Perma-Fix Environmental Services, Inc. (NASDAQ:PESI) Q4 2023 Earnings Conference Call March 13, 2024 11:00 AM ET Company Participants David Waldman - IR, Crescendo Communications Mark Duff - CEO Ben Naccarato - EVP & CFO Louis Centofanti - EVP, Strategic Initiatives Conference Call Participants Howard Brous - Wellington Shields & Co. Walter Schenker - MAZ Capital Advisors Brian Russo - Sidoti & Company Ross Taylor - ARS Investment Partners Operator Greetings. Welcome to the Perma-Fix Q4 and Fiscal 2023 Year ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ Commission File No. 1-11596 PERMA-FIX ENVIRONMENTAL SERVICES, INC. (Exact name of registrant as specified in its charter) Delaware 58-1954497 State or other ...

Financial Data and Key Metrics Changes - Total revenue from continuing operations for Q3 2023 was $21.9 million, an increase of $3.4 million or 18.4% compared to $18.5 million in Q3 2022 [19][24] - Gross profit increased by 48.2%, with gross margin rising from 16.6% to 20.8% [24] - Net income for the quarter was $341,000, down from $664,000 in the previous year, which included employee retention credits [51] - Adjusted EBITDA from continuing operations was $1.2 million compared to a loss of $374,000 in the previous year [53] Business Segment Data and Key Metrics Changes - Treatment segment revenue improved by $1.9 million, while services segment revenue increased by $1.5 million due to improved productivity and new project starts [19][46] - Year-to-date revenue through September 30 was up $13.2 million or 24.5%, with treatment segment revenue increasing by $8.5 million and services segment revenue up $4.7 million [47] Market Data and Key Metrics Changes - Waste backlog and unearned revenue as of September 30 was $12.1 million, significantly improved from $9.2 million at year-end and $7.1 million in September 2022 [34] - The company anticipates sustained receipts from European expansion, estimating combined annual revenues in the $10 million to $20 million range starting in late 2024 [11] Company Strategy and Development Direction - The company continues to implement its growth strategy, focusing on new opportunities that could significantly enhance revenues and long-term backlog [8] - The startup of the DFLAW facility is critical, expected to provide vitrification services for about 40% of the tank waste volume on site [31] - The company is optimistic about the near-term market outlook based on a growing backlog and several important contracts expected to be awarded over the next few quarters [33] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for continued growth in both segments, despite temporary customer delays impacting Q3 results [18][26] - The company is focused on increasing productivity and reducing costs to maximize margins [18] - Management remains confident in maintaining a sustainable revenue foundation in the $90 million to $100 million range annually [66] Other Important Information - The company has several large potential strategic awards from the DOE, which could represent significant increases in sustainable revenue [9] - The TBI initiative is progressing, with expectations for waste extraction and treatment to begin in the second half of 2024 [15] Q&A Session Summary Question: What does the contract in Croatia and Italy mean for Perma-Fix? - Management indicated that these contracts could significantly increase revenue and position the company for larger contracts in the future [40] Question: What is the status of the DFLAW facility? - Management confirmed that the DFLAW facility is on track for a late 2024 startup, with no announced delays [43][72] Question: What is the expected revenue from transuranic waste? - Management estimated that the transuranic waste program could represent a sustainable backlog, with potential revenues in the $50 million to $200 million range [76] Question: What is the services backlog as of September? - The services backlog was reported to be in the $22 million range [105] Question: How does the company plan to achieve its revenue targets? - Management expressed confidence in upcoming projects and bids, indicating a strong pipeline for future revenue growth [111]

