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bob wigcraft

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bob wigcraft

  1. 1. Bay of Bengal WINGCRAFT BoB WING CRAFT Asking 100% Financing Further Query: Hafiz, seekinvestor2007@yahoo.com
  2. 2. Legal Page Confidentiality Agreement The undersigned reader acknowledges that the information provided by Bay of Bengal WINGCRAFT. in this business plan is confidential; therefore, reader agrees not to disclose it without the express written permission of Hafizul Haque. It is acknowledged by reader that information to be furnished in this business plan is in all respects confidential in nature, other than information which is in the public domain through other means and that any disclosure or use of same by reader, may cause serious harm or damage to Bay of Bengal WINGCRAFT. Upon request, this document is to be immediately returned to Hafizul Haque. ___________________ Signature ___________________ Name (typed or printed) ___________________ Date This is a business plan. It does not imply an offering of securities.
  3. 3. Table of Contents Page 1 1.0 Executive Summary .................................................................................................................... 1 Chart: Highlights .......................................................................................................................... 1 1.1 Objectives.................................................................................................................................... 2 1.2 Mission.......................................................................................................................................... 2 1.3 Keys to Success ........................................................................................................................ 2 2.0 Company Summary..................................................................................................................... 2 2.1 Company Ownership............................................................................................................... 3 2.2 Start-up Summary................................................................................................................... 3 Table: Start-up.............................................................................................................................. 4 Chart: Start-up.............................................................................................................................. 4 3.0 Products ........................................................................................................................................... 5 4.0 Market Analysis Summary ........................................................................................................ 5 4.1 Market Segmentation............................................................................................................. 6 Table: Market Analysis............................................................................................................... 6 Chart: Market Analysis (Pie).................................................................................................... 6 4.2 Target Market Segment Strategy...................................................................................... 7 4.3 Industry Analysis...................................................................................................................... 7 4.3.1 Competition and Buying Patterns .............................................................................. 7 5.0 Strategy and Implementation Summary ............................................................................ 7 5.1 Competitive Edge ..................................................................................................................... 8 5.2 Marketing Strategy.................................................................................................................. 8 5.3 Sales Strategy........................................................................................................................... 9 5.3.1 Sales Forecast.................................................................................................................... 9 Table: Sales Forecast ............................................................................................................. 9 Chart: Sales Monthly............................................................................................................ 10 Chart: Sales by Year............................................................................................................. 10 5.4 Milestones.................................................................................................................................. 11 Table: Milestones........................................................................................................................ 11 Chart: Milestones ....................................................................................................................... 11 6.0 Management Summary............................................................................................................ 12 6.1 Personnel Plan......................................................................................................................... 13 Table: Personnel......................................................................................................................... 13 7.0 Financial Plan............................................................................................................................... 13 7.1 Start-up Funding .................................................................................................................... 14 Table: Start-up Funding.......................................................................................................... 14 7.2 Important Assumptions ....................................................................................................... 15 7.3 Break-even Analysis.............................................................................................................. 15 Table: Break-even Analysis.................................................................................................... 15 Chart: Break-even Analysis ................................................................................................... 16 7.4 Projected Profit and Loss..................................................................................................... 17 Table: Profit and Loss............................................................................................................... 17 Chart: Profit Monthly ................................................................................................................ 18 Chart: Profit Yearly.................................................................................................................... 18 Chart: Gross Margin Monthly................................................................................................. 19
