FormerXBC Inc XEBEQ

Waga isn't exactly shooting the lights out

[tamaracktop]

$16.8 million CAD revenues for 2021, up 29%.

3 installations commissioned in 2021.

I'm quite confident Xebec has a definite advantage in Quebec.

It may be true that each company caters to a different market, but that's only true to an extent.

The differences are the volumes of RNG production and the degree of customization in their offerings.

Waga is pursuing the very business Xebec has essentially abandoned with their plans to maximize margins through standardization. 

Don't rule out a symbiotic relationship evolving between these two companies. It's interesting that the two were essentially "partners" in hosting the RNG forum, after Energir and GNR hooked up only one rung above them in the "hierarchy", the provincial government of Quebec being at the top of course.

Waga has signed 2 projects in Canada in 2021.
They don't seem a threat at all.

In fact, if Waga does penetrate the Canadian market at all, which remains to be seen, they may seek to increase production at any of their as yet fictional projects at some point in the future by incorporating Biostream units.

Here's the important point. 

Read this:

   "2021, the ten WAGABOX® units in operation produced 145 GWh (494,000 mmBtu) of RNG, a 26.7% year-on-year increase. The increase in production is due to consistent improvements in the operation of WAGABOX® units (the technology pushed production up 18%) and to the fact that the three units commissioned in 2020 were operational for the entire year 2021."

This is very important, and I referred to it in an earlier post when I pointed out that Xebec will see no revenues from Boo projects in the fiscal year they are announced.

The revenue stream from each Boo project won't kick in until 16 to 20 months after construction has started.

Herein lies the beauty of it.

Each Boo project will have a long-term off-take contract with a partner to purchase the RNG produced.

This will result in a very transparent and predictable revenue and cash flow model that analysts will be able to take into account when calculating Xebec's net present value.

This is true for each and every Boo project announced going forward.

I might be wrong, but I doubt it.

The major point here is that I haven't seen a single research report that has taken into account even the remotest possibility of Xebec profiting from another source of recurring revenues from something called Boo.

It's almost as if the analysts haven't even heard of it.

It's my opinion that Boo is a hidden arrow in Xebec's quiver.

 

One that may be just beginning to dawn on the market.

 

One that will make Xebec leave the analysts' targets in the dust when Xebec starts announcing contracts, to everyone's surprise but the market itself.