Wow. Eloquent work. Would have liked the sustainable fuels and engine lubricant paths detailed a bit to bring the history full circle, in the speculation department alongside vaccine ingredients. But the theme is constant and clearly explained - SCALE is the golden ticket. Sustainable, cheaper, and only accomplished commercially by this one company. Antonio happy new year! Your objective thought process is a cold refreshment.
An update on this would be appreciated especially given the terrible crash in the value of the shares based on the very large cash burn in Q1 and resulting liquidity fears. Cash burn will remain elevated in Q2 and if they don’t get that seriously under control they will run out of cash by Q4. Melo says he has various ways to raise cash without more dilution but market is skeptical given his past lies and failed promises. (He very clearly promised cash flow positive by Q4 of 2021 in late 2020, early 2021)
On the plus side JVN is a huge best seller doing far better than expected and Barra Bonita should come on line end of June which should dramatically change the economics of production. It’s going to be tough year. Thanks for these excellent write ups. You should consider also submitting these to Seeking Alpha.
You mention in your excellent analysis that AMRS outsources its manufacturing. I believe you're referring to the Brotas 1 plant which AMRS sold to DSM in 2017 in exchange for $98M in cash and a farnesene supply agreement. Still, it's important to note that this is still AMRS exclusive and patented technology. Agree that Barra Bonita will further expand manufacturing capacity and increase gross margins.
Thanks for this. It raises a question: If AMRS core competence is scaling up, why does it outsource some manufacturing? Does it give away trade secrets?
Or perhaps, AMRS provides the secret ingredients (squalane) to others that make the cosmetics, incorporating the squalene manufactured by AMRS?
Thanks again, this is good, and I like the charts, particularly revenue etc per share over the years.
It is incongruent indeed. I believe it is due to the upfront CAPEX setting up a facility requires. Thank you as always for reading the analysis, Timmuggs!
Amyris' biggest problem is capacity or lack thereof. Outsourcing manufacturing is likely multiple times more expensive than production from their own plant. But it's something they have to do because of Demand
Synbio production is not a brand new thing. Contractual manufacturing exists and I'm sure Amyris uses a reputable place (I think one is in Spain). But costs are in the air due to feedstocks etc.
Amyris needs to build out it's custom state of the art manufacturing plants. These plants not only have cheap feedstock, but they focus on a circular economy - turning waste into valuable products. Margins will be disgusting.
Agree. They have high costs currently because they don’t have their own plant. The hope is that Barra Bonita will change those economics for good. We’ll know for sure this year.
Wow. Eloquent work. Would have liked the sustainable fuels and engine lubricant paths detailed a bit to bring the history full circle, in the speculation department alongside vaccine ingredients. But the theme is constant and clearly explained - SCALE is the golden ticket. Sustainable, cheaper, and only accomplished commercially by this one company. Antonio happy new year! Your objective thought process is a cold refreshment.
Thanks a lot, Natehammer. Happy new year to you too! May this year bring $AMRS the success it deserves.
An update on this would be appreciated especially given the terrible crash in the value of the shares based on the very large cash burn in Q1 and resulting liquidity fears. Cash burn will remain elevated in Q2 and if they don’t get that seriously under control they will run out of cash by Q4. Melo says he has various ways to raise cash without more dilution but market is skeptical given his past lies and failed promises. (He very clearly promised cash flow positive by Q4 of 2021 in late 2020, early 2021)
On the plus side JVN is a huge best seller doing far better than expected and Barra Bonita should come on line end of June which should dramatically change the economics of production. It’s going to be tough year. Thanks for these excellent write ups. You should consider also submitting these to Seeking Alpha.
Here’s the update:
https://antoniolinares.substack.com/p/amyris-q1-2022-er-digest
The situation remains high risk, high potential reward
You mention in your excellent analysis that AMRS outsources its manufacturing. I believe you're referring to the Brotas 1 plant which AMRS sold to DSM in 2017 in exchange for $98M in cash and a farnesene supply agreement. Still, it's important to note that this is still AMRS exclusive and patented technology. Agree that Barra Bonita will further expand manufacturing capacity and increase gross margins.
Thanks for this. It raises a question: If AMRS core competence is scaling up, why does it outsource some manufacturing? Does it give away trade secrets?
Or perhaps, AMRS provides the secret ingredients (squalane) to others that make the cosmetics, incorporating the squalene manufactured by AMRS?
Thanks again, this is good, and I like the charts, particularly revenue etc per share over the years.
It is incongruent indeed. I believe it is due to the upfront CAPEX setting up a facility requires. Thank you as always for reading the analysis, Timmuggs!
Amyris' biggest problem is capacity or lack thereof. Outsourcing manufacturing is likely multiple times more expensive than production from their own plant. But it's something they have to do because of Demand
Synbio production is not a brand new thing. Contractual manufacturing exists and I'm sure Amyris uses a reputable place (I think one is in Spain). But costs are in the air due to feedstocks etc.
Amyris needs to build out it's custom state of the art manufacturing plants. These plants not only have cheap feedstock, but they focus on a circular economy - turning waste into valuable products. Margins will be disgusting.
Agree. They have high costs currently because they don’t have their own plant. The hope is that Barra Bonita will change those economics for good. We’ll know for sure this year.
I agree with this.