EVGI Reports EPS Signs $121 Million Rapeseed Oil Sales Contract; Sees Revenue More than Doubling YOY in FY2013
GROVELAND, Fla., Oct. 10, 2012 /PRNewswire/ -- Eco Ventures Group, Inc. (OTCBB: EVGI), an emerging producer of diversified sustainable alternative energy and resources, today announced Germany-based Energiepark Supitz GmbH ("EPS") has signed a contract to supply at least 90,000 metric tons of rapeseed oil to GGT Trading, Ltd, valued at a minimum €93 million, or approximately US$121 million, over the next 15 months. The Company August 7 reported it had signed a Definitive Agreement to acquire EPS and, on Oct. 8, announced it planned to acquire 100 percent of EPS in a single closing transaction.
This contract contains a provision that allows GGT to buy up to a total 120,000 metric tons from EPS, or 33 percent more than the minimum, over the 15-month term with an upside total value of €124.8 million or approximately US$162 million. The contract deliveries will begin ramping up this month, with the majority of the revenue expected to be recorded in 2013.
GGT is a Cyprus-based firm with a strong presence in Poland and elsewhere in Eastern Europe. It has major business interests in biodiesel, oil and steel as well as strong business and political connections throughout those sectors and the region. It has purchased 5,000 to 10,000 tons of EPS' rapeseed oil annually for the past two to three years.
During that time, EPS has established an excellent reputation for the consistently high quality of its rapeseed oil and high reliability of its fulfillment. As a result, GGT has dramatically increased its purchase of EPS rapeseed oil from approximately 10,000 metric tons annually, to a minimum 90,000 metric tons over the next 15 months. This contract represents a minimum incremental revenue increase to EPS of approximately $100 million on an annualized basis.
EPS buys rapeseed from growers in Germany and elsewhere, and processes them through its mill producing rapeseed oil and rapeseed cake. EPS sells the rapeseed oil to be used as cooking (canola) oil or feedstock for biofuel production. It sells the rapeseed cake to farmers who use as it nutritious feed for livestock.
Mark Cox, President of EVGI, said, "This dramatically increased rapeseed contract confirms EPS' ability to compete against the largest companies in all of Europe and to win the big contracts. This contract has healthy gross margins, and will enable EPS to continue to generate robust growth year over year, organically, in its core markets profitably. EPS last month posted revenue for the first six months of 2012 that doubled to a record $24.4 million, and it posted $41.4 million in trailing twelve months revenue ended June 30, 2012.
"Adding $100 million in revenue is a game changer," Mr. Cox added. "It positions EPS as a leader amongst the industry's largest players to capture market share and bigger wins in the future. With the execution of this contract, we see EPS' 2013 revenue doubling, if not tripling, over what we fully expect will be record 2012 revenue. Further, EPS has a number of other positive, potentially game changing strategic initiatives in its new business pipeline for which we are increasingly optimistic."
"This new agreement confirms our investment in the industry was well thought out, and we are now reaping the reward of a solid growth strategy," said Matthias Tanzer, EPS Co-founder, Principal and Operations Manager. "We anticipate this relationship and other seeds we planted in Eastern Europe to flourish in the coming year."
About Eco Ventures Group
Eco Ventures Group, Inc. ("EVGI") is both acquiring and developing a portfolio of ecologically friendly businesses to provide renewable energy and related feedstock (www.ecoventuresgroup.com).
EPS is a diversified alternative energy feedstock, transportation, heat & solar power production company with approximately 50 employees -- whose primary business is the production, processing and brokering of alternative energy feedstocks including rapeseed, palm oil and wood. The acquisition combines two renewable energy companies whose technology, bio fuel and grid-tied energy products will create a diversified international platform with important operating synergies.
Safe Harbor Statement
Safe Harbor statement under the Private Securities Litigation Reform Act of 1995: EVGI encourages those interested in our Company to rely only on information included in our filings with the United States Securities and Exchange Commission which can be found at www.sec.gov. Statements released by Eco Ventures Group, Inc. that are not purely historical are forward-looking within the meaning of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding the company's expectations, hopes, intentions, and strategies for the future to include all those of its intended acquisition of Energiepark Suptitz, GmbH. Investors are cautioned that forward-looking statements involve risk and uncertainties that may affect the company's business prospects and performance. The company's actual results could differ materially from those in such forward-looking statements. Risk factors include but are not limited to general economic, competitive, governmental, and technological factors as discussed in the company's filings with the SEC on Forms 10-K, 10-Q, and 8-K. The company does not undertake any responsibility to update the forward-looking statements contained in this release.
Eco Ventures Group, Inc.
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SOURCE Eco Ventures Group, Inc.