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PyroGenesis Canada Inc

PyroGenesis awarded multiyear contract worth C$55 million

The contract is the largest in PyroGenesis’s history and would put the high-tech manufacturer of plasma systems into profitability

contract signing
The contract is the largest in the plasma manufacturer's history

PyroGenesis Canada Inc (CVE:PYR) (OTCMKTS:PYRNF) has been awarded a contract worth potentially C$55 million in future revenues, the company announced Monday afternoon.

The contract is the largest in PyroGenesis’s history and would put the high-tech manufacturer of plasma systems into profitability, the company said in April as talks were ongoing.

The terms of the contract and potential parties involved have not been disclosed at press time, but according to PyroGenesis, first-year revenue targets will hit $20 million. The net present value of subsequent yearly revenue is $35 million, giving the contract a total value of $55 million.

READ: PyroGenesis posts quarterly earnings showing a backlog of nearly C$9 million in contracts

According to PyroGenesis, the contract is not related to the company’s military-business line.

“This is indeed a watershed moment in PyroGenesis’ history,” said CEO Peter Pascali. “With the revenues from this contract, we do not foresee raising capital for working capital purposes in the foreseeable future as the company, with this contract, which is cash flow positive from the start, will be profitable.”

The contract is contingent on a site visit under normal due diligence, which PyroGenesis expects to be completed shortly.

The Montreal-based company designs and manufactures advanced plasma processes and products for use in a selection of different technology-intensive industries, such as mining and defense. It told shareholders recently that there is a backlog of C$8.5 million in signed contracts that will contribute to revenue growth going forward.

Shares of PyroGenesis rose 3.7% on Monday to close at C$0.56 in Toronto and slipped 4.6% on OTC markets at US$0.41.

Contact Angela at [email protected]

Follow her on Twitter @AHarmantas

Quick facts: PyroGenesis Canada Inc

Price: $0.50

Market: TSX-V
Market Cap: $69.81 m
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