Energy Recovery Reports its Third Quarter 2024 Financial Results
Energy Recovery (Nasdaq: ERII) announced its financial results for Q3 2024, with revenue reaching $38.6 million, at the upper end of its $35-39 million guidance. The gross margin was 65.1%, a decrease of 480 basis points compared to Q3 2023, due to higher manufacturing and product mix costs. Operating expenses rose by 7.8% to $18.1 million, primarily from increased consulting and employee costs. Consequently, income from operations fell by 22.7% to $7.1 million. Net income was $8.5 million, and adjusted EBITDA stood at $11.6 million. The company holds $139.9 million in cash and investments. CEO David Moon highlighted the company's progress in desalination, wastewater, and CO2 refrigeration businesses, along with a new five-year growth plan to be detailed in a webinar on November 18, 2024.
Energy Recovery (Nasdaq: ERII) ha annunciato i risultati finanziari per il terzo trimestre del 2024, con un fatturato che ha raggiunto i 38,6 milioni di dollari, al limite superiore delle previsioni di 35-39 milioni di dollari. Il margine lordo è stato del 65,1%, con una diminuzione di 480 punti base rispetto al terzo trimestre del 2023, a causa di costi più elevati di produzione e mix di prodotti. Le spese operative sono aumentate del 7,8%, raggiungendo i 18,1 milioni di dollari, principalmente a causa dell'aumento dei costi di consulenza e del personale. Di conseguenza, l'utile operativo è diminuito del 22,7%, scendendo a 7,1 milioni di dollari. L'utile netto è stato di 8,5 milioni di dollari, e l'EBITDA rettificato si è attestato a 11,6 milioni di dollari. L'azienda detiene 139,9 milioni di dollari in cassa e investimenti. Il CEO David Moon ha messo in evidenza i progressi dell'azienda nei settori della dissalazione, delle acque reflue e della refrigerazione CO2, insieme a un nuovo piano di crescita quinquennale che sarà dettagliato in un webinar il 18 novembre 2024.
Energy Recovery (Nasdaq: ERII) anunció sus resultados financieros para el tercer trimestre de 2024, con ingresos que alcanzaron los 38.6 millones de dólares, en el extremo superior de su guía de 35-39 millones de dólares. El margen bruto fue del 65.1%, una disminución de 480 puntos básicos en comparación con el tercer trimestre de 2023, debido a mayores costos de fabricación y mezcla de productos. Los gastos operativos aumentaron un 7.8% hasta los 18.1 millones de dólares, principalmente por el aumento de los costos de consultoría y personal. En consecuencia, el ingreso de operaciones cayó un 22.7% hasta los 7.1 millones de dólares. El ingreso neto fue de 8.5 millones de dólares, y el EBITDA ajustado se situó en 11.6 millones de dólares. La empresa posee 139.9 millones de dólares en efectivo e inversiones. El CEO David Moon destacó los progresos de la compañía en los negocios de desalinización, aguas residuales y refrigeración de CO2, junto con un nuevo plan de crecimiento a cinco años que se detallará en un seminario web el 18 de noviembre de 2024.
에너지 리커버리(Nasdaq: ERII)는 2024년 3분기 재무 결과를 발표했으며, 매출은 3,860만 달러에 달하여 가이던스인 3,500만 달러에서 3,900만 달러의 상단에 도달했습니다. 총 이익률은 65.1%로, 2023년 3분기와 비교하여 480베이시스 포인트 감소했으며, 이는 더 높은 제조 및 제품 혼합 비용 때문입니다. 운영 비용은 7.8% 증가하여 1,810만 달러에 달하며, 주로 컨설팅 및 인건비 증가로 인한 것입니다. 결과적으로, 영업이익은 22.7% 감소하여 710만 달러에 달했습니다. 순이익은 850만 달러였으며, 조정 EBITDA는 1,160만 달러로 집계되었습니다. 회사는 현금 및 투자로 1억 3,990만 달러를 보유하고 있습니다. CEO 데이비드 문은 담수화, 폐수 및 CO2 냉각 사업에서의 회사의 진전을 강조하며, 2024년 11월 18일 웨비나에서 자세히 설명될 5개년 성장 계획을 언급했습니다.