  4. 4. Table of Contents Page 2 Chart: Gross Margin Yearly.................................................................................................... 19 7.5 Projected Cash Flow.............................................................................................................. 20 Table: Cash Flow........................................................................................................................ 20 Chart: Cash................................................................................................................................... 21 7.6 Projected Balance Sheet...................................................................................................... 22 Table: Balance Sheet................................................................................................................ 22 7.7 Business Ratios ....................................................................................................................... 22 Table: Ratios................................................................................................................................ 23 Table: Sales Forecast ......................................................................................................................... 1 Table: Personnel................................................................................................................................... 2 Table: Personnel................................................................................................................................... 2 Table: Profit and Loss......................................................................................................................... 3 Table: Profit and Loss......................................................................................................................... 3 Table: Cash Flow.................................................................................................................................. 4 Table: Cash Flow.................................................................................................................................. 4 Table: Balance Sheet.......................................................................................................................... 6 Table: Balance Sheet.......................................................................................................................... 6
  5. 5. Bay of Bengal Wing Craft Page 1 1.0 Executive Summary Bay of Bengal WINGCRAFT . is a manufacturer of wing-in-ground effect (WING) crafts, with one location in Chittagong/Khulna, Bangladesh. Bay of Bengal WINGCRAFT. is a start-up manufacturing firm. Along with a significant level of its own capital and patented designs, Bay of Bengal WINGCRAFT . hopes to initially make a successful effort to secure start -up financing to begin operations. Bay of Bengal WINGCRAFT . is looking to conduct operations at its location to meet an ever- growing level of demand for this alternative transportation vehicle. The company's initial product offering will lude the "BoB-12" with plans to finalize the designs of the BoB-30 in year two. These products are expected to be very popular among government agencies for Marine belt Coast Guard, like Bangadesh, Srilanka, India, Pakistan, Japan, Malaysia, Singapore, Hongkong, UAE, EU/US Countries, etc., and commercial companies because of their versatility and capabilities. Strong contact relationships and referral networks among commercial company owners are expected to allow for a rapid entry into this market. Chart: Highlights
  6. 6. Bay of Bengal Wing Craft Page 2 1.1 Objectives 1. To establish four production lines at the first plant in Chittagong/Khulna, Bangladesh in order to produce the Bangladesh built model of the BoB-12. 2. To expand production annually by opening two additional lines of production each year for years two through five. 3. Achieve a target of 2 units built and sold in the first production year, while raising annual production to 16 units by the end of year three. 4. First year projected sales of 2 units is expected to bring net profits of $1.5 million (before taxes), and growth from years two through five is projected to bring accumulated profits (before taxes) to be $20 million for the first five years of production. 5. Bay of Bengal WINGCRAFT. will take advantage of the acute need for solutions to fuel efficient, high speed modes of transportation over sea, and establish plants in different locations where demand for such vehicles warrant. 6. Develop foreign markets for island based countries (Malaysia, Japan, UK, Haiti, Thailand, etc.,), through licensing agreements, such as in Alaska USA, where the WING mode of transportation would be beneficial for productivity and environmental needs. 1.2 Mission Bay of Bengal WINGCRAFT. develops Wing-In-Ground Effect (WING) vehicles for use as the next-generation maritime transportation. The value that Bay of Bengal WINGCRAFT . delivers to this market is the ability to dramatically improve the efficiency, speed and cost of maritime transportation. Bay of Bengal WINGCRAFT. technology enables the development of WING vehicles that travel at the speeds normally associated to air planes, while using the fuel that is normally associated with cars. 1.3 Keys to Success Bay of Bengal WINGCRAFT. keys to success include: 1. Uncompromising commitment to the quality in its product line using quality materials and a high standard of quality in production. 2. Significant investments in research and development and engineering with the aim to focus on the next generation of maritime transportation. 3. Successful niche marketing to global customers in both the public and private sectors. 4. Improving efficiencies of operations. 2.0 Company Summary Bay of Bengal WINGCRAFT, is a start-up manufacturing firm which will be managed by two executives representing administration, marketing, sales, and finance. These executives bring to the company a large degree of experience in the equipment manufacturing industry. They perceive an opportunity to acquire a significant amount of market share by focusing on the specific needs of the commercial transportation industry and by providing more efficient means of maritime transport to their clients than other competitors. The company will be organized as a closely-held corporation with a majority of the shares held by the two propel executives. The company will be seeking to raise approximately $2-20 million in loans from JV capitalist /
