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INVESTOR NEWSLETTER
Monday, July 09, 2007
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Welcome to the latest issue of JER's Investor Newsletter. This publication is designed to keep you better informed about JER's operations, sales activities and ongoing opportunities. If you have any questions, comments or suggestions about this publication or the Company in general, please contact Mark Komonoski, VP of Corporate Communications at mark@jerenvirotech.com. You can also call
toll-free: 1-877-255-8483 (US & Canada) or worldwide: +1 (403) 470-8384.
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WHAT'S INSIDE:
1. Appointment of Chief Financial Officer
2. New Toll Opportunity with Major Injection Moulder in Windsor, ON
3. Update on Laminate Flooring Opportunity
4. Biocomposite Pellet Lines Ramping Up
5. Factoid: The Importance of Biocomposite Dryness
6. New Opportunity with Fencing Material Manufacturer
7. Orders Grow with South Carolina Extrusion Manufacturer
8. Advancing Business with US-Based Extrusion Company
9. JER Closes First Tranche of Brokered Private Placement
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1. APPOINTMENT OF CHIEF FINANCIAL OFFICER
JER has appointed Mr. Ji Yoon as Chief Financial Officer. Mr. Yoon has assumed responsibility for all financial functions of the organization, from accounting, finance and tax management to inventory control, strategic financial capital management and financial reporting. Mr. Yoon brings to JER more than 14 years of finance, accounting and public markets experience, having worked in the high technology, engineering, and distribution industries. His previous executive management experience includes:
- 2005 to 2007 - Acting Chief Financial Officer and Controller for Taiga Building Products Ltd., a Vancouver-based public company, Taiga is Canada's largest independent wholesale distributor of building products with sales over a billion dollars. Taiga distributes building products through fourteen distribution centres across Canada and two distribution centres in the USA. On behalf of building supply dealers and industrial manufacturers, Taiga distributes dimension lumber, panel products, treated wood, engineered wood, roofing materials, mouldings, composite decking, polyethylene sheeting, batt and foam insulation, siding and flooring. In this capacity, Mr. Yoon was responsible for all matters related to public reporting, audit, treasury, and tax planning.
- 2004 to 2005 - Corporate Controller for Seon Design Inc., a specialist in the design and manufacture of video surveillance systems for mobile applications based in Coquitlam, British Columbia.
- 2003 to 2004 - Corporate Controller for BC Hot House Foods Inc., a leading North American company with head offices in BC, that performs grading, packing and distribution services for a full line of greenhouse grown products across North America, Japan, Hong Kong, and Taiwan.
- 2002 to 2003 - Controller for Intrinsyc Software International Inc., a BC-based mobility software and services company and enabler of next generation handheld products with clients and partners worldwide.
Mr. Yoon is a Certified Management Accountant and holds a Bachelor of Commerce degree from the University of Alberta and a Business Diploma
(Honours) from Lambton College of Applied Arts and Technology in Sarnia, Ontario. He is a member of the American Institute of Certified Public Accountants and also serves on the adjudicating board of the Certified Management Accountants Strategic Leadership Program. He is also completing his Masters of Business Administration from Queen's University, Ontario.
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2. NEW TOLL OPPORTUNITY WITH MAJOR INJECTION MOULDER IN WINDSOR, ON
JER has recently completed a production evaluation with a large injection molding company based in Windsor, Ontario. The customer is looking to JER to perform toll production of its proprietary wood plastic composite formulation for an undisclosed application. The opportunity is now scaling up with an initial 5000 lb pre-production trial in the second week of July. Assuming all goes well, the customer has indicated a requirement of upwards of 80,000 lbs per month ongoing.
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3. UPDATE ON LAMINATE FLOORING OPPORTUNITY
For approximately six months now, JER has been working with one of the largest hardwood flooring manufacturers in North America to evaluate JER's biocomposite panel boards as a moisture-resistant substrate for laminate flooring. In this application, JER's panel board material has been thoroughly tested and the Company has been notified that it complies with the customer's engineering specifications.
What makes this opportunity particularly exciting is that the customer is looking to develop a new product line designed entirely around JER's 5mm and 7mm panel board technology. This new line would be marketed as an environmentally preferrable alternative to traditional laminate flooring solutions that also feature some significant performance advantages, particularly for installations where moisture may be present (kitchens, bathrooms and basements).
Key personnel visited JER's production facility in Delta, British Columbia in mid-June to discuss production logistics. Initial production is expected before the end of the 2007 calendar year. If this opportunity comes to full fruition, the volumes required to meet supply requirements would require multiple panel board production lines running at full capacity.
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4. BIOCOMPOSITE PELLET LINES RAMPING UP
JER is pleased to report that its two biocomposite compound pellet lines in Delta, British Columbia, are working hard these days. With increased sales, the lines are now operating at two shifts with additional scheduled overtime and management is currently working on a plan for three shifts daily, maximizing their capacity.
