Sample L-1 Business Plan Pages by Greengate Consulting

3214 Appletree Rd. #101 Springfield, TX 91232

Geo Labs, LLC is a new company incorporated in March 2014 and located near Houston in the State of Texas. The company is a specialized consulting business which provides environmental monitoring services, seismic hazard evaluations and innovative seismological methodologies for major business who operate primarily in the hydroelectric, oil and mineral exploration, and civil engineering and construction sectors.

The following dashboard highlights the results of the financial analysis, expected company performance, and summary of market break down. The reader may use this page as a quick reference visual aid to quickly understand the expected financial performance of the company.

Geo Labs Dashboard Geo Labs Dashboard Geo Labs 5-Year Highlights Gross Margin

Net Profit

Personnel

$7,000

$4,000

$3,000

$2,000

$1,000

Thousands

$5,000

2015

2016

2017

2018

2019

136

$400

491

$200

355

$100 $0

Assets

Expenses

Funding

Geo Labs Net Profits Forecast

Seismic Microzonation Env. Monitoring

Net Earnings

Thousands

109

$500

$6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0

Net Margin

$3,000

60%

$2,500

50%

$2,000

40%

$1,500

30%

$1,000

20%

$500

Source and Units 10%

($500)

2015

2016

Yearly Projected Cash Flow of Geo Labs Net Cash Flow Thousands

Start-Up Needs

$600

Geo Labs 5-Year Sales Forecast Seismic Evaluation Mineral Exploration Rock and Soil Study

Additional Funds

$300

-$1,000

Against Needs

$6,000

Per sonnel

Thousands

Sales

Geo Labs Start-Up Funding

2017

2018

Cash Balance

$6,000

Federal and state government Mining industry

10%

Energy industry Other

15%

23%

12%

$4,000 $2,000

18%

$0 2016

2017

2018

Geo Labs Market Distribution Construction and manufacturing industry Automotive industry

$8,000

2015

2019

22%

2019

-$2,000

Table of Contents 1 Executive Summary ................................................................................................................................ 4 1.1 Mission ................................................................................................................................................................................ 6 1.2 Objectives ........................................................................................................................................................................... 6

2 Company Summary ................................................................................................................................ 7 2.1 Start-Up Summary .............................................................................................................................................................. 7 2.2 Funding Sources ................................................................................................................................................................. 8

3 Environmental Services ......................................................................................................................... 9 4 Marketing Analysis ............................................................................................................................... 10 4.1 Market Segmentation ........................................................................................................................................................ 10

5 Sales Strategy ....................................................................................................................................... 11 5.1 Sales Forecast .................................................................................................................................................................. 11

6 Personnel Hiring Plan .......................................................................................................................... 14 6.1 Company Structure ........................................................................................................................................................... 14 6.2 Job Descriptions................................................................................................................................................................ 14

7 Financial Projections............................................................................................................................ 16 7.1 Projected Profit and Loss .................................................................................................................................................. 16

Appendix ................................................................................................................................................. 18

1 Executive Summary Since 2005 Soluciones Seísmicas del Pacífico, Ltda., (referred to as ‘SSP’) a Colombian-based environmental consultancy business, has been working with major corporations in the oil exploration, energy, hydroelectric and civil engineering and construction industries, helping them to overcome environmental challenges and to mitigate against any hazards or risks that may apply. It has developed innovative environmental monitoring methodologies and has worked successfully with major multinational companies, including GE Energy, a major Fortune 500 energy conglomerate, and Repsol, a Spanish petrochemical company that has an annual revenue in excess of $40 billion. SSP has funded the establishment of Geo Labs, LLC in the State of Texas transferring its highvalue expertise and innovative services to the U.S. market and taking advantage of major U.S. businesses increasing demand for scientific and environmental services. Geo Labs is a new consulting business which provides specialized environmental monitoring services, seismic hazard evaluations and innovative seismological methodologies for companies in the hydroelectric, oil and mineral exploration, and the civil engineering and construction sectors. Geo Labs has secured $600,000 in funding from its overseas affiliate which will be utilized to create a dedicated U.S. office, recruit an initial team of highly skilled U.S. professionals, and to launch its operations. SSP is proposing the appointment of Mr. Alberto García to act as General Manager (GM) of Geo Labs under an L-1 visa beneficiary scheme, with an initial salary of $84,000 per annum. Mr. Alberto García is a co-founder of SSP and has been employed as its Director of Operations since the company's inception in 2005. He is a leading authority on seismological and environmental issues and his academic qualifications include a doctorate in Seismology from the Universidad Politécnica de Bogotá, as well as a period as tenured Professor of Seismology at the same institution. During this time, Mr. García mentored and supervised eight students, published numerous papers in leading international science journals, and partnered with the Colombian multinational energy company Repsol in a $5 million scientific project. It is clear that Mr. García is an exceptional academic who has significant expertise in a broad range of disciplines. He has personally developed innovative seismic monitoring and analysis systems which have widespread application across the environmental consulting sector and, furthermore, the entrepreneurial and leadership skills that have been developed over the course of his academic and business career will prove invaluable in leading Geo Labs