  7. 7. Bay of Bengal Wing Craft Page 3 private investors for start-up purposes. The company will have one manufacturing facility in Chittagong/Khulna, Bangladesh. 2.1 Company Ownership The company will be a closely-held corporation with four/five active shareholders who will form the Board of Directors. It is anticipated that within the next five years, the company will be instituting a public offering to enlarge its ability to acquire financing. The propel owners will seek to retain the majority of the company's stock for the foreseeable future. The company will cooperate with the Bangladesh Navy, FBCCI, DCCI, MBCCI, RJSC, Dhaka as this offers the most advantageous location for testing and demonstrations in all weather conditions. 2.2 Start-up Summary The following summary table shows the projected start-up costs during the four/six months needed to get into production. It lodes the supply of specific machinery and equipment needed for the production lines. The start-up costs are to be financed by the money raised through this Private Placement Memorandum Offer. The funds sought for opening the plant with four production lines is $5 million with projected net profits, in the first year of over $10 million. Alternatively, as a minimum plan, we could open with one line of production with funds of $2 million. In this case, the projected net profit, in the first year is over $1 million. In either case, about $750,000 will be available as working capital for the first six months of operations (after the plant is in production). Management expects to begin production in approximately 60-120 days from funding as detailed in the Start-Up table. Long-term Assets Equipment and Machinery $150,000 Plant Improvements $50,000 LV Truck $15,000 Plant Vehicle $5,000 Total Equipment and Plant $270,000
  8. 8. Bay of Bengal Wing Craft Page 4 Table: Start-up Start-up Requirements Start-up Expenses Legal $5,000 Stationery etc. $500 Insurance $5,000 Rent $250,000 $25,000 Patenting Computer $24,000 Other $12,500 Total Start-up Expenses $322,000 Start-up Assets Cash Required $850,000 Start-up Inventory $300,000 Other Current Assets $200,000 Long-term Assets $200,000 Total Assets $1,550,000 Total Requirements $1,877,000 Chart: Start-up
  9. 9. Bay of Bengal Wing Craft Page 5 3.0 Products Bay of Bengal WINGCRAFT . product - the BoB wing in ground effect vehicle is the next generation of maritime transport vehicles. The patent protected BoB is classified as a maritime vessel that flies above surfaces at speeds that are comparable to air planes, while using a fraction of the fuel and requiring minimal maintenance. The specifications of our craft comply with the HSC Code for both the IMO (International Maritime Organization) and USCG (United States Coast Guard) regulations and safety standards. The patented BoB gives our WING craft the following advantages over other boats or air planes:  Less costly to maintain.  More fuel efficient than an airplane or boat.  Comparable speed of an air plane without needing a pilot's license.  No rocking motion due to waves, when cruising.  Environmentally friendly, creating virtually no wake.  Able to navigate over shallow waters, sand bars and other obstacles.  Operational year round, over water and ice.  Proper utilization of Hydroxy fuel to reduce fuel operational cost (proposed) It is a rare occasion when a company can make a significant contribution to our environment as well as create an important long awaited product that will provide substantial cost savings for its users and allow them the opportunity to use and promote environmentally friendly, methods of travel. The WING craft (Wing-In-Ground Effect vehicle) is an all-weather highly economical and safe multipurpose, vehicle that operates close to the ground, flying in a dynamic space that is known as ground effect. Designed for contactless motion above the surface (water, ice, snow, etc...) at altitudes of 0.2-3 m, the BoB WING craft can be effectively used for passenger or cargo transportation in a multitude of environments and regions. The BoB can operate in most environments and configured to be used for Emergency Response, Marine Police, Coast Guard, Military or Private use, making this WING craft one of the most effective vehicles in near fuure. 4.0 Market Analysis Summary Our target markets include:  Ferry Services  Remote Tourism  Cargo & Currier Companies  Government agencies o Marine Police o Coast Guard o Military o Emergency Response Units  Exploration and Mining Companies
  10. 10. Bay of Bengal Wing Craft Page 6 4.1 Market Segmentation Due to the fact that Bay of Bengal WINGCRAFT projected plan is to open a new plant and expand on that plant with two production lines each year over the next five years, and willingness to capture 0.15% to 0.75% of the U.S. maritime transportation market, our main growth problem will be the limited abilities to supply the potential demand. Although we segmented the market into four groups we cannot indicate the percentage of growth for each segment, as the growth is not linear. Table: Market Analysis Market Analysis 2011 2012 2013 2014 2015 Potential Customers Growth CAGR Ferry Services 5% 83 87 91 96 101 5.03% Government Agencies 10% 63 69 76 84 92 9.93% Exploration & Mining 5% 381 400 420 441 463 4.99% Total 5.63% 527 556 587 621 656 5.63% Chart: Market Analysis (Pie)
  11. 11. Bay of Bengal Wing Craft Page 7 4.2 Target Market Segment Strategy The following table demonstrates the cost savings that will be realized when a company moves from using a boat or an air plane to using the BoB . 4.3 Industry Analysis The industry is new with only a few companies, such as AFD Airfoil Development GmbH (Germany), C&S AMT Ltd (Korea) and Botec (Germany), currently manufacturing vessels. Out of these major competitors, AFD Airfoil Development GmbH is the largest, with the first WING vessel to receive a certificate of class from Lloyd's Register. AFD Airfoil Development GmbH reported sales of the AirFish-8 to Flightship in Australia in 2002, with a price tag of $1,200,000 for the standard layout. Each of these manufacturers has multi-segment marketing strategies that provide a base model that can be customized for large blocks of customers. Companies are marketing their products directly or in some cases through local distributors who are often franchises of the parent manufacturers. There is a significant direct sale to customers, providing greater opportunity to build relationships with customers, while customizing vessels for each client and their needs, allowing for maximizing vessel usage. Customers who purchase such vessels require reliability, easy maintenance, rapid availability of parts, and versatility for a variety of anticipated uses. Customers are influenced by reputation and cost, so vessel purchases can be the most significant portion of the customer's long-term assets. 4.3.1 Competition and Buying Patterns The purchase decision for our customer is based on an experienced test ride combined with the cost savings potential and our experts have ability to manufacture a high quality vessel in North America. We have established relationships with our customers which extend beyond that of the buyer/seller. The Bay of Bengal WINGCRAFT label means that the product has been chosen and prepared with the highest quality standards in mind. Our vessels are priced up to nine percent higher than similar products. Our customers are willing to pay more for our product because they are familiar with us and trust in the quality of our vessels. This is the result of their success in the marketplace with our product. 5.0 Strategy and Implementation Summary Bay of Bengal WINGCRAFT's strategy is to expand production capabilities in order to fulfill the requests of government agencies and global businesses those who have currently expressed interest for large orders that we are unable to currently fulfill. In addition Bay of Bengal WINGCRAFT seeks to establish additional contracts with global importers and introduce a BoB- 30 with a larger payload capacity in the 3rd year of production.
