Renewable Energy and Power Inc (RBNW)

[Lord_of_Trades]

10-K Analysis

Overall, the company is not yet profitable, but is certainly trending in the right direction. I fully expect the newly expanded contract with MDI to push them into the black this year, in addition to several other revenue sources that could formulate a large deal at any point in time (i.e., assisted living centers, mall lighting contracts, University JV's, etc).

Below are the numerical trends that support this conclusion:

Revenues: $633,529 - Increase of 4.9%

The primary significance here is to notice that 98% of this amount came from the prior contract with MDI. The new contract for 2016 is expected to increase this total by 57.8% to approx $1,000,000.

Gross Profit: $171,387 - Increase of 104%

This is the single largest takeaway from the filing. The company increased its operating efficiency by over 100% for the year. The remaining expenses deducted after gross profit are primary fixed expenses that should not fluctuate any material amount on account of the expanded MDI revenues. As such, one can expect the following:

Current Year Profit Margin: ($171,387 / $633,529) = 27%

New Profit from Expanded MDI Contract: ($1,000,000 - $633,529) X 27% = $98,947

Current Loss From Operations = ($91,284)

$98,947 > $91,284

Hence, operations should be profitable in 2016 based upon projected expectations. Keep in mind, this does not factor in any additional revenues from other projects and/or any further increases to operating efficiency.

Let me know your thoughts.

Good Luck to ALL

-Lord