Summary
The fund managers believe that FBR Ltd has made significant strides in its US Demonstration Program, particularly through its partnership with CRH Ventures, a major player in the construction materials industry. In their opinion, the completion of the Demonstration Program, which involved constructing the walls of nine homes in Florida, showcases the potential of the Hadrian X® technology and demonstrates compliance with building standards. FBR's revenue potential is estimated at over US$1.1B annually with target gross margins exceeding 50%, contingent upon the successful exercise of a joint venture option with CRH. However, the fund managers express concern over the recent decision by CRH not to proceed with the joint venture, attributing this to leadership changes within CRH. This has created uncertainty for FBR as it seeks new partnerships in the US market. Despite these challenges, the fund managers acknowledge FBR's advancements and ongoing discussions with Samsung Heavy Industries, indicating a potential pivot towards the shipbuilding sector. Investors should be aware of the risks associated with capital raises and the need for new strategic partnerships.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Source: Trading View
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Commentary From The Managers
Saville Capital
31 Mar 2025
$0.01
Summary
- Saville Capital sold their investment in FBR due to the lapsed option agreement with CRH Ventures.
- There was no imminent deals to fund FBR's entry into the US construction market.
- Despite their belief in FBR's technology, Saville Capital decided to exit the position.
- They will remain close observers of FBR's activities, especially concerning Samsung.
- With emerging investment opportunities in the market, Saville Capital felt their capital could be better utilized elsewhere.
- FBR is working towards an agreement with Samsung and seeking other partners in the US.
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Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
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Commentary From The Managers
Saville Capital
31 Mar 2025
$0.01
Summary
- Saville Capital sold their investment in FBR due to the lapsed option agreement with CRH Ventures.
- There was no imminent deals to fund FBR's entry into the US construction market.
- Despite their belief in FBR's technology, Saville Capital decided to exit the position.
- They will remain close observers of FBR's activities, especially concerning Samsung.
- With emerging investment opportunities in the market, Saville Capital felt their capital could be better utilized elsewhere.
- FBR is working towards an agreement with Samsung and seeking other partners in the US.
Saville Capital
28 Feb 2025
$0.02
Summary
- Saville Capital highlights the completion of the Demonstration Program with positive feedback from PulteGroup.
- FBR did not receive formal notice from CRH regarding the JV option, which is seen as a disappointment.
- The introduction of a new CEO at CRH may have influenced its decision not to proceed with the joint venture.
- FBR is now tasked with seeking other potential partners within the US building sector.
- Despite setbacks, Liebherr remains committed as a manufacturing partner for FBR.
- The search for a new partner will require more time and working capital.
- FBR successfully demonstrated its technology to Samsung Heavy Industries on February 24.
- The demonstration aims to assess the feasibility of applying FBR’s technology in the shipbuilding industry.
- Negotiations for a business agreement between FBR and SHI are set to begin, focusing on joint development and prototyping.
Saville Capital
31 Dec 2024
$0.04
Summary
- FBR announced the completion of the Demonstration Program with CRH Ventures in Florida.
- Nine homes were constructed using the Hadrian X® and concrete masonry blocks from CRH Ventures.
- One home was built in a single day, confirmed by independent structural engineers.
- The completion of the program triggers a 45-day period for CRH to exercise an exclusive joint venture option with FBR starting January 2, 2025.
- This option includes a US$400k payment to FBR upon exercise.
- FBR and CRH aim to build additional homes for major US builders outside the program.
- CRH, a major construction materials company, has a market cap of ~US$60B.
- A US$40m rolling loan facility will support the construction of Hadrian X® units once the option is exercised.
- The joint venture plans to execute a binding conditional purchase order for 20 units and has options for more units, subject to metrics.
- Exclusive concrete block supply from CRH subsidiaries will enhance profit sharing from the JV.
- Revenue potential of deploying 300 units at 70% utilisation exceeds US$1.1B annually.
- Target gross margins are expected to exceed 50%.
- Completion of the program has not yet influenced FBR’s share price, possibly due to perceived risks.
- FBR is positioned for significant value creation for shareholders moving forward.
Saville Capital
30 Sept 2024
$0.05
Summary
- FBR has launched its US Demonstration Program, achieving a milestone by completing the first home walls in Florida.
- This completion represents the first international build by Hadrian X®.
- Collaboration with New Century USA, a participating builder, showcases the technology's adaptability.
- FBR plans to construct walls for four additional homes for New Century in the Demonstration Program.
- Christopher Alan Homes, another builder in the program, adds credibility as the largest homebuilder in Southwest Florida.
- The Demonstration Program aims to highlight the versatility and compliance of FBR's technology across different home styles.
Saville Capital
31 Aug 2024
$0.04
Summary
- FBR raised $12.5m via a placement to fund its working capital during important phases for US JV Option exercise with CRH Ventures.
- Completed a Site Acceptance Test at Fort Myers facility, triggering a US$600k payment, yet stock declined from ~$0.05/share to placement price of $0.038.
- Currently undergoing a US Demonstration Program, constructing five houses with potential for five additional houses funded by CRH Ventures.
- Houses will be certified by an independent structural engineer upon completion.
- Completion will yield US$400k from CRH Ventures and begin a 45-day period for exercising joint venture option for Wall as a Service®.
- Significant event anticipated for FBR upon formation of the joint venture.
Saville Capital
31 July 2024
$0.05
Summary
- Saville Capital continues to hold due to FBR's surge on the arrival of Hadrian X® in Florida.
- The surge is viewed as a delayed reaction to earlier positive developments and a capital raising in challenging markets.
- In January, FBR announced a binding suite of agreements for a US Demonstration Program with CRH Ventures Americas, Inc.
- CRH is a major player with a market cap of ~US$55B and is one of the largest construction materials companies globally.
- On exercising the joint venture option, a US$40m rolling loan facility will fund construction of Hadrian X® units.
- Orders for 20 units under a binding conditional purchase order are anticipated, with additional conditions for further orders.
- Revenue potential of 300 units at 70% utilization exceeds US$1.1B annually, with target gross margins over 50%.
- FBR may need to raise additional capital to fund operations during the Demonstration Program.
- Upon clearing financial hurdles and exercising the JV Option, FBR's value could increase significantly from current levels.
Saville Capital
28 Feb 2024
$0.02
Summary
- FBR continues to trade below its recent capital raise price.
- Successful completion of the Factory Acceptance Test for CRH has triggered a second milestone payment of US$800k.
- The test structure achieved an effective lay rate of 330 blocks/hour, exceeding the required 285 blocks/hour.
- Preparations are underway to ship the Hadrian X® to Florida for the Site Acceptance Test.
- This will precede a 5 – 10 house Demonstration Program.
- FBR’s Hadrian X® will be serviced at Liebherr’s facilities in Florida, facilitating knowledge transfer.
- This collaboration aims to accelerate manufacturing ramp up following a long-term Manufacturing and Commercialisation Agreement.
Saville Capital
31 Jan 2024
$0.02
Summary
- FBR has executed a binding suite of agreements for a US Demonstration Program in Florida to construct external walls of 5-10 single storey houses.
- Partnership established with CRH Ventures Americas, Inc., which is part of a NYSE-listed company with a market cap of ~US$50B.
- CRH is one of the largest construction materials companies globally, with operations in the US, Europe, and Australia.
- Upon exercising the exclusive Option, a US$40m rolling loan facility will be set up to fund construction of Hadrian X® units.
- Initial binding conditional purchase order for 20 units will be executed, with potential additional orders based on utilisation and gross margin metrics.
- CRH subsidiaries will supply concrete blocks exclusively to the US joint venture, sharing profits as units are hired out.
- The revenue potential from deploying 300 units at 70% utilisation is estimated at over US$1.1B annually, with target gross margins over 50%.
- FBR needed to raise approximately $12m to continue operations amid share price decline due to capital raise challenges.
- Saville Capital continues to hold investments in FBR due to the long-term potential of these agreements and revenue generation capabilities.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Frequently Asked Questions
Who has invested in FBR Ltd (ASX:FBR)?
Fund managers including Saville Capital have invested in FBR Ltd (ASX:FBR).
Why have investment managers invested in FBR Ltd (ASX:FBR)?
Fund managers have invested in FBR Ltd due to its strategic partnerships and technological advancements in the construction sector. The company has secured a binding agreement with CRH Ventures Americas, a major player in the construction materials industry, to implement a US Demonstration Program for its Hadrian X® technology. This program involves constructing external walls for homes in Florida, showcasing FBR's innovative automation capabilities. The revenue potential from this initiative is significant, with projections exceeding $1.1 billion annually at optimal utilization rates. Despite recent challenges, including the need for additional capital and a lapsed joint venture option with CRH, the successful completion of the Demonstration Program has established FBR's credibility in the US market. Fund managers believe that once operational hurdles are cleared, FBR could see substantial value growth, driven by its unique technology and potential partnerships, particularly with companies like Samsung Heavy Industries.
What happened to FBR Ltd (ASX:FBR)?
There have been no recent updates from fund managers regarding FBR Ltd although fund managers including Saville Capital have previously commented.