in the U.S. market and in attracting new clients who wish to take advantage of the specialist expertise and services that the company offers. As General Manager Mr. García will take overall responsibility for the strategic, scientific and operational direction of the company, and will oversee the appointment of technical manager who will provide day-to-day managerial support. Under the guidance of Mr. García, the company will develop a team of exceptional scientific professionals, many with Master or Doctoral degrees, and continue to deliver unrivalled expertise and high-value services to major clients while taking advantage of the positive outlook for environmental consultants in the U.S. The U.S. Environmental Consulting industry is expected to experience strong growth over the next five years, with the increasing emphasis on environmental sustainability. Additionally, as the economy improves, and construction picks up, environmental consultants will be needed for audits and inspections to ensure that building and underlying lands are environmentally safe and to evaluate potential risks. Companies in sectors such as energy, mining and oil exploration, will increasingly utilize environmental consultants to undertake inspections, surveys and hazard evaluations associated with mineral explorations and resource exploitations. These factors, combined with strict regulatory frameworks and increasing pressure for corporations to be more environmentally responsible, will drive growth. Over the five years to 2019, industry revenues are forecast to rise by an average annualized rate of 5.5% to $23.1 billion1 The chart to the right illustrates the expected

Geo Labs, LLC 5-Year Highlights

net profit, and personnel – over its five years. During its first year the company is forecasting annual sales of $422,000, with strong growth over subsequent years as the company consolidates its position in the domestic

Thousands

financial metrics – annual sales, gross margin,

Sales $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 -$1,000

Gross Margin

Net Profit

Personnel 30 25 20 15 10

Personnel

performance of Geo Labs by highlighting key

5 2015

2016

2017

2018

2019

market and continues its investment in developing innovative solutions and attracting exceptional employees to maintain high-value expertise. Sales are predicted to rise from $1.6 million to over $5.9 million by 2019. Much of this growth will be aided by the introduction of lucrative environmental monitoring services from 2016; these services are expected to account for over 50% of annual revenues by 2019. During the first year, the company will record a net loss of almost $90,000 as it absorbs initial set-up and staffing costs. This lossmaking position will quickly reverse from 2016, with improving efficiencies in conjunction with increased demand driving profit forward from over $300,000 to over $2.5 million by the end of 2019.

Edwards, J. Sept 2014. IBISWorld Industry Report 54162 ‘Environmental Consulting in the U.S.’

The upward trend in sales revenues and annual net profits will naturally lead to an increase in business net worth, which is forecast to reach $7.7 million by the end of 2019. The overall growth outlook for the company will ultimately lead to a sustainable platform from which to achieve long-term success in the U.S. market, and help it to branch out into even wider territories and to expand its expertise into other high demand environmental services.

1.1

Mission

The mission of Geo Labs is to deliver high-quality solutions and world leading expertise to U.S. corporations assisting them in reducing their environmental impacts, which in turn will help generate sustainable economic and environmental benefits. Underpinning this mission is a commitment to developing and harnessing the company’s technical expertise to continue producing innovative solutions and exceptional customer care to meet the challenges of a rapidly changing regulatory and environmental landscape.

1.2

Objectives

Strategic 

Establish Geo Labs as a world leading environmental and seismological consultancy business, developing a strong reputation for success, expertise and innovation across the U.S., Canada and the Caribbean.



Leverage the unique scientific and software service ‘GEOTON’ developed by Mr. Alberto García to offer the U.S. an innovative methodology to survey and inspect water dams.

