Olmito project aquaculture with investors numbers & graphics fish & prawns
- 1. Olmito Agriquatics Treating Wastewater to Produce Macrobrachium & Tilapia Some “Numbers” and Graphs
- 3. A Close-up of the Olmito WWT Plant site
- 4. Olmito Agriquatics Project Abstract The Olmito Agriquatics project will treat the wastewater now collected by the Olmito Water Supply Corporation (OWSC) to a fully recyclable condition – achieving the highest quality treated effluent in the state of Texas. It will also desludge and formally decommission the two lagoons that now serve as OWSC’s wastewater treatment plant. The project will also treat wastewater now being produced by the neighboring town of Los Fresnos. It will continue, in the future, to accept and treat wastewater flows originating in the existing Olmito Water Supply Corporation service area, as well as adjacent neighborhoods currently served by the City of Brownsville and the community of Rancho Viejo. Production is expected, in future, to expand to the North Alamo Water/Wastewater district, a region having the potential to treat approximately 10 times as much wastewater as is now received in the Olmito district. In addition to treated wastewater, the principal byproducts of the Agriquatics System are a superior quality biogas and harvested duckweed. The former will be used in a combined heat and power context to produce thermal energy and electricity for local consumption as well as peaking electricity for export to the grid. The latter will be solar dried (gas assisted) blended with corn and milo carbohydrates and fed to Tilapia fish and Macrobrachium prawns grown onsite using the Company’s innovative dome-housed, intensive, recirculating aquaculture system. Fish will be harvested daily, filleted onsite and packaged for shipping to clients: Sysco Foods, Whole Foods and HEB. Olmito Agriquatics is expected to generate pre-tax profits of almost $3.5 million in 2016 on a projected sale of 1,054 tonnes of tilapia fillets and 105 tonnes of whole macrobrachium prawns.
- 5. Duckweed Aquaculture Scenario Scenario-Specific Notes In this scenario, with minor exception, the entire 1,200+ tonnes (dry weight) of duckweed produced annually as a byproduct of the Olmito Agriquatics wastewater treatment process is committed to supplying internal aquaculture of Tilapia fish and Macrobrachium prawns. The system is unique among intensive aquaculture systems for it’s ability to remove all wastes – including residual nitrates and phosphorus – from the water the fish are grown in. It is also unique in that it captures these wastes – both solids and dissolved solids -- leverages them with photosynthetic energy (sunlight on duckweed), and then feeds the product back to the fish. By slaughtering and processing fish onsite, the project is also able to recycle as feed, 100% of fish discards (skin, head, guts, bones and fins). This brings feed costs for the Agriquatics system to the lowest among all global aquaculture systems/technologies. This scenario presumes a cash investment of approximately $1.3 million by third party investors. The cash investor is being offered a first-in-first-out return on his/her investment (year 4) and a convertible B preferred share/unit that will pay dividends equal to 22% of the invested amount in circumstances where post-tax net earnings permit (presumably year 5, going forward). The preferred shares/units are convertible through the end of year 5 to 20% of the company’s then outstanding shares. The conversion is presumed to allow the investor to share, proportionately, in the company’s future growth in the South Texas Valley. These shares/units are projected to have obtained a value of $4.36 million within 5 years – just as the company begins a rapid expansion phase by taking in wastewater from the City of Brownsville. While, in this circumstance, guarantees are presumed to be provided by The Olmito Water Supply Corporation, were they to be offered to third party investors, they would be valued at 50% of cash. $3.0 million in guarantees would, therefore, obtain an equivalent share/unit value (20%) as is here offered to the cash investor – presuming the cash investor opts for conversion.
- 7. Cash Flow Statement Note under “Dividend Paid” in 2015, the Investor is fully reimbursed for his capital investment. Dividends paid in 2016, equal to 22% of the original cash investment, will be paid to the investor continuously thereafter, or until such time as the investor makes a decision to convert his preferred “B share/unit to a common A share/unit.
- 8. Balance Sheet Note: Project partner, The Olmito Water Supply Corporation, is presumed to retain ownership of the project’s land and existing Lagoon facilities. As such, the “Land and Improvements” line shows a zero value across the board. This circumstance is considered “open” to further clarification and interpretation.
- 9. Start-up Costs & Sources of Financing
- 11. Labor and Wage Summary
- 14. Ratio Analysis
- 15. Shareholder Value Calculations (A)
- 16. Shareholder Value Calculations (B)
- 17. Shareholder Value Calculations (C)
- 18. Olmito Agriquatics Stock / Units Matrix
- 19. Olmito Agriquatics Key Parameter Value Assumptions (A) Note: The only product assumed to be manufactured in this scenario is the “Milled to <10 microns” duckweed powder. All Other products may, however, be produced under differing, feasible scenarios.
