PyroGenesis reports strong financials, revenue growth, operational milestones, and contract wins

From GlobeNewswire: 2025-03-31 22:49:00

PyroGenesis Inc. reported a quarterly revenue of $4.22 million, up 40% year-over-year, with a quarterly net income of $145,320. Full-year revenue reached $15.7 million, up 27% year-over-year, with a backlog of $54.4 million, 87% in U.S. dollars. Revenue growth expected to continue in 2025 with major global energy transition clients in aluminum, aerospace, and steelmaking sectors. The company is confident in its financial position and sees opportunities for growth in the upcoming fiscal quarters. Post-quarter-end events include securing contracts for aluminum melting and waste-to-energy projects, indicating a positive outlook for the company’s future. PyroGenesis announced a $27 million contract for a 20MW plasma torch system with a U.S. client in October. In November, a contract with a top steelmaker was revealed. The Company also completed a $1 million order for the US Navy in October. In December, PyroGenesis successfully operated a plasma torch system to destroy harmful PFAS chemicals.

In Q4 2024, PyroGenesis focused on cost optimization, resulting in over $3 million in savings. Repriced warrants were exercised for $1,093,125, and payments totaling $4,800,000 were received from contracts with Raidan Oil and HPQ Silicon Inc. Post quarter end, payments of $1,850,000 and $1,040,000 were received from Raidan Oil and a U.S. defense client, respectively.

Operational highlights include a corporate name change to PyroGenesis Inc. and a new headquarters in Montreal. The name change reflects the Company’s international focus. Trading of shares continued on the TSX and OTCQX with no impact on stock symbols. The move to a larger office signifies growth after 30 years in Montreal’s Griffintown neighborhood. PyroGenesis has relocated its corporate headquarters to 1100 René-Lévesque Boulevard West in Montreal, providing a more modern and accessible office space for employees and customers. The move brings the company closer to key downtown landmarks like Montreal Central Station and the Bell Centre. Revenues for the fourth quarter of 2024 increased to $4.2 million, up from $3.0 million in the same period in 2023. Fiscal 2024 revenues totaled $15.7 million, showing a $3.3 million increase over fiscal 2023. Key revenue drivers included progress on DROSRITE™ contracts, support services for the US Navy, and biogas upgrading projects. The company is optimistic about potential benefits from the incoming Trump administration, particularly in areas like reducing corporate taxes and accelerating project approvals. PyroGenesis projects future revenue from signed and awarded contracts at $54.4 million, with 87% in US dollars, to be recognized over the next three years. Costs for Q4 2024 rose due to higher employee compensation, subcontracting expenses, and manufacturing overhead. However, direct material costs decreased, leading to a gross profit increase of $1 million compared to Q4 2023. For fiscal 2024, cost of sales and services rose by $1.5 million, primarily due to increased production activity.

Selling, General and Administrative expenses for Q4 2024 decreased by $8.1 million compared to Q4 2023, mainly due to a reduction in expected credit loss, absence of goodwill impairment charge, and improved cost efficiencies. For the twelve-month period ended December 31, 2024, SG&A expenses decreased by $20.0 million, reflecting the company’s focus on cost efficiencies.

Share-based compensation expense for the three and twelve-month periods ended December 31, 2024, was $1.2 million and $2.1 million, respectively. This is an increase of $0.4 million and a decrease of $1.0 million, respectively, compared to the same periods in 2023. The expense is non-cash and mainly relates to 2022, 2023, and 2024 grants. Share-based payment expenses are non-cash expenses impacted by stock option vesting structures. Depreciation on property and equipment remained stable at $0.07 million for three months and $0.4 million for twelve months ending December 31, 2024. Research and Development costs decreased by $0.4 million in Q4, 2024, and $1.4 million for the year. Finance expenses increased by $2.5 million in 2024 compared to 2023. Strategic investments resulted in a slight loss for Q4 and twelve-month periods ending December 31, 2024. Other income includes a $1.5 million settlement gain. Comprehensive income for Q4, 2024, showed a favorable variation of $9.9 million compared to Q4, 2023, mainly due to revenue increase, lower SG&A expenses, and other factors. In 2024, the company reported a comprehensive loss of $6.8 million, a significant improvement from the previous year’s loss of $28.5 million. Factors contributing to this included increased revenue of $3.3 million, higher gross profit margins of 34%, reduced SG&A expenses by $20.0 million, and lower R&D expenses by $1.4 million.

As of December 31, 2024, the company had cash of $3.0 million and a net working capital deficiency of $9.2 million. They were able to secure gross proceeds of $2,804,600 from a private placement and had a term loan balance of $308,774. The company expects to finance its operations through cash, liquidity, and capital markets.

Looking ahead, the company did not provide specific revenue or net income guidance for 2025 due to the early stage of market adoption of their core business lines. They focus on providing technology solutions to heavy industries, leveraging expertise in ultra-high temperature processes. Key factors impacting their strategy include carbon reduction programs, environmental technologies, and critical mineral availability.

