Agriculture loan

This loan is to be applied specifically to their wine business, to buy bottles, corks, boxes, labels, and all other expenses necessary to bottle 75 000 litters of wine (100 000 bottles). This amount of wine that they have in vats is divided between Syrah, Alicante Bouschet, Touriga Nacional Caladoc, and Touriga Franca for Red wines and Moscatel, Arinto, Viosinho, Verdelho, Encruzado and Fernão Pires for the White wines. This represents a quite diversified portfolio of wines regarding the grapes, quality tiers and the blend possibilites, allowing them to have viable options for different markets and sectors.

With this financing, the company will be able to sell the wine bottled and labelled with their brand, instead selling the wine by the barrel to another brand. This will have a large impact on their revenue, given that it represents an increase of the expected selling price from a price range of 0.55 to 0.65 euros per litter if sold in vats, to an expected average 3.75 to 4.25 euros if sold in bottles (2.25 to 7.00 euros per bottle, depending on the wine). This was the original plan of the business before the steep increase of prices all across the production processes, which forced them to consider selling of the wine in vats.

Sociedade Agricola Quinta da Eira, Lda is now requesting a loan of 67,000 € to kick off the first phase of preparing and implementing their marketing campaign. They have already begun bottling wine from their vats. With this campaign, the client aims to establish a premium, reserve, and rotation wine range as a reference in the national and international markets from the demarcated region of Lisbon.

To ensure this loan, the project owner is pledging the equipment of the wine cellar, which represented an investment of 1.4 Million euros in stainless steel alone in 2012. The price of stainless steel has since more than doubled, as the large stainless steel wine containers (wine vats). These assets are insured to a maximum of 2.25 million euros, and have high liquidity, given the demand for this equipment among Portuguese wine producers. The collateral will be pledged with a value of 235 935 €, giving 28% LTV.

Please note that asset pledged on this loan was also used as collateral on their two previous loan (PT0001182 & PT0001183) in equal pledged value of 235 935 € (28% LTV). The total active loan balance of two existing loans is 132 000 €

In the past years, the family went through a major investment effort to restructure and modernize the business in three main areas.

- The automation to optimize the processes of the Apple, Pear, and Plum orchards that are the main business area. A large part of the farmlands was re-planted recently with improved organization and structures, which represents an increase in production in the next years. They also have now full coverage with their own water holes and efficient irrigation systems in place. Both orchards and vineyards are fully mechanized, having their own harvesting platforms and harvesting machines.

- The revival of the family wine business, redoing and equipping the cellars with full capacity for the expected production of the coming years and with a bottling line. They are also in the process of the international expansion of the wine company, which was established in 1998, and have been registering their wine brands for export. The expectation is that this business revenue will grow to surpass the weight fruit business.

- They also started an Agro/Wine tourism business, given the proximity to Lisbon, the beachside, and premium golf courses, building a space dedicated to wine tasting and shop, and the restoration of the family’s 200 years old wine cellars.

Tiago Casimiro, the director of the company has borrowed 2 loans on the HeavyFinance platform for the development of fruit production line and currently has a a total active amount of 35 500 € that he has been paying timely.