- 20. Olmito Agriquatics Key Parameter Value Assumptions (B)
- 21. Olmito Agriquatics Key Parameter Value Assumptions (C)
- 22. Olmito Agriquatics Capital Structure Olmito Agriquatics Capital Structure Cash Invested, $1,300,000 Working Loan, $ 1,500,000 Term Loan, $ 5,142,247 NOTE: OWSC contribution of land, lagoons and developed infrastructure are assessed to have a present value of approximately $3.0 million
- 23. Olmito Agriquatics Capital Allocations Tissue Culture Lab - AD and Stevia $0 $ 1,050,000 WWT (series of 22 l/s units - including fish,worms & digesters) Local Hydraulics & Sludge Mining $ 300,000 Roads $ 150,000 Security $ 100,000 $ 30,000 Electricity and Backup Power Units $ 129,718 $ 80,000 Phase II Park Project Landscaping Phase II Park Construction $ 300,000 $ 4,544,386 Non-Farm Rolling Stock Miscellaneous Equipment + Spare Parts $ 325,000 $ 480,000 Closing Costs Preliminary Expenses Initial inventory $ 72,676 Initial accounts receivable $ 85,845 Initial operations, admin & sales costs $ 337,324
- 24. Olmito Agriquatics Year 1. Cost Distribution $250,000 $200,000 $150,000 $100,000 $50,000 $0 Mon01 Mon02 Mon03 Mon04 Mon05 Mon06 Mon07 Mon08 Mon09 Mon10 Mon11 Mon12 Debt Service Depreciation General & Admin. R&D/Quality Assurance & Prelim Expenditures Sales, marketing, & distribution Production Costs Production Labor Raw Material
- 25. Olmito Agriquatics Year 1. Cost Structure Production Labor, $21,326 Production Costs, $21,326 Raw Material, $684 Sales, marketing, & distribution, $1,500 R&D/Quality Assurance & Prelim Expenditures, $28,000 Depreciation, $332,296 General & Admin., $170,103
- 26. Olmito Agriquatics Year 1 Cash Flow $ 1,600,000 $ 1,400,000 $ 1,200,000 $ 1,000,000 $ 800,000 $ 600,000 $ 400,000 $ 200,000 $0 Mon01 Mon02 Mon03 Mon04 Mon06 Mon08 Mon09 Mon10 Mon12 Mon05 Mon07 Mon11
- 27. Olmito Agriquatics Olmito Agriquatics Year 1. Assets Year 2. Assets Cash & short-term investments, $ 416,446 Cash & short-term investments, $ 678,212 Other Assets, $ 0 Accounts Other Assets, $ 0 receivable, $ 0 Accounts receivable, $ 541,732 Inventories, $ 62,314 Inventories, $ 50 Plant & Equipment, $ 5,714,854 Plant & Equipment, $ 5,917,794 Olmito Agriquatics Olmito Agriquatics Year 1. Liabilities Year 2. Liabilities Short-term debt and notes payable, $ Short-term debt and 1,304,025 Equity, $ 742,029 notes payable, $ 1,279,741 Equity, $ 416,913 Accounts payable, $ 14,197 Accounts payable, $ 148,443 Long Term Debt, $ 4,565,133 Long Term Debt, $ 4,860,921
- 28. Olmito Agriquatics Year 2 Cost Distribution $500,000 $450,000 $400,000 $350,000 $300,000 $250,000 $200,000 $150,000 $100,000 $50,000 $0 Mon01 Mon02 Mon03 Mon04 Mon05 Mon06 Mon07 Mon08 Mon09 Mon10 Mon11 Mon12 Debt Service Depreciation General & Admin. R&D/Quality Assurance & Prelim Expenditures Sales, marketing, & distribution Production Costs Production Labor Raw Material
- 29. Olmito Agriquatics Year 2 Cost Structure Taxes, $195,171 Raw Material, $939,738 Debt Service, $1,237,164 Production Labor, $546,491 Production Costs, $546,491 Depreciation, $316,794 Sales, marketing, & distribution, $223,516 General & Admin., $605,535 R&D/Quality Assurance & Prelim Expenditures, $82,694
- 30. Olmito Agriquatics Year 2. Production (tons) 250.00 200.00 150.00 100.00 50.00 0.00 Mon01 Mon02 Mon03 Mon04 Mon05 Mon06 Mon07 Mon08 Mon09 Mon10 Mon11 Mon12 Aquameal Macrobrachium Tilapia
- 31. Olmito Agriquatics Year 2. Sales ($s) $ 600,000 $ 500,000 $ 400,000 $ 300,000 $ 200,000 $ 100,000 $0 Mon01 Mon02 Mon03 Mon04 Mon05 Mon06 Mon07 Mon08 Mon09 Mon10 Mon11 Mon12 Tilapia Macrobrachium
- 32. Olmito Agriquatics 5-Year Cost Distribution $8,000,000 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 2012 2013 2014 2015 2016 Taxes Debt Service Depreciation General & Admin. R&D/Quality Assurance & Prelim Expenditures Sales, marketing, & distribution Production Costs Production Labor Raw Material
- 33. Olmito Agriquatics Year 5 Cost Structure Taxes, $1,040,224 Raw Material, $1,677,788 Debt Service, $1,259,803 Depreciation, $328,062 Production Labor, $779,338 General & Admin., $725,622 Production Costs, $779,338 R&D/Quality Assurance & Prelim Expenditures, $74,976 Sales, marketing, & distribution, $199,587
