I've seen it for a few clients who are SMEs and not very labour intensive. Beyond that I have seen it for a few companies with quasi monopolies and disruptive technologies. A a state owned rare earths miner in China comes to mind.
AJX definitely doesn't fall into the SME category. Disruptive technologies - maybe. However I don't see margins at 70%, across the entire business, especially to start with. One thing is for sure though, the business runs mostly on fixed overheads, so the more volume is sold, the lower the overheads per tonne. Given that we do have a bit of IP benefit/disruptive technology in here I reckon 50% margin is feasible, albeit below what Nick once quoted.
