that Dole is working on, or would it be something that would be used in existing products? And I am thinking about like the different products, you have got some freeze drying or some freezing there with their banana pieces? Are you trying to integrate any of your technology or anything familiar into the Dole products? Can you just explain that development of the products and what we should be looking for going forward?
Dan Henriques
Yes. So Neil, just to clarify, I think you mentioned Elea as well, in that question. So, Elea is Pulsed Electric Field Technology, which is a pretreatment to vegetables and fruits for certain applications is not being considered for the Dole applications that would be prospectively going to market in the very near-term here. In terms of the area, or the portfolio, it’s an expansion. So, they are going into obviously shelf-stable snacks that are dried, versus what we typically would see either canned or the small packs in juices and what have you. So, that would be relatively new to Dole. That is one part of the project. The other part, as I mentioned earlier, is early stage engagement with their ingredients division, which would be essentially employing REV as a consolidator of processes to get to the point where the off-cuts and/or B or C grade materials can be in dried form ready for powdering and then being used as functional ingredient. So, it’s a twofold project at the moment. In terms of the ongoing collaboration, and there was a question submitted online to you about this, like, what does it mean, like this global strategic partnership, because is it just you sell the 10-kilowatt license and that’s it, no, no, no, we are heavily intertwined with their leadership in marketing, new product development and senior executives on leveraging our tech as much as they possibly can, to carve out a competitive advantage in the marketplace. And so we are talking about weekly calls and commitment from the highest levels in their organization to move quickly. This is not like a 2025 project. This is like a now project where they are going to commit necessary capital to get the infrastructure in place. They would likely leverage some of our current royalty, bearing licensees to get early stage product, but ultimately want to take manufacturer in-house, obviously to better control their cost of goods.
Neil Linsdell
Okay, alright. Great. Congratulations and good luck.
Brent Charleton
Thanks Neil.
Operator
Thank you. Our next question is a follow-up coming from Steve Hansen of Raymond James. Please go ahead.
Steve Hansen
Yes. Hi guys. Just a follow-up on the REVworx startup and commissioning, Dan, I think you described pretty well the timeline to get things going. But I am just curious if you could remind us where we are at from sort of a capacity commitment standpoint and where you are at in the pipeline there to fill that up?
Dan Henriques
For sure, Steve. So, the project was delayed a little bit due to getting some permits from the city here in Delta. We got all the permits we need, except for one, so we are just waiting any day now to get the final permit for the modifications we did to the flooring to get the drain the sloped floors and installed, so we can have the best food grade facility. And so we expect the machine to go in sometime in mid to late-September. So, the forum should be going in the next week or two weeks here. And then there is a curing of a week and then we are going to start putting the machine and everything else is pretty much ready. So, if things go according to our plan right now, we expect to have the commissioning and startup process completed at some point in October. And then from there, we can start to pursue those certifications. So, by all accounts, we should be starting to receive revenue from REVworx at some point in Q1 2022 hopefully. It will start out modest as we start to bring customers into that new vertical, but we have already – we have had tangible interest from a number of companies. We haven’t taken contracts or committed out anything beyond sort of non-binding capacity offerings, just because we don’t want to over promise and have our partners make plans to launch products and then have delays in our startup of our plans and certifications. So, we are getting the interest, our sales and business development teams working on a number of leads to bring product into the pipeline there. So, we think we have good prospects to have REVworx up and running and producing revenue for us in 2022.
Steve Hansen
Okay, that’s helpful. Thanks guys.
Brent Charleton
Thank you, Steve.
Operator
Thank you. I would like to turn it over to Mr. Charleton for the web questions today.
Brent Charleton
Yes. Thanks very much. So, we had several web questions submitted. And we will go through the ones that haven’t already been addressed with the voice questions here. So, the first was in reference to licensee activity. One question submitted was asking how many of the 48 current active licenses are actually paying royalties and how many are what we consider as dormant or on pause. And so looking at that portfolio of licensees about 10, or so, I would classify as being slow in starting their commercialization with smaller scale machinery, and still trying to find their niche. We have about 10 to 11 larger pairs that we are seeing rapidly accelerate their royalty quarterly payments. And then the rest have been growing modestly. That all being said, we have three large scale machines set for commissioning within the coming, call it two months to three months here, which should hypothetically ratchet up the amount of royalty potential for our business immediately. And as I have mentioned, we are looking to hopefully secure new large scale orders before the end of Q4. And there is the prospects of delivering those machines in a very consolidated timeframe to again ratchet up the royalty potential for fiscal ‘22. So, as with all projects, some of them will be outstanding, and we will get great success from them. But like anything, some won’t be as successful. But that gives you an idea of where we stand today. The second web question submitted was pursuant to our Q3 numbers, and asking if those numbers are likely indicator of our performance moving forward through Q4 and into fiscal ‘22. So, as Dan alluded to earlier, our cost structure is relatively stable here, been forthright with our bullishness on near-term opportunities to finish off Q4 and into fiscal ‘22. So assuming that, this pipeline converts into tangible commercial success, we do believe that our numbers going forward should be positive and be moving in the right direction. Dan, do you have any further comments you would like to share on…?
