FBR Limited

ASX:FBR

FBR Limited

ASX:FBR
TradeAdd trade order Follow Unfollow Set Price Alert
$0.026 (+4%)
Last close price
#363
Rank
1
Held by
12
Followers
TradeAdd trade order Follow Unfollow Set Price Alert
Reports (1) My Report Forum Investors
Forum Topics FBR FBR Financials and USA demo-build

Pinned straw:
lastever
Added 2 months ago

https://www.fbr.com.au/upload/pages/20240228091001/2687507-half-year-accounts.pdf

There's a state-of-play at the top of the financial report.

They are waiting on delivery of their second-generation robot (from Germany, I think), to be attached to a US truck chassis and sent to Florida to demo-build the walls on 5 to 10 residential houses. Timing is unclear but as soon as possible.

They have already built the walls on 15 or so residential houses in Perth.

They have a binding agreement with CRH, a construction entity in the USA and Europe. Successful completion of the Florida builds would trigger the ordering of 20 truck-mounted robots at $40 million.

I just hope this is real and that the patents are solid. But since Brickworks are a significant shareholder, I am tagging along for what could be an interesting ride.

I don't know what the value should be, but I can't help imagining more than $100 million if the story is legit and developers like the product.

It would be good to hear from any home builders about first impressions and any practical considerations. There are some videos on fbr.com.au and youtube.
Rudyboy
2 months ago

I have been to FBR and seen the machine in action a couple of years ago. Potential is obviously huge, particularly where they build cookie cutter homes as in the US.

The patents are strong, but bear in mind it has been a long road to here with many iterations to get it working well. The hydraulics and placement technologies are key.

Having Brickworks and by inference WSP certainly helps, but having built and run a technology company in Perth, it's a very tough road to commercialisation of anything.

I suspect still a year or two until meaningful revenue, but who knows.

7
rh8178
2 months ago

I did a little bit of research recently on this one. I agree I think it’s a very interesting technology with potential. My concern here is potential dilution to get to revenue/break even - as they are still losing money at a significant clip. I don’t think this bothers Brickworks as they don’t appear to be looking at it through their normal rigorous investment lens but as a way to increase efficiency in their traditional brick business. Worth watching though.

8
lastever
2 months ago

Yes, they indicated that there would likely be further dilution. Do you happen to have an idea how it would affect price when balanced out by an apparently real landing in the USA and a binding agreement for 40 fully funded trucks? Are there analogous business stories we could compare this to?

I have zero understanding of the practicalities of fundraising but I'm wondering if, after some houses are built to code in Florida other funding avenues might open up.

6
rh8178
2 months ago

Hard to say - but the current cash burn (c. $35 to $40m p.a.) means that at a market cap of $100m it could be significant. Lost $20m last half. Cash at 31/12 was $5m + $12m raise in Jan less cash burn would give you current cash of approx. $10m (give or take) at the moment.

It's not clear what cash flow will come from the US JV and on my quick read it's silent as to timing of sales and milestones (they left most of the timing out of the slides - probably because they don't have certainty and don't want to put a target on their back). From the terms it looks self funding anyway - down the track if successful could be material though.

So real question is this, how long will it take the US JV to get to cash flow positive. And after that, can the cash flow in the US meet the cash burn here or cash burn in Australia be reduced (or ideally both). Because on these numbers - you'll need to issue share cap of 3% of the company just to meet the monthly cash burn on current rates - and that's a lot.

10
rh8178
2 months ago

Further to my comment above - another couple of month's cash burn covered with a $9m ATO R&D refund, announced this morning. Question still remains how much cash flow can US generate and how much cash burn can they curb to avoid a raise? BTW in my view a raise doesn't necessarily mean its not worth investing in, just need to bring it into your assessment of value when you consider what the business might be worth.

Discl - I don't hold IRL or on SM.

5
TomS
2 months ago

Very interesting company and product @lastever... I might have to look a little deeper into this one.

5