  12. 12. Bay of Bengal Wing Craft Page 8 5.1 Competitive Edge Bay of Bengal WINGCRAFT's most important competitive edge is based on the unique and patented design used to manufacture the WING craft. The versatile design is protected by the issued patents that will prevent duplication or "copyc ut" competition. BoB vessels will be manufactured from quality tested materials and manufacturing processes that meet or exceed maritime law and most Governments defense requirements. Bay of Bengal WINGCRAFT design has already sold several units of the BoB-12 as namely Ivolga of the EL-12 to the Russian Coast Guard for use in northern territories where extreme climates make it difficult to operate other vehicles. With manufacturing facilities in the Bangladesh, we will focus on different government agencies including the Coast Guard, Department of Defense and Department of Tourism & Transportation to introduce and market the BoB-12 and BoB-30. The BoB is already classified as a maritime vessel and does not require a pilot’s license to operate. This reduces the training requirement to operate the vehicle. When combined with the fact that maintenance and gas usage are comparable to the average Bangladeshi or international cargos, the BoB WING craft will be more affordable and accessible than most water vessels or air planes. The BoB WING craft is an environmentally friendly product that cruises above the water leaving little or no wake and no destruction caused by propellers, behind. The vessel can be operated in lakes, oceans, swamps and ice. The BoB 's ability to retract the wings, allows it to operate in most environments and spaces, where wings might cause problems with docking. The BoB will be the best cost effective/performance WING craft in the market. The summary of advantages that our WING craft has in comparison to existing WING craft such as the Airfish-8 or Sea Rider and boats or air planes, are: Much less cost to buy and maintain than an air plane. Faster than most Wing crafts or boats with a cruising speed of 107 knots (200 km/h). Carries 3,300 lbs. Easy and cheap maintenance. Operate cost $182/ h. Classified as a maritime vessel requiring only maritime licensing to operate. Fuel efficient with a range of 1,125 ml (1,800 km) using 756 L (100 gal) of Gas. Easily configured for specific use (Coast Guard, Ferry Services, Military/Police, etc...). Able to operate in environments where air planes or boats cannot. 5.2 Marketing Strategy Bay of Bengal WINGCRAFT's marketing strategy will include the use of targeted print media advertising and direct selling to prospective clients in oil exploration companies, those are involve in the oil exploration on the Bay of Bengal at Bangladesh and abroad. We will capitalize on existing relationships with prospective clients and partners who have already expressed their willingness to purchase the BoB-12. We will have positioned ourselves as a monopoly Bangladeshi manufacturer of WING crafts and the nex-gen modern maritime vehicles, that will meet or exceed world class standards and regulations. The primary marketing efforts will be to communicate with the existing and potential customers.
  13. 13. Bay of Bengal Wing Craft Page 9 5.3 Sales Strategy Bay of Bengal WINGCRAFT's sales focus will be first on meeting with the Federation of Bangladesh Chambers of Commerce and Industries members (FBCCI), business groups and government tourism & defense ministries to aware the benefits to purchase such type of vehicles for their fleet. Secondly, we will focus on raising the volume, while maintaining the percentage of sales, of vessels sold to the overseas market. When we will have reached maximum sales to existing channels then we may shift our focus to Gulf, Haiti, Srilanka, Japan, etc. 5.3.1 Sales Forecast The following chart and table show our present sales forecast. We project sales to grow approximately 250% annually in 2015, after the first year following the production of our first Bangladeshi build vessels, increase again by 370% percent in 2016, and reach maximum for production capacity in 2016. Our forecasts are based on communications with interested parties located in our network and abroad, who are already showing their interest to purchase such type of environment friendly cost effective vehicles. Table: Sales Forecast Sales Forecast FY 2014 FY 2015 FY 2016 Sales BoB-12 $4,000,000 $10,500,000 $28,000,000 BoB-30 $0 $0 $9,000,000 Total Sales $4,000,000 $10,500,000 $37,000,000 Direct Cost of Sales FY 2014 FY 2015 FY 2016 Labor $431,999 $1,046,200 $1,484,616 Material $591,000 $2,660,000 $5,023,000 Overhead $283,130 $306,000 $330,000 Subtotal Direct Cost of Sales $1,306,129 $4,012,200 $6,837,616
  14. 14. Bay of Bengal Wing Craft Page 10 Chart: Sales Monthly Chart: Sales by Year 0 200000 400000 600000 800000 1000000 1200000 1400000 1600000 1800000 2000000 Bob -12 BoB-30 $0 $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 $35,000,000 $40,000,000 2014 2015 2016 BoB-12 BoB-30 Total Sales