Operational 

Generate at least 20 full-time U.S. employment opportunities over the next five years, developing a team of highly qualified U.S. professionals.



Provide exceptional environmental consultancy to major U.S. businesses, helping them to negotiate a rapidly shifting environmental landscape, and developing a domestic portfolio of successful projects.

Financial 

Attain annual sales in excess of $5.9 million within five years of launching in the U.S. market



Improve net operating margins to 42% over the next five years, resulting in expected annual net profits of $2.5 million by the end of 2019.

2 Company Summary Geo Labs, LLC is a new company incorporated in March 2014 in the State of Texas. The company is a specialized consulting business which provides environmental monitoring services, seismic hazard evaluations and innovative seismological methodologies for major business who operate primarily in the hydroelectric, oil and mineral exploration, and civil engineering and construction sectors. The company operates under the guidance of Mr. Alberto García, who will be appointed GM under an L-1 visa beneficiary petition. Mr. García is currently the Director of Operations of SSP and possesses a unique blend of academic, entrepreneurial and leadership expertise having previously founded successful scientific consultancy businesses in Colombia in addition to holding a Professorial role in the Seismology Department of the Universidad Politécnica de Bogotá. His skillset and expertise will prove invaluable to Geo Labs Environment Solutions, enabling it to develop a team of highly-talented professionals and to deliver a range of high-quality services to major U.S. businesses including a network of those who currently work with SSP across Colombia. The stature of Mr. García will greatly assist the company in attracting the best geologists, hydrologists, geophysicists and other scientific professionals with an ultimate expectation of a U.S. workforce of twenty five (25) employees by the end of 2019.

2.1

Start-Up Summary

Summary of Start-Up Needs in the U.S. and to fund a dedicated U.S. office, including Total Start-Up Expenses The level of funding required to establish Geo Labs, LLC

$136,000

Legal Fees

15,000

Company Formation

1,000

launch its operations has been fully provided by the joint

Consulting

10,000

owners. This funding requirement has been identified as

Marketing & Advertising

10,000

totaling almost $500,000 as outlined in the table to the

Branding

an initial team of highly skilled U.S. professionals, and

right.

Planning, Budgeting, Travel

Total Start-Up Assets

0 100,000

$355,280

The start-up assets ($355,280) include the acquisition and

Cash Reserve for Operations

155,280

installation of essential office, I.T., and technical

Equipment

200,000

equipment valued at $200,000; and a cash reserve of

Total Requirements

$491,280

$155,280 that will be utilized as working capital to meet ongoing operational costs during the first 12 months of the company setting up its U.S. presence. The expenses budgeted for at start-up ($136,000) include legal fees of $15,000; company formation costs of $1,000; consulting expenses of $10,000; initial marketing and advertising expenditure of $10,000; and a $100,000 provision for travel, planning and budgeting purposes.

2.2

Funding Sources

The two columns to the left of the graph

Geo Labs, LLC Start-Up Funding

opposite – assets and expenses – relate

Against Needs

discussed in Section 3.1. The third column – funding – represents the total amount that the joint-owners, including prospective L-1 visa petitioner Mr. Alberto García, have allocated to set-up and establish the company in the United States.

Thousands

directly to those start-up requirements

Additional Funds

$600

109

$500

136

$400 $300 $200

Start-Up Needs

491

355

$100 $0 Assets

Expenses

Funding

As the chart illustrates, this investment commitment from the joint owners totals $600,000, and given the extent of the aforementioned start-up requirements and the associated investment, it is clear that a significant proportion of this investment has been irrevocably committed to the financing of these starting assets and expenses. In addition to meeting the initial start-up requirements, the funding from the investors has created a significant cash surplus of around $109,000. This reserve will ensure that Geo Labs has access to sufficient liquidity to fund and maintain its nascent U.S. operations beyond the already planned working capital accounted for in the Assets required.

