I spent a few hours looking at Fastbrick today. There I said it. Judge me all you like but I feel better having shared that.

I don't really know what compelled me but I'm pretty sure @lastever cops some of the blame. I want to shoot myself for saying this but it could have been worse. Don't get me wrong, looking back it's been an enormous pile of choice excrement, whose greatness at torching cash and diluting shareholders is its singular most impressive feature. Just take a look at this graph of share capital, operating cash and earnings over the last decade.

Free cash is even worse! It's the classic meme stock. About 2 minutes of the time I spent looking at it I spent on HC, and I needed to get hosed down after. But...but...but...the robot is rad. No, it really is! Some of the Transformers are shitter than this thing. Obviously not Optimus Prime, but it's way cooler than Wheelie and Broadside. You can see it working here.

Also, it's doing a paid proof of concept in the US with CRH Ventures, who are what is officially known is the biz as A Player. Now even if they pass all the milestones they will only receive $2 million, which this very generously paid management team can spend on a coffee run. But successful end of the POC triggers an option period, which if triggered would lead to the establishment of a JV with CRH, funding for the JV and a path to up to 300 of the next gen Hadrian X trucks being ordered. That represents income circa $700 million in the US alone. That's a lot of coffee runs!

What I'm not sure of is what the incentive is for builders. Is it going to be cheaper than using labour? Or is the proposition more around time savings and availability? Or is it all of the above. What are unit economics? Will they build and operate or licence it out? Do I care enough to find out?

@Strawman do you think we could ask them in? I know, I hate me too!

The first US formality, building a small structure in a controlled setting, has been completed. Over the next few weeks, the building of real house walls will begin as part of a demonstration for 3 US building companies in Florida.

With a little luck, this will win eyeballs in the USA, and with significantly more luck, CRH Ventures will see enough industry interest to be convinced that it should fund a US joint entity - for the production of further robots to become a 'walls on call' building contractor.

https://www.fbr.com.au/view/investor-centre

Disc: I own shares IRL.

FBR halted on Thursday for an institutional share placement announced today of $12m. The discount was 20%. Bell Potter scored $720,000 for their pain and suffering.

This leaves FBR with cash balance of $16m explicitly to see them through to the anticipated exercising of joint venture option with CRH Ventures. It brings on board some (presumably US-based) international shareholders.

The shares will be tradable on 9 August.

I’ve heard people describe FBR as a story stock. Well, this is a very interesting chapter.

Mike, the CEO, is a good salesman when he gets going and he does in this interview. He’s transparent that he doesn’t know exactly what the next chapter will look like. 

https://www.therobotreport.com/advancing-the-world-of-construction-robotics/

Time stamps:

23:40) Background, technology, benefits to builder of locking in a price and time for his walls, hopes and dreams for global adoption.

56:20) Upcoming Florida demo builds of 10 houses in the next 4 to 8 weeks for 3 well known building names, to be witnessed by industry and US investors.

‘From there some decisions are going to made…we are going to gauge the interest…

…The question is: If this machine was available, if you could order your walls from a service provider at a known time and price, would you use it?

If the answer is yes, then we will put things in place to order the first 20 machines.’

My take:

This is the end of the beginning for FBR. I think the odds are favourable that the technology will find a partner or a taker. US google searches for FBR are just ticking up.

P.S. One quirk of the way this robot lays blocks or bricks which it took me some time to grasp - at present, the walls need rendering after (because adhesive is applied to the tops and bottoms of blocks, but not the sides, and perhaps the adhesive drips). In Florida, rendered ‘stucco’ block walls are the standard.

You also need space for a truck within 30m of the walls. I’d be glad to hear if someone spots anything else, I am not a builder.

FBR have one month of cash left and are exploring their raise options, including non-dilutive. The quarterly notes ‘for the avoidance of doubt, this process remains ongoing and incomplete’. They also have some RnD grant funding that they get an advance loan on.

Meanwhile the market cap has doubled. Obviously, this is because their situation is ‘interesting’ rather than ‘dire’. They have many solid stakeholders who want them to succeed, including Brickworks, CRE Ventures as a US construction industry partner and Liebherr as the presumptive manufacturer and service centre operator.

