@stockrockYour financial analysis is a lot stronger than mine,...

@stockrock

Your financial analysis is a lot stronger than mine, but I believe that Fluence are already counting the expected $3.5 million NADB disbursement as part of the $24.1 million USD in cash receipts for Q2. Think that net outflows will be $6.5 million as forecast.

I would be rapt with only $3 million in net cash outflows in Q3 though.

In terms of BOOT finance, I was excited to see this line show up in the Annual Report.


BOOT finance is so important moving forward, that we now have a financial subsidiary LLC arm dedicated to it.

The $50 million facility from Generate Capital allows Fluence to streamline the financing of projects in-house, and allows them to make margins on the project construction and equipment sale side, plus on the water sale side as well. The $50 million in available capital also has a multiplier effect, as the initial size of the project wins equaltes to much larger long term revenue.

For example. The Peruvian $8.4 million USD plant is leading to a 10 year WPA, for $1.7 million USD in recurring revenue.
If 75% of this was funded by Generate Capital, a $6.3 million drawdown (plus $2.1 million cash investment by Fluence) would lead to $17 million USD in recurring revenue over 10 years. The plan is for this plant to expand with additional WPAs up to $5 million USD in annual recurring revenue.
So technically we could see a future 10x Nirobox plant, with an investment of approx $13.4 million USD, funded by $10.05 million from Generate Capital and $3.35 million Fluence cash, leading to $50 million USD in recurring revenue over 10 years.

I'll take my liberties and extrapolate this out a bit, but if the full $50 million from Generate Capital was utilized as above, Fluence could technically generate approx $250 million USD in recurring revenues from BOOT sales, only using $16.75 million of actual cash. Obviously there are also some other costs that need to be accounted for in the cost of maintaining the plants over 10 years (electricity, maintenance, staffing, replacement parts, etc). But Fluence will also get direct up-front benefits (25% gross margins on Nirobox sales into the BOOT structure), inventory turnover, long term revenue visibility/stability.

Using the above figures, the new Fluence BOOT Finance LLC subsidiary over 3 years, has the potential to generate approx $66 million USD in project wins, plus approx $250 million in long term recurring revenue, with required capital injection of approx $20 million.

The mix of projects won and lengths of WPAs, as well as the region in which they are won will determine the final ratios of initial investment vs recurring revenue, but I think most can see the potential of this structure and the contribution this could have to overall revenue.