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Barbados Sugarcane Executive Summary
Barbados Sugarcane Executive Summary
Figure 1.1-1
At the centre of this new operation will be the Tilby Cane Separation System which replaces the
traditional sugar cane crushing machinery with a much more efficient state-of-the-art cane
separation system that will provide high-grade feed stocks to numerous downstream value-added
processing facilities. Since, at the present time, there are no commercial Tilby Cane Separation
Systems in operation; Tilby Systems, Ltd is considering a joint venture. In addition, the plan
proposes an initial 50 ton per hour Tilby Cane Separation Trial System until its reliability and
commercial performance can be demonstrated.
To accomplish this task requires an infusion of funds from investors and/or lenders and evolving
the industry from producing traditional commodity raw sugar to producing predominantly cane-
based value-added products and services.
Capital costs to deploy all of the proposed options are projected to be US$191.68 million (Phase-
1 US$98.84 million; Phase-2 US$56.37 Million, Phase-3 US$36.47). The number of new jobs
created is projected to be in the 200 range once all of the proposed facilities are operational with
the completion of Phase-3. From the point that the decision is made to proceed and funding is
secured, the new integrated Phase-1 facilities can be operational within 18 months.
In an effort to have Phase-1 facilities operational in time for the 2005 sugar cane harvest
season an aggressive schedule had to be compiled as shown in Table 10.1-1 of this plan. Due
to the limited sugar cane harvesting window on Barbados and new facility installation lead
times, any significant delays in the proposed schedule will result in missing the 2005 sugar
cane harvest, delay the project by an additional year, and forego significant revenue streams.
CBET wants BSCIDI to be successful and believes that CBET’s Business Health Care Program
will add to the success of this plan.
1.3.2 Five-Year Revenue Forecast
The following five-year revenue forecast assumes that BSCIDI will start corporate operation
during 2003, however, Phase-1 production will commence with the 2005 sugar cane harvest. All
numbers shown are in US$ thousands (000).
$180,000
$160,000
$140,000
$120,000
Total gross sales
$100,000
Total cost of goods
$80,000
Total net sales
$60,000
$40,000
$20,000
$0
2003 2004 2005 2006 2007
$160,000
$140,000
$120,000
$20,000
$0
2003 2004 2005 2006 2007
-$20,000
$100,000
$80,000
$0
2003 2004 2005 2006 2007
-$20,000
1.4 Return on Investment
Investors are willing to make investments in business ventures as long as the risks are reasonable
and the returns on investment attractive. The following tables depicts projected rates of return on
investment (50% of net earnings distributed in dividends) based on optimistic, most likely and
pessimistic sales projections. Table 1.4-1 shows rates of return based on 100% equity financing.
Table 1.4-2 shows rates of return on investment based on 30% equity financing and 70% long-
term debt. This does not take into account any potential stock price appreciation:
Table 1.4-1
Fiscal Year 2003 2004 2005 2006 2007
Optimistic (+15%) 0% 0% 20.34% 17.57% 16.11%
Most Likely 0% 0% 15.88% 13.50% 12.42%
Pessimistic (–25%) 0% 0% 8.44% 6.72% 6.27%
Table 1.4-2
Fiscal Year 2003 2004 2005 2006 2007
Optimistic (+15%) 0% 0% 61.65% 54.25% 50.21%
Most Likely 0% 0% 58.52% 47.17% 39.20%
Pessimistic (–25%) 0% 0% 21.99% 18.08% 17.39%
Details associated with this plan are presented in the following sections: