OPEX and Technology Investment Evaluation

Evaluate operations efficiency and investments to make food grade bottles from rPET

• The client had recently purchased a polyester recycling plant – the facility was primarily focused on rPET into packaging strapping.
• Along with plant improvement initiatives, various proposals had been made to upgrade the facility to make food grade bottles.
• Sales demand had been increasing at the same time the plant’s ability to maintain increasing quality demands was falling behind.
• Caravel was asked to:
  • Evaluate the operating efficiency of the plant and make recommendations
  • Leverage Caravel polymer expertise to analyze and predict future market demands and quality requirements of rPET
  • Evaluate various upgrade options and make recommendations
  • Build a plant financial model that combined all effects as well as positioned the client to be able to evaluate other future plant changes

Evaluate market and operating performance; Develop an overall strategy complete with tactical action.

• Evaluated market and operating performance.
• Developed an overall strategy complete with Tactical Action Plan:
  • rPET market trends as compared to PET were analyzed and future estimates made for price and demand
  • Site visit and plant operating performance analysis revealed a well-run plant that needed more best practices in maintenance & reliability, Improved automation was also recommended in key areas

EBITDA Impact from 12% to 24% – 8.5M/yr.

• rPET is a unique market that has increasing demand along with ever-increasing social & political support.
• Caravel polymer experts were strongly supportive of the investment to expand and upgrade the plant – making insightful recommendations on improving the technology with
• Steady State Polymerization reactors and newly upgraded extrusion.
• Key plant recommendations were made to improve Sorting & Grinding yield along with improvements in Equipment Uptime.
• A financial model quantified the impact of all scenarios and positioned the client to continue to use the model to explore “life” what-if scenarios in the future.
• Annual financial goals and expectations along with action plans were developed.
• Ultimate Strategy recommended: Major Upgrade with a Project ROI of 35%+.