3 Environmental Services Geo Labs provides a range of environmental consultancy expertise to major businesses, particularly those that operate in the hydroelectric, mining, energy and mineral exploration industries. Businesses are becoming increasingly reliant on environmental professionals

assist

them

mineral

explorations,

environmental monitoring, impact analysis, and hazard risk evaluation and remediation. In addition to this, many industries are often subject to changing regulations in respect of their operations and how its impacts the environment. Geo Labs plans to put together a highly-qualified team, specializing in mostly geological, geophysical, seismological and hydrological consultancy services. The table below summarizes the major services that the company plans to introduce to the U.S. market, and highlights key characteristics – average sale price, typical margins, etc. – associated with each type:

Price

Direct Unit Cost

Contrib. Margin %

0.42

$30,000

$5,000

83%

Average Monthly Margins in Year 1 $10,493

Seismic Micro zonation

0.08

$50,000

$15,000

70%

$2,810

Mineral Exploration Environmental Monitoring Rock and Soil Study

0.00

$50,000

$30,000

40%

0.08

$200,000

$100,000

50%

$8,028

0.17

$15,000

$5,000

67%

$1,697

Average Unit Sales per Month in Year 1

Seismic Evaluation

Services

As the table illustrates, the primary profit driver during 2015 will be as a result of seismic evaluation consulting, which is expected to contribute almost $10,500 to the average monthly margin. This service benefits from a high 83% gross margin, with an average sales price of $30,000. Environmental monitoring will also generate significant profits for the company, primarily by virtue of the high value associated with its sale (an average of $200,000 per project) resulting in just over $8,000 of average monthly margin. Seismic Micro zonation and rock and soil studies will also contribute generously to the monthly margin – $2,800 and $1,700 respectively – with the lower contribution a consequence of the relative low volume of expected sales during 2015; however, both these services have good margins, between 67% and 70%, so will prove potentially lucrative in the event of securing a greater volume of sales. The mineral exploration services are not expected to be commenced until the company has established itself and enlarged its scientific team. 9

4 Marketing Analysis The section examines the relevant market information and characteristics that the leadership of Geo Labs consider important to the companyâ&#x20AC;&#x2122;s strategic planning and decision making processes.

4.1

Market Segmentation

The chart to the right illustrates the typical market distribution of the U.S. Environmental Consulting industry during 2014, highlighting the expected share of annual industry revenues. The Mining, Energy and Chemical industries represent the primary market, accounting for 33% of typical annual revenues. Businesses in this sector often have require a lot of environmental support, whether its surveys or inspections for mineral exploration, or risk evaluation and mitigation advice in respect of potential hazards. The Construction and Manufacturing sectors are another key downstream market, accounting for 23% of typical annual revenues. Most companies in this sector rely on consultants to ensure they comply with environmental regulations as well as assisting with inspections and surveys associated with land and building developments. Governmental institutions, including Federal, State and other municipal organizations, represent the third major market accounting for 21% of typical annual revenues. Much of the consulting focus for these public bodies is centered on remediation, pollution consultation, and services related to potential environmental accidents or disasters such as natural flooding, dam breaching, or seismic activities. With just over 12% of the average annual market, the automotive industry is another

Geo Labs, LLC Market Distribution

major sector that utilizes environmental consultations, however, the majority of the relationship focuses on emissions control, which is not an area that Geo Labs

Construction & Manufacturing

Governmental

Mining, Energy & Chemical

Automotive industry

Forestry industry

specializes in. Forestry industries represent approximately

Households 12%

6% of typical annual revenues, with the majority of

23%

environmental consulting being related to assessing the impact of the removal of natural resources. The remaining 5% of the annual revenues are households and represent

33% 21%

an industry growth area as consumers become increasingly conscious of their eco-footprint and the potential risks posed by the environment.

5 Sales Strategy Geo Labs will drive its revenue growth through a variety of factors. Firstly, it benefits from the existing commercial relationships that its overseas affiliate company has in the energy and oil exploration sectors; clients such as GE Energy, a major U.S. business, currently work with SSP in respect of its Colombian-assets, as does Repsol, a Spanish-conglomerate in the energy industry that has an annual turnover of over $40 billion. The U.S. entity expects to be able to leverage this relationship to secure business with these companies throughout some of their U.S. operations and assets. Secondly, the company provides highly-specialized services within a fairly niche market, so a continual commitment to innovation, research and development, and through attracting and retaining the best scientific professionals across a diversity of disciplines, including geological, hydrological, geophysical and environmental engineering, will help the company to remain competitive and relevant in the face of a constantly shifting environmental and regulatory landscape. Finally, the company can draw upon the expertise and reputation of its General Manager, Mr. Alberto GarcĂa, who, in addition to successfully founding several seismological consultancy businesses, is also a respected former Professor and academic with an impressive research, development and publication record in leading international journals. As a result of these factors the company is forecasting annual sales of $422,000 during its first year. Future revenue growth will be underpinned by: 1. Leveraging relationships with existing clients to secure new projects; 2. Developing relationships across the U.S. hydroelectric, energy, oil and mineral exploration and construction sectors to attract new clients; 3. Developing innovative new solutions to help meet rising demand in the face of increasing environmental and regulatory issues; 4. Broadening into new territories; 5. Maximizing the expertise of the company through selective recruitment and effective internal mentoring and training.

