"2 months to assemble the FIRST modular unit including taking down and moving the first one to make room (according to the CC) doesn't seem too bad to me"--Rawnoc
The 10-K does not, in my opinion and from what I've found therein on the topic, insinuate that part of the 8 weeks needed to install the processor was devoted to re-arranging the 1st processor. Here's the only comment I've thus far found in the 10-K on the matter:
"The second processor was fully assembled from rack modules in approximately 8 weeks."--p. 6.
The rollout is going to be much slower than most of us anticipated, and the "plug and play" notion needs to be dropped in my opinion as it does not reflect the reality of manually installing the units as a whole. Yes, they will get somewhat quicker at installing them. But, then again, unless JBI intends to have multiple traveling crews for installing these processors, each new site will, presumably, entail hiring local workers working off of blueprints for a one time installation.
How long did it take to erect the new prototype 7200 sf building including pouring the slab? My sense is it was 10 weeks minimum as the slab may have to cure longer than normal given its intended use. Then add 8 weeks for "1" processor unit. Presumably they will get to the stage where they can install 3 processors at once and hence get a fully operational prototype up in about 3 months. This, however, does not include getting all the requisite permits.
Q1 sales will be a huge advance. But the company is totally strapped at present in terms of manufacturing capacities. Here's how the 10-K explains it (which I know you've already seen, but thought I'd posted for others who may not have):
"We have limited internal capacity to manufacture our P2O processor components. As a result, we are dependent upon the performance and capacity of third party manufacturers for the manufacturing of many components of our P2O processor.
We do not currently rely on any primary contract manufacturer to produce the components of our P2O processor. However, we expect that as we begin to build additional P2O processors, we will need to rely on particular manufacturers for specific P2O processor components...."
"If we require additional manufacturing capacity and are unable to obtain it in sufficient quantity from our current manufacturers, we may not be able to meet our obligations to construct P2O processors, and we may be required to make substantial capital investments to build that capacity or to contract with other manufacturers on less favorable terms. If we build our own manufacturing capacity, it could take a significant amount of time before our facility is able to produce a sufficient volume of P2O processor components. In addition, if we contract with other manufacturers, we may experience delays of several months in qualifying them, which could harm our relationships with our partners or customers and could negatively affect our revenues or operating results."
"We are working to establish long-term supply contracts with contract manufacturers and are evaluating whether to invest in our own manufacturing capabilities. However, we cannot guarantee that we will be able to enter into long-term supply contracts on commercially reasonable terms, or at all, or to acquire, develop or contract for internal manufacturing capabilities. Any resources we expend on acquiring or building internal manufacturing capabilities could be at the expense of other potentially more profitable opportunities" (p. 27f).
These, in my opinion, are formidable stumbling blocks, and ones that cannot be solved just by getting a chunk of money to work with. They entail at least two different trajectories: one is outside sourcing; the other is building inhouse manufacturing capabilities that will take a considerable amount of time to build. The plus of outside sourcing is that it can start delivering parts sooner. The downside is pricing may go up, and the Company may have to disclose more information than it wants to to such third party manufacturers.
Yet however one cuts it, in seems to me the gist of it is the rollout is going to go much slower than what many of us thought it would, myself most definitely included. I also think it's important to realize when the Company said that "The second processor was fully assembled from rack modules in approximately 8 weeks," that that 8 weeks does not include the amount of time it took the fabricators to get the pieces into modularized units, nor the amount of time it takes JBI employees to assemble the key components they currently are doing inhouse.
Perhaps you or others have more precise information, but from what I've thus far seen and from what I recall from the recent cc, it seems processor #3 is still in the stage of getting assembled into modular form. If so, then whenever that's finished we need to add another 8 weeks onto that before #3 will be operational. Hopefully that doesn't mean that the other two processors have to be shut down for a long stretch during that 8 weeks of installation. If so, it suggests that going forward it might be most economical for the Company to install 3 processors at the same time at RKT sites rather than trying to get one operational, then two, and then three. If so, this will be yet another factor slowing down the rollout given how long it takes to make one processor/plant. It also will require more up front capital. The fact that, according to Tykundegex's post #171441,
"Nearly all of our anticipated P2O revenue for fiscal 2012 will be derived from the sale of fuel that we produce at the Niagara Falls Facility"--from 10-K
might suggest that RKT is intending to give JBI financing, but they want to see a full functioning prototype up and running at full capacity first. If they can start installing processor 3 on April 1st, then it should be finished by July 1st. Run all three at full capacity for 30 days and it's August 1st. That only leaves four months to get the first RKT site up in 2011. Sounds rather unfortunate, but nonetheless is in accord with where management anticipates revenues coming from in 2012.
On a more positive side, it was great to hear that "The processor does not require further modifications and therefore our focus going forward is to maximize fuel sales and build more processors"--(p. 6). That's a huge milestone to have behind them. Obviously, too, the fact that the whole thing only costs about $800k including the new pre-melt is fabulous. It's certainly nice, too, that the market evidently had already priced in Q4 as what it was: a developmental quarter.
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