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Tavis Karnes
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Who Are We? Recycle Tires Produce
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Where Are We?
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Total Capital Costs with Safety
Capital Budget Source Value Building & Land $689,387 Equipment & Operations $1,076,625 Total Capital Costs $1,766,012 Capital Cost Safety (20%) $353,202 Total Capital Costs with Safety $2,119,214 67% Debt 19% Grant 14% Equity
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Agriculture & Construction
Our Segments Provider Purchaser Steel Agriculture & Construction Oil General Tires Cb Carbon Black
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Position High Emissions Unsustainable Sustainable Low Emissions
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Products
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Price $300/tonne $60/BBL Cb $900/tonne
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Promotion Provider Purchaser
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Place Phone Contracts
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Financial Performance
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Financial Performance
Performance Factor Value Net Payback $16,419,047 NPV $2,091,582.68 IRR 120.7%
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Break Even Analysis
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1 2 3 4 5 Rolling Forward Develop Business Plan
Contracts with Target Segments 3 Raise Funding 4 Begin Construction/Tire Collection 5 Begin Operations
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Thank you!
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Equipment and Operations
Capital Budget Building and Land Building (60'x120'x18') $73,400 Office Development $50,000 Concrete pad $24,408 Furnace $4,979 Water Heater $1,000 Bathroom Installations $2,470 Light Fixtures $980 Utility Installs $5,000 Location Sign $24,000 Gravel Road $3,150 Quarter Section of Land $500,000 Building and Land total $689,387 Equipment and Operations 750 Barrel Tank $15,000 Vessels (2 vessels)+Insulation $125,500 Burners and accessories $60,576 Gas Piping $600 Heat Exchanger $5,000 Tire Cutter $60,000 Industrial Magnet $3,500 Propane Tanks $7,200 Metal Bin $18,000 Rubber Bin 2 loaders $330,000 Air Compressor Pumps 2017 Ford F-150 $28,249 Semi-trailer unit $175,000 Vac truck $150,000 Initial Cash Requirement $75,000 Equipment and Operations Total $1,076,625
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Financing
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Organizational Structure
Board of Directors CEO Tavis Karnes Plant Manager Loader/Vac truck Operator Plant Operator Collction, Sales, and Marketing Manager Collection Truck Driver
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Operating Expenses
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Operating Expenses Accounting and Legal 2,000 2,032 2,065 2,099 2,133
Marketing 29,270 24,830 25,099 25,373 25,651 General Supplies Insurance 20,000 20,324 20,653 20,988 21,328 Property Taxes 4,618 4,693 4,769 4,846 4,925 Health and Safety Training 2,500 2,541 2,582 2,623 2,666 Natural Gas 4,320 4,390 4,461 4,533 4,607 Power-Electrical 23,400 23,779 24,164 24,556 24,954 Water-Sewage 1,440 1,463 1,487 1,511 1,536 Telephone/Internet 900 915 929 944 960 Tools 6,000 6,097 6,196 6,296 6,398 Uniforms 2,250 2,286 2,323 2,361 2,399 Repair and Maintenance 1,000 1,016 1,033 1,049 1,066 Wages and Salaries 413,268 423,187 433,343 443,744 454,393 Employee Benefits (salaries) 22,433 22,971 23,523 24,087 24,665 Employee Benefits (wages) 22,314 22,849 23,398 23,959 24,534 Misc Variable Costs % Sales 5,592 6,710 7,828 8,947 10,065 Capital Cost Allowance 210,968 165,529 133,381 107,625 86,983 Debt Interest 99,345 95,392 91,161 86,635 81,792 Total Operating Expenses 873,617 833,036 810,462 794,276 783,188
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Marketing Costs Marketing Costs 2018 2019 2020 2021 2022 Google ads
$15,000 $15,243 $15,490 $15,741 $15,996 Website $5,000 $300 $304 $309 $314 Social Media Ads $8,187 LinkedIn $959 $975 $991 $1,007 $1,023 Business Cards $20 Fuel (sales meetings) $102 $104 $106 $107 $109 Total $29,270 $24,8230 $25,099 $25,373 $25,651
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Revenue Projections Product 2018 2019 2020 2021 2022 Metal (tonnes)
203 244 285 326 366 Carbon Black (tonnes) 566 679 792 905 1018 Oil (BBL) 9128 10954 12780 14605 16431 Total Revenue $ 1,118,332 $ 1,341,999 $ 1,565,665 $ 1,789,332 $ 2,012,999
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Total Operating Expenses
Income Statement Year 2018 2019 2020 2021 2022 Revenue $1,118,333 $1,341,999 $1,565,666 $1,789,332 $2,012,999 COGS $163,318 $181,187 $199,077 $216,989 $234,922 Gross Profit $955,015 $1,160,812 $1,366,588 $1,572,343 $1,778,077 Total Operating Expenses $873,617 $833,036 $810,462 $794,276 $783,188 Taxable Income $81,398 $327,776 $556,126 $778,067 $994,889 Taxes $10,175 $40,972 $76,532 $132,017 $186,222 Net Income $71,223 $286,804 $479,595 $646,050 $808,666
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Total Owners' Compensation
Year 2018 2019 2020 2021 2022 Owner Salary 110,000 112,640 115,343 118,112 120,946 Dividends - 335,752 547,322 683,494 Total Owners' Compensation 451,095 665,433 804,440
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Net Cash Flows
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Base tonne of tire/year Breakeven tonne of tire/year
2264 2717 3170 3623 4076 Breakeven tonne of tire/year 2087 2000 1953 1919 1897 Safety Cushion 7.8% 26.4% 38.4% 47.0% 53.5%
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Sensitivity Analysis Tonne/Year Average 5-year Profit Net Payback IRR
Year 5 Owner Comp Cash Balance 1250 (100,952) 2,560,196 17.1% 120,946 Negative in 5 years 1500 51,411 6,202,639 39.5% 141,362 Positive in year 3 1750 189,358 9,652,852 64.3% 509,845 Positive throughout 2000 321,856 12,946,112 91.5% 658,893 2264 458,468 16,419,047 120.7% 804,440 2500 576,800 19,482,366 149.5% 932,483 2750 700,529 22,731,776 179.2% 1,069,278 3000 823,161 25,975,707 209.3% 1,206,072
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Sensitivity Analysis Product Purchase Price Average 5-Year Profit
Net Payback IRR Year 5 Owner Comp Cash Balance -30% 69,725 6,533,505 42.3% 216,095 Positive in year 3 -20% 203,692 9,999,682 67.0% 526,650 Positive throughout -10% 332,509 13,212,384 93.8% 670,003 458,468 16,419,047 120.7% 804,440 10% 580,932 19,591,727 150.6% 937,061 20% 701,535 22,763,357 179.6% 1,070,590 30% 821,155 25,930,071 209.1% 1,204,119
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Risk Factors & Mitigations
Sales Volume Developing working contracts Inability to get Government Grant Raise more equity or increase bank loan, feasible regardless Quantity of Production Follow through with marketing plan Develop contracts with tire shops Oil Quality Sell to producer rather than refinery, take a small loss Product Selling Price Develop working contracts
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