The company’s market opportunity is significant, with industries like aluminum, steelmaking, manufacturing, defense, and government seeking technology-based solutions. As more offerings reach commercialization, PyroGenesis aims to attract influential customers while controlling operating expenses for profitable growth. Key performance indicators include industry depth, new industry engagement, and customer depth to monitor and optimize organizational performance. The Company values customer identities as confidential unless stated otherwise. When engaging new customers, they carefully assess access to capital, operational history, and reputation. Studies like computational fluid dynamics help potential clients understand the fit of the Company’s technology. Monthly recurring revenue is a key goal, with after-sale parts representing the largest source. PyroGenesis aims for a diverse revenue mix and efficient cost controls. Amid macroeconomic uncertainty, the Company focuses on growth, cost optimization, and enhanced sales and marketing efforts. PyroGenesis, a global leader in advanced plasma processes, recently confirmed that it does not have any operations in Russia, Belarus, or Ukraine. However, they do have customer projects in Poland, which are not currently affected by geopolitical challenges. The company continues to monitor global events for potential impacts on its business and operations.

In terms of business line developments, PyroGenesis outlined upcoming milestones that are expected to validate the effectiveness of their strategies in the near term (0-3 months). These timelines are estimates subject to change due to various factors beyond their control, such as negotiations and technical challenges with clients.

Financially, PyroGenesis announced an extension of the payment plan for an outstanding receivable under a $25 million+ Drosrite™ contract. This strategic move was made to alleviate pressure on the end-user’s cash flow. Additionally, the company is in discussions with a major metal producer to develop a plasma-based solution that could potentially be worth $10 million.

PyroGenesis is also advancing plasma-based projects in energy transition and emission reduction. They are conducting tests with plasma torches for metal manufacturing processes to improve precision, as well as for glass recycling initiatives. The company is working on solutions for aluminum remelting furnaces to help decarbonize the aluminum production process, with potential projects underway with industry leaders like Constellium and others. They have also announced a co-venture with GE Vernova’s Power Conversion division to electrify third-party furnaces in the iron ore pellet and primary aluminum smelter industries. PyroGenesis won a $2.4 million contract with Norsk Hydro ASA to test plasma torches in aluminum production, aiming to eliminate fossil fuels in the industry. Live furnace tests with major aluminum companies are ongoing, with additional discussions for more tests planned.

Commissioning of plasma torch systems for iron ore pelletization at Client B faced delays due to unforeseen challenges, such as rainstorms and power outages. Live trials continue, with a Q2 2025 timeline for completion. Client C is also exploring plasma applications for decarbonization, with a Q2 2025 project completion expected.

PyroGenesis is in the final stages of becoming an approved supplier of titanium metal powder for Boeing. Drosrite furnace system trials for aluminum dross processing were conducted in Europe, with potential new customers visiting operational sites. Data analysis will guide future steps for potential Drosrite system purchases.

Discussions are ongoing with a European company for PyroGenesis’ Plasma Resource Recovery System, focused on pyrolysis of plastics. PyroGenesis is in final negotiations with a US distributor for their SPARC Refrigerant Waste Destruction System, with an estimated contract value of $2-3 million. They are also in discussions with a Canadian entity for a plasma-based furnace for glass valorization, with a potential contract value of $2 million.

The Company is also in talks with a Middle Eastern customer for their SPARC system, with a possible profit-sharing co-venture on the table. They are currently conducting due diligence on key elements related to the potential business model.

PyroGenesis has successfully produced the first batch of materials from a week-long operation of the Fumed Silica Reactor (FSR) pilot plant. The material has been visually analyzed and confirmed to be consistent with previous lab-scale production. Analysis at an independent lab is scheduled to verify product quality.

The Company is in discussions with a European entity for the sale of a plasma torch system for carbon black and hydrogen production. They are also in various stages of negotiations with aluminum manufacturers for the purchase of Drosrite aluminum dross processing systems.

PyroGenesis is in talks with companies in North America and Europe for the sale of titanium metal powder, as well as discussions with a European entity for a plasma torch system for green cement additive production. They are also in discussions for the sale of silicon, nano-silicon, and silica production systems.

In the long term, PyroGenesis is in discussions with potential customers for advances methods in silicon, nano-silicon, and silica production. They are also in early-stage discussions with an Asian commodity producer for the transformation of waste into silica compounds using plasma technology. Additionally, they are in talks with a North American hazardous waste facility for the sale of a plasma torch system for waste destruction. PyroGenesis has a framework agreement with EarthGrid, receiving a $667,000 downpayment for plasma torches. Positive negotiations for a substantial statement of work are ongoing, pending client funding. A single plasma torch purchase is expected soon, with potential for more orders over several years. EarthGrid faces challenges in securing capital.

A 2-stage contract for a plasma waste-to-energy system in Europe was paused due to lost financing. The system is based on PyroGenesis’ Plasma Resource Recovery System, converting waste into syngas and chemicals. $2 million was removed from the backlog until alternate funds are secured.

Discussions are ongoing with a European entity for plasma torches in waste-to-energy projects. The entity has partnered with a German tech company to establish 300 hydrogen-producing plants. Other projects not mentioned are not necessarily at risk.

PyroGenesis is a high-tech company specializing in plasma processes for sustainable solutions. Their technologies are used in iron ore pelletization, aluminum, waste management, and additive manufacturing. PyroGenesis is ISO certified and publicly traded. For more information, visit their website.

Forward-looking statements in this press release are based on current beliefs and expectations, subject to uncertainties and risks. Factors affecting actual results include those listed in PyroGenesis’ annual information form. Investors are encouraged to consider these risk factors carefully.



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