  15. 15. Bay of Bengal Wing Craft Page 11 5.4 Milestones The following table lists important project milestones during the pre-production start-up period, with dates and managers in charge, and budgets for each milestone. The milestone schedule indicates our emphasis on planning for implementation. The production schedule is based on two shifts. During the first month only one shift will be in operation, with a second shift being implemented in the second month of production. Table: Milestones Milestones Milestone Start Date End Date Budget Manager Department Secure Manufacturing Facilities 03/01/2013 03/02/2013 $17,500 ABC Department Purchase & Installation of Equip. 06/02/2013 30/02/2013 $121,800 ABC Department Purchase Manufacturing Supplies 13/02/2013 30/5/2013 $899,232 ABC Department First BD-12 off the line 04/06/2013 27/11/2013 $327,000 ABC Department Testing of first craft 06/12/203 17/12/2013 $65,000 ABC Department Design Composite Version of BD-12 04/05/2013 30/05/2013 $240,000 ABC Department USCG Certification 06/05/2013 31/05/2013 $84,000 ABC Department Lloyd's Certification 06/05/2013 31/11/2013 $138,000 ABC Department Marketing & Advertising 06/12/2013 30/01/2014 $260,000 ABC Department Patent BD-12,30 06/01/2014 28/04/2014 $38,000 ABC Department Totals $2,190,532 Chart: Milestones 0 1 2 3 4 5 6 Milestones Milestones
  16. 16. Bay of Bengal Wing Craft Page 12 6.0 Management Summary THE MANAGEMENT TEAM (will disclose, after finalization of MOU) Bay of Bengal WINGCRAFT . management team and its consultants are qualified professionals with vast experience with plant installation and operations, purchasing and marketing. Bay of Bengal WINGCRAFT's consultants will be employed during the start-up period (see Start-up table). Bay of Bengal WINGCRAFT . welcomes any additional person from our investor's group that can contribute to the success of the company. XXXXXX, CEO: SUMMARY OF QUALIFICATIONS  M.D. in Aviation Engineering, XXXXXX Aviation Institute of XXXXXX.  Military Pilot in XXXX XXXX Sea 1982-93  Production Manager light aircraft XXXXX republic 1993-2000  XXXXXX, has been involved in design, management and manufacturing processes of the XXXXX 2004. XXXXXX: SUMMARY OF QUALIFICATIONS  Co-designer - PhD WING Craft design degree. 25 year experience XXXXXXXX, Lead Designer  Honored Test Pilot Design Office XXXX, academician of the Academy of Sciences of Russia, chief designer of ground-effect crafts, 50 year experience
  17. 17. Bay of Bengal Wing Craft Page 13 6.1 Personnel Plan The personnel table assumes slow growth in employees, and 3-5% per annum pay raises. We plan to offer a strong benefits policy (with fully-paid medical, dental, and life insurance, plus a profit sharing and 401K plan) to encourage a very low turnover. Salaries are generally in line with market pay for the Philadelphia area, although our benefits are above standard market level, so we ultimately pay a bit more for our people than what might be considered standard in our market. As we grow, we expect to see steady reaches in our personnel to match the reaches in sales and production. Table: Personnel Personnel Plan FY 2012 FY 2013 FY 2014 Engineering & Design $159,500 $247,200 $254,616 Mechanical $87,480 $189,000 $260,000 Assembly $162,519 $400,000 $550,000 Sales $22,500 $210,000 $420,000 Total People 11 15 18 Total Payroll $431,999 $1,046,200 $1,484,616 7.0 Financial Plan Bay of Bengal WINGCRAFT . expects to raise $2 - $20 million in private investment for start-up costs for the first year. This will provide the bulk of the financing required to grow operations at the planned rate.
  18. 18. Bay of Bengal Wing Craft Page 14 7.1 Start-up Funding The start-up costs of Bay of Bengal WINGCRAFT . will consist primarily of materials, equipment and fixtures. XXXXX and XXXX have invested $3,8M in cash and $4,2M million in labor during 2004-present to get the current design made. We are seeking investment capital of approximately $2-5 million to start Bangladesh & also $2-5 million for USA based consortium for at a time production of the USA / BD-12,30. Table: Start-up Funding Start-up Funding Start-up Expenses to Fund $322,000 Start-up Assets to Fund $1,550,000 Total Funding Required $1,877,000 Assets Non-cash Assets from Start-up $500,000 Cash Requirements from Start-up $850,000 Additional Cash Raised $9,000 Cash Balance on Starting Date $859,000 Total Assets $1,359,000 Liabilities and Capital Liabilities Current Borrowing $0 Long-term Liabilities $0 Accounts Payable (Outstanding Bills) $0 Other Current Liabilities (interest-free) $0 Total Liabilities $0 Capital Planned Investment Owner 0 Investor $1,877,000 Additional Investment Requirement $2,500,000 Total Planned Investment $1,877,000 Loss at Start-up (Start-up Expenses) ($275,000) Total Capital $1,342,000 Total Capital and Liabilities $1,359,000 Total Funding $1,877,000
