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Resin Systems announces initial order for the application of its Version(TM) resin in the industrial sector 4/26/2005
EDMONTON, Apr 26, 2005 (Canada NewsWire via COMTEX) -- Resin Systems Inc. ("RSI") (RS - TSX Venture / RSSYF - OTCBB), a composite materials technology company, through its operating division, RS Technologies ("RS"), is pleased to announce that it has received a multi-year, multi-million dollar order from Inline Fiberglass Limited ("IFL") of Toronto, Ontario, Canada, to supply Version(TM) resin for the manufacture of industrial conveyor system rollers. IFL will use a pultrusion process to manufacture the rollers, applying technologies and dies jointly developed by IFL and RS. Regular full container shipments of Version(TM) resin are scheduled to commence in early July 2005, and continue for a minimum of three years. The frequency of shipments will be a minimum of one full container of Version(TM) resin per month and will increase to meet production and schedule requirements.
Large industrial conveyor systems are commonplace in open pit mining operations or where large volumes of earth and/or rock are moved great distances. Historically, the majority of heavy industrial conveyor rollers have been manufactured with high quality steel pipe. Management of RS believes that rollers made from its Version(TM) resin composite material will gradually replace the steel pipe used in the manufacturing process as end users will enjoy an immediate and significant reduction in conveyor operating costs as a result of the conversion, including (i) operating cost savings resulting from using less energy to operate the significantly lighter Version(TM) resin rollers as compared to steel rollers, and (ii) reduced maintenance cost savings resulting from Version(TM) resin being maintenance free and not impacted by the natural elements such as rain, snow, moisture, temperature, etc. The conversion from traditional steel rollers is only possible because of the unique superior strength and impact resistance properties of RSI's proprietary Version(TM) resin.
The end user of the composite rollers to be made by IFL is KWB SA Kopalnia Wegla Brunatnegro ("KWB") located in Betchatow, Poland, the largest open pit mine in the European Union. KWB mines in excess of 35 million tonnes of coal annually, all of which is used as a source of energy for an adjacent 4,000 megawatt thermal power plant. KWB is the largest member of a multi-coal mine industry group in Poland and is known to be a leader in new mining process applications. Currently, the KWB mine alone operates in excess of 90 kilometres (56 miles) of industrial conveyors which require more than 600,000 rollers. The manufacture of each composite roller requires approximately 4 kilograms (9 pounds) of Version(TM) resin. KWB has initiated a conversion program which will see the existing steel rollers replaced with rollers made from Version(TM) resin over the next three year period. Due to KWB's desire to begin the conversion program immediately, initial manufacturing will commence in IFL's existing facilities in Toronto and will continue in Poland as soon as local facilities are commissioned.
IFL is a major global composite materials pultrusion fabrication company, specializing in "thin wall" pultrusion manufacturing. IFL is continuing to actively integrate Version(TM) resin into its comprehensive range of composite building and industrial products. IFL is headquartered in Toronto, Ontario, and provides the global marketplace with composite material products.
RS is a composite material products technology company providing engineered solutions to applications of its proprietary Version(TM) resin material on a worldwide market basis. RS is also commercializing its RStandard(TM) modular composite utility pole for sale to power utility companies domestically and abroad.
"Version" and "RStandard" are trademarks of Resin Systems Inc. For more information
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this release.
%SEDAR: 00011122E
please contact: Greg Pendura, Chairman, President and Chief Executive Officer, ResinSystems Inc., Phone: (780) 482-1953, Fax: (780) 452-8755, Email: gregp@grouprsi.com,www.grouprsi.com; Grant Howard, Investor Relations, The Howard Group Inc., Phone:(888) 221-0915, Fax: (403) 237-8387, Email: grant@***********inc.com,www.***********inc.com Copyright (C) 2005 CNW. All rights reserved.
Posts: 9 | Registered: Dec 2004
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CC tomorrow!!! Listen in , chart has bullish crossover, last new release showing massive revenues coming for this hot smallcap, a double from here near term not out of the question, this stock has a bright future imho:
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moving up nicely on news yet again today...
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As an alternative to the pointless, perpetual bashing, I have put together a summary of the conference call from what I heard. If anyone heard differently, or has some additions, or otherwise has any kind of meaningful thoughts or analysis, your input would be more than welcome. The three areas of business were addressed:
1) Filament winding - RStandard utility poles
Big change in 2004 was switch from distribution to transmission. Because Resin would no longer be stocking inventories at distribution companies that serviced customers, and the need now is for Resin to have a direct link to the customer and to service the customer directly, existing agreements had to be discontinued. The agreements have been replaced by these companies being able to purchase product on a purchase order basis.