PART I - FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) The condensed consolidated financial statements detail the company's financial position and performance, highlighting asset growth, a return to profitability, and improved cash flow from operations [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheets reflect an increase in total assets driven by receivables, alongside a rise in liabilities and a modest increase in stockholders' equity Balance Sheet Highlights (In Thousands) | Balance Sheet Highlights (In Thousands) | Sep 30, 2023 (Unaudited) | Dec 31, 2022 | | :--- | :--- | :--- | | **Total Current Assets** | $32,217 | $23,526 | | Accounts receivable, net | $15,342 | $9,364 | | Unbilled receivables | $9,336 | $6,062 | | **Total Assets** | **$79,504** | **$70,898** | | **Total Current Liabilities** | $27,469 | $22,708 | | Deferred revenue | $7,765 | $4,813 | | **Total Liabilities** | **$40,673** | **$33,365** | | **Total Stockholders' Equity** | **$38,831** | **$37,533** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The statements of operations show significant revenue growth for both the quarter and nine-month period, leading to a return to profitability from prior-year losses Key Metrics (In Thousands) | Key Metrics (In Thousands) | Q3 2023 | Q3 2022 | Nine Months 2023 | Nine Months 2022 | | :--- | :--- | :--- | :--- | :--- | | **Net Revenues** | $21,877 | $18,472 | $67,016 | $53,842 | | **Gross Profit** | $4,549 | $3,070 | $12,074 | $7,590 | | **Income (loss) from operations** | $496 | $(928) | $765 | $(3,691) | | **Net Income (loss)** | $341 | $664 | $404 | $(2,124) | | **Basic EPS** | $0.03 | $0.05 | $0.03 | $(0.16) | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The cash flow statements indicate improved operating cash flow, continued investment in property and equipment, and significant cash generation from financing activities Cash Flow Summary (In Thousands) | Cash Flow Summary (In Thousands) | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :--- | :--- | :--- | | Cash used in operating activities | $(26) | $(893) | | Cash used in investing activities | $(1,386) | $(922) | | Cash provided by (used in) financing activities | $1,890 | $(694) | | **Increase (decrease) in cash** | **$478** | **$(2,513)** | [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies, revenue disaggregation, debt agreement amendments, significant receivable settlements, and the recognition of an Employee Retention Credit - Revenue is primarily recognized over time and is disaggregated by contract type (Fixed price, Time and materials) and generator (Government, Commercial). For the nine months ended Sep 30, 2023, total revenue was **$67.0 million**, with **$53.8 million** from domestic government sources[28](index=28&type=chunk)[30](index=30&type=chunk)[31](index=31&type=chunk) - The company amended its loan agreement with PNC Bank on July 31, 2023, extending the maturity to May 15, 2027, and obtaining an additional term loan of **$2.5 million**[57](index=57&type=chunk)[60](index=60&type=chunk)[66](index=66&type=chunk) - Perma-Fix Canada Inc. (PF Canada) has reached an agreement in principle with Canadian Nuclear Laboratories (CNL) to settle and receive payment for approximately **$2.3 million** in unpaid receivables and **$1.1 million** in contractual holdbacks[71](index=71&type=chunk) - The company determined it was eligible for the Employee Retention Credit (ERC) and claimed a refund of approximately **$1,975,000**, which was recognized as other income in Q3 2022 and received in cash in March 2023[93](index=93&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion highlights significant revenue and gross profit growth driven by segment performance, improved liquidity from a credit facility amendment, and ongoing uncertainties including government reliance and macroeconomic factors [Results of Operations](index=31&type=section&id=Results%20of%20Operations) Results of operations show strong consolidated revenue and gross profit growth for both the quarter and nine-month period, driven by segment-specific performance, while SG&A expenses remained stable Revenue Change by Segment (In thousands) | Revenue Change by Segment (In thousands) | Q3 2023 vs Q3 2022 | Nine Months 2023 vs 2022 | | :--- | :--- | :--- | | Treatment Segment | +$1,918 (+21.6%) | +$8,474 (+34.2%) | | Services Segment | +$1,487 (+15.5%) | +$4,700 (+16.2%) | | **Total** | **+$3,405 (+18.4%)** | **+$13,174 (+24.5%)** | Gross Profit Change by Segment (In thousands) | Gross Profit Change by Segment (In thousands) | Q3 2023 vs Q3 2022 | Nine Months 2023 vs 2022 | | :--- | :--- | :--- | | Treatment Segment | -$473 (-24.0%) | +$1,069 (+25.6%) | | Services Segment | +$1,952 (+177.0%) | +$3,415 (+99.8%) | | **Total** | **+$1,479 (+48.2%)** | **+$4,484 (+59.1%)** | - SG&A expenses remained flat, increasing by only **$4,000** in Q3 2023 and decreasing by **$66,000** for the nine-month period compared to the prior year[115](index=115&type=chunk)[116](index=116&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is strong, supported by increased working capital and an amended credit facility that extends maturity and provides additional borrowing capacity, deemed sufficient for the next twelve months - At September 30, 2023, borrowing availability under the revolving credit facility was approximately **$10,378,000**, which included cash and was net of **$3.2 million** in standby letters of credit and a **$750,000** availability reduction[121](index=121&type=chunk) - The company amended its credit facility on July 31, 2023, extending the maturity to May 15, 2027, adding a new **$2.5 million** term loan, and removing the Tangible Adjusted Net Worth covenant[128](index=128&type=chunk)[131](index=131&type=chunk) - The company met all its loan covenant requirements in Q2 and Q3 2023 and expects to continue to do so for the next twelve months[136](index=136&type=chunk) [Known Trends and Uncertainties](index=40&type=section&id=Known%20Trends%20and%20Uncertainties) Key trends and uncertainties include heavy reliance on government contracts, potential impacts from government shutdowns, progress on international agreements, and ongoing macroeconomic pressures like inflation - The company is heavily dependent on government contracts, which accounted for **74.2%** of revenue in Q3 2023 and **82.6%** YTD[141](index=141&type=chunk) - A potential U.S. government shutdown could negatively impact financial results through delays in procurement, waste shipments, and new projects[142](index=142&type=chunk) - An agreement in principle has been reached with CNL for the payment of approximately **$2.3 million** in receivables and **$1.1 million** in holdbacks to the company's Canadian subsidiary, PF Canada[144](index=144&type=chunk) - Macroeconomic factors, including inflation, supply chain issues, and higher interest rates, continue to negatively impact financial results and may inhibit the company's ability to raise prices[146](index=146&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=41&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section is not required for smaller reporting companies, thus no disclosure is provided - Disclosure is not required for smaller reporting companies[150](index=150&type=chunk) [Item 4. Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of September 30, 2023, with no material changes in internal control over financial reporting during the quarter - The Principal Executive Officer and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective as of September 30, 2023[151](index=151&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[152](index=152&type=chunk) PART II - OTHER INFORMATION [Item 1. Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings) No new material legal proceedings are pending against the company or its subsidiaries, nor have there been material changes to previously disclosed proceedings - There are no material legal proceedings pending against the company or its subsidiaries that have not been previously reported in the Form 10-K for the year ended December 31, 2022[154](index=154&type=chunk) [Item 1A. Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred in the risk factors previously disclosed in the 2022 Form 10-K and Q1 2023 Form 10-Q - No material changes have occurred in the risk factors previously disclosed in the 2022 Form 10-K and Q1 2023 Form 10-Q[155](index=155&type=chunk) [Item 6. Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the report, including credit agreement amendments, officer certifications, and Interactive Data Files (XBRL) - Exhibits filed include the Seventh Amendment to the Credit Agreement, CEO and CFO certifications pursuant to Rule 13a-14(a) and Section 1350, and various Inline XBRL documents[158](index=158&type=chunk)

