Perma-Fix Environmental Services, Inc. (NASDAQ:
PESI) (the “Company”) today announced financial results
for the third quarter ended September 30, 2023, and provided a
business update.
Mark Duff, President and CEO of the Company,
commented, “I am pleased to report another solid quarter, as we
achieved an 18.4% increase in revenue to $21.9 million, a 48.2%
increase in gross profit, net income of $341,000 and $1.2 million
of EBITDA (as defined below) for the third quarter of 2023. Within
our Treatment Segment, we have experienced a steady improvement in
waste receipts, supporting our visibility and backlog for the next
year. Within the Services Segment, we realized several new awards,
including a $40 million, 5-year contract for our joint venture,
Enviro-Fix Solutions, LLC, by the Buffalo District of the U.S. Army
Corps of Engineers (USACE) for environmental remediation at the
Niagara Falls Storage Site (NFSS).”
Mr. Duff continued, “While we achieved strong
year-over-year growth, we believe we would have generated even
stronger results if not for certain temporary customer delays in
our Treatment and Services Segments, which is not unusual in our
business. Nevertheless, these projects have since commenced, which
we believe will contribute to improved results for the fourth
quarter of 2023. Looking ahead, we are benefitting from improved
waste backlog within our Treatment Segment, as well as increased
bidding opportunities within our Services Segment, including both
the government and commercial sectors. As I have stated previously,
several of the projects we are bidding on are quite significant,
and we are hopeful they will be awarded in the fourth quarter. We
also continue to implement our strategy for growth, which includes
positioning for large future procurements within DOE, USACE, EPA
and the US Navy, while expanding our waste treatment offering
within the commercial and international markets. Collectively,
these projects represent a sizable opportunity for Perma-Fix in the
coming years. In the meantime, we remain highly encouraged by the
near-term outlook for the business based on our growing backlog and
sales pipeline.”
Financial ResultsRevenue for
the third quarter of 2023 was $21.9 million versus $18.5 million
for the same period last year. Revenue for the Treatment Segment
increased to approximately $10.8 million for the three months ended
September 30, 2023, from $8.9 million for the corresponding period
of 2022. The increase was primarily due to overall higher waste
volume which was offset by lower average price due to revenue mix.
The Treatment Segment has continued to see steady improvements in
waste receipts since the latter part of the second quarter of 2022,
as the lingering effects of COVID-19 have continued to subside.
Revenue for the Services Segment increased to approximately $11.1
million for the three months ended September 30, 2023, from $9.6
million for the corresponding period of 2022, due to continuing
operation and improved productivity on certain projects that had
previously been delayed/curtailed, due in part to the lingering
effects of COVID-19. Revenue within both segments was also
positively impacted by new contracts won in the first half of
2023.
Gross profit for the third quarter of 2023 was
$4.5 million versus $3.1 million for the third quarter of 2022. The
overall increases in gross profit and margin were entirely within
the Services Segment due to improved margin on its projects.
Operating income was approximately $496,000
versus an operating loss of approximately $928,000 for the third
quarter of 2022. Net income for the third quarter of 2023 was
approximately $341,000, or $.03 per basic share, as compared to net
income of $664,000, or $.05 per basic share, for the third quarter
of 2022. Net income for the third quarter of 2022 included an
income recorded in the amount of approximately $2.0 million (within
other income and current other receivables), that represented a
refundable tax credit against the Company’s share of certain
payroll taxes as permitted by the Employee Retention Credit (“ERC”)
program under the Coronavirus Aid, Relief and Economic Securities
Act (“CARES Act”), as amended. This refundable tax credit was
received by the Company in March of 2023. The ERC program was
provided to qualifying businesses that kept employees on their
payroll during the COVID-19 pandemic.
The Company achieved EBITDA of $1.2 million from
continuing operations during the quarter ended September 30, 2023,
and Adjusted EBITDA of ($374,000) for the same period of 2022.
There were no adjustments to EBITDA for the 2023 third quarter. The
Company defines EBITDA as earnings before interest, taxes,
depreciation and amortization. Adjusted EBITDA is defined as EBITDA
before income from ERC refund claim (net of costs incurred).
