presentation -english finall
TRANSCRIPT
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Romania2013
WAGYU BREEDING AND FATTENING
FARM
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The business and the product
The Market and competition
Strategy
Business drivers
Management
Financials
Funding requirement
Anexa 1 – Wagyu grading
Anexa 2 – Biogas Graph
OVERVIEW
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The newly formed company is to produce for luxury markets the world class Wagyu Cattles of A5 grade (annex 1)
Two farms – 1 housing the breeding population and 1 housing the feeding lot – to be build with a total capacity of 6000 heads
Biogas Plant – 1.6 MW installation producing 12.000 MW/year
BUSINESS PROPOSITION
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Wagyu Black full blood cattle with the highest obtainable marbling due to its own genetics and thru intensive feeding over a period of 550-600 days
Green energy– 12.000 MW/year
THE PRODUCT
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The high cost of purchase of genetic material and the feeding makes the wagyu producing prohibited for most of the farmers
The demand is high and in a continuous growth, as reflected in it’s high prices (10,000-20,000 USD/carcass)
THE MARKET
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The product is designated for markets where the luxury hospitality services are at a high or developing
Saudi Arabia, Dubai, Qatar, Thailand, Taiwan, Hong Kong, China, Indonesia
MARKETS
26.8 22.4 20.6
37.3 36.1 33.4
15.79.5 7.1
15.8
26.8
33.1
4.4 5.1 5.8
USA
Europe
Japan
Asia Pacific excluding Japan
Middle East and Others
Share of Global Sales %
2006
2011
2015
Share of global expenditure on luxury branded products
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Europe – at this point are a small number of farms that are having wagyu cattle mainly for breeding purposes. Approximate number of heads in each farm not exceeding 500-600
USA – while has a much more number of wagyu farmers, most of them are producing a mix breed of wagyu – A1
Australia – AA CO - the major producer world wide of wagyu catles having a number of 60.000 heads
COMPETITION
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Obtain a population for breeding of 3000 heads through the purchase of wagyu full blood embryos
Obtain a population for fattening of 3000 heads through intensive breeding program over fi rst 4 years
The farm is designed to be broadly self-suffi cient in that we are aiming to produce about 95% of our animals’ feed from within the farm, using their manure as a biomass and as fertilizer.
The building of Biogas plant that is to produce 12.000 MW/year of green energy from the cattle manure.
STRATEGY
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Wagyu cattle are highly adaptable to the European climate
Black Sea International Harbor which facilitates transport of livestock to Middle East market
Low cost of agriculture land in Romania
Low cost of labor in Romania
Low tax/profit in Romania (16%)
BUSSINESS DRIVERS
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Florentina Agiakatsikas –age 35 - with an overall 15 years of work experience, out of which over 9 years in entrepreneurship, has proven to be trustworthy in setting up and approaching complex projects in a simple and straightforward manner. Her communication skills as well as contagious optimism and "can do" attitude makes work with her inspiring, leading to the fulfi llment of the expected financial returns. She is a very detailed-oriented person and has high standards in terms of quality. She is a results - oriented manager who decides strategy, identifies needs and changes, sets objectives, controls target fulfi llment, manages the resources and motivates the team
MANAGEMENT
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Cristian Dinu – age 36 - working for 15 years in various fields, from building to electric equipment, Cristian had acquired vast knowledge and experience. He is a combination of strong personality with a hard working character. If I have to define him in 3 words: Nothing is impossible. Although strong personality his team player qualities
do not suffer.
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The project aims to arrive at full production capacity of exporting (approx. 850 heads) in the 4 th year
FINANCIALS
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Starting with 2014 Biogas plant brings a revenue of 2.196.000 € from the sales of green certificates and energy. Revenue is used to continue investment in livestock and genetic material
Starting with 2015 the initial cattle (6000 heads) used for wagyu embryos implanting will be sold recovering 90% from their purchase value
Starting with the year 2017 the fi rst wagyu cattle are ready for export at an approximate price of 10,000 €/each
OVERVIEW OF FINANCIAL INCOME
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WAGYU FARM - 6000 HEADS
Total investment €19,229,727 Salaries and operational costs €2,407,074 INCOME/year - starting with 2020 Export wagyu catle 900 heads 10000€/each €9,000,000 Wagyu cows 300 heads 7000€/each €2,100,000 Green certificates 36000 G.C 46€/each €1,656,000 Energy sold in the network 12000 MW 45€/each €540,000 Government subventions €1,056,000 Total income €14,352,000 Profit before tax €11,944,926 Profit after TAX €10,033,738
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BUSINESS PROJECTION
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CASHFLOW
2013 2014 2015 2016 2017 2018 2019 2020
Cash Inflows
Sales €1,946,000 €5,300,000 €5,652,000 €10,256,000 €13,852,000 €13,852,000 €14,352,000Investment €9,910,665 €4,234,732 €1,474,383 €1,162,383 €2,447,563 - - -Total Cash Inflows €9,910,665 €6,180,732 €6,774,383 €6,814,383 €12,703,563 €13,852,000 €13,852,000 €14,352,000
Cash outflows
Purchases €9,400,000 €4,320,000 €4,320,000 €4,320,000 - - -Operational Expenses €685,665 €1,758,273 €2,315,474 €2,355,474 €2,520,007 €2,407,074 €2,407,074 €2,407,074Taxes €34,065 €102,459 €138,909 €138,909 €154,389 €154,389 €154,389 €154,389Income Tax - - - - €1,836,417 €1,806,486 €1,806,486 €1,911,188Return of 2017 liquidity €2,447,563 - - -Return of Investment (ROI) - - - - €4,800,000 €9,450,000 €4,803,396 -Withdraws/Profit - - - - - - €4,650,000 €9,800,000Total Cash Outflows €10,119,730 €6,180,732 €6,774,383 €6,814,383 €11,758,376 €13,817,949 €13,821,345 €14,272,652
Cash Surplus/Deficit - - - - €945,187 €34,051 €30,655 €79,348Opening Cash Balance €9,910,665 €6,180,732 €6,774,383 €6,814,383 €1,505,438 €2,450,624 €2,484,675 €2,515,330Closing Cash Balance - - - - €2,450,624 €2,484,675 €2,515,330 €2,594,678
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Over a period of 4 ½ years the business needs a total injection of capital of 19.229.727 €
ROI (Return of Investment) starts at the end of 5 th year (2017) and ends in the 7 th year (2019)
FUNDING REQUIREMENT AND ROI
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Building and machinery Farm purchasing and extend the capacity to 6000 heads Biogas plant – production of 12000 MW/year
Livestock and genetic material purchase 6000 heifers to be implanted with wagyu embryos 9600 Full blood wagyu embryos
Operational costs Crops development Utilities Salaries Taxes
USE OF FUNDS
34.93%
48.17%
16.90%
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In 2019-2020 a second farm can be build, doubling the capacity (12.000 heads) and the production for export.
An increase in profit of 100% is to be expected by the 2023-2024
BUSINESS EXTENSION
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ANNEX 1 – WAGYU GRADING
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ANNEX - BIOGAS
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PROJECT PROPOSED FOR 2013
Entrepreneur Florentina Agiakatsikas
E’mail: fl [email protected]+30 6947407619
Thank you