IFM Instant Food Marketing LLC

Transcription

1 IFM Instant Food Marketing LLC Preservation and Refinement of Food Products: Berries - Fruits Vegetables via the INVAP-Refining Process - 1 -

2 The Industry Sector: Food Products - Innovative Food Conservation Industry: Innovative food preservation For more than 10 years, the company founder has been observing the constantly growing market and the development of applied production techniques for so-called "TVP" (Thermal - Vacuum - Puffing) products. We have now succeeded in winning the inventor of several patented TVP processes for an exclusive cooperation and collaboration whose patented processes (MIVAP / PEX process) have been successfully used in production for years. The new technology and the brands are used under an exclusive license. This laid the base for the implementation of a new business concept. It led to the foundation of IFM Instant Food Marketing AG (LI). The company was founded in 2015 and has a fully paid-up capital of CHF In addition the company IFM Instant Food Marketing LLC (US) is in the founded in Delaware/USA in Production-Method: The production process used is essentially an advanced and optimized method of already known TVP processes (Thermal Vacuum Puffing). By combining already proven basic components, a completely new production concept was developed, which does not yet exist on the market in this form. The process is called "INVAP" refining and stands for INert-VAcuum-Puffing. The newly developed "INVAP" technology does not infringe the already known and partially patented processes! Project: Construction and operation of a tropical fruit production plant in Costa Rica using INVAP technology. The focus is on the product "banana", because the banana contains all vital food components for humans. (e.g. baby, school, children, sports nutrition, etc.). In 2015 IFM AG established a subsidiary, SECA RICA S.A. (CR) with a capital of CRC 10, in the state of Talamanca to apply for the necessary permits for the production facility. Unique selling proposition: Exceptional texture: cross & crunchy, excellent taste, natural colour, predominant preservation of all important nutrients (through the "INVAP" refining process) without any additives or ingredients. Market: The "INVAP" technology offers access to a large number of business areas, as this technology meets the increasing nutritional requirements of the market. The obvious markets are snack applications and the replacement of freeze-dried products. TVP products are increasingly used and in demand for vegetable snacks, baby food, sweets, dairy products (ice cream, yoghurt, etc.) and as an ingredient in instant soups, teas, etc. Growth strategy: After completion of phase I, i.e. start of production in CR, production facilities (production islands) are to be set up in several countries in the short term in order to exploit the respective national advantages (e.g. raw product safety, energy prices, wages, etc.) and to expand the product range and thus gain relevance as a global company

3 The further expansion is already firmly in planning and a further capital requirement of initially million is expected for this phase II (can be provided in partial amounts), so that the continuously increasing market requirement can be covered reliably. Scheduling: Local instalment will be executed by a renowned plant manufacturer, so that the first production line in Costa Rica will be finished within 18 month of concluding full financing. Management: An experienced entrepreneur and process engineer could be won for the function of the management of the IFM LLC and IFM AG. The management of the subsidiary (SECA RICA S.A.) is placed in the hands of a Costa Rican engineer. The constant and mutual support of this management team guarantees optimum production reliability. Marketing: In recent years, the company founder has already established many contacts with several companies in the B2B sector, which have shown great interest in the finished products. For the B2C sector, the development of an own brand (snacks) has already begun. Trademark protection already exists in various countries. The brand is used under the exclusive license. AOS >> All Organic Snack Production Capacity / Turnover: Production Capacity is planned to be at a minimum of 400 tons per annum of final product, so that turnover at full capacity can be expected to be more than US$ 16 Mio. Opportunities / Risks: Demand for new organic Snacks (without any additives) is rising continuously, so that an enormous demand in VP-Products can be expected. The risks of the production locality are estimated to be low, as Costa Rica is known to be politically stable (German Law is applied). Capital requirements: The total financial requirement of phase I amounts to approx. US$ 8.5 million, consisting of investment capital of US$ 7.5 million and working capital of US$ 1 million. The return of investment is above average and stable in the double-digit range (see attached plan balance sheet). In the 10th year of operation, full capacity utilization of 400 t/a of finished product is achieved in Costa Rica, then the company's earnings after taxes (EAT) amount to approx. US$ 6 million per year. For security reasons, the entire production plant investment remains the property of IFM AG (LI) and is only transferred to SECA RICA S.A. (CR) rented and/or leased

