DM-XTech · DM-X CBM
DM-XTech · DM-X CBM
v3.5R model · Conservative assumptions · Three revenue streams · Full sensitivity disclosure
This revision incorporates: (i) updated land-rental market rate of ₱100,000/ha/year (reflecting post-crisis landowner expectations); (ii) post-fuel-crisis LPG reference price of ₱100/kg retail (pre-crisis ₱80/kg, crisis peak ₱100–140/kg), driving CBM BTU-parity selling price to ₱80/Nm³; and (iii) fertilizer and carbon-credit revenues now treated as base-case line items rather than stackable upside. Additional revenue streams (hobby retail, livestock feed, dried meal) are held outside the base case for conservatism.
• 25% CIT applied in all years — no Income Tax Holiday assumed (RA 9513 upside excluded)
• 250 L CH₄/kg VS methane yield — mid-range literature value, not upper bound
• ₱9.00/kWh power cost — indicative Luzon industrial rate; sensitivity at ₱11/kWh shown
• Carbon credits at $12/tCO₂e mid-case — registry validation not assumed
DM-X CBM is priced at full BTU parity with imported LPG — consumers pay the same per usable BTU, so no subsidy or discount is required for adoption.
| Parameter | Value | Source |
|---|---|---|
| LPG retail price (post-crisis) | ₱100.00/kg | Retail cylinder market, April 2026 |
| LPG higher heating value | 47,400 BTU/kg (50.0 MJ/kg) | Standard propane/butane blend |
| CBM higher heating value | 37,760 BTU/Nm³ (39.8 MJ/Nm³) | ≥97% CH₄ at STP |
| DM-X CBM selling price | ₱80.00/Nm³ | BTU parity: ₱100 × (37,760÷47,400) |
If LPG retail resets to the pre-crisis ₱80/kg level, BTU parity drives CBM price to ₱64/Nm³. Under this scenario, Year 2 DSCR falls to approximately 1.84× — still above the 1.25× bank minimum but with materially reduced margin. The project remains viable, but Phase 2 expansion timing would likely shift right by 12–18 months. This is the single largest exogenous risk to the base case.
DM-XTech cultivates its own azolla supply by leasing suitable farmland — shallow wetlands, rice paddies, fish pond complexes. DM-XTech's cultivation teams manage everything. This is a fully vertically integrated feedstock model.
Fresh azolla is currently sold on Instagram by hobbyists at ₱100/kg — marketed as "seedlings" to aquarists. Once commercial-scale demand becomes visible, any supply negotiation would anchor to this benchmark, making feedstock cost unmanageable. By cultivating on rented land with own staff, DM-XTech controls its cost structure entirely.
| Cultivation Cost Assumptions · v3.5R IN-HOUSE | Value |
|---|---|
| Land rental rate (paddy / wetland) | ₱100,000 / ha / yr |
| Cultivation labor (harvest, water mgt.) | ₱15,000–20,000 / ha / yr |
| Inputs (inoculant top-up, minor nutrients) | ~₱2,000 / ha / yr |
| Total cultivation cost per ha | ≈ ₱120,000 / ha / yr |
| Azolla yield (Philippine tropical) | 150 t fresh / ha / yr |
| Equivalent cost per kg fresh azolla | ₱0.80 / kg |
| DM content · Volatile solids | 10% DM · 75% VS |
| Methane yield (base case) | 250 L CH₄ / kg VS |
| Fresh azolla per Nm³ CBM | 50.9 kg |
| Cultivation cost per Nm³ CBM | ₱40.72 |
| All other OPEX per Nm³ | ~₱14.60 |
| Total OPEX per Nm³ CBM | ~₱55.32 |
| CBM selling price | ₱80.00 |
| EBITDA per Nm³ (CBM-only) | ~₱24.68 (30.9%) |
Note: The v3.5R model uses 250 L CH₄/kg VS (base case) versus 280 L/kg VS in the prior v3.5. This increases fresh azolla required per Nm³ from 47.6 kg to 50.9 kg and raises cultivation cost per Nm³ from ₱38.08 to ₱40.72. The financial model has been recalibrated to absorb this conservatism.
DM-XTech requests a term loan of ₱12,000,000 to co-finance construction and commissioning of the DM-X CBM gas-processing plant. The 18 reinforced-concrete cultivation tanks have already been fully constructed from proponent equity and are operational.
| Term | Detail |
|---|---|
| Loan Amount Requested | ₱12,000,000 |
| Proponent Equity (already deployed) | ₱5,000,000 (29.4%) |
| Loan-to-Total-Cost Ratio | 70.6% |
| Interest Rate | 8.0% p.a. fixed |
| Tenor | 8 years (1 year grace + 7 years amortization) |
| Principal Grace Period | 12 months from drawdown |
| Annual principal repayment (Y2–Y8) | ₱1,714,286 (straight-line) |
| Year 2 debt service (peak) | ₱2,674,286 |
| Year 2 DSCR (base case) | 2.84× ✓ |
| Year 5 DSCR | 4.81× ✓ |
| Collateral Coverage Ratio | 1.50× (₱18.06M / ₱12M) |
The v3.5R base case includes three distinct revenue lines: primary CBM sales at BTU parity, secondary fertilizer sales from digestate, and tertiary carbon-credit revenue at $12/tCO₂e mid-case.
| Line Item | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Output (Nm³/year) | 210,000 | 280,000 | 320,000 | 350,000 | 360,000 |
| Capacity Utilization | 48% | 64% | 73% | 80% | 82% |
| CBM Price (₱/Nm³) | 80.00 | 80.00 | 80.00 | 82.00 | 82.00 |
| CBM Revenue (₱) | 16,800,000 | 22,400,000 | 25,600,000 | 28,700,000 | 29,520,000 |
| Fertilizer Revenue | 1,056,000 | 1,408,000 | 1,606,000 | 1,760,000 | 1,804,000 |
| Carbon Credit Revenue ($12/tCO₂e) | 320,000 | 428,000 | 488,000 | 534,000 | 549,000 |
| Total Revenue (₱) | 18,176,000 | 24,236,000 | 27,694,000 | 30,994,000 | 31,873,000 |
| Azolla Cultivation (land + labor) | (8,551,000) | (11,402,000) | (13,030,000) | (14,252,000) | (14,660,000) |
| Power & Utilities | (1,890,000) | (2,520,000) | (2,880,000) | (3,150,000) | (3,240,000) |
| Labor (10 FTEs) | (1,260,000) | (1,300,000) | (1,300,000) | (1,350,000) | (1,400,000) |
| Maintenance (2% CAPEX) | (340,000) | (357,000) | (375,000) | (394,000) | (414,000) |
| Distribution & Transport | (600,000) | (780,000) | (900,000) | (960,000) | (984,000) |
| Insurance, Admin & Overhead | (500,000) | (520,000) | (540,000) | (560,000) | (580,000) |
| Fertilizer Direct Costs (30%) | (317,000) | (422,000) | (482,000) | (528,000) | (541,000) |
| Carbon Credit Direct Costs (20%) | (64,000) | (86,000) | (98,000) | (107,000) | (110,000) |
| Total OPEX (₱) | (13,522,000) | (17,387,000) | (19,605,000) | (21,301,000) | (21,929,000) |
| EBITDA (₱) | 4,654,000 | 6,849,000 | 8,089,000 | 9,693,000 | 9,944,000 |
| Depreciation (₱17M ÷ 10 yr) | (1,700,000) | (1,700,000) | (1,700,000) | (1,700,000) | (1,700,000) |
| Interest Expense (8% on beg. bal.) | (960,000) | (960,000) | (822,857) | (685,714) | (548,571) |
| Earnings Before Tax | 1,994,000 | 4,189,000 | 5,566,143 | 7,307,286 | 7,695,429 |
| Income Tax @ 25% (No ITH) | (498,500) | (1,047,250) | (1,391,536) | (1,826,822) | (1,923,857) |
| Net Income (₱) | 1,495,500 | 3,141,750 | 4,174,607 | 5,480,465 | 5,771,571 |
| Annual Debt Service (₱) | 960,000 | 2,674,286 | 2,537,143 | 2,400,000 | 2,262,857 |
| DSCR (EBITDA ÷ Debt Service) | 4.85× ✓ | 2.56× ✓ | 3.19× ✓ | 4.04× ✓ | 4.39× ✓ |
The shift from 280 L/kg VS to 250 L/kg VS (conservative base case) increases cultivation cost and reduces EBITDA margin. Year 2 DSCR falls from 2.84× (v3.5) to 2.56× (v3.5R). This is still comfortably above the 1.25× bank minimum and reflects honest, defensible biology. The project remains fully bankable.
The table below reports DSCR in Year 2 (the peak debt-service year at lowest utilization — the binding constraint) under various stress scenarios.
| Scenario | Y2 DSCR | Y3 DSCR | Assessment |
|---|---|---|---|
| Base Case · v3.5R ₱80/Nm³ · ₱0.80/kg · 64%→73% util · CBM+fert+credits | 2.56× | 3.19× | ✔ Above min |
| CBM price −5% → ₱76/Nm³ (LPG softens to ₱95/kg) | 2.18× | 2.73× | ✔ Safe |
| CBM price −10% → ₱72/Nm³ (LPG at ₱90/kg) | 1.80× | 2.27× | ✔ Safe |
| CBM price −20% → ₱64/Nm³ (LPG at ₱80/kg pre-crisis) | 1.04× | 1.35× | ⚠ Y2 below min · Y3 recovers |
| Cultivation cost +15% → ₱0.92/kg (land rental to ₱115K/ha) | 2.02× | 2.54× | ✔ Safe |
| Cultivation cost +25% → ₱1.00/kg (land rental to ₱125K/ha) | 1.66× | 2.10× | ✔ Safe |
| Power cost +30% → ₱11.70/kWh | 2.32× | 2.90× | ✔ Safe |
| Combined stress: CBM −10% AND Cultivation +15% | 1.26× | 1.71× | ⚠ Y2 just above min |
| Severe stress: CBM −20% AND Cultivation +20% (simultaneous multi-vector shock) | 0.71× | 1.21× | ✗ Breach Y2 · recovers Y3 |
Break-even CBM price at Year 2 DSCR = 1.25×: Under v3.5R base-case volumes and cultivation cost, the minimum CBM price to keep Year 2 DSCR at 1.25× is approximately ₱68/Nm³ (LPG parity at ₱85/kg). Against the base-case ₱80/Nm³, Y2 has ~15% price headroom. This is lower than v3.5's 19% headroom because of the conservative biology revision — but it is honest and defensible.
DM-XTech anticipates accepting the following financial covenants on the ₱12M facility:
| Covenant | Threshold | Rationale |
|---|---|---|
| Minimum DSCR | ≥ 1.25× trailing 12-mo | Standard project-finance minimum. v3.5R base: 2.56× Y2. |
| Maximum Debt / EBITDA | ≤ 4.0× at year-end | Starting Y1 ≈ 2.6×, falling to 1.7× Y2, below 1.2× by Y5. |
| CAPEX lock-up | ≤ ₱500K discretionary p.a. | Prevents cash diversion. Maintenance CAPEX exempt. |
| Distribution test | DSCR ≥ 1.50× for 12 mo prior | Equity distributions blocked unless trailing DSCR ≥ 1.50×. |
| Cross-default | Material default on any other ₱5M+ facility | Standard protection. No other material debt in place. |
| Insurance maintenance | Public liability ≥ ₱5M · BI ≥ ₱3M | Budgeted in OPEX at ~₱100k/yr total premium. |
| Permit maintenance | Good standing on DOE, ERC, DENR, BIR | Standard operating requirement. |