5.1

Sales Forecast

The primary driving force behind the companyâ&#x20AC;&#x2122;s sales strategy lies in the expertise of its leadership and team of scientific professionals, and in the innovative solutions it offers major businesses who are constantly facing environmental challenges throughout their resource exploration, civil engineering and construction, and energy 11

operations. During 2015 the company expects to generate annual sales of $422,000, building on existing relationship with major U.S. corporations to establish a foothold in the domestic market. Growth will be strong over subsequent years as the company expands its workforce and clients commence large-scale projects across the U.S., Canada and the Caribbean. As a result, the company is forecasting annual revenues to increase from $1.6 million to over $5.9 million by 2019. Much of this growth will be aided by the introduction of high-value environmental monitoring services from 2016; these services are expected to account for over 50% of annual revenues by 2019. A full breakdown of the five-year sales forecast is shown below.

Geo Labs, LLC 5-Year Sales Forecast

Thousands

Seismic Evaluation Env. Monitoring

Seismic Microzonation Rock and Soil Study

Mineral Exploration

$6,000 $4,000 $2,000 $0

Sales Forecast Unit Sales

2015

2016

2017

2018

2019

Seismic Evaluation

5.04

9.96

49.80

57.27

65.86

Seismic Microzonation

0.96

2.08

5.20

5.98

6.88

Mineral Exploration

0.00

0.96

2.12

2.44

2.81

Env. Monitoring

0.96

5.54

9.97

11.47

13.19

Rock and Soil Study

2.04

10.20

11.73

13.49

9.00

20.58

77.29

88.89

102.23

2015

2016

2017

2018

2019

151,100

307,764

1,584,985

1,877,425

2,223,763

48,167

107,120

275,834

326,723

387,172

49,612

112,455

133,312

158,133

192,667

1,141,240

2,115,435

2,506,711

2,969,082

30,550

31,524

162,323

192,266

227,752

Total Units Sales Seismic Evaluation Seismic Microzonation Mineral Exploration Env. Monitoring Rock and Soil Study

Total Sales

$422,484 $1,637,260 $4,251,032 $5,036,437 $5,965,902

Direct Unit Costs

2015

288% 2016

Seismic Evaluation

25,183

51,297

264,189

312,923

370,660

Seismic Microzonation

14,450

32,140

82,753

98,018

116,155

29,767

67,473

79,988

94,880

Env. Monitoring

96,333

570,620

1,057,717

1,253,361

1,484,548

Rock and Soil Study

10,183

10,512

54,111

64,093

75,922

146,149

694,336

1,526,243

1,808,383

2,142,165

Mineral Exploration

Subtotal Direct Cost of Sales

160% 2017

18% 2018

18% 2019

6 Personnel Hiring Plan This section examines the internal staffing structure of the company, highlighting the relevant skills and experiences of the proposed L-1 visa beneficiary. It will also provide an insight into the expected progression of the company staffing requirements over the next five years, summarizing the anticipated timetable and salary costs of any future appointments.

6.1

Company Structure

Geo Labs has been organized as a Limited Liability Company (LLC), providing a flexible taxation structure for the company and its owners. As the accompanying chart illustrates, the company operates within a straightforward hierarchical structure. This structure benefits from clearly defined lines of responsiblilty and promotes ease of communication between the leadership and subordinate staff members. The following organizational chart highlights the structure of the firm during the first year of operations:

