ESGFIRE: Replenish Nutrients (Earthrenew) secures $7 million grant and clears path to $40 million in revenues. ESGFIRE sets target price of $0.35 cents

MALMÖ, Sweden, July 13, 2023

MALMÖ, Sweden, July 13, 2023 /PRNewswire/ -- Our largest portfolio holding ,Replenish Nutrients (Formerly known as Earthrenew), yesterday (12/7) reported that they have secured $7 million in non dilutive grant financing from Emissions Reduction Alberta (ERA). The funds will provide the company with the equity required to fund their ready to build regenerative fertilizer manufacturing facility "Debolt"  which has already secured all necessary environmental approvals. The remaining funds required for the facility have been secured through a loan term sheet.

Once ready the Debolt facility will have a capacity up to 50,000 metric tons equaling annual revenues of $20-25 million (ESGFIRE projection using a price of $400 / ton). Combined with already existing facilities, Replenish Nutrients will be able to target a combined revenue of $40-50 million annually (ESGFIRE calculation using a price of $400 / ton).

Our opinion is that the news of the $7 million in grant is a true gamechanger for the company as most doubts regarding the company's short term need to raise money through equity should be gone for the moment. Thus, further dilutive financing is no longer a short-term concern. Our opinion is also that the grant shows validation for the company's technology.

It's also worth keeping in mind that the company recently have reported progress on licensing revenue discussions alongside a stunning product superiority of 61 % higher return on investment (compared to grower standard products).

Our current fair share price of the company after today's news is $ 50 million CAD or 35 cents per share and is based on a projected future sales multiple of X 1,25. Our opinion is that the company deserves to trade at a premium compared to the much larger industry peer Yara International (valued at 0,54 X sales for 2024). We base our premium sales valuation on the news reported by the company that they have a proven superiority in their regenerative fertilizer product and that they also have a massive licensing revenue potential (not included in the $40 million in our future projected sales). The licensing revenue will likely provide very high margin revenues. Our opinion is also that the company soon will be able to charge a premium for their products which will increase potential future sales beyond $40 million annually.

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