PyroGenesis Canada Inc, the advanced materials group, told investors it sees 2022 as a base on which to build "decades of exponential growth" as the company posted first quarter results.
In the three months to end-March, the company, which develops plasma processes to reduce greenhouse gases (GHG), posted revenue of C$4.2 million, down 33% compared to the first quarter of 2021.
"Our backlog remains very large, above $41MM, and despite gross reported revenue being impacted this quarter slightly by accounting procedures related to international logistical and shipping challenges, our factories continue to produce at a rapid rate, both against the backlog and in anticipation for new business throughout the year," explained CEO Peter Pascali in a statement.
"Perhaps even more exciting, our new business development efforts have grown dramatically, with a pipeline of pitched projects within the aluminum business line alone now over several hundred million dollars," he added.
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"The board and I see continued production and sales success in the months ahead; as our iron ore pelletization torches enter into on-site client install and testing, 3D powder qualification with the global aerospace company moves to the finish line, and some of our potential aluminum projects in negotiations reach a signing point, we expect the backlog to race past the $50MM mark and beyond," he summed up.
Earnings before interest, taxes, depreciation, and amortization (EBITDA) in the period was a loss of C$3.3 million, compared to an EBITDA gain of C$3.9 million in the first quarter of 2021. PyroGenesis said the decrease was due to the increase in depreciation on property and equipment, an increase in depreciation ROU (right of use) assets, an increase in amortization of intangible assets, a rise in expenses, and an increase in income taxes.
As of March 31, the company had cash and equivalents and shares of C$18.5 million and a backlog of signed and/or awarded contracts of C$41.2 million.
"Despite the continuing challenges of the global marketplace due to Covid, plus new challenges resulting from conflict in Ukraine, as well as energy supply shortages in Europe and China impacting both the cost and output of aluminum and steel, opportunities for PyroGenesis continue to expand across the board," the firm said of the outlook.
"Led by unprecedented awareness of the Company's capabilities across the aluminum industry after the successful commissioning of its DROSRITETM metal recovery systems at a leading Middle Eastern primary aluminum producer; along with the discovery, pursuit, and active engagement of new market prospects both upstream and downstream from the Company's DROSRITETM systems; and major new developments within primary, secondary (recycled) and tertiary (manufacturers' in-house casting facilities) aluminum producers who are engaging the company in a variety of discussions and negotiations regarding metal recovery, furnace retro-fitting, and comprehensive fuel-switching initiatives.
"These factors, bolstered by the quickening global push towards fossil fuel reduction at both industry and government levels that further showcases the PyroGenesis advantage, allows management to expect that tailwinds into an already strong pipeline will continue throughout 2022 and beyond," said the company.
Contact the author at giles@proactiveinvestors.com