Neither EBITDA nor Adjusted EBITDA are measures of performance
calculated in accordance with Generally Accepted Accounting
Principles in the United States of America (“GAAP”), and should not
be considered in isolation of, or as a substitute for earnings as
an indicator of operating performance or cash flows from operating
activities as a measure of liquidity. The Company believes the
presentation of EBITDA and Adjusted EBITDA is relevant and useful
by enhancing the readers’ ability to understand the Company’s
operating performance. The Company’s management utilizes EBITDA and
Adjusted EBITDA as a means to measure performance. The Company’s
measurements of EBITDA and Adjusted EBITDA may not be comparable to
similarly titled measures reported by other companies. The table
below reconciles EBITDA and Adjusted EBITDA, both non-GAAP
measures, to GAAP numbers for income (loss) from continuing
operations for the three and nine months ended September 30, 2023
and 2022.
|
(Unaudited) |
|
(Unaudited) |
|
|
Three Months
Ended |
|
Nine Months
Ended |
|
|
September 30, |
|
September 30, |
|
(In thousands) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
Income
(loss) from continuing operations |
$ |
246 |
|
|
$ |
824 |
|
|
$ |
448 |
|
|
$ |
(1,682 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
Depreciation & amortization |
|
686 |
|
|
|
497 |
|
|
|
2,124 |
|
|
|
1,433 |
|
|
Interest income |
|
(146 |
) |
|
|
(29 |
) |
|
|
(445 |
) |
|
|
(69 |
) |
|
Interest expense |
|
89 |
|
|
|
47 |
|
|
|
189 |
|
|
|
123 |
|
|
Interest expense - financing fees |
|
36 |
|
|
|
16 |
|
|
|
80 |
|
|
|
44 |
|
|
Income tax expense (benefit) |
|
254 |
|
|
|
179 |
|
|
|
482 |
|
|
|
(147 |
) |
|
|
|
|
|
|
|
|
|
|
EBITDA |
|
1,165 |
|
|
|
1,534 |
|
|
|
2,878 |
|
|
|
(298 |
) |
|
|
|
|
|
|
|
|
|
|
Income from
ERC refund claim, net (1) |
— |
|
|
(1,908 |
) |
|
— |
|
|
(1,908 |
) |
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA |
$ |
1,165 |
|
|
$ |
(374 |
) |
|
$ |
2,878 |
|
|
$ |
(2,206 |
) |
|
|
|
|
|
|
|
|
|
|
(1) net of costs
incurred in connection with the ERC program in the amount of
approximately $67. |
|
|
|
|
|
|
|
The tables below present certain unaudited
financial information for the business segments, which excludes
allocation of corporate expenses.
|
|
Three Months
Ended |
|
Nine Months
Ended |
|
|
September 30,
2023 |
|
September 30,
2023 |
|
|
(Unaudited) |
|
(Unaudited) |
(In thousands) |
|
Treatment |
|
Services |
|
|
Treatment |
|
Services |
|
Net revenues |
|
$ |
10,795 |
|
$ |
11,082 |
|
|
$ |
33,223 |
|
$ |
33,793 |
|
Gross
profit |
|
|
1,494 |
|
|
3,055 |
|
|
|
5,237 |
|
|
6,837 |
|
Segment
profit |
|
|
1,014 |
|
|
1,120 |
|
|
|
2,619 |
|
|
2,933 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
Nine Months
Ended |
|
|
September 30,
2022 |
|
September 30,
2022 |
|
|
(Unaudited) |
|
(Unaudited) |
(In thousands) |
|
Treatment |
|
Services |
|
|
Treatment |
|
Services |
|
Net revenues |
|
$ |
8,877 |
|
$ |
9,595 |
|
|
$ |
24,749 |
|
$ |
29,093 |
|
Gross
profit |
|
|
1,967 |
|
|
1,103 |
|
|
|
4,168 |
|
|
3,422 |
|
Segment
profit |
|
|
1,628 |
|
|
710 |
|
|
|
1,766 |
|
|
1,580 |
|
|
|
|
|
|
|
|
|
|
|
|
Conference Call
Perma-Fix will host a conference call at 11:00
a.m. ET on Thursday, November 2, 2023. The call will be available
on the Company’s website at
https://ir.perma-fix.com/conference-calls, or by calling
888-506-0062 for U.S. callers, or +1 973-528-0011 for international
callers, and by entering access code: 443703. The conference call
will be led by Mark J. Duff, Chief Executive Officer, Dr. Louis F.
Centofanti, Executive Vice President of Strategic Initiatives, and
Ben Naccarato, Executive Vice President and Chief Financial Officer
of Perma-Fix Environmental Services, Inc.
A webcast will also be archived on the Company’s
website and a telephone replay of the call will be available
approximately one hour following the call, through Thursday,
November 9, 2023, and can be accessed by dialing 877-481-4010 for
U.S. callers or +1 919-882-2331 for international callers and
entering access code: 49407.
About Perma-Fix Environmental
ServicesPerma-Fix Environmental Services, Inc. is a
nuclear services company and leading provider of nuclear and mixed
waste management services. The Company's nuclear waste services
include management and treatment of radioactive and mixed waste for
hospitals, research labs and institutions, federal agencies,
including the DOE, the DOD, and the commercial nuclear industry.