- 34. Olmito Agriquatics 5-Year Production tons) 3,000 2,500 2,000 1,500 1,000 500 0 2012 2013 2014 2015 2016 Macrobrachium Tilapia Aquameal
- 35. Olmito Agriquatics 5-Year Sales ($s) $ 8,000,000 $ 7,000,000 $ 6,000,000 $ 5,000,000 $ 4,000,000 $ 3,000,000 $ 2,000,000 $ 1,000,000 $0 2012 2013 2014 2015 2016 Tilapia Macrobrachium
- 36. Olmito Agriquatics 5-Year Cash Flow ($ millions) 3 2.5 Note: The pronounced dip in Year 4 is a consequence of compensating the Investor on 2 a first-in-first-out basis 1.5 1 0.5 0 2012 2013 2014 2015 2016
- 37. Olmito Agriquatics 5-year Pretax Profits $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 2012 2013 2014 2015 2016 -$500,000 -$1,000,000 -$1,500,000
- 38. Olmito Agriquatics Year 5 Assets Other Assets, $ 0 Cash & short-term investments, $ 2,511,158 Plant & Equipment, $ 4,974,979 Accounts receivable, $ 714,960 Inventories, $ 628,775 Olmito Agriquatics Year 5. Liabilities Short-term debt and notes payable, -$ 276,947 Accounts payable, $ 726,103 Equity, $ 4,989,656 Long Term Debt, $ 3,391,059
- 39. Fresh Tilapia Filets Break Even Price ($/ton) $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 2012 2013 2014 2015 2016 Break Even Price Target Price Fresh Tilapia Filets Break Even Volume (tons/yr) 1400 1200 1000 800 600 400 200 0 2012 2013 2014 2015 2016 Break Even Volume Target Volume
- 40. Fresh Macrobrachium Prawns Break Even Price ($/ton) $10,000 $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 2012 2013 2014 2015 2016 Break Even Price Target Price Fresh Macrobrachium Prawns Break Even Volume (tons/yr) 120 100 80 60 40 20 0 2012 2013 2014 2015 2016 Break Even Volume Target Volume
- 41. Olmito Agriquatics Current & Quick Ratios 25 20 15 10 5 0 2012 2013 2014 2015 2016 Current ratio Quick ratio
- 42. Olmito Agriquatics Profit Ratios 2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2012 2013 2014 2015 2016 Gross margin Operating margin Profit margin on total sales Return on assets Return on equity
- 43. Olmito Agriquatics Sales to Fixed Assets 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2012 2013 2014 2015 2016
- 44. Olmito Agriquatics Debt Ratios 2 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2012 2013 2014 2015 2016 Debt to total assets Debt to total capitalization Debt to equity
- 45. Olmito Agriquatics Efficiency Ratios 0.9 0.7 0.5 0.3 0.1 2012 2013 2014 2015 2016 -0.1 -0.3 -0.5 Production Sales, Marketing & Distribution R&D/Quality Assurance General & Administration
- 46. Olmito Agriquatics Asset Turnover 1.2 1 0.8 0.6 0.4 0.2 0 2012 2013 2014 2015 2016
- 47. Olmito Agriquatics Cost Structure $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 2012 2013 2014 2015 2016 Total Variable Costs Total Fixed Costs
- 48. Olmito Agriquatics Share Prices $25.000 $20.000 $15.000 Series1 $10.000 $5.000 $0.000 2012 2013 2014 2015 2016 2017
- 49. Olmito Agriquatics Wastewater Treated (cubic meters treated monthly) 300,000.00 250,000.00 200,000.00 150,000.00 100,000.00 50,000.00 0.00 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59 1 3 5 7 9
- 50. Olmito Agriquatics Sales $800,000 $700,000 $600,000 Dollars in Sales $500,000 $400,000 $300,000 $200,000 $100,000 $0 Year Macrobrachium Tilapia
- 51. Olmito Agriquatics Fresh Tilapia Filet Sales $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Year 4 Year 1 Year 2 Year 3 Year 5
- 52. Olmito Agriquatics Fresh Macrobrachium Sales $90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Year 1 Year 2 Year 4 Year 5 Year 3
- 53. Olmito Agriquatics Accounts Receivable $ 800,000 $ 700,000 $ 600,000 $ 500,000 $ 400,000 $ 300,000 $ 200,000 $ 100,000 $0 Year 1 Year 2 Year 3 Year 4 Year 5
- 54. Olmito Agriquatics Finished Inventories $ 700,000 $ 600,000 $ 500,000 $ 400,000 $ 300,000 $ 200,000 $ 100,000 $0 Year 1 Year 2 Year 3 Year 4 Year 5
- 55. Olmito Agriquatics Capital Spending $ 1,400,000 $ 1,200,000 $ 1,000,000 $ 800,000 $ 600,000 $ 400,000 $ 200,000 $0 Year 1 Year 5 Year 2 Year 3 Year 4
- 56. Olmito Agriquatics Outstanding Debt $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $0 Year 1 Year 2 Year 3 Year 4 Year 5