Energy Recovery (Nasdaq: ERII) a annoncé ses résultats financiers pour le troisième trimestre 2024, avec un chiffre d'affaires atteignant 38,6 millions de dollars, au haut de sa fourchette de prévisions de 35 à 39 millions de dollars. La marge brute était de 65,1%, une baisse de 480 points de base par rapport au troisième trimestre 2023, en raison de coûts plus élevés de fabrication et de mix de produits. Les frais d'exploitation ont augmenté de 7,8% pour atteindre 18,1 millions de dollars, principalement en raison de l'augmentation des coûts de conseil et de personnel. Par conséquent, le résultat d'exploitation a chuté de 22,7% pour s'établir à 7,1 millions de dollars. Le bénéfice net était de 8,5 millions de dollars, et l'EBITDA ajusté s'élevait à 11,6 millions de dollars. L'entreprise détient 139,9 millions de dollars en liquidités et en investissements. Le PDG David Moon a souligné les progrès de l'entreprise dans les secteurs de la désalinisation, des eaux usées et de la réfrigération au CO2, ainsi qu'un nouveau plan de croissance quinquennal qui sera détaillé lors d'un webinaire le 18 novembre 2024.
Energy Recovery (Nasdaq: ERII) hat seine finanziellen Ergebnisse für das 3. Quartal 2024 bekannt gegeben, wobei die Umsätze 38,6 Millionen US-Dollar erreichten, am oberen Ende der Prognose von 35-39 Millionen US-Dollar. Die Bruttomarge betrug 65,1%, was einem Rückgang von 480 Basispunkten im Vergleich zum 3. Quartal 2023 entspricht, bedingt durch höhere Produktions- und Produktmixkosten. Die Betriebskosten stiegen um 7,8% auf 18,1 Millionen US-Dollar, hauptsächlich aufgrund von höheren Beratungs- und Personalkosten. Infolgedessen sank der Betriebsgewinn um 22,7% auf 7,1 Millionen US-Dollar. Der Nettoertrag betrug 8,5 Millionen US-Dollar, und das bereinigte EBITDA belief sich auf 11,6 Millionen US-Dollar. Das Unternehmen hält 139,9 Millionen US-Dollar in Bar und Investitionen. CEO David Moon hob die Fortschritte des Unternehmens in den Bereichen Meerwasserentsalzung, Abwasser und CO2-Kühlung hervor sowie einen neuen fünfjährigen Wachstumsplan, der am 18. November 2024 in einem Webinar detailliert vorgestellt wird.
- Revenue of $38.6 million, reaching the upper end of guidance.
- Net income of $8.5 million.
- Adjusted EBITDA of $11.6 million.
- Cash and investments totaling $139.9 million.
- Gross margin decreased by 480 basis points to 65.1%.
- Operating expenses increased by 7.8% to $18.1 million.
- Income from operations decreased by 22.7% to $7.1 million.
- Net income decreased by 12% to $8.5 million.
Insights
Energy Recovery's Q3 2024 results show mixed performance.
Key concerns include declining margins and operating efficiency. However, positive signals emerge from:
- Strong cash position of
$139.9M - Growth in core desalination business
- Expansion in wastewater segment
- Progress in CO2 refrigeration business with PX G1300 validation
The upcoming five-year growth strategy presentation on November 18 will be important for understanding future value creation potential across all three business segments.
The market's focus should be on Energy Recovery's strategic diversification beyond its core desalination business. While quarterly financials show some pressure points, the company's expansion into wastewater and CO2 refrigeration markets represents significant growth potential. The third-party validation of PX G1300 technology through white paper results is particularly noteworthy, as it could accelerate OEM adoption in the commercial refrigeration sector.