4 Advanced Service Provision: The company has already finalised planning and construction work for integral machines and complete planning of the production plant. Return on Investment: outstandingly stable and in the double-digit range. Financing / Participation: Private Placement. The investors will be offered preferential participation in the expected returns. Securities: The complete operational facilities remain property of the IFM AG (LI) and will be leased to the SECA RICA S.A. (CR) only. A full comprehensive insurance will be arranged. IFM Instant Food Marketing LLC 903 South College Avenue Newark, New Castle County Delaware, DE Phone: Phone direct line: llc@instant-food-marketing.com - 4 -

5 IFM - budgeted balance sheet data derived from monthly figures Year of Operation # Revenues (Sales) US$ 0 675'000 3'050'000 5'000'000 7'450'000 9'650'000 11'350'000 12'800'000 15'100'000 16'550'000 Expensives IFM AG (fix + variable) US$ -362' ' '000-1'109'000-1'265'000-1'727'000-1'889'000-2'019'000-2'139'000-2'219'000 SECA RICA S.A. (fix + variable) US$ -50' '000-1'163'600-1'767'600-2'137'200-2'781'200-3'150'800-3'150'800-3'873'200-4'024'400 Royalties (2%, based on sales) -13'500-61' ' ' ' ' ' ' '000 Costs US$ -412'000-1'428'500-2'147'600-2'976'600-3'551'200-4'701'200-5'266'800-5'425'800-6'314'200-6'574'400 EBITDA US$ -412' ' '400 2'023'400 3'898'800 4'948'800 6'083'200 7'374'200 8'785'800 9'975'600 Incentives for all employees (3% based on EBITDA) US$ -27'070-60' ' ' ' ' ' '270 Depreciation / Amortisation US$ -293' ' ' '540-1'166'205-1'258'080-1'258'080-1'590'580-1'424'830 EBIT US$ -412'000-1'047' '790 1'283'440 3'031'300 3'634'135 4'642'620 5'894'890 6'931'650 8'251'500 Basis of taxation (EBIT-Accumulative) US$ -412'000-1'461' '660 1'691'070 3'031'300 3'634'135 4'642'620 5'894'890 6'931'650 8'251'500 Taxes (12,5% fix/flat-rate) US$ -2'160-2'160-2' ' ' ' ' ' '456-1'031'438 EAT - Profit / Loss US$ -414'160-1'049' '630 1'072'056 2'652'388 3'179'868 4'062'293 5'158'029 6'065'194 7'220'063 Crowd-Dividend (anual 7% based on EBITDA if > 0) US$ -63' ' ' ' ' ' ' '000 Crowd-Dividend Special payment US$ -2'745' '982 IFM AG - Dividend (anual 7% based on EBITDA if > 0) US$ -63' ' ' ' ' ' ' '000 Initial Capital AG / LLC (approx.) US$ 100'000 Initial Capital AG / LLC (crowd) US$ 8'500'000 Cash Position US$ 8'500'000 3'921'840 2'290' '014 1'817' ' '529 5'430'253 8'101'974 14'319'766 Investment: Land, Machinery, etc. (all costs) US$ -4'164' '000-2'040' '000-3'960' '000-2'712'000 Liquidity US$ 3'921'840 2'290' '014 1'817' ' '529 5'430'253 8'101'974 14'319'766 21'774'658 Accumulated: Land, Machinery, etc. US$ 4'164'000 5'040'000 7'080'000 7'728'000 11'688'000 12'348'000 12'348'000 15'060'000 15'060'000 15'060'000 Accumulated: Depreciation / Amortisation US$ -293' '330-1'438'590-2'189'130-3'355'335-4'613'415-5'871'495-7'462'075-8'886'905 Land, Machinery, etc. (book value) US$ 4'164'000 4'746'210 6'320'670 6'289'410 9'498'870 8'992'665 7'734'585 9'188'505 9'188'505 9'188'505 Cash Flow US$ -4'578'160-1'631'660-1'166'830 1'103' '073 3'686'073 5'320'373 3'704'109 7'655'774 8'644'893 Remarks Cumulative dividends at an annual rate of 7.0 % of the purchase price per Member unit of the common stock, which is paid yearly. Crowd-dividend, with 7% of EBITAD (if> 0.0) and a term of 10 years and 2 special payments for the difference in year 6 and 9, if projected liquidity is reached! No price forecasts for the future have been taken into account! (Exception: Machines) Optimization effects from "New Products" can be expected! The liquidity reported, are primarily used for the share repurchase and investments in phase II, which will be detailed later