Arq(ARQ) - 2025 Q3 - Quarterly Results

Financial Performance - Generated revenue of $35.1 million in Q3 2025, reflecting a 1% increase compared to $34.8 million in the prior year period[5] - Achieved Adjusted EBITDA of $5.2 million in Q3 2025, marking the sixth consecutive quarter of positive Adjusted EBITDA[13] - Revenue for Q3 2025 was $35,074,000, a slight increase of 0.86% compared to $34,774,000 in Q3 2024[27] - Operating loss for Q3 2025 was $839,000, compared to an operating income of $2,028,000 in Q3 2024[27] - For the three months ended September 30, 2025, the net loss was $653,000 compared to a net income of $1,617,000 for the same period in 2024[35] - EBITDA for the three months ended September 30, 2025, was $3,818,000, down from $5,060,000 in 2024, while Adjusted EBITDA was $5,168,000 compared to $5,884,000 in 2024[35] - For the trailing twelve months ended September 30, 2025, the net loss was $3,922,000, significantly higher than the net loss of $480,000 in 2024[37] - Trailing twelve months EBITDA for 2025 was $9,678,000, compared to $11,585,000 in 2024, indicating a decline in operating performance[37] - Adjusted EBITDA for the trailing twelve months ended September 30, 2025, was $16,730,000, an increase from $14,645,000 in 2024[37] Costs and Expenses - Gross margin was 28.8% in Q3 2025, down from 38.6% in the prior year period, primarily due to lower initial GAC production volumes[9] - Cost of revenue for Q3 2025 was $24,965,000, up 17.5% from $21,339,000 in Q3 2024[27] - Research and development costs rose to $2.6 million in Q3 2025, compared to $0.8 million in the prior year period, driven by pre-commencement testing of the GAC Facility[11] - Research and development expenses increased to $2,566,000 in Q3 2025, compared to $787,000 in Q3 2024, reflecting a focus on innovation[27] - GAC Facility pre-production feedstock costs amounted to $2,879,000 for the trailing twelve months, with no costs reported in 2024[37] Cash and Debt - Cash and restricted cash totaled $15.5 million as of September 30, 2025, down from $22.2 million as of December 31, 2024[15] - Total debt, including financing leases, increased to $25.9 million as of September 30, 2025, compared to $24.8 million at the end of 2024[16] - Cash and restricted cash at the end of Q3 2025 was $15,493,000, down from $57,380,000 at the beginning of the period[29] - The company reported a decrease in accounts payable and accrued expenses to $13,114,000 as of September 30, 2025, from $21,017,000 at the end of 2024[25] - Total current assets decreased to $43,927,000 as of September 30, 2025, down from $52,356,000 at the end of 2024[25] - Total liabilities decreased to $60,792,000 as of September 30, 2025, compared to $67,092,000 at the end of 2024[25] Strategic Initiatives - Initial commercial GAC production and sales were achieved at Red River, generating initial GAC revenues[5] - The company is exploring new markets for its products, including renewable natural gas and rare earth minerals, to drive future growth[21] - The company aims to provide a clearer view of underlying operating trends through the use of TTM Adjusted EBITDA, which helps in assessing the effectiveness of ongoing initiatives[32] Other Financial Metrics - Reported a net loss of $0.7 million in Q3 2025, compared to net income of $1.6 million in the prior year period[12] - Net loss for the nine months ended September 30, 2025, was $2,583,000, an improvement from a net loss of $3,770,000 in the same period of 2024[29] - Share-based compensation for the trailing twelve months was $3,053,000, slightly up from $3,023,000 in 2024[37] - The company reported a gain on insurance proceeds of $685,000 for the trailing twelve months ended September 30, 2025[37] - The company experienced a loss on extinguishment of debt amounting to $1,422,000 for the trailing twelve months, with no such loss reported in 2024[37]