The upcoming strategic Playbook presentation could be a catalyst for market sentiment, especially if management provides concrete growth targets and implementation timelines. Current
Third Quarter Highlights
-
Revenue of
, reaching the upper end of our guidance of$38.6 million -$35 .$39 million -
Gross margin of
65.1% , a decrease of 480 bps, as compared to Q3’2023, due primarily to higher manufacturing costs and higher costs related to product mix. -
Operating expenses of
, an increase of$18.1 million 7.8% , as compared to Q3’2023, due primarily to higher consulting costs related to enhancement of our corporate growth strategy and higher employee costs. -
Income from operations of
, a decrease of$7.1 million 22.7% , as compared to Q3’2023, mainly due to higher operating expenses and lower gross margin. -
Net income of
and adjusted EBITDA(1) of$8.5 million .$11.6 million -
Cash and investments of
, which include cash, cash equivalents, and short- and long-term investments.$139.9 million
David Moon, President and CEO, commented on the financial results, “We delivered strong third quarter results, hitting the upper end of our guidance for the quarter and, although there is still work to be done, we believe we are well-positioned in this quarter to deliver on our guidance for the full year. Our core desalination business continues to demonstrate durability of growth, our wastewater business continues to expand, and we are making real progress this year in our CO2 refrigeration business.”
Mr. Moon continued, “With our PX G1300 summer data collection complete, we just issued a white paper with the measurement and verification results, provided by a third party engineering firm, that we believe will be an important next step to getting the PX G1300 integrated into OEM systems designs and ultimately specified by supermarkets. Finally, we concluded our strategic work on what I have termed our Playbook. This Playbook outlines our five-year plan to grow all three of Energy Recovery’s businesses. It is an ambitious and I believe achievable blueprint for growth that I, along with Mike Mancini, CFO, and our business unit leads, are excited to lay out next month on a live investor webinar we are hosting on November 18, 2024.”
Financial Highlights
|
Quarter-to-Date |
|
|
Year to Date |
||||||||
|
Q3’2024 |
|
Q3’2023 |
|
vs. Q3’2023 |
|
|
2024 |
|
2023 |
|
2024 vs. 2023 |
|
(In millions, except net income (loss) per share, percentages and basis points) |
|||||||||||
Revenue |
|
|
|
|
up |
|
|
|
|
|
|
up |
Gross margin |
|
|
|
|
down 480 bps |
|
|
|
|
|
|
down 290 bps |
Operating margin |
|
|
|
|
down 640 bps |
|
|
( |
|
( |
|
down 540 bps |
Net income (loss) |
|
|
|
|
down |
|
|
( |
|
|
|
down |
Net income (loss) per share |
|
|
|
|
down |
|
|
( |
|
|
|
down |
Effective tax rate |
|
|
|
|
|
|
|
|
|
( |
|
|
Cash provided by (used for) operations |
( |
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Financial Highlights (1)
|
Quarter-to-Date |
|
|
Year to Date |
||||||||
|
Q3’2024 |
|
Q3’2023 |
|
vs. Q3’2023 |
|
|
2024 |
|
2023 |
|
2024 vs. 2023 |
|
(In millions, except adjusted net income per share, percentages and basis points) |
|||||||||||
Adjusted operating margin |
|
|
|
|
down 200 bps |
|
|
|
|
|
|
up 370 bps |
Adjusted net income |
|
|
|
|
up |
|
|
|
|
|
|
up |
Adjusted net income per share |
|
|
|
|
up |
|
|
|
|
|
|
up |
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow |
( |
|
|
|
|
|
|
|
|
|
|
|
___________ | ||
(1) |
Refer to the sections “Use of Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” for definitions of our non-GAAP financial measures and reconciliations of GAAP to non-GAAP amounts, respectively. |
Forward-Looking Statements
Certain matters discussed in this press release and on the conference call are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including the belief that the Company is well-positioned in the fourth quarter to deliver on our guidance for the full year, the belief that the Company is making real progress this year in its CO2 refrigeration business, the belief that the Company’s recently published white paper is an important next step to getting the PX G1300 integrated into original equipment manufacturers’ systems designs and ultimately specified by supermarkets, and the belief that the Company’s Playbook is an achievable blueprint for growth. These forward-looking statements are based on information currently available to the Company and on management’s beliefs, assumptions, estimates, or projections and are not guarantees of future events or results. Potential risks and uncertainties include risks relating to the future demand for the Company’s products, risks relating to performance by our customers and third-party partners, risks relating to the timing of revenue, and any other factors that may have been discussed herein regarding the risks and uncertainties of the Company’s business, and the risks discussed under “Risk Factors” in the Company’s Form 10-K filed with the
Use of Non-GAAP Financial Measures
This press release includes certain non-GAAP financial measures, including adjusted operating margin, adjusted net income, adjusted net income per share, adjusted EBITDA and free cash flow. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either exclude or include amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in
Notes to the Financial Results
- Adjusted operating margin is a non-GAAP financial measure that the Company defines as income (loss) from operations which excludes i) share-based compensation; and ii) executive transition costs, such as executive search costs, retention costs, one-time severance costs and one-time corporate growth strategy costs, divided by revenues.