They need economies of scale to operate their ‘wall-as-a-service’ business concept (which is why they could not find a partner in Aus). Florida’s home builder market is a bit different, they can have large development sites. So Florida is FBR’s chosen launching ground and they have a couple of demo hoops to jump through before CRE Ventures considers going 50/50 with them on their US adventure.

I am operating on very basic reasoning as I HODL. Management appear better at inventing and engineering than on managing a listed entity. However, their invention could be a game-changer. They have recently taken on a new board member with experience at relevant OEMs including Liebherr and Hitachi, and at Bisalloy Steel.

Seems to be something going on perhaps....i cant find any news

FBR has listed on OTCQX in the USA. Not entirely sure what that means for the SP but it's setting the stage for something.

I know this company is basically a gangly teenager, but it looks to me like they do have some coordination skills.

Note that their next big event will be a demo build in Florida, and their manufacturer, Liebherr, has a service centre in Florida.

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.

FBR is c. $110m market cap - Just announced what looks like a significant JV in the US with a builder. The company is still yet to turn a profit (or revenue for that matter), so from my perspective a bit too early for me and I don't hold here or IRL - but still researching and monitoring.

My initial thoughts are:

Positives - founders still have reasonable stakes and still involved in the business, Brickworks the main shareholder at c. 20% and have lifted it recently, FBR appear to be doing successful trials in WA and now have a new deal in the US. Provides some interesting productivity benefits for builders/developers (I'd be interested what it can do for builder margins/prices) and the possible market is huge - basically the market could be most new brick builds (not sure what size market that is though?).

Risks - announced a new cap raise today, and still making losses (c. $20m last year), so likely future raises and dilution a possibility - given cash was $13m recently and just raising $12m could need more raises before it turns cash flow positive. The deal in the US looks exclusive so have they tied themselves into the right party (and if not, how easily can they get out).

Is anyone else following and have further thoughts - I'll post more as I find out more,

Rich

Positive Commentary in the Brickworks AGM release today...

@BKW

FBR Limited is an Australia-based robotic technology company. The Company designs, develops and builds stabilized robots to address global needs. The Company’s robots are designed to work outdoors using the Company’s Dynamic Stabilization Technology (DST). It is commercializing products for the construction sector together with DST, which enables solutions for other industries. The Company has built a bricklaying machine, Hadrian X. The Company's Hadrian X builds block structures from a three-dimensional (3D) computer aided design (CAD) model, producing less waste than traditional construction methods while improving site safety. Hadrian X provides Wall as a Service (WaaS) to deliver erected walls to customers, including builders, contractors and government bodies.

Overview:

FBR Ltd (FBR, formerly Fastbrick Robotics Ltd) designs, develops and builds stabilised robots to address global needs. These robots are designed to work outdoors using the FBR's Dynamic Stabilisation Technology. FBR is commercialising products for the construction sector together with DST- enabled solutions for other industries. The first application of DST is the Hadrian X, a construction robot capable of building the walls of a structure from a 3D CAD model.

Hadrian X:
Hadrian X is a unique construction robot mounted into a classic cab over engine truck to easily transport it to and from a location for on-site building. Using FBR's Dynamic Stabilisation Technology (DST), Hadrian X measures movement caused by wind, vibration and inertia and counteracts it in real time using advanced algorithms to provide precision. Its unique control system uses CAD (Computer-Aided Design) to create a 3D model of the building design, which is then used to calculate the materials list and tell Hadrian X what to build - all with precision. Hadrian X builds walls using the Fastbrick Wall System, made up of uniquely designed blocks and adhesive for continuous construction. In July 2020, the first display home built by an end-to-end autonomous bricklaying robot anywhere in the world was completed in Dayton, a residential suburb in Western Australia. The Hadrian X built a 3-bedroom, 2-bathroom home in Dayton on a site bordered by 7 occupied homes with an average lay speed (during up time) was 146 blocks per hour, or 671 standard brick equivalents (SBEs) per hour. Further in September 2020, Hadrian Xr had completed the structural walls of a commercial and community centre in Byford, Western Australia. This was the first non-residential structure the Hadrian Xr had built, and the first time the Hadrian X had built both the internal and external leaf of a double brick cavity wall with a slab step-down with an The Hadrian X achieved an average laying speed during uptime of approximately 174 blocks per hour, or approximately 800 SBEs per hour.

Observation:

FBR, I saw these yrs ago at 0.20c so not much fabrication going with profits and share price here.