$TPAC Thoughts and feeling from and about the con
Post# of 22940
Posted On: 07/28/2016 1:03:45 PM
$TPAC Thoughts and feeling from and about the conference call(going by memory - no notes, no script):
While I feel that the CC was a move towards transparency, I must state clearly that despite the information given and the professional format, that it was premature in terms of its timing. One of the reasons for saying this was the lack of firm answers. How much? Give a number; right away, and on the spot - no flinching or dancing. When? Give a date or definitive range of dates.
The call was a great way to meet the IR team and to begin a dialogue, but the Q&A and overall conference time was in need of extension. I, for one, kept hearing bells dinging on my end of the line, which I had perceived to be other shareholders pressing *6. I wish I would have been alerted that that was not the case, as I had questions of my own, but did not feel they would be answered , seeing as I felt there to be a whole queue of people before me.
Also, I feel that rather than putting IR on the spot to field questions, the FR, BDG, and TPAC management team should have been the ones hosting, and doing so only after the final draft of the reconstruction is released. IR did great for being the messenger, but next time, let's have the answers straight from the source.
Aside from the feelings, as mentioned above, a bit of new information surfaced.
First, for clarity, TPAC is not a manufacturer. We are a supplier of the NAVAIR cert and of raw materials. Entities like BTL fall in the realm of manufacturer.
The 24% offset no longer applies due to the fact that we are a US company. A 10% rebate is said to have taken its place, which I believe was geared to benefit the manufacturer, and not us, the supplier.
Most, if not all, know that TPAC is in the bearing business. For those that follow IR's emails and Twitter feed, those shareholders have been alerted that TPAC has also received RFQ's for bushings and rod ends. What I was not aware of until today's CC is that TPAC will also be supplying for the manufacture of hinges. Someone on Twitter asked Bill how many bearings on a door, with the answer being thirty-two. It must now be asked: How many hinges on an aircraft, on a submarine, and on any other vehicle (or "stationary"/ floating entity) the we will be providing a service for? And if the bearing cost for each new aircraft is 500,000, how much will the translate to in hinges(and also in rod ends and bushings)?
IR mentioned a 2-3M production run. Did anyone catch if they were referring to 2-3M gross/net cash, or were they referring to 2-3M bearings produced per full capacity run? If that was 2-3M bearings per run, and each aircraft requires 3,000 bearings, when you do the math (2M/3K), that equates to 667 aircraft per production run. And 667 * $500,000(which is the cost in bearings per aircraft) is equal to $333,500,000. That alone would place us above the entire value of the 10-yr BTL SLA, so that needs some clarification.
It appears we now have access to machinery, but if I am not mistaken, it seems as if it is a bit of higher-end/higher interest rent-to-own scenario, as it was mentioned that points were to be added to the top. Provided we have sufficient capture and retention of RFQ's, with BTL et al able to handle the production load, with both TPAC and BTL offering a favorable cost and manufacture time in comparison to competition, those submitting the RFQ's should bite, and that would then make sense to engage in equipment financing in order to ramp up production and to continue to scale upwards.
Boeing is still in the works. They have just changed some of their requirements and now are requesting up to 120 days to submit payment for supplies and services rendered. This is where some of the competition has taken a hit and thus cannot service Boeing. As mentioned on the call, some of the other suppliers and manufacturers are not able to keep business afloat with payment for large business, such as Boeing, being held out for up to 120 days. And according to IR on the CC, TPAC is able to handle those terms.
NAVAIR is not our only business. NAVAIR is only required for defense. Please correct me if I am wrong and that includes other additional business. What gives TPAC the advantage outside of the defense sector, just by having NAVAIR, is that, they can offer a bearing of higher quality at an equal or lesser price to the buyer that will not need to be replaced as often due to wear and tear.
The BTL deal is set in stone, both the SLA and LA. Two more SLA's are being negotiated, and eight more companies in China are seeking to manufacture for TPAC, just as BTL is doing. Bill is handling those talks in person while in China. Revs from BTL were slated to begin in January, but are now being considered for Q4 2016.
Also, it was said that an investor base of up to 5M had eyes on TPAC.
BTL supply costs were said to cost 7-9M on our end for raw materials. I believe that IR quoted that 3M would be retained, with 10-20% set aside to assist with internal pps stabilization.
All in all, the call gave way to some new information and gave us a chance to listen to IR in a live format. My personal opinion is that we are on the right track, but this is all going to take some time. Some have mentioned 2017 being the year, and more and more I am seeing that as being correct. Very little buying going on, but very little selling either. No extreme sentiments came out of the call. Just a dialogue and some info to digest.
Thank you to the two callers who asked questions on behalf of the team and for all who listened in and attended today's CC. And thank you to IR for hosting as well. My laptop is about out of juice, so I will catch everyone later on in the day when I get a charge.
Please correct any information I added that is in error, or add to the compilation above with any information that I missed. I'm just writing from the top of my head and from one man's opinion.