The Company’s nuclear services group provides project management,
waste management, environmental restoration, decontamination and
decommissioning, new build construction, and radiological
protection, safety and industrial hygiene capability to our
clients. The Company operates four nuclear waste treatment
facilities and provides nuclear services at DOE, DOD, and
commercial facilities, nationwide.
Please visit us at http://www.perma-fix.com.
This press release contains “forward-looking
statements” which are based largely on the Company's expectations
and are subject to various business risks and uncertainties,
certain of which are beyond the Company's control. Forward-looking
statements generally are identifiable by use of the words such as
“believe”, “expects”, “intends”, “anticipate”, “plans to”,
“estimates”, “projects”, and similar expressions. Forward-looking
statements include, but are not limited to: improved results for
the fourth quarter; award of significant projects in the fourth
quarter; collectively, projects represent a sizable opportunity for
Perma-Fix in the coming years; continue to implement our strategy
for growth; expanding our waste treatment offering within the
commercial and international markets; and near-term outlook for the
business based on our growing backlog and sales pipeline. These
forward-looking statements are intended to qualify for the safe
harbors from liability established by the Private Securities
Litigation Reform Act of 1995. While the Company believes the
expectations reflected in this news release are reasonable, it can
give no assurance such expectations will prove to be correct. There
are a variety of factors which could cause future outcomes to
differ materially from those described in this release, including,
without limitation, future economic conditions; industry
conditions; competitive pressures; our ability to apply and market
our new technologies; the government or such other party to a
contract granted to us fails to abide by or comply with the
contract or to deliver waste as anticipated under the contract;
inability to win bid projects; failure of Congress to provide
continuing funding for the DOD’s and DOE’s remediation projects;
ability to obtain new foreign and domestic remediation contracts;
inability to meet financial covenants; impact of COVID-19; and the
“Risk Factors” discussed in, and the additional factors referred to
under "Special Note Regarding Forward-Looking Statements" of, our
2022 Form 10-K and Form 10-Q for quarters ended March 31, 2023,
June 30, 2023 and September 30, 2023. The Company makes no
commitment to disclose any revisions to forward-looking statements,
or any facts, events or circumstances after the date hereof that
bear upon forward-looking statements.
FINANCIAL TABLES FOLLOW
Contacts:David K. Waldman-US
Investor RelationsCrescendo Communications, LLC (212) 671-1021
Herbert Strauss-European Investor Relationsherbert@eu-ir.com+43
316 296 316
PERMA-FIX
ENVIRONMENTAL SERVICES, INC.CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS(UNAUDITED) |
|
|
|
|
|
|
|
|
Three Months
Ended |
|
|
Nine Months
Ended |
|
|
September 30, |
|
|
September 30, |
(Amounts in Thousands, Except for Per Share Amounts) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenues |
$ |
21,877 |
|
|
$ |
18,472 |
|
|
$ |
67,016 |
|
|
$ |
53,842 |
|
Cost of
goods sold |
|
17,328 |
|
|
|
15,402 |
|
|
|
54,942 |
|
|
|
46,252 |
|
Gross profit |
|
4,549 |
|
|
|
3,070 |
|
|
|
12,074 |
|
|
|
7,590 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative expenses |
|
3,933 |
|
|
|
3,929 |
|
|
|
10,969 |
|
|
|
11,035 |
|
Research and
development |
|
120 |
|
|
|
69 |
|
|
|
340 |
|
|
|
245 |
|
Loss on
disposal of property and equipment |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1 |
|
Income (loss) from operations |
|
496 |
|
|
|
(928 |
) |
|
|
765 |
|
|
|
(3,691 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense): |
|
|
|
|
|
|
|
|
|
|
|
Interest
income |
|
146 |
|
|
|
29 |
|
|
|
445 |
|
|
|
69 |
|
Interest
expense |
|
(89 |
) |
|
|
(47 |
) |
|
|
(189 |
) |
|
|
(123 |
) |
Interest