  19. 19. Bay of Bengal Wing Craft Page 15 7.2 Important Assumptions The financial plan depends on important assumptions, most of which are shown in the following table. The key underlying assumptions are: • We assume a slow-growth economy, during the current recession. • We assume of course that there are no unforeseen changes in technology to make our products immediately obsolete. • We assume access to equity capital and financing sufficient to maintain our financial plan as shown in the tables. 7.3 Break-even Analysis The break-even analysis shows that Bay of Bengal WINGCRAFT . has sufficient sales strength to remain viable. Our break-even point is close to 1 unit per year and our sales forecast for the next year calls for almost 1 unit per month on average. Table: Break-even Analysis Break-even Analysis Monthly Revenue Break-even $78,146 Assumptions: Average Percent Variable Cost 33% Estimated Monthly Fixed Cost $52,629
  20. 20. Bay of Bengal Wing Craft Page 16 Chart: Break-even Analysis
  21. 21. Bay of Bengal Wing Craft Page 17 7.4 Projected Profit and Loss As the profit and loss table shows, Bay of Bengal WINGCRAFT . expects to continue its steady growth in profitability over the next three years of operations. Table: Profit and Loss Pro Forma Profit and Loss FY 2012 FY 2013 FY 2014 Sales $4,000,000 $10,500,000 $37,000,000 Direct Cost of Sales $1,306,129 $4,012,200 $6,837,616 Other Costs of Sales $17,000 $84,000 $100,000 Total Cost of Sales $1,323,129 $4,096,200 $6,937,616 Gross Margin $2,676,871 $6,403,800 $30,062,384 Gross Margin % 66.92% 60.99% 81.25% Expenses Payroll $431,999 $1,046,200 $1,484,616 Marketing/Promotion $9,000 $15,000 $20,000 Depreciation $0 $10,000 $13,000 Rent $105,000 $110,000 $115,000 Utilities $5,250 $5,670 $6,237 Insurance $5,500 $5,500 $5,500 Payroll Taxes $64,800 $156,930 $222,692 Other $10,000 $20,000 $50,000 Total Operating Expenses $631,549 $1,369,300 $1,917,045 Profit Before Interest and Taxes $2,045,322 $5,034,500 $28,145,339 EBITDA $2,045,322 $5,044,500 $28,158,339 Interest Expense $0 $0 $0 Taxes urred $470,424 $1,157,935 $6,473,428 Net Profit $1,574,898 $3,876,565 $21,671,911 Net Profit/Sales 39.37% 36.92% 58.57%
  22. 22. Bay of Bengal Wing Craft Page 18 Chart: Profit Monthly Chart: Profit Yearly
  23. 23. Bay of Bengal Wing Craft Page 19 Chart: Gross Margin Monthly Chart: Gross Margin Yearly
  24. 24. Bay of Bengal Wing Craft Page 20 7.5 Projected Cash Flow The financial outlook is positive as the company rolls out and meets its milestones. After financing, cash flow will be negative for year. By year two, Bay of Bengal WINGCRAFT . expects to be cash flow positive. Table: Cash Flow Pro Forma Cash Flow FY 2012 FY 2013 FY 2014 Cash Received Cash from Operations Cash Sales $4,000,000 $10,500,000 $37,000,000 Subtotal Cash from Operations $4,000,000 $10,500,000 $37,000,000 Additional Cash Received Sales Tax, VAT, HST/GST Received $0 $0 $0 New Current Borrowing $0 $0 $0 New Other Liabilities (interest-free) $0 $0 $0 New Long-term Liabilities $0 $0 $0 Sales of Other Current Assets $0 $0 $0 Sales of Long-term Assets $0 $0 $0 New Investment Received $0 $0 $0 Subtotal Cash Received $4,000,000 $10,500,000 $37,000,000 Expenditures FY 2012 FY 2013 FY 2014 Expenditures from Operations Cash Spending $431,999 $1,046,200 $1,484,616 Bill Payments $1,828,454 $7,127,420 $13,203,163 Subtotal Spent on Operations $2,260,453 $8,173,620 $14,687,779 Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out $0 $0 $0 Pripal Repayment of Current Borrowing $0 $0 $0 Other Liabilities Pripal Repayment $0 $0 $0 Long-term Liabilities Pripal Repayment $0 $0 $0 Purchase Other Current Assets $0 $0 $0 Purchase Long-term Assets $0 $0 $0 Dividends $0 $0 $0 Subtotal Cash Spent $2,260,453 $8,173,620 $14,687,779 Net Cash Flow $1,739,547 $2,326,380 $22,312,221 Cash Balance $2,598,547 $4,924,926 $27,237,147
  25. 25. Bay of Bengal Wing Craft Page 21 Chart: Cash
  26. 26. Bay of Bengal Wing Craft Page 22 7.6 Projected Balance Sheet Bay of Bengal WINGCRAFT's projected company balance sheet follows. Table: Balance Sheet Pro Forma Balance Sheet FY 2012 FY 2013 FY 2014 Assets Current Assets Cash $2,598,547 $4,924,926 $27,237,147 Inventory $269,792 $2,303,251 $2,177,655 Other Current Assets $100,000 $100,000 $100,000 Total Current Assets $2,968,339 $7,328,178 $29,514,802 Long-term Assets Long-term Assets $100,000 $100,000 $100,000 Accumulated Depreciation $0 $10,000 $23,000 Total Long-term Assets $100,000 $90,000 $77,000 Total Assets $3,068,339 $7,418,178 $29,591,802 Liabilities and Capital FY 2012 FY 2013 FY 2014 Current Liabilities Accounts Payable $151,440 $624,715 $1,126,428 Current Borrowing $0 $0 $0 Other Current Liabilities $0 $0 $0 Subtotal Current Liabilities $151,440 $624,715 $1,126,428 Long-term Liabilities $0 $0 $0 Total Liabilities $151,440 $624,715 $1,126,428 Paid-in Capital $1,617,000 $1,617,000 $1,617,000 Retained Earnings ($275,000) $1,299,898 $5,176,463 Earnings $1,574,898 $3,876,565 $21,671,911 Total Capital $2,916,898 $6,793,463 $28,465,374 Total Liabilities and Capital $3,068,339 $7,418,178 $29,591,802 Net Worth $2,916,898 $6,793,463 $28,465,374 7.7 Business Ratios Standard business ratios are laded in the following table. The ratios show an aggressive plan for growth in order to reach maximum production within three years. Return on investment reaches each year as we bring the new facility to maximum capacity and production. Return on sales and assets remain strong and cost of goods decreased based upon efficiency projections. Projections are based on the 2011/12 selling price.