General Manager Mr. Alberto GarcĂa 2015

Secretary 2015

Technical Manager 2015

Geologist

Hydrologist

2015

6.2

2015

Field Technician 2015

Environmental Engineer

Biologist

2015

Job Descriptions 14

In addition to the aforementioned executive leadership appointment mentioned previously, the following definitions provide brief descriptions of the roles and responsibilities to be filled as part of the initial team that will be appointed by Geo Labs, LLC: Technical Manager The company will appoint a technical manager to provide day-to-day supervision of staff members, allowing Mr. Alberto GarcĂa to invest more time in developing corporate strategies and leveraging existing networks of contacts to increase awareness of the company and identify opportunities. Core duties will include, but not be limited to the following: overseeing day-to-day team members; liaising with the GM on operational policies; managing internal office functions; assist with understanding U.S. regulatory frameworks; liaising with U.S. environmental institutions; and editing, correcting and presenting technical reports prepared by other team members. This position will ideally require an experienced manager, preferably with a Masters degree or Doctoral degree in Geology or Geophysics. The Technical Manager will be appointed by the middle of 2015, and be entitled to an annual salary of $60,000. Secretary The Secretary will provide clerical and administrative support for the U.S. office. Core duties include: organizing and scheduling meetings for the senior leadership team; answering general telephone enquiries; liaising with outsourced service providers such as accountants, legal services and office supplies; general secretarial duties including filing, mailing, and typing; and other administrative support duties to assist the other staff members in ensuring smooth operational processes. The company will look to appoint an experienced secretary who has a relevant educational and, preferably, industry experience. The Secretary will be entitled to an annual salary of $25,000, and will commence in the first quarter of 2015. Geologist â&#x20AC;&#x201C; Specializing in Environmental Analysis An Applied Geologist will be required in order to fulfill the some of the environmental monitoring services and mineral exploration Services which Geo Labs provides. Core duties will involve: collecting data in respect of contamination studies, characterization, analysis and remediation; preparing high-level technical reports; performing environmental studies involving subsurface water; liaising with clients; and other scientific research and reporting activities to assist clients in their environmental needs. The Geologist role will ideally attract an experienced professional with a relevant Masters or Doctoral degree, and attract an annual salary of $50,000.

7 Financial Projections In addition to the previously stated information regarding the companyâ&#x20AC;&#x2122;s mission; corporate objectives; funding and ownership; operating activities; sales and marketing strategies; and its personnel plan, this section will further examine the long-term viability of the business model and appraise the relative risk and return to investors, by presenting a series of robust financial projection and modeling outcomes.

7.1

Projected Profit and Loss

As the chart below illustrates, the company is expected to record a net loss of around $90,000 during its first year of U.S. operations as the company absorbs initial set-up and staffing costs while investing in its operational framework. However, this loss-making position will quickly reverse in 2016, with annual net profits expected to exceed $300,000 as the company takes advantage of the existing client relationships of its overseas affiliate to generate significant sales revenues. With its range of high-value environmental consulting services, underpinned by the expertise of its GM, the company forecasts strong growth in profit over subsequent years with annual net profits rising strongly from around $2 million in 2017 to just over $2.5 million in 2019. Over the same five-year period, the net operating margin will rise in line with increasing efficiencies and personnel growth, settling at 44% by the end of 2019. Geo Labs, LLC Net Profits Forecast

Thousands

Net Earnings

Net Margin

$3,000

50%

$2,500

40%

$2,000 $1,500

30%

$1,000

20%

$500 10%

$0 ($500)

2015

2016

2017

2018

2019

Profit & Loss Statement 2015

2016

2017

2018

2019

Sales Direct Cost of Sales Operations Payroll Total Cost of Sales

$422,484 $1,637,260 $4,251,032 $5,036,437 $5,965,902 146,149 694,336 1,526,243 1,808,383 2,142,165 156,833 385,220 428,604 576,960 873,395 302,982 1,079,556 1,954,847 2,385,343 3,015,560

Gross Margin Gross Margin %

$119,502 28%

$557,704 $2,296,185 34% 54%

$2,651,094 $2,950,342 53% 49%

Sales and Marketing Expenses Sales and Marketing Payroll Advertising/Promotion Travel Miscellaneous Total Sales and Marketing Expenses

0 4,200 12,000 12,000 $28,200

0 4,326 12,360 12,360 $29,046

0 4,456 12,731 12,731 $29,917

0 4,589 13,113 13,113 $30,815

0 4,727 13,506 13,506 $31,739

General and Administrative Expenses General and Administrative Payroll Other Employee Related Expenses Rent Business Supplies Utilities Insurance Payroll Taxes, Insurance, Benefits Total General and Administrative