500,000 poles in North America are currently replaced or new. When the Calgary plant is up and running, they will be able to meet less than 3% of that potential. By 2007 the Calgary plant will be able to double that (less than 6%).
And so, Resin is focusing on 100 customers that make-up 90% of the total market. Resin is on track to have them all on-board within two years.
For the International market, focusing on Europe, Asia, Middle East and Australia, and all have advanced discussions and announcements are forthcoming. Australia is a case-in-point, as an agreement was announced that morning. Australia has a 300 million dollar market in maintenance and new utility poles. Australia has a shortage of wood and needs help in upgrading infrastructure.
The plan is to dedicate the Edmonton plant to target the Australian market till the end of 2006/ beginning 2007 (when they will have their own equipment up and running).
The Edmonton plant can produce 300 Kg/hr, and will grow to a max of 350 Kg/hr, or 1500 tons annually. The Edmonton plant can produce module 6&7 “light” utility poles, 32 meters (105 ft). Mostly, Australia needs only module 1 to 5 utility poles.
The timeframe for the new Calgary plant is just 10% off-schedule. Final delivery of equipment is scheduled for the latter part of June. The Calgary plant can produce utility poles past module 6&7. The initial focus is to produce module 8&9 utility poles, at 40 meters, or at 32 meter with stiff/high load characteristics. This will be accomplished in the 3rd quarter. This is required by most domestic customers as it is the basic transmission pole need.
By the middle of the 3rd quarter after commissioning and producing test components, the Calgary plant will be producing 1000 Kg/hr.
By the 4rd quarter the Calgary plant will be producing 2000 Kg/hr.
The plan is to have the Calgary plant producing 4000 Kg/hr by early 2006, which will help satisfy off-shore needs.
UV protection has been developed and is being patented.
Areas: Pressure plates, building curtain wall construction (news release); Window frames, housing, rollers (recent news release), routing pipes. Resin is in the process of retooling, and is looking at 90 days for delivery.
Resin is capable of producing 1000 Kg/hr of Version, or 20 Containers/month.
This is a growing business. Starting the 3rd quarter, Resin already has 20% of that capacity in-hand in the way of orders.
3) Molding - Boat hulls, Industrial trailers.
Basically now in R&D. By the middle of 3rd quarter R&D will be completed.
Projections:
For the rest of the 2nd quarter, Resin will generate little revenue.
During the 3rd quarter, revenue will start.
For the 4th quarter, Resin will generate in excess of 3 million in revenue.
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Key Business Elements Rapidly Falling Into Place
The key event this past month was the recent conference call of May 3rd with RS Technologies CEO Paul Giannelia covering events of the first quarter as well as a look into the future.
Before discussing the teleconference, we'll first comment on a news release that was issued two days later. On May 5th. RS announced (click here) that it secured an order for an "initial shipment of its RStandard™ utility poles for the Athabasca Tar Sands".
It would be very difficult to find anyone who hasn't heard of Alberta's Tar Sands based on its enormous oil reserves and the billions of dollars that are being invested in the area for new plants to enhance production from the current rate of several hundred thousand barrels per day. While the news release doesn't say so, it is our understanding that these will be the first composite power poles in the Tar Sands! These are 60 feet in length and will be shipped "within 30 days" for "one of the largest oil sands plant operators in the Athabasca oil sands region". For those who have been paying any attention to the ongoing development of the massive area in Northern Alberta, it has been made abundantly clear that government and industry have no choice but to spend hundreds of millions of dollars on infrastructure projects. These issues have been well publicized. Power generation is a critical element to the ongoing development of the area.
This begs the question as to what else RS is working on in regards to the Tar Sands. Unfortunately, we can provide no further comment but are hopeful that there will be additional news not too far down the road.
Now to the matter of the Q1 update teleconference. The first item on the agenda was the 2004 year-end results. There were no surprises based on the Company "transitioning from an R & D organization into commercialization". In short, RS lost $0.23 per share ($14+ million) on revenues of several hundred thousand dollars. $6 million was attributable to more than $6 million in capital expenditures and a $2 million write down on inventory and old equipment.