And to Bill McKay: Thank you for all of your hard work and all that you have been doing behind the scenes. Your shareholders believe in you and your company, and believe it will be a success. Get some rest and get well soon!
While I feel that the CC was a move towards transparency, I must state clearly that despite the information given and the professional format, that it was premature in terms of its timing. One of the reasons for saying this was the lack of firm answers. How much? Give a number; right away, and on the spot - no flinching or dancing. When? Give a date or definitive range of dates.
The call was a great way to meet the IR team and to begin a dialogue, but the Q&A and overall conference time was in need of extension. I, for one, kept hearing bells dinging on my end of the line, which I had perceived to be other shareholders pressing *6. I wish I would have been alerted that that was not the case, as I had questions of my own, but did not feel they would be answered , seeing as I felt there to be a whole queue of people before me.
Also, I feel that rather than putting IR on the spot to field questions, the FR, BDG, and TPAC management team should have been the ones hosting, and doing so only after the final draft of the reconstruction is released. IR did great for being the messenger, but next time, let's have the answers straight from the source.
Aside from the feelings, as mentioned above, a bit of new information surfaced.
First, for clarity, TPAC is not a manufacturer. We are a supplier of the NAVAIR cert and of raw materials. Entities like BTL fall in the realm of manufacturer.
The 24% offset no longer applies due to the fact that we are a US company. A 10% rebate is said to have taken its place, which I believe was geared to benefit the manufacturer, and not us, the supplier.
Most, if not all, know that TPAC is in the bearing business. For those that follow IR's emails and Twitter feed, those shareholders have been alerted that TPAC has also received RFQ's for bushings and rod ends. What I was not aware of until today's CC is that TPAC will also be supplying for the manufacture of hinges. Someone on Twitter asked Bill how many bearings on a door, with the answer being thirty-two. It must now be asked: How many hinges on an aircraft, on a submarine, and on any other vehicle (or "stationary"/ floating entity) the we will be providing a service for? And if the bearing cost for each new aircraft is 500,000, how much will the translate to in hinges(and also in rod ends and bushings)?
IR mentioned a 2-3M production run. Did anyone catch if they were referring to 2-3M gross/net cash, or were they referring to 2-3M bearings produced per full capacity run? If that was 2-3M bearings per run, and each aircraft requires 3,000 bearings, when you do the math (2M/3K), that equates to 667 aircraft per production run. And 667 * $500,000(which is the cost in bearings per aircraft) is equal to $333,500,000. That alone would place us above the entire value of the 10-yr BTL SLA, so that needs some clarification.
It appears we now have access to machinery, but if I am not mistaken, it seems as if it is a bit of higher-end/higher interest rent-to-own scenario, as it was mentioned that points were to be added to the top. Provided we have sufficient capture and retention of RFQ's, with BTL et al able to handle the production load, with both TPAC and BTL offering a favorable cost and manufacture time in comparison to competition, those submitting the RFQ's should bite, and that would then make sense to engage in equipment financing in order to ramp up production and to continue to scale upwards.
Boeing is still in the works. They have just changed some of their requirements and now are requesting up to 120 days to submit payment for supplies and services rendered. This is where some of the competition has taken a hit and thus cannot service Boeing. As mentioned on the call, some of the other suppliers and manufacturers are not able to keep business afloat with payment for large business, such as Boeing, being held out for up to 120 days. And according to IR on the CC, TPAC is able to handle those terms.
NAVAIR is not our only business. NAVAIR is only required for defense. Please correct me if I am wrong and that includes other additional business. What gives TPAC the advantage outside of the defense sector, just by having NAVAIR, is that, they can offer a bearing of higher quality at an equal or lesser price to the buyer that will not need to be replaced as often due to wear and tear.
The BTL deal is set in stone, both the SLA and LA. Two more SLA's are being negotiated, and eight more companies in China are seeking to manufacture for TPAC, just as BTL is doing. Bill is handling those talks in person while in China. Revs from BTL were slated to begin in January, but are now being considered for Q4 2016.
Also, it was said that an investor base of up to 5M had eyes on TPAC.
BTL supply costs were said to cost 7-9M on our end for raw materials. I believe that IR quoted that 3M would be retained, with 10-20% set aside to assist with internal pps stabilization.
All in all, the call gave way to some new information and gave us a chance to listen to IR in a live format. My personal opinion is that we are on the right track, but this is all going to take some time. Some have mentioned 2017 being the year, and more and more I am seeing that as being correct. Very little buying going on, but very little selling either. No extreme sentiments came out of the call. Just a dialogue and some info to digest.
Thank you to the two callers who asked questions on behalf of the team and for all who listened in and attended today's CC. And thank you to IR for hosting as well. My laptop is about out of juice, so I will catch everyone later on in the day when I get a charge.
Please correct any information I added that is in error, or add to the compilation above with any information that I missed. I'm just writing from the top of my head and from one man's opinion.
And to Bill McKay: Thank you for all of your hard work and all that you have been doing behind the scenes. Your shareholders believe in you and your company, and believe it will be a success. Get some rest and get well soon!
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