20,833 0 22,000 14,400 6,000 1,800 26,167 $91,200

25,750 0 24,720 14,832 6,180 1,854 49,749 $123,085

26,523 0 25,462 15,277 6,365 1,910 54,424 $129,960

27,318 0 26,225 15,735 6,556 1,967 69,607 $147,409

28,138 0 27,012 16,207 6,753 2,026 99,608 $179,744

Other Expenses: General Manager Payroll Audit Fees Consultancy Fee (Accounting, Tax etc.) Total Other Expenses

84,000 0 5,400 $89,400

86,520 0 5,562 $92,082

89,116 0 5,729 $94,844

91,789 0 5,901 $97,690

94,543 0 6,078 $100,620

$208,800

$244,213

$254,722

$275,914

$312,104

Total Operating Expenses EBITDA Interest Expense Depreciation Taxes Incurred Net Earnings Net Margin

($89,298) 0 0 0 ($89,298) -21%

$313,491 $2,041,463 0 0 0 0 0 0 $313,491 $2,041,463 19%

48%

$2,375,181 $2,638,239 0 0 0 0 0 0 $2,375,181 $2,638,239 47%

44%

Appendix The following information is presented in this plan to illustrate financial details, projections, general assumptions, and expected results. As in any business plan, success is solely dependent on the business execution and the circumstances that surround its operations. The objective of these projections is therefore to aid the entrepreneur on understanding the business model, along with the feasibility of such business development in current market conditions and with the underlying assumptions considered only as part of this study.

Table 1: Expected Wages by Quarter Expected Wages Employee Names/Titles Operations

2015

2016

2017

2018

2019

$13,167

$37,333

$51,500

$54,833

$156,833

$96,305

$385,220

$428,604

$576,960

$873,395

Technical Manager

5,000

15,000

35,000

15,450

61,800

63,654

65,564

67,531

Geologist

8,333

12,500

33,333

12,875

51,500

53,045

54,636

56,275

Hydrologist

3,333

10,300

41,200

42,436

43,709

45,020

Environmental Engineer

2,917

8,750

29,167

18,025

72,100

74,263

76,491

78,786

Biologist

2,500

7,500

25,000

7,725

30,900

63,654

65,564

67,531

Field Technician

7,750

31,000

31,930

127,720

131,552

270,996

558,252

$2,083

$6,250

$20,833

$6,438

$25,750

$26,523

$27,318

$28,138

2,083

6,250

20,833

6,438

25,750

26,523

27,318

28,138

General Manager

$21,000

$84,000

$21,630

$86,520

$89,116

$91,789

$94,543

Mr. Alberto Garcia

21,000

84,000

21,630

86,520

89,116

91,789

94,543

$36,250

$64,583

$78,750

$82,083

$261,667

$124,373

$497,490

$544,242

$696,067

$996,075

5.0

7.0

8.0

12.0

13.0

17.0

25.0

General and Administrative Secretary

Total Wages Total Staff

Table 2: Quarterly Profit and Loss Profit & Loss Statement $422,484 146,149 156,833 302,982

1Q $163,480 62,833 96,305 159,138

2Q $260,746 105,063 96,305 201,368

3Q $441,202 186,434 96,305 282,739

4Q 2016 2017 2018 2019 $771,832 $1,637,260 $4,251,032 $5,036,437 $5,965,902 340,006 694,336 1,526,243 1,808,383 2,142,165 96,305 385,220 428,604 576,960 873,395 436,311 1,079,556 1,954,847 2,385,343 3,015,560