expense-financing fees |
|
(36 |
) |
|
|
(16 |
) |
|
|
(80 |
) |
|
|
(44 |
) |
Other |
|
(17 |
) |
|
|
1,965 |
|
|
|
(11 |
) |
|
|
1,960 |
|
Income
(loss) from continuing operations before taxes |
|
500 |
|
|
|
1,003 |
|
|
|
930 |
|
|
|
(1,829 |
) |
Income tax
expense (benefit) |
|
254 |
|
|
|
179 |
|
|
|
482 |
|
|
|
(147 |
) |
Income
(loss) from continuing operations, net of taxes |
|
246 |
|
|
|
824 |
|
|
|
448 |
|
|
|
(1,682 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Income
(loss) from discontinued operations, net of taxes |
|
95 |
|
|
|
(160 |
) |
|
|
(44 |
) |
|
|
(442 |
) |
Net income (loss) |
$ |
341 |
|
|
$ |
664 |
|
|
$ |
404 |
|
|
$ |
(2,124 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) per common share - basic: |
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations |
$ |
.02 |
|
|
$ |
.06 |
|
|
$ |
.03 |
|
|
$ |
(.13 |
) |
Discontinued
operations |
|
.01 |
|
|
|
(.01 |
) |
|
|
— |
|
|
|
(.03 |
) |
Net income (loss) per common share |
$ |
.03 |
|
|
$ |
.05 |
|
|
$ |
.03 |
|
|
$ |
(.16 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) per common share - diluted: |
|
|
|
|
|
|
|
|
|
|
|
Continuing
operations |
$ |
.02 |
|
|
$ |
.06 |
|
|
$ |
.03 |
|
|
$ |
(.13 |
) |
Discontinued
operations |
|
— |
|
|
|
(.01 |
) |
|
|
— |
|
|
|
(.03 |
) |
Net income (loss) per common share |
$ |
.02 |
|
|
$ |
.05 |
|
|
$ |
.03 |
|
|
$ |
(.16 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Number of
common shares used in computing |
|
|
|
|
|
|
|
|
|
|
|
net income (loss) per share: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
13,568 |
|
|
|
13,297 |
|
|
|
13,468 |
|
|
|
13,265 |
|
Diluted |
|
13,979 |
|
|
|
13,447 |
|
|
|
13,749 |
|
|
|
13,265 |
|
|
|
|
|
|
|
|
|
|
|
|
|
PERMA-FIX
ENVIRONMENTAL SERVICES, INC.CONDENSED CONSOLIDATED
BALANCE SHEET |
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
(Amounts in Thousands, Except for Share and Per Share Amounts) |
|
(Unaudited) |
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
Current
assets: |
|
|
|
|
Cash |
|
$ |
1,988 |
|
|
$ |
1,866 |
|
Account receivable, net of allowance for credit losses of $42 and
$57, respectively |
|
|
15,342 |
|
|
|
9,364 |
|
Unbilled receivables |
|
|
9,336 |
|
|
|
6,062 |
|
Other current assets |
|
|
5,536 |
|
|
|
6,219 |
|
Assets of discontinued operations included in current assets |
|
|
15 |
|
|
|
15 |
|
Total current assets |
|
|
32,217 |
|
|
|
23,526 |
|
|
|
|
|
|
Net property
and equipment |
|
|
18,693 |
|
|
|
18,957 |
|
Property and
equipment of discontinued operations |
|
|
81 |
|
|
|
81 |
|
|
|
|
|
|
Operating
lease right-of-use assets |
|
|
2,094 |
|
|
|
1,971 |
|
|
|
|
|
|
Intangibles
and other assets |
|
|
26,419 |
|
|
|
26,363 |
|
Total assets |
|
$ |
79,504 |
|
|
$ |
70,898 |
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY |
|
|
|
|
Current
liabilities |
|
$ |
27,230 |
|
|
$ |
22,346 |
|
Current
liabilities related to discontinued operations |
|
|
239 |
|
|
|
362 |
|
Total current liabilities |
|
|
27,469 |
|
|
|
22,708 |
|
|
|
|
|
|
Long-term
liabilities |
|
|
12,254 |
|
|
|
9,749 |
|
Long-term
liabilities related to discontinued operations |
|
|
950 |
|
|
|
908 |
|
Total liabilities |
|
|
40,673 |
|
|
|
33,365 |
|
Commitments
and Contingencies |
|
|
|
|
Stockholders' equity: |
|
|
|
|
Preferred Stock, $.001 par value; 2,000,000 shares authorized, |
|
|
|
|
no shares issued and outstanding |
|
— |
|
— |
Common Stock, $.001 par value; 30,000,000 shares authorized, |
|
|
|
|
13,588,933 and 13,332,398 shares issued, respectively; |
|
|
|
|
13,581,291 and 13,324,756 shares outstanding, respectively |
|
|
14 |
|
|
|
13 |
|
Additional paid-in capital |
|
|
116,106 |
|
|
|
115,209 |
|
Accumulated deficit |
|
|
(77,032 |
) |
|
|
(77,436 |
) |
Accumulated other comprehensive loss |
|
|
(169 |
) |
|
|
(165 |
) |
Less Common Stock held in treasury, at cost: 7,642 shares |
|
|
(88 |
) |
|
|
(88 |
) |
Total stockholders' equity |
|
|
38,831 |
|
|
|
37,533 |
|
|
|
|
|
|
Total liabilities and stockholders' equity |
|
$ |
79,504 |
|
|
$ |
70,898 |
|
|
|
|
|
|
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