- Adjusted net income is a non-GAAP financial measure that the Company defines as net income which excludes i) share-based compensation; ii) executive transition costs; and iii) the applicable tax effect of the excluded items including the share-based compensation discrete tax item.
- Adjusted net income per share is a non-GAAP financial measure that the Company defines as net income (loss), which excludes i) share-based compensation; ii) executive transition costs and iii) the applicable tax effect of the excluded items including the share-based compensation discrete tax item, divided by basic shares outstanding.
- Adjusted EBITDA is a non-GAAP financial measure that the Company defines as net income (loss) which excludes i) depreciation and amortization; ii) share-based compensation; iii) executive transition costs; iv) other income, net, such as interest income and other non-operating income (expense), net; and v) provision for (benefit from) income taxes.
- Free cash flow is a non-GAAP financial measure that the Company defines as net cash provided by (used in) operating activities less capital expenditures.
Conference Call to Discuss Financial Results
LIVE CONFERENCE CALL:
Wednesday, October 30, 2024, 2:00 PM PT / 5:00 PM ET
US / Canada Toll-Free: +1 (866) 682-6100
Local / International Toll: +1 (862) 298-0702
CONFERENCE CALL REPLAY:
Available approximately three hours after conclusion of the live call.
Expiration: Friday, November 29, 2024
US / Canada Toll-Free: +1 (877) 660-6853
Local / International Toll: +1 (201) 612-7415
Access code: 13749222
Investors may also access the live call and the replay over the internet on the “Events” page of the Company’s website located at https://ir.energyrecovery.com/news-events/ir-calendar.
Disclosure Information
Energy Recovery uses the investor relations section on its website as means of complying with its disclosure obligations under Regulation FD. Accordingly, investors should monitor Energy Recovery’s investor relations website in addition to following Energy Recovery’s press releases, SEC filings, and public conference calls and webcasts.
About Energy Recovery
Energy Recovery (Nasdaq: ERII) is a trusted global leader in energy efficiency technology. Building on the Company’s pressure exchanger technology platform, the Company designs and manufactures reliable, high-performance solutions that generate cost savings and increase energy efficiency across several industries. With a strong foundation in the desalination industry, the Company has delivered transformative solutions that optimize operations and deliver positive environmental impact to its customers worldwide for more than 30 years. Headquartered in the
ENERGY RECOVERY, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) |
|||||
|
September 30, 2024 |
|
December 31, 2023 |
||
|
(In thousands) |
||||
ASSETS |
|
|
|
||
Cash, cash equivalents and investments |
$ |
139,911 |
|
$ |
122,375 |
Accounts receivable and contract assets |
|
33,319 |
|
|
47,529 |
Inventories, net |
|
33,464 |
|
|
26,149 |
Prepaid expenses and other assets |
|
5,295 |
|
|
3,251 |
Property, equipment and operating leases |