$14,167 13%

$119,502 28%

$4,342 3%

$59,378 23%

$158,463 36%

$335,521 43%

0 1,050 3,000 3,000 $7,050

0 4,200 12,000 12,000 $28,200

0 1,082 3,090 3,090 $7,262

0 4,326 12,360 12,360 $29,046

0 4,456 12,731 12,731 $29,917

0 4,589 13,113 13,113 $30,815

0 4,727 13,506 13,506 $31,739

6,250 0 6,000 3,600 1,500 450 6,458 $24,258

6,250 0 6,000 3,600 1,500 450 7,875 $25,675

6,250 0 6,000 3,600 1,500 450 8,208 $26,008

20,833 0 22,000 14,400 6,000 1,800 26,167 $91,200

6,438 0 6,180 3,708 1,545 464 12,437 $30,771

25,750 0 24,720 14,832 6,180 1,854 49,749 $123,085

26,523 0 25,462 15,277 6,365 1,910 54,424 $129,960

27,318 0 26,225 15,735 6,556 1,967 69,607 $147,409

28,138 0 27,012 16,207 6,753 2,026 99,608 $179,744

21,000 0 1,350 $22,350

84,000 0 5,400 $89,400

21,630 0 1,391 $23,021

86,520 0 5,562 $92,082

89,116 0 5,729 $94,844

91,789 0 5,901 $97,690

94,543 0 6,078 $100,620

Total Operating Expenses

$44,658

$53,658

$55,075

$55,408

$208,800

$61,053

$244,213

$254,722

$275,914

$312,104

EBITDA Interest Expense Depreciation Taxes Incurred Net Earnings

$11,510 0 0 0 $11,510

($21,992) 0 0 0 ($21,992)

($37,575) 0 0 0 ($37,575)

($41,242) 0 0 0 ($41,242)

($89,298) 0 0 0 ($89,298)

($56,711) 0 0 0 ($56,711)

($1,675) 0 0 0 ($1,675)

$97,410 0 0 0 $97,410

$274,468 0 0 0 $274,468

11%

-21%

-36%

-39%

-21%

-35%

-1%

22%

36%

1Q $106,134 36,799 13,167 49,966

2Q $105,450 36,450 37,333 73,783

3Q $105,450 36,450 51,500 87,950

4Q $105,450 36,450 54,833 91,283

$56,168 53%

$31,667 30%

$17,500 17%

Sales and Marketing Expenses Sales and Marketing Payroll Advertising/Promotion Travel Miscellaneous Total Sales and Marketing Expenses

0 1,050 3,000 3,000 $7,050

2,083 0 4,000 3,600 1,500 450 3,625 $15,258

Other Expenses: General Manager Payroll Audit Fees Consultancy Fee (Accounting, Tax etc.) Total Other Expenses

Sales Direct Cost of Sales Operations Payroll Total Cost of Sales Gross Margin Gross Margin %

Net Margin

2015

$557,704 $2,296,185 $2,651,094 $2,950,342 34% 54% 53% 49%

$313,491 $2,041,463 0 0 0 0 0 0 $313,491 $2,041,463 19%

48%

$2,375,181 $2,638,239 0 0 0 0 0 0 $2,375,181 $2,638,239 47%

44%

Table 3: Pro Forma Balance Sheet Pro Forma Balance Sheet 1Q

2015

2016

2017

2018

2019

Current Assets Cash Accounts Receivable Inventory Other Current Assets

275,510 0 0 0

253,518 0 0 0

215,943 0 0 0

174,702 0 0 0

117,990 0 0 0

116,315 0 0 0

213,725 0 0 0

488,193 0 0 0

2,529,656 0 0 0

4,904,837 0 0 0

7,543,075 0 0 0

Total Current Assets

275,510

253,518

215,943

174,702

117,990

116,315

213,725

488,193

2,529,656

4,904,837

7,543,075

Long-term Assets Long-term Assets Accumulated Depreciation

200,000 0

200,000

Assets

Total Long-term Assets

200,000

$475,510

$453,518

$415,943

$374,702

$317,990

$316,315

$413,725

$688,193

Total Long Term Liabilities

Total Liabilities

600,000 -124,490

600,000 -146,482

600,000 -184,057

600,000 -225,298

600,000 -282,010

600,000 -283,685

600,000 -186,275

600,000 88,193

600,000 2,129,656

600,000 4,504,837

600,000 7,143,075

475,510

453,518

415,943

374,702

317,990

316,315

413,725

688,193

2,729,656

5,104,837

7,743,075

Total Liabilities and Equity

$475,510

$453,518

$415,943

$374,702

$317,990

$316,315

$413,725

$688,193

$688,193 $2,729,656 $5,104,837 $7,743,075

Net Worth

$475,510

$453,518

$415,943

$374,702

$317,990

$316,315

$413,725

$688,193

$688,193 $2,729,656 $5,104,837 $7,743,075

Total Assets

$688,193 $2,729,656 $5,104,837 $7,743,075

Liabilities and Equity Current Liabilities

Total Current Liabilities Long Term Liabilities

Equity Paid-in Capital Retained Earnings

Total Equity