We use the term "no surprises" as certainly no one that we have spoken with expected anything more than a substantial loss in 2004. Based on the fact the stock actually moved up to a $1.49 from $1.25 over the past four weeks, our belief is reinforced that shareholders did not plan for anything other than what was reported.
Mr. Giannelia stated, "RS will be a cash user in Q2 and Q3 but in Q4 will be cash positive". While he wasn't more specific on expectations, we refer you to last October's webcast and conference call, where he stated that RS was a year behind its previously stated projections. At that time, the Company expected to generate approximately $23 million in sales in 2004. We feel RS is now looking to that revenue level for 2005.
As we are looking for very little in the way of revenues in Q1 and Q2, Q3 should see a marked escalation in sales and a several fold increase in Q4.
On the basis that management's expectations are realized, it is our feeling that the RS story will become very different as compared to today. No longer would there be questions about the Company's ability to sell its products and technologies. The anticipation would be focused on the organization's ability to handle what would be "stunning" growth.
In short, what shareholders have been waiting for should be in view. By mid-November, with the reporting of the Q3 results, it will become apparent if years of work are now translating into returns that all have been awaiting.
However, well in advance of this time frame, the market should have more than a feel for what the future holds, based on contracts and agreements that will be announced in the coming months.
To meet expectations, the new manufacturing facility in Calgary, Alberta is crucial to the future. It was stated in the teleconference that the facility will be fully operational early in Q3, as compared to the initial expectation that this would occur by the end of June. When the switch is pulled, the first production line will be capable of manufacturing 1,000 kilograms (2,200 pounds) of RS modular poles per hour. The second line is slated to come on stream in mid Q4 with the possibility of two more lines being added in early 2006, which decision has not been taken yet.
For those who may be new to the RS story, the Company discusses pole production in terms of weight as compared to lengths. The reason for this is that it will sell transmission and distribution poles of varying lengths. In addition, the Calgary facility will ramp up its production of the Version™ resin proportionate to the increase in pole manufacturing.
A key comment was that "at this time, we have orders in hand that equate to 20% of the plant's Version™ production capacity in Q3".
To ensure this is clear to everyone, RS is manufacturing modular poles and selling resin to other companies such as Inline Fibreglass. As such, it currently has two revenue streams, which will grow over time as "licensing, engineering and royalty" fees kick in with the establishment of manufacturing facilities in other parts of the globe.
To put some perspective on what all of this could mean, by early 2006 the Calgary facility, based on full production of poles and VersionÔ resin, would be capable of generating at a rate in excess of $100 million in annual revenues, based on our discussions with management.
In our opinion, the market's assessment of RS' "blue sky potential" will gain significant traction based on a combination of agreements announced over the next three quarters, Q3 financial results and a perspective on expectations for Q4.
There will be additional clarity on the next steps in the "path forward" as the Company will be holding another teleconference in the latter part of July. A point raised in the web cast was that even at maximum capacity, the Calgary facility would be capable of meeting only 6% of the annual North American market demand of 500 thousand transmission poles. The Edmonton plant is currently producing 300 KG of product per hour with plans that this will rise to 350 KG per hour by the end of June.
In regards to pending product developments, Mr. Giannelia said that housing products such as soffits, eaves troughs are about 90 days away from becoming available to the sector. This project has been undertaken in conjunction with a partner.
We regard this comment as a "hidden gem" in the teleconference as the potential of this market is enormous. When the time comes that RS can make an announcement (Q3) on this pending development, the impact of this product line on sales should come into focus. On the subject of partners, on April 26th (click here) RS announced that it signed a multi-year, multi-million dollar order with Inline Fibreglass of Toronto to supply Version™ for the manufacture of industrial conveyor system rollers. Inline and RS jointly developed the dies and technologies. RS will begin shipping a minimum of one container of Version™ per month to Inline starting this July. This initiative is focused on a deal that was secured with a company running the largest open pit mine in Poland, which utilizes 600 thousand rollers over 56 miles of conveyor systems. Each roller uses 4 kilograms (9 pounds) of Version™. The question we have been asked more than a few times since this announcement is, "what does this mean in terms of sales?" Unfortunately, we are not at liberty to get into the specifics of container values or, on a micro basis, what each roller means to RS in terms of dollars. All we can say is that each container of Version™ is valued into the six-figure category.
