Financial Data and Key Metrics Changes - Consolidated revenues for Q2 2025 declined to $5.6 million from $7.0 million in the prior year due to lower APC segment revenue [22] - APC segment revenue decreased to $2.5 million from $3.9 million, primarily due to the timing of project execution [22] - Consolidated gross margin increased to 46% from 42% in the prior year, driven by segment contribution mix [22] - FUEL CHEM gross margin rose to 47% compared to 46% in the previous year despite flat segment revenues [22] - The net loss for the quarter was $689,000 or $0.02 per share, compared to a net loss of $421,000 or $0.01 per share in the prior year [26] Business Line Data and Key Metrics Changes - FUEL CHEM segment revenue remained flat at $3.1 million for the quarter, with expectations to meet an annual objective of $15 million to $16 million [22][8] - APC segment margin rose to 44% in Q2 compared to 39% in the prior year, attributed to project and product mix [23] - The backlog for the APC segment increased to $7.8 million as of June 30, 2025, up from $6.2 million at the end of 2024 [23] Market Data and Key Metrics Changes - The company anticipates receiving an incremental $2.5 million to $3 million in new APC awards before the end of August 2025 [6][10] - The company is pursuing additional awards driven by industrial expansion globally and state-specific regulatory requirements in the U.S. [11] - The backlog includes $2.8 million of domestically delivered project backlog and $5 million of foreign delivered project backlog [23] Company Strategy and Development Direction - The company is optimistic about the application of its APC emissions control solutions in the construction of AI-related data centers in the U.S. [16] - The company aims to build a material contract backlog as it moves towards 2025 and into 2026 [21] - The company is focusing on expanding its DGI technology into various end markets, including wastewater treatment and aquaculture [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to maintain a strong financial position and fund growth initiatives [26] - The company is cautious in its revenue guidance for 2025, reducing it to a range of $28 million to $29 million due to uncertainties in APC award timing [20] - Management noted that regulatory changes are not expected to provide significant headwinds or tailwinds for the business [40] Other Important Information - The company has no long-term debt and maintains a strong cash position of approximately $30.9 million [26][27] - Research and development expenses increased to $490,000, reflecting ongoing investment in DGI systems [24] Q&A Session Summary Question: Clarification on FUEL CHEM revenue expectations - Management confirmed that the expected FUEL CHEM revenue of $15 million to $16 million does not include contributions from new accounts [32] Question: Backlog recognition timing - Management indicated that the backlog of $7.8 million is expected to be recognized over the next twelve months, but it is project-specific [34] Question: DGI demonstration costs - The DGI demonstration is considered R&D expense, with no reimbursement expected from the customer [35] Question: Regulatory impacts on NOx control - Management stated that current opportunities for APC are driven by business expansion rather than regulatory changes [39] Question: Data center opportunities - Management highlighted a pipeline of approximately $100 million in bids related to AI data centers, indicating significant potential [46] Question: Global data center opportunities - Management expects to see data center build-out opportunities outside the U.S., although they are less developed [53] Question: Engagement with Mexican partners - Management confirmed ongoing engagement with partners in Mexico, noting increased pressure for emissions compliance [74]

Financial Data and Key Metrics Changes - Revenues for the first quarter of 2025 rose 29% to $6,400,000 from $5,000,000 in the prior year period, primarily driven by the robust performance from the FUEL CHEM business segment [17][5] - Consolidated gross margin improved to 46% from 41% in the prior year, reflecting a higher proportion of FUEL CHEM segment revenue [18] - The operating loss narrowed to $952,000 from $1,700,000 in the previous year, indicating improved revenue profit [22] - The net loss for the quarter was $739,000 or $0.02 per share, compared to net income of $281,000 or $0.01 per share in the same period last year [22] Business Segment Data and Key Metrics Changes - FUEL CHEM segment revenue increased by 92% to $5,100,000 from $2,600,000 in the prior year, comprising nearly 80% of total revenues for the quarter [17][8] - APC segment revenue declined to $1,300,000 from $2,300,000 in the previous year, primarily due to the timing of project execution [17][9] - APC backlog improved significantly, reaching $10,300,000 as of March 31, 2025, up from $6,200,000 at December 31, 2024 [19] Market Data and Key Metrics Changes - The company is encouraged by the global landscape of business development activities, driven by manufacturing expansion and growing demand for power generation [6] - The demand for emissions control solutions is increasing due to the need for compliance with environmental regulations across various markets [7] Company Strategy and Development Direction - The company aims to maintain its revenue guidance for 2025, expecting total revenues to approximate $30,000,000, with both business segments exceeding their performance in 2024 [14] - The company is pursuing additional FUEL CHEM opportunities both domestically and internationally, including a new demonstration of TIFI technology [8] - Investment in water quality and infrastructure is growing, with the company planning to demonstrate its dissolved gas infusion technology [7] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the