Revenue from doubling salesQuestion asked: “How much in revenue would a doubling of machine orders suggest for next year?”
It is my understanding that 2021 guidance is for 5 large and 12 small machines and that somewhere the 2022 guidance is for 10 large and 15 small
From my past notes of comments made by management, I have the following for the approximate revenue per machine:
Small: 10 kW - $0.23 million
Medium 60 kW: - $1.3 million
Large: 100 kW - $2.0 million
Large: 120 kW - $2.0 million
These figures are a couple of years old. They may be higher now.
If 2021 machine sales are achieved, the machine revenue will be 5 x 2 + 12*.23 = $12.76 million
If 2022 machine sales are achieved, the machine revenue will be 10 x 2 + 15*.23 = $23.45 million
My notes say that the margin on machine sales is 30-35%. Using 30%, the gross margin for 2021 could be 12.76 x .3 = $3.8 million and for 2022 it could be 23.45*.3 = $7.0 million.
IF they can control costs for more than one quarter (that is a BIG IF), they will have impressive results.
There is also revenue from Nutradried and royalties.
We should remember that machine sales are not the same as revenue flows. I recall someone in management saying 40% is put down on order, 20% comes after 3 months, 20% on delivery and 20% after delivery.