  27. 27. Bay of Bengal Wing Craft Page 23 Table: Ratios Ratio Analysis FY 2012 FY 2013 FY 2014 Industry Profile Sales Growth n.a. 162.50% 252.38% 6.60% Percent of Total Assets Inventory 8.79% 31.05% 7.36% 1.92% Other Current Assets 3.26% 1.35% 0.34% 29.79% Total Current Assets 96.74% 98.79% 99.74% 55.54% Long-term Assets 3.26% 1.21% 0.26% 44.46% Total Assets 100.00% 100.00% 100.00% 100.00% Current Liabilities 4.94% 8.42% 3.81% 36.66% Long-term Liabilities 0.00% 0.00% 0.00% 33.75% Total Liabilities 4.94% 8.42% 3.81% 70.41% Net Worth 95.06% 91.58% 96.19% 29.59% Percent of Sales Sales 100.00% 100.00% 100.00% 100.00% Gross Margin 66.92% 60.99% 81.25% 52.98% Selling, General & Administrative Expenses 27.55% 24.07% 22.68% 14.74% Advertising Expenses 0.22% 0.14% 0.05% 0.26% Profit Before Interest and Taxes 51.13% 47.95% 76.07% 4.89% Main Ratios Current 19.60 11.73 26.20 1.16 Quick 17.82 8.04 24.27 1.11 Total Debt to Total Assets 4.94% 8.42% 3.81% 70.41% Pre-tax Return on Net Worth 70.12% 74.11% 98.88% 32.74% Pre-tax Return on Assets 66.66% 67.87% 95.11% 9.69% Additional Ratios FY 2012 FY 2013 FY 2014 Net Profit Margin 39.37% 36.92% 58.57% n.a Return on Equity 53.99% 57.06% 76.13% n.a Activity Ratios Inventory Turnover 5.35 3.12 3.05 n.a Accounts Payable Turnover 12.96 12.17 12.17 n.a Payment Days 29 19 23 n.a Total Asset Turnover 1.30 1.42 1.25 n.a Debt Ratios Debt to Net Worth 0.05 0.09 0.04 n.a Current Liab. to Liab. 1.00 1.00 1.00 n.a Liquidity Ratios Net Working Capital $2,816,898 $6,703,463 $28,388,374 n.a Interest Coverage 0.00 0.00 0.00 n.a Additional Ratios Assets to Sales 0.77 0.71 0.80 n.a Current Debt/Total Assets 5% 8% 4% n.a Acid Test 17.82 8.04 24.27 n.a Sales/Net Worth 1.37 1.55 1.30 n.a Dividend Payout 0.00 0.00 0.00 n.a
  28. 28. Appendix Page 1 Table: Sales Forecast Sales Forecast May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Sales BD-12 $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,000,000 $2,000,000 $0 BD-30 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,000,000 $2,000,000 $0 Direct Cost of Sales May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Labour $0 $7,000 $17,500 $38,750 $38,750 $38,750 $38,750 $38,750 $38,750 $53,333 $53,333 $68,333 Material $0 $0 $51,000 $51,000 $51,000 $80,000 $77,000 $51,000 $51,000 $77,000 $51,000 $51,000 Overhead $0 $127,500 $15,563 $15,563 $15,563 $15,563 $15,563 $15,563 $15,563 $15,563 $15,563 $15,563 Subtotal Direct Cost of Sales $0 $134,500 $84,063 $105,313 $105,313 $134,313 $131,313 $105,313 $105,313 $145,896 $119,896 $134,896
  29. 29. Appendix Page 2 Table: Personnel Personnel Plan May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Engineering & Design $0 $67,000 $67,000 $69,750 $69,750 $69,750 $69,750 $69,750 $69,750 $80,000 $80,000 $80,000 Mechanical $0 $0 $27,500 $28,330 $28,330 $28,330 $28,330 $28,330 $28,330 $40,000 $40,000 $40,000 Assembly $0 $0 $0 $36,670 $36,670 $36,670 $36,670 $36,670 $36,670 $40,833 $40,833 $40,833 Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $15,500 $15,500 $27,500 Total People 0 13 15 20 20 20 20 20 20 23 23 23 Total Payroll $0 $67,000 $94,500 $134,750 $134,750 $134,750 $134,750 $134,750 $134,750 $176,333 $176,333 $188,333
  30. 30. Appendix Page 3 Table: Profit and Loss Pro Forma Profit and Loss May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,000,000 $2,000,000 $0 Direct Cost of Sales $0 $134,500 $84,063 $105,313 $105,313 $134,313 $131,313 $105,313 $105,313 $145,896 $119,896 $134,896 Other Costs of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $5,000 $5,000 $7,000 Total Cost of Sales $0 $134,500 $84,063 $105,313 $105,313 $134,313 $131,313 $105,313 $105,313 $150,896 $124,896 $141,896 Gross Margin $0 ($134,500) ($84,063) ($105,313) ($105,313) ($134,313) ($131,313) ($105,313) ($105,313) $1,849,104 $1,875,104 ($141,896) Gross Margin % 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 92.46% 93.76% 0.00% Expenses Payroll $0 $7,000 $17,500 $38,750 $38,750 $38,750 $38,750 $38,750 $38,750 $53,333 $53,333 $68,333 Marketing/Promotion $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,000 $2,000 $5,000 Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Rent $0 $17,500 $8,750 $8,750 $8,750 $8,750 $8,750 $8,750 $8,750 $8,750 $8,750 $8,750 Utilities $0 $300 $450 $500 $500 $500 $500 $500 $500 $500 $500 $500 Insurance $0 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 Payroll Taxes 15% $0 $1,050 $2,625 $5,813 $5,813 $5,813 $5,813 $5,813 $5,813 $8,000 $8,000 $10,250 Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $10,000 $0 $0 Total Operating Expenses $0 $26,350 $29,825 $54,313 $54,313 $54,313 $54,313 $54,313 $54,313 $83,083 $73,083 $93,333 Profit Before Interest and Taxes $0 ($160,850) ($113,888) ($159,626) ($159,626) ($188,626) ($185,626) ($159,626) ($159,626) $1,766,021 $1,802,021 ($235,229) EBITDA $0 ($160,850) ($113,888) ($159,626) ($159,626) ($188,626) ($185,626) ($159,626) ($159,626) $1,766,021 $1,802,021 ($235,229) Interest Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Taxes urred $0 ($36,996) ($26,194) ($36,714) ($36,714) ($43,384) ($42,694) ($36,714) ($36,714) $406,185 $414,465 ($54,103) Net Profit $0 ($123,855) ($87,694) ($122,912) ($122,912) ($145,242) ($142,932) ($122,912) ($122,912) $1,359,836 $1,387,556 ($181,126) Net Profit/Sales 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 67.99% 69.38% 0.00%