Dan Henriques
That sums it up. We have pulled back on expenses at NutraDried. And we have the tools we need to scale the business. Now, we got to go execute, but everything is headed in that direction.
Brent Charleton
Great. Okay. Another question asked, when will the AstraZeneca proof of concept work be completed? That’s underway, basically this week. And we anticipate that proof of concept work to be completed before the end of the calendar year. We may decide to do a few different iterations of the trials, which they are requesting. And then following that, of course, we are hopeful that they will acquire their own testing machinery or continue testing VR cells or GEA Lyophi, our partner in the pharma space on a paid – pay basis, more to come on that later, we hope. Next question, was asking about the bulk sales manufacturing model at NutraDried. And so I will pass it over to Dan to just briefly explain the benefit of selling bulk versus some of the branded opportunities.
Dan Henriques
Yes, it’s a pretty simple sales proposition. When we produce our Moon Cheese, the first thing we do after we take it off the drying lines, it gets packed into bulk boxes and then it will sit there for a few weeks before it heads over to seasoning and packaging for our finished goods. So, we now have customers that want that dried cheese and they want to use it for inclusion in snacks, trail mixes, things like that. So, it’s a typical B2B sales model, we take POS. We don’t have long-term contracts in place. But we take POS for bulk from customers that need it, and they pick it up at our facilities. So, we don’t incur freight. And it’s a clean margin, when compared to our branded product sales. So, we don’t incur commissions. We don’t have trade spending. We don’t have to promote it. It’s a clean margin with an invoice and the payment. So, that’s the general model. There is a lot of interest. I think I mentioned earlier in this kind of inclusion for snacks and mixes, and things like that. So, we are now out talking to other snack companies, trail mix companies, some of the big players in that space trying to get their interest in using our format of cheese as part of their innovation pipeline. And we are getting some good results there. So, we hope to see that continue.
Brent Charleton
Thanks, Dan. One of the questions that came through the web portal was do we plan to access or increase or improve the access to retail shareholders in the U.S. to trade EnWave? And I will just in short respond to that yes, due diligence is underway, trying to determine the best option to improve the ability for retail shareholders in the U.S. to trade our stock versus over the counter, so yes, more to come on that hopefully in the coming months here. Next question is to do with expectations, the range from the ongoing litigation. And obviously, I can’t comment further than what we have already discussed on the conference call today in terms of updates. As promised, we will provide pertinent public updates as they come forth. But what I also want to add is that, this effort really sets a precedent, that we are not huffing, puffing and frets that we are going to sue people if we feel that they are in breach of certain agreements, will actually follow through and reasonable follow through is because we absolutely need to protect the cornerstone of our business, which is our intellectual property portfolio. That’s what allowed us to charge royalties to these large companies leveraging REV technology for their commercial benefit. And then last question that has been submitted that I will answer today is regarding the U.S. Army asking, okay, well, great, prospectively, they will move forward with a large scale machine if the funding is released, as they have communicated to us in fiscal ‘22, late-fiscal ‘22. How big can this be? How many machines can the industry partners potentially buy for the production of military rations? And so because we don’t know how big this is going to get, what we do know is that the two primary applications that have already been developed, tested and approved for inclusion would require at a minimum, one large scale machine likely to. And so we are talking about two components, when there is many different ration packs with many different components. And we know that the product application development continues at Natick, where the folks of the U.S. Army are developing other potential inclusions. And in all likelihood, it will be a number of industry partners producing these bespoke inclusions for future years. So in short, we know that there is potentially one coming down the pipe for next year, how big can this be, we don’t know. Okay, with that and answering all of the questions submitted through the web portal, I would like to thank everyone for their participation today and allowing Dan and I and John to provide you with a pertinent update on both business units and the direction that EnWave Corporation is going, reiterate our confidence in how the cost structure has evolved, and our outlook with robust pipeline we have in both businesses. Thanks very much.
Operator
Ladies and gentlemen, thank you for your participation. This concludes today’s event. You may disconnect your lines at this time and have a wonderful day.