To appreciate the magnitude of what RS has accomplished, one must appreciate Inline Fibreglass. It is a well established and highly reputable organization. Note that this is the second agreement that RS has signed with Inline. On March 11th of this year it was announced that RS had supplied resin to Inline for the manufacture of composite curtain walls, which were used in a Federal Government building.
Based on Inline's history and reputation, one should understand the importance of the deal for the conveyor rollers and what this could also lead to strictly in terms of the global mining industry.
On the day of the teleconference (May 3rd) RS announced (click here) a supply and license agreement with Armor Utilities Structures of Sydney, Australia to "introduce and supply RStandard™ utility poles to Australia and New Zealand. The agreement also covers the establishment of a manufacturing facility in Australia by the end of 2006. Up to that time, RS will ship modular poles from its Alberta facilities.
While we understand that it's difficult to appreciate issues impacting other countries and the opportunities that are then presented to RS, we encourage you to click on the newspaper headline graphic and read about the magnitude of the issues facing the power industry in that part of the world and the funding commitments that have been made by government. Click on the graphic of Electric Energy online as the publication also carried the Australian deal announcement.
The power industry in Australia is, in short, running out of suitable trees! Refer to the quotes in the news release. It has been identified that in excess of 200 thousand utility poles need to be replaced in the Australian power grid on an annual basis.
No one should feel that RS could capture the entire market in Australia and New Zealand. If you combined the manufacturing capacity of the Edmonton plant, Calgary capacity by early 2006, and a fully operational Australian plant, it still would not come close to meeting the annual demand. In addition, there will be other demands on RS' production capacity for North America and abroad.
We note this item as illustration that RS can capture small percentages of various markets to have an incredible impact on its growth.
In summary, a number of the dots are now being connected and there's no doubt the roadmap is becoming clear. In all respects, shareholders really don't have to wait all that much longer before RS can pronounce that it has reached long awaited milestones.
The Howard Group, members of The Howard Group and theInsight Limited Partnership are investors in Resin Systems.
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Resin Systems receives first order for its Version(TM) resin for application in the South Korean construction industry 5/11/05
EDMONTON, May 11, 2005 /PRNewswire-FirstCall via COMTEX/ -- Resin Systems Inc. (RS - TSX Venture / RSSYF - OTCBB), a composite materials products technology company, and its operating division, RS Technologies (collectively, "RS"), are pleased to announce that RS has received an initial order for a full container load of its proprietary Version(TM) resin from Polymate, Inc., a South Korean distributor, which resin will be used to manufacture industrial grouting pipes. RS will advise the manufacturer on RS's proprietary pultrusion process which will be implemented to manufacture the grouting pipes. After initial manufacturer re-tooling, monthly full container loads of Version(TM) resin shipments to Polymate, Inc. are scheduled to commence in October 2005. Industrial grouting pipes are commonly used in civil engineering projects such as tunnelling where they are threaded through the soil to stabilize areas surrounding tunnelways. Tunnelling is an important endeavor in South Korea where mountains make up 70% of the geography, providing accessibility to otherwise inaccessible locations.
RS understands that the industrial grout piping to be manufactured with Version(TM) resin will be used by Dae Won Soil, Construction & Engineering ("DWS"), headquartered in Seoul, South Korea, which has significant construction and engineering operations underway throughout the world. DWS specializes in state-of-the-art composite technology applications in underground support systems and soil stabilization projects and has many patented grout pipe applications using fibre-reinforced polymer and polyester resin. RS understands that DWS is making the transition to Version(TM) polyurethane resin because of its superior strength properties. For further information on DWS, visit www.daewontns.co.kr.
RS is a composite materials technology company, which provides engineered solutions for applications of its proprietary Version(TM) resin on a worldwide market basis. RS is also commercializing its RStandard(TM) modular composite pole for sale to power utility companies domestically and internationally. For more information on RS, visit www.grouprsi.com.
"Version" and "RStandard" are trademarks of Resin Systems Inc. The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.
SOURCE Resin Systems Inc.
Greg Pendura, President and Chief Executive Officer, Resin Systems Inc., Ph: (780) 482-1953, Fax: (780) 452-8755, Email: gregp@grouprsi.com, www.grouprsi.com; Grant Howard, Investor Relations, The Howard Group Inc., (888) 221-0915, (403) 237-8387, grant@***********inc.com, www.***********inc.comhttp://www.prnewswire.com
Copyright (C) 2005 PR Newswire. All rights reserved.
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kaboom, thar she blows, should ber a nice gapper up next week imho...
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