near-term outlook for business development opportunities, indicating that 2025 will be a year of growth [4] - The company does not expect specific tailwinds from new regulations but is confident in capturing opportunities driven by general business expansion [11][31] - Management noted that the extension of life for coal-fired units could benefit the company due to increased demand for reliable power [31] Other Important Information - The company has no long-term debt and maintains a strong financial position with approximately $31,000,000 in cash and investments [6][24] - Research and development expenses increased to $570,000, reflecting ongoing investment in water and wastewater treatment technologies [21] Q&A Session Summary Question: How is the company positioned regarding the current political environment and regulations? - Management indicated that the current administration is not deterring business opportunities, and general business expansion is driving growth [29][31] Question: Can the company share any names of partners in the data center market? - Management refrained from naming specific partners but mentioned working with OEM suppliers and large tech companies [33] Question: What is the potential size of the data center opportunity? - Management noted that opportunities could be significant, with costs per unit ranging from $1,000,000 to $2,000,000 [35] Question: What is needed for the Mexican opportunity to materialize? - The Mexican government needs to allocate funds for pollution remediation systems to begin receiving orders [39] Question: Is there a plan for stock buybacks given the current trading levels? - Management discussed the potential for stock buybacks but believes there is enough positive momentum to drive stock price without using cash for buybacks at this time [68]

Financial Data and Key Metrics Changes - Consolidated revenues for 2024 were $25.1 million, at the lower end of the guidance range of $25 million to $26 million, reflecting a 17% decrease in total APC segment revenue, partially offset by a 2% increase in FUEL CHEM revenue [7][32] - Consolidated gross margin for 2024 marginally decreased to 42% from 43% in the previous year, with a decline in both APC and FUEL CHEM gross margins [33] - Net loss for 2024 was $1.9 million or $0.06 per diluted share, compared to a net loss of $1.5 million or $0.05 per diluted share in 2023 [35] Business Segment Data and Key Metrics Changes - FUEL CHEM segment revenue was essentially unchanged at $3.5 million for Q4 2024, while APC segment revenue declined to $1.8 million from $2.8 million in the prior year [27] - APC gross margin declined to 36% from 55%, primarily due to product mix and lower segment revenue, while FUEL CHEM gross margin declined to 45% from 48% [28] - Consolidated APC segment backlog at December 31, 2024, was $6.2 million compared to $7.5 million at the end of 2023, with expectations for backlog improvement through the first half of 2025 [29] Market Data and Key Metrics Changes - The company is pursuing additional FUEL CHEM accounts, with a demonstration scheduled for late Q3 2025, and is in discussions to expand its chemical technology in Mexico [11][12] - The global data center power market is expected to expand significantly, with investments in emissions control solutions to address surging electricity demand [15][86] - The company is following opportunities in the municipal solid waste market driven by state-specific regulatory requirements [14] Company Strategy and Development Direction - The company aims to exceed $30 million in total revenues for 2025, with expectations that both business segments will outperform their 2024 performance [24] - The company is focusing on the commercialization of its DGI technology, with ongoing demonstrations and discussions in various end markets [22][23] - The company is exploring small acquisitions or licensing opportunities to enhance its market position [114] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2025, citing a strong portfolio of APC business opportunities and a return to normalized operations in FUEL CHEM [9][14] - The company does not expect significant contributions from new EPA regulations but is monitoring the regulatory landscape for potential impacts [16][20] - Management indicated that achieving breakeven on operating income would likely require revenues closer to $33 million to $35 million [112] Other Important Information - The company ended 2024 with cash, cash equivalents, and investments totaling approximately $30 million and no long-term debt [8][36] - SG&A expenses increased to $13.8 million for 2024, reflecting higher employee-related costs [33] Q&A Session Summary Question: Is the $30 million revenue outlook for 2025 based on confidence in securing additional FUEL CHEM customers and APC orders? - Management confirmed that the APC orders are included in the outlook, but contributions from new FUEL CHEM accounts are not expected to be significant in 2025 [44] Question: What is the expected gross margin trend for 2025? - Management anticipates a return to historical gross margins of 49% to 50% for FUEL CHEM, while APC margins are expected to remain in the 35% to 38% range [54][56] Question: Are there any impacts from tariffs on the supply chain? - Management acknowledged potential impacts from steel and aluminum tariffs, which could affect costs but would be passed on to end customers [66] Question: What is the timeline for data center-related orders? - Management indicated that delivery schedules for data center orders would typically be around 40 weeks from order to delivery [104] Question: Is the company considering M&A or stock buybacks? - Management is exploring small acquisitions and licensing opportunities but believes current business momentum will drive shareholder value without the need for buybacks [114][116]