Combined, the two lines are capable of producing up to 3800 lbs per hour, or approximately 83,600 lbs per day operating for 22 hours over three work shifts. JER is now in the process of hiring experienced producton line managers and operators to fulfill the additional workshift.
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5. FACTOID: THE IMPORTANCE OF BIOCOMPOSITE DRYNESS
Much of JER's intellectual property centers around the interface between the organic fibre and the thermoplastic matrix of its biocomposite compounds, and specifically on the inherent dryness of the finished product.
A high degree of dryness is important because it enables a better bond between the hydrophilic (water absorbing) organic fibre and the hydrophobic (water repelling) thermoplastic matrix, which is particularly important for biocomposite formulations with high fibre
content. The result is a decreased hygro-sensitivity (better
moisture resistance) in the finished compound, which means improved long-term performance, integrity, and resistance to environmental factors such as fungal growth and microorganizm infestation.
JER achieves very high levels of biocomposite dryness through a patented chemical reaction that occurs in the production process.
Using a chemical process rather than a mechanical process for drying has a number of key advantages:
- It enables a lower-cost, simpler and faster manufacturing process.
As no external drying equipment is required, JER can manufacture its biocomposites with fewer steps, less labour, and lower capital equipment costs.
- A chemically-based drying process is also much safer. Whenever an extremely dry, flammable material of a fine particle composition is used in manufacturing, there is an increased possibility for fire and even a dust explosion. This can occur when airborne particles reach a critical saturation point and then come into contact with an ignition source - a combustion chain reaction quickly occurs and the result can be devastating!
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6. NEW OPPORTUNITY WITH FENCING MATERIAL MANUFACTURER
JER is currently working with a large US-based manufacturer of fencing materials to test its wood-thermoplastic biocomposite technology for an injection-molded fence end cap application.
The manufacturer has placed a trial order for one gaylord (1300 lbs) of JER's 905 formulation, which is based on pine wood flour. This is the first time the manufacturer will be using wood-thermoplastic biocomposite compound as an alternative to pure polymer. The customer is interested in offering an environmentally-preferrable end cap solution to its customers.
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7. ORDERS GROW WITH SOUTH CAROLINA EXTRUSION MANUFACTURER
Over the last 60 days, JER has supplied 320,000 lbs (8 truckloads) of its proprietary wood-thermoplastic biocomposites to a large manufacturer of extruded decking products in the United States. The orders are comprised of the company's standard pine-based formulation as well as two new formulations using oak and maple wood flour to provide a different appearance as well as a much harder finished material.
JER's relationship with the customer to-date has been outstanding and JER has met all production requests during this significant and important ramp up phase. Overall potential from this customer alone is estimated at 320,000 lbs per month.
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8. ADVANCING BUSINESS WITH US-BASED EXTRUSION COMPANY
JER has been working for a number of months with a US-based manufacturer of extruded parts destined for the gardening industry (the exact application for JER's biocomposite is confidential). The client is currently a supplier to one of the world's largest retailers of home building products. JER is pleased to report its wood-thermoplastic composites have been performing well for this application, and the client has indicated a potential for approximately 2 truckloads monthly (80,000 lbs) on an ongoing basis.
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9. JER CLOSES FIRST TRANCHE OF BROKERED PRIVATE PLACEMENT
On June 20, 2007, JER announced that, further to its brokered private placement announced on April 11, 2007, the Company has closed the first tranche (the "First Tranche") of the private placement, representing 3,420,367 Units for gross proceeds of $2,052,220. The total offering (the "Offering"), the balance of which will be conducted on a non-brokered basis, is up to 8,500,000 units ("Units") priced at $0.60 per unit for gross proceeds of up to $5,100,000.
For more details, download the full news release:
jerenvirotech.com
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Comments or questions? Do you know anyone else who should receive this or future updates? Please contact:
JER ENVIROTECH INTERNATIONAL CORPORATION
Investor Relations:
Mr. Mark Komonoski
Vice President of Corporate Communications Toll-Free (US & Canada): 1-877-255-8483
Worldwide: +1 (403) 470-8384
E-mail: mark@jerenvirotech.com
TSX VE: "JER" | Frankfurt Stock Exchange: "KFTB"
You received this monthly INVESTOR NEWSLETTER because you are a member of JER's investor e-mail list. If you do not wish to receive this publication, please reply to this e-mail and ask to be taken off the list. You can also contact Mark Komonoski at mark@jerenvirotech.com or toll-free: 1-877-255-8483.
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This INVESTOR NEWSLETTER contains forward-looking statements within the meaning of the "safe harbor" provisions of various Canadian and US legislation. These statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward looking statements.
The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this publication. |
