Well, I'd say that the majority of my comments came from observations of BIOA's Income Statement rather than from its Balance Sheet, as one can see from the 3 links I posted.
However, be that as it may, what will ultimately be of interest will be the ratio of BIOA's Revenue to the various costs/expenses that it will incur after all its planned plants come on stream.
If we look at its Balance Sheet we see an existing negative "Retained Earnings" of -$149 million. That's likely to go up in the medium term until such time that BIOA starts to report Bottom Line profits.
If we take someone like Buffett's preferred ratio of CoS/Revenue to be >40% and we work backwards from a zero Bottom Line number, i.e. break even, and assume no tax deducted (probably unlikely), and all its current ratios stay much the same, then its Pretax Income would need to be about $34 million (based on its last Annual).
Therefore its Gross Profit would need to be in the order of about $(~41('Operating Expenses')+$34))million = ~$75 million.
That could then be translated into a top line Revenue in the order of $75mil./40% = ~$188 million Annual Revenue just to break even.
Once it needs to start paying Corporate Tax in the region of, say, 25%, then its top line Revenue would probably have to be somewhere in the region of about $250 to $280 million in order to start showing a decent Bottom Line profit, in order to start reducing that negative Retained Earnings number on its Balance Sheet, and to also be able to pay its shareholders a dividend.
Of course, when its gross Revenue is up there at about $188mil., then its SG&A plus R&D, will very likely be higher than they are currently. So $250/280mil. may be at the bottom end of its future Revenue requirement.
If it gets to that stage in its business then I'm pretty sure one will see a reasonably consistent upward trend in its share price.
If my numbers are acceptable, and based on what BIOA show in their chart, "Our Vision: a Path to $1 Billion in Revenues", that $250/280 million, or greater, is only likely to kick in somewhere between 2016 and 2017, provided both Sarnia and Plant 2 are on stream and producing at "Full Capacity" (to quote BIOA management).
Until then ..... ?? |