Perma-Fix Environmental Services, Inc. (NASDAQ:PESI) Q2 2023 Earnings Conference Call August 3, 2023 11:00 AM ET Company Participants David Waldman - Investor Relations Mark Duff - President & Chief Executive Officer Ben Naccarato - Executive Vice President & Chief Financial Officer Conference Call Participants Brian Russo - Sidoti Ross Taylor - ARS Investment Partners Aaron Warwick - Breakout Investors Stephen Fein - Sofein LLC Operator Greetings. Welcome to the Perma-Fix Second Quarter 2023 Earnings Confe ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION For the quarterly period ended June 30, 2023 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______________to_________________ Commission File No. 001-11596 PERMA-FIX ENVIRONMENTAL SERVICES, INC. (Exact name of registrant as specified in its charter) Delaware 58-1954497 WASHINGTON, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT ...

Perma-Fix Environmental Services, Inc. (NASDAQ:PESI) Q1 2023 Earnings Call May 9, 2023 11:00 AM ET Company Participants David K. Waldman - Investor Relations, Crescendo Communications, LLC Mark Duff - President and Chief Executive Officer Ben Naccarato - Executive Vice President and Chief Financial Officer Conference Call Participants Howard Brous - Wellington Shields Brian Russo - Sidoti Ross Taylor - ARS Investment Partners Aaron Warwick - Breakout Investors Avram Fisher - Long Cast Advisers Stephen Fein ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____________ to ___________ Commission File No. 1-11596 PERMA-FIX ENVIRONMENTAL SERVICES, INC. (Exact name of registrant as specified in its charter) Delaware 58-195449 ...

Perma-Fix Environmental Services, Inc. (NASDAQ:PESI) Q4 2022 Earnings Conference Call March 23, 2023 11:00 AM ET Company Participants David Waldman - Investor Relations Mark Duff - President and Chief Executive Officer Lou Centofanti - Executive Vice President, Strategic Initiatives Ben Naccarato - Chief Financial Officer Conference Call Participants Howard Brous - Wellington Shields Aaron Warwick - Breakout Investors Ross Taylor - ARS Investment Partners Stephen Fein - Fein LLC Operator Good day, everyone ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _____ to _____ Commission File No. 1-11596 PERMA-FIX ENVIRONMENTAL SERVICES, INC. (Exact name of registrant as specified in its charter) Delaware 58-1954497 State or other ...