MONTREAL, Nov. 11, 2022 (GLOBE NEWSWIRE) -- PyroGenesis Canada Inc. (
http://pyrogenesis.com) (TSX: PYR) (NASDAQ: PYR) (FRA: 8PY), a high-tech company (hereinafter referred to as the “Company” or “PyroGenesis”), that designs, develops, manufactures and commercializes advanced plasma processes and sustainable solutions which are geared to reduce greenhouse gases (GHG), is pleased to announce today its financial and operational results for the third quarter ended September 30th, 2022.
“In Q3 we delivered another quarter of strong margins against a difficult logistical and inflationary environment for heavy-industry manufacturers and their customers. With our strong production margins firmly established, and our operational and sourcing approaches proven again as not just viable, but sustainable and secure, we can remain squarely focused on maturing the commercialization plan of the past two years,” said Mr. P. Peter Pascali, CEO and Chair of PyroGenesis. “That implies, turning a very large pipeline into signed new business; finalizing various ventures that have been in long-term testing, planning, or negotiation; and moving certain of our R&D initiatives into more fully-realized, customer-ready solutions.”
The Company’s backlog remains above $25M, and the potential contract pipeline has expanded significantly, which, along with the 73% quarterly gross margin, serves to demonstrate how the Company’s careful yet committed approach to diversification allows for various guards against rising inputs – both direct and macro – such as labor, currency, and supply-chain disruption-related costs.
“Certain of our customers are experiencing implementation/order delays due to the continued infrastructure, personnel, and parts availability challenges affecting industries across the spectrum1,” continued Mr. Pascali. “We remain confident in our positioning and long term plans given (i) our above-industry2 average margins3, (ii) continuing introduction of torch niche solutions, and (iii) a focus on large companies seeking technology solutions for GHG reduction and production output optimization. Combined with the upcoming commencement of major trials of our key plasma products, and near completion of various testing and certification processes by other clients, we continue to see a positive future.”
Q3 2022 results reflect the following highlights:
- Revenues of $5.7 M
- Gross margin profit of $4.1 M or 73% of revenue,
- Cash, cash equivalents and publicly traded shares at September 30, 2022 of $8.3 M
- Backlog of signed and/or awarded contracts of $26.0 M
Post-Quarter End Events
On November 10, the Company announced it produced hydrogen from methane using this revolutionary ZCE hydrogen production technology. PyroGenesis’ plasma-based hydrogen production process converts methane into a valuable solid carbon and hydrogen, thereby creating a ZCE hydrogen.
On November 3, the Company announced participation in a decarbonization “fuel-switching” project with a major international aluminum company, with a specific goal of investigating the feasibility of applying the Company’s plasma torches as a heating source in the aluminum company’s cast house furnaces.
On November 2, the Company announced it passed its annual quality audit for two key international standards: ISO 9001:2015, and AS9100D. The audits encompassed all of PyroGenesis’ facilities for the purpose of meeting compliance with the existing quality management designations.
On November 2, the Company provided an update on its 3D printing metal powders business line:
- The qualification process for the global aerospace firm, ongoing for 18 months, continues, with recent events that the Company has completed 90% of the adjustments requested by the client as part of its recent in-factory audit of the Company’s metal powder production process and facilities. The remaining 10% of recommendations are to be remedied by year’s end, with the qualification process still on track for Q4 2022/Q1 2023.
- Early-stage discussions with at least one potential partner has commenced in regards to the potential establishment of a European manufacturing facility for metal powders.
- The Company is currently upgrading and repurposing one of its existing plasma-atomization reactors that was previously used for various R&D activities, in order to be able to product commercial powders for specialty applications.
- The Company is expanding its business development team for metal powders.
On October 26, the Company announced that its Plasma Arc Waste Destruction System (“PAWDS”) is in operation4 on the newly launched USS Gerald R. Ford aircraft carrier that departed Naval Station Norfolk on October 4, 2022 for its initial deployment. The ship – the first of four carriers the US Navy have contracted with the Company to have the PAWDS system on board – will spend the next two months in both the Mediterranean Sea and the Atlantic Ocean as part of a multi-national exercise with eight other countries, including Canada and France, to prepare the crew for real-world scenarios.5
On October 6 and then on November 8, the Company announced the commencement and subsequent successful completion of operational testing of the Company’s Gen3 PUREVAP™ Quartz Reduction Reactor (QRR) pilot plant for its client, HPQ Silicon. The PUREVAP™ QRR is an innovative process (patent pending), which will permit the one-step transformation of quartz (SiO2) into high purity silicon (Si) at reduced costs, energy input, and carbon footprint.
OUTLOOK
Despite the world-wide macro-economic headwinds which have been exasperated by international supply chain volatility, both of which have affected our client’s planning, logistics, and spending PyroGenesis continues to demonstrate its ability to execute productively in Q3 2022.
While existing and prospective customers saw delays as they continued to manage their own backlog of projects to their resource, personnel, and infrastructure availability, the stage-setting of the first half of the year continued into Q3, the Company maintained its focus on production efficiency, steady progression towards full commercialization for its emerging business lines, the pursuit of innovation, and expanding the relationships with existing and potential clients.
In the face of continued macro uncertainties, the Company remains firm in the belief that it is well positioned and remains confident in the potential sales increases cited in the previous Q2 outlook, through 2023 and beyond.
The reasons for this are four-fold:
First, the Company believes that the heavy industry commitments to fossil fuel-related carbon reduction measures made years ago are here to stay. This commitment has only intensified in the face of increased pressure from rising carbon pollution penalties combined with the significant volatility seen in fossil-fuel availability over the past three years.
Second, concerns focusing on commodity security are driving optimization efforts across the metals sector, with aluminum producers, steelmakers, and other metal producers seeking in-line technology solutions to improve output percentages of primary, secondary, tertiary, and even unprocessed waste from other mineral production sources previously considered as exhausted.
Third, the trending global shift back to increased electricity-based power will result in more major infrastructure creation, across renewables, hydro-electric, and even nuclear installations, benefitting industries and technologies, such as PyroGenesis’. with electricity-ready solutions.
Fourth, PyroGenesis’ clean electricity-based technology has proven effective, efficient, and to such a degree that even in the absence of the above, its benefit cannot go ignored.
PyroGenesis’ research and development, which has been dedicated over the past three decades to plasma based environmental solutions, has made it possible for the Company to play the role it is today. PyroGenesis’ innovations are already impacting heavy industry as they prioritize the many issues facing them today; greenhouse gas emissions reduction, fuel switching to combustion-free electric sources, improved value recovery of metal waste-streams, enhanced metal production output from the same input, safe destruction of hazardous waste, and more rapid and higher quality metal powder production for component weight reduction, just to name a few. This underscores our belief that we are well positioned with respect to both our recent critical milestones and our long-term positioning.