  31. 31. Appendix Page 4 Table: Cash Flow Pro Forma Cash Flow May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Cash Received Cash from Operations Cash Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,000,000 $2,000,000 $0 Subtotal Cash from Operations $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,000,000 $2,000,000 $0 Additional Cash Received Sales Tax, VAT, HST/GST Received 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 New Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 New Other Liabilities (interest-free) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 New Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Sales of Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Sales of Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 New Investment Received $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Subtotal Cash Received $0 $0 $0 $0 $0 $0 $0 $0 $0 $2,000,000 $2,000,000 $0 Expenditures May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Expenditures from Operations Cash Spending $0 $7,000 $17,500 $38,750 $38,750 $38,750 $38,750 $38,750 $38,750 $53,333 $53,333 $68,333 Bill Payments $17,000 $2,862 $69,123 ($9,745) $108,994 $86,839 $162,281 $95,981 $33,895 $103,623 $662,634 $494,967 Subtotal Spent on Operations $17,000 $9,862 $86,623 $29,005 $147,744 $125,589 $201,031 $134,731 $72,645 $156,956 $715,967 $563,300 Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Pripal Repayment of Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Other Liabilities Pripal Repayment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Long-term Liabilities Pripal Repayment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Purchase Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Purchase Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
  32. 32. Appendix Page 5 Subtotal Cash Spent $17,000 $9,862 $86,623 $29,005 $147,744 $125,589 $201,031 $134,731 $72,645 $156,956 $715,967 $563,300 Net Cash Flow ($17,000) ($9,862) ($86,623) ($29,005) ($147,744) ($125,589) ($201,031) ($134,731) ($72,645) $1,843,044 $1,284,033 ($563,300) Cash Balance $842,000 $832,138 $745,515 $716,510 $568,766 $443,176 $242,145 $107,414 $34,769 $1,877,813 $3,161,846 $2,598,547
  33. 33. Appendix Page 6 Table: Balance Sheet Pro Forma Balance Sheet May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Assets Starting Balances Current Assets Cash $859,000 $842,000 $832,138 $745,515 $716,510 $568,766 $443,176 $242,145 $107,414 $34,769 $1,877,813 $3,161,846 $2,598,547 Inventory $300,000 $300,000 $269,000 $184,937 $210,626 $210,626 $268,626 $262,626 $210,626 $210,626 $291,792 $239,792 $269,792 Other Current Assets $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 Total Current Assets $1,259,000 $1,242,000 $1,201,138 $1,030,452 $1,027,136 $879,392 $811,802 $604,771 $418,040 $345,395 $2,269,605 $3,501,638 $2,968,339 Long-term Assets Long-term Assets $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Long-term Assets $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 Total Assets $1,359,000 $1,342,000 $1,301,138 $1,130,452 $1,127,136 $979,392 $911,802 $704,771 $518,040 $445,395 $2,369,605 $3,601,638 $3,068,339 Liabilities and Capital May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr Current Liabilities Accounts Payable $17,000 $0 $82,993 $0 $119,596 $94,763 $172,416 $108,316 $44,497 $94,763 $659,137 $503,614 $151,440 Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Subtotal Current Liabilities $17,000 $0 $82,993 $0 $119,596 $94,763 $172,416 $108,316 $44,497 $94,763 $659,137 $503,614 $151,440 Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Liabilities $17,000 $0 $82,993 $0 $119,596 $94,763 $172,416 $108,316 $44,497 $94,763 $659,137 $503,614 $151,440 Paid-in Capital $1,617,000 $1,617,000 $1,617,000 $1,617,000 $1,617,000 $1,617,000 $1,617,000 $1,617,000 $1,617,000 $1,617,000 $1,617,000 $1,617,000 $1,617,000 Retained Earnings ($275,000) ($275,000) ($275,000) ($275,000) ($275,000) ($275,000) ($275,000) ($275,000) ($275,000) ($275,000) ($275,000) ($275,000) ($275,000) Earnings $0 $0 ($123,855) ($211,548) ($334,460) ($457,372) ($602,613) ($745,545) ($868,456) ($991,368) $368,468 $1,756,024 $1,574,898 Total Capital $1,342,000 $1,342,000 $1,218,146 $1,130,452 $1,007,540 $884,628 $739,387 $596,455 $473,544 $350,632 $1,710,468 $3,098,024 $2,916,898 Total Liabilities and Capital $1,359,000 $1,342,000 $1,301,138 $1,130,452 $1,127,136 $979,392 $911,802 $704,771 $518,040 $445,395 $2,369,605 $3,601,638 $3,068,339 Net Worth $1,342,000 $1,342,000 $1,218,146 $1,130,452 $1,007,540 $884,628 $739,387 $596,455 $473,544 $350,632 $1,710,468 $3,098,024 $2,916,898

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