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hi jarthurgood question must say I don't fully know but this...

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    hi jarthur
    good question must say I don't fully know but this would be some of my thoughts.
    in brazil and USA we have licensee, they secure the work but buy the product from us so PEt is only getting the product sale. Although that doesn't sound as great as supplying and applying ourself it does have its benefits. Government might look for more local companies when awarding contracts so we might not of picked up as much work in Brazil if we wasn't using the licensee and when these licensee was set up the company didn't have the funds to set up bases all over the place. The rest of the application ie Europe Canada, china, Australia would be us supplying and applying. With the money side the main thing to worry about is the overall sales and gross margin . Using some past figures ie cost of projects, company values of inventory I would think it goes something like this. Brazil and USA when buying our product we sell to them for around $3000 per ton and it might cost us about $1500 per ton so we are making our 50% margin. Brazil and USA are then probably marking up the cost of product for their projects and also picking up the fee for applying. With something like the $200k for kitsap the breakdown could look something like 100k for us in product of which we make $50k gross margin. The aquatechnex then sells the product for $150k making $50k and the last 50k is for the applying, applying would not just be applying but also testing, modelling work etc before applicat I ion. Of the 50k applying aquatechnex would also be making a margin on. For some idea our licensee in USA are selling 20kg bags for $5300 us dallors per ton. This would be for small orders i image when they are doing bigger projects like Florida they are bringing that price down considerably.
    with our work in china because of the size of some projects we might be at lower costs per ton we charge as we already have our mark up on the product and you don't have the like of sepro putting their mark up on. We might be getting around the $3000 per ton in china and still keeping our 50% margin on product sale but also increasing our revenue with the application side. The only real figure I can think of was at tender documents we saw for xingyun I think it was $3570 per ton applied so maybe something like 3000k for product, 70 transport and 500 for applying, so something like this we might be making margins 1800 per ton, 1500 product 300 applying to come up with the >50% margins on sales.

    hope that helps some, but just my thoughts could be wrong but logically should be something like that
    thanks
    mickem
 
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