Thanks, Rex, for checking that the IC funding is not free cash...

Thanks, Rex, for checking that the IC funding is not free cash but for working capital for the IC project.

Let me try to explain the business as best I can as a layman.

The fact that FLC has arranged, and secured financing, from The Israeli and Italian export import banks is a feat in themselves. Being able to meet the challenges of an EPC (engineering, procurement, construction) AND securing funding on top of designing, construction, procurement and engineering is a major feather in FLC's cap. It's a very rigorous process which explains why design to construction to delivery will take 5 to 10 years to complete. Mind you, a project of this size (Euro 165m) is not small for a company of FLC's size. Major players who take on these EPC roles are usually 10 times FLC's size before it is viable.

To reap the full economic benefits of the project, EPC players try to latch on BOOT (Build Own Operate Transfer) functions with EPC so that they can derive a stream of income for the whole of the 30 years over the operating life of the water treatment plant. That way, they stand to gain a stream of income PLUS gain from construction margins. To top off the cherry, EPC's try to secure a maintenance contract as well. That would make their sweat and toil over 30 years worthwhile.

For the record, FLC has only managed to secure the EPC portion of the project. A maintenance contract, usually worth about 20% of the whole construction, is still under negotiation will only be awarded once the construction is completed. The BOOT component is also not secured because I don't think FLC wants to take on the political risks.

Now, what is going to happen to FLC over the next few years will determine what kind of company FLC will be. If MABR is goint to be accepted further, and the decentralisation theme becoming a central theme, then FLC will be come a product company with greater velocity of sales, and less lumpiness in the EPC construction revenues. MABR now is where MBR twenty years ago. Membranes are the Intel chip inside every WWTP. It brings down opex and capex and increases efficiency for the plant. Hence, we really need Dupont's and Suez's help here. If MABR becomes widely accepted both in the east and west, then FLC's Aspiral and SUBRE will be more valuable and demanded by a MNC player, especially a player from China because it is so dominant there.

That is the long shot gamble that I am taking. As an investor, that is my exit strategy. GLTA.