Perma-Fix Environmental Services(US:PESI)2025-03-13 15:00Financial Data and Key Metrics Changes - Total revenue for Q4 2024 was $14.7 million, a decrease of 35.2% from $22.7 million in Q4 2023 [17] - For the full year 2024, revenue was $59.1 million, down 34.1% from $89.7 million in 2023 [18] - Net loss for Q4 2024 was $3.5 million compared to a net income of $81,000 in Q4 2023 [20] - For the year ended 2024, net loss was $20 million compared to a net income of $485,000 in 2023 [20] - EBITDA loss for Q4 2024 was $3 million compared to income of $434,000 in Q4 2023 [21] Business Segment Data and Key Metrics Changes - Treatment segment revenue decreased by $1.4 million, while Services segment revenue dropped by $6.6 million in Q4 2024 [17] - For the year, Treatment segment revenue was down $8.5 million and Services revenue decreased by $22.1 million [18] - Gross profit for Q4 2024 was $594,000, down from $4.3 million in Q4 2023 [19] - Gross profit for the year was down $16.4 million, impacted by lower revenue and higher costs [19] Market Data and Key Metrics Changes - Treatment backlog as of December 2024 was $7.9 million, down from $10.7 million at the end of 2023 [23] - Cash on the balance sheet increased to $29 million from $7.5 million at year-end 2023, primarily due to equity raises [22] Company Strategy and Development Direction - The company aims for a return to growth and profitability in 2025, driven by a solid backlog and improving project execution [16] - Key initiatives include the Direct Feed Low Activity Waste Program at Hanford, expected to begin operations in summer 2025 [8] - Expansion in the industrial waste market and pursuit of government contracts are part of the growth strategy [10][11] - The company is diversifying revenue by expanding into international markets, particularly in Canada, Mexico, and Europe [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in 2024 due to delays in project starts and federal budget resolutions but remains optimistic about long-term growth [7] - The company expects limited impact from potential government shutdowns due to a strong backlog [28] - Management is confident in the commitment from the DOE to maintain milestones for the DFLAW program, which is crucial for future operations [32] Other Important Information - The company has strengthened its executive leadership team with the appointment of a new COO [15] - Significant investments have been made in PFAS destruction technology, which is seen as a promising growth area [13] Q&A Session Summary Question: Impact of federal budget delays on near-term operations - Management indicated that a government shutdown of less than two weeks would have limited impact due to a strong backlog, while longer shutdowns could affect procurement [27][29] Question: Update on DFLAW program and operational readiness - The DFL facility is undergoing an operational readiness review, and management expects to start operations on track for August [35][36] Question: Costs associated with PFAS initiatives - In 2024, the company spent approximately $3 million on PFAS initiatives, with projections for 2025 to be around $5 million [42] Question: Economics of Gen 2 PFAS unit - The goal for Gen 2 is to achieve $5 million in revenue per quarter with a target operating margin of 70% [53] Question: Cash flow breakeven from DFLAW operations - Management expects to be close to cash positive once DFLAW operations ramp up, with additional waste streams contributing to revenue [64] Question: Core business performance and future outlook - Management is focused on returning the core business to breakeven or better, with optimism for improved revenue in the second half of 2025 [71]