Perma-Fix Environmental Services(PESI) - 2020 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company achieved profitability in Q2 2020, with revenue increasing by 29% year-over-year to $22 million [9][13] - Adjusted EBITDA was approximately $847,000, down from $1 million in the same period last year [14][30] - Net income attributable to common shareholders was $204,000, consistent with $0.02 per share, compared to $289,000 in the prior year [14][30] Business Line Data and Key Metrics Changes - Services Segment revenue increased by 102% to $14.2 million, driven by improved project activity [13][22] - Treatment Segment revenue decreased by 22.3% to $7.8 million due to COVID-related impacts on waste receipts [13][23] Market Data and Key Metrics Changes - The backlog for the Services Segment was approximately $48 million, indicating strong future revenue potential [11][32] - The Treatment Segment backlog was approximately $6.4 million, reflecting a decrease due to slower waste receipts [32][62] Company Strategy and Development Direction - The company is focusing on expanding its nuclear services and enhancing its offerings to the commercial sector [15][19] - New initiatives include the deployment of the Perma-Sort system, which has shown promising results in processing radioactive soils [21][69] - The company aims to achieve a 10% EBITDA margin, although current margins may be lower due to the high percentage of revenue from the Services Segment [56] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery of waste receipts and anticipated increases in revenue in Q3 and Q4 [19][80] - The company has successfully navigated the challenges posed by COVID-19, maintaining operations and securing a PPP loan to support its workforce [18][25] Other Important Information - The company has only reported one COVID-19 case among its employees, highlighting effective safety measures [16] - The company is awaiting final permit modifications for the GeoMelt business, which could significantly increase revenue once operational [74] Q&A Session Summary Question: Update on EPA contract with Jacobs - Management noted that an announcement regarding the contract is expected soon [36][38] Question: Status of Navy contracts - Management confirmed ongoing work on several Navy contracts, with positive progress [39] Question: Revenue recognition and backlog - Management explained that revenue is recognized in phases, and a backlog exists despite current delays [47][62] Question: Treatment Segment expansion opportunities - Management highlighted the potential for increased revenue from the GML and commercial sector, aiming for $10 million to $15 million annually [88][89] Question: Impact of PPP loan on financials - Management indicated that without the PPP loan, significant labor-related decisions would have been necessary, potentially impacting productivity [64] Question: Future opportunities with DOE funding - Management anticipates increased opportunities as DOE funding is expected to carry over into the next fiscal year [80]