|
26,504 |
|
|
30,168 |
Goodwill |
|
12,790 |
|
|
12,790 |
Deferred tax assets and other assets |
|
11,422 |
|
|
10,712 |
TOTAL ASSETS |
$ |
262,705 |
|
$ |
252,974 |
|
|
|
|
||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||
Liabilities |
|
|
|
||
Accounts payable and accrued expenses |
$ |
13,938 |
|
$ |
18,583 |
Contract liabilities and other liabilities, non-current |
|
3,069 |
|
|
1,304 |
Lease liabilities |
|
11,825 |
|
|
13,279 |
Total liabilities |
|
28,832 |
|
|
33,166 |
|
|
|
|
||
Stockholders’ equity |
|
233,873 |
|
|
219,808 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
262,705 |
|
$ |
252,974 |
ENERGY RECOVERY, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) |
|||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||||
|
(In thousands, except per share data) |
||||||||||||
Revenue |
$ |
38,584 |
|
$ |
37,036 |
|
$ |
77,873 |
|
|
$ |
71,160 |
|
Cost of revenue |
|
13,472 |
|
|
11,154 |
|
|
28,060 |
|
|
|
23,580 |
|
Gross profit |
|
25,112 |
|
|
25,882 |
|
|
49,813 |
|
|
|
47,580 |
|
|
|
|
|
|
|
|
|
||||||
Operating expenses |
|
|
|
|
|
|
|
||||||
General and administrative |
|
7,673 |
|
|
7,369 |
|
|
24,771 |
|
|
|
21,704 |
|
Sales and marketing |
|
6,413 |
|
|
5,411 |
|
|
18,669 |
|
|
|
15,397 |
|
Research and development |
|
3,969 |
|
|
3,969 |
|
|
12,264 |
|
|
|
12,043 |
|
Total operating expenses |
|
18,055 |
|
|
16,749 |
|
|
55,704 |
|
|
|
49,144 |
|
Income (loss) from operations |
|
7,057 |
|
|
9,133 |
|
|
(5,891 |
) |
|
|
(1,564 |
) |
Other income, net |
|
1,768 |
|
|
1,045 |
|
|
4,771 |
|
|
|
2,357 |
|
Income (loss) before income taxes |
|
8,825 |
|
|
10,178 |
|
|
(1,120 |
) |
|
|
793 |
|
Provision for (benefit from) income taxes |
|
344 |
|
|
518 |
|
|
(699 |
) |
|
|
(906 |
) |
Net income (loss) |
$ |
8,481 |
|
$ |
9,660 |
|
$ |
(421 |
) |
|
$ |
1,699 |
|
|
|
|
|
|
|
|
|
||||||
Net income (loss) per share |
|
|
|
|
|
|
|
||||||
Basic |
$ |
0.15 |
|
$ |
0.17 |
|
$ |
(0.01 |
) |
|
$ |
0.03 |
|
Diluted |
$ |
0.15 |
|
$ |
0.17 |
|
$ |
(0.01 |
) |
|
$ |
0.03 |
|
|
|
|
|
|
|
|
|
||||||
Number of shares used in per share calculations |
|
|
|
|
|
|
|
||||||
Basic |
|
57,756 |
|
|
56,443 |
|
|
57,409 |
|
|
|
56,346 |
|
Diluted |
|
58,290 |
|
|
57,969 |
|
|
57,409 |
|
|
|
57,761 |
|
ENERGY RECOVERY, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) |
|||||||
|
Nine Months Ended September 30, |
||||||
|
|
2024 |
|
|
|
2023 |
|
|
(In thousands) |
||||||
Cash flows from operating activities: |
|
|
|
||||
Net (loss) income |
$ |
(421 |
) |
|
$ |
1,699 |
|
Non-cash adjustments |
|
11,432 |
|
|
|
8,817 |
|
Net cash provided by (used in) operating assets and liabilities |
|
556 |
|
|
|
1,756 |
|
Net cash provided by operating activities |
|
11,567 |
|
|
|
12,272 |
|
|
|
|
|
||||
Cash flows from investing activities: |
|
|
|
||||
Net investment in marketable securities |
|
(21,067 |
) |
|
|
(17,278 |
) |
Capital expenditures |
|
(1,194 |
) |
|
|
(1,179 |
) |
Proceeds from sales of fixed assets |
|
90 |
|
|
|
82 |
|
Net cash used in investing activities |
|
(22,171 |
) |
|
|
(18,375 |
) |
|
|
|
|
||||
Cash flows from financing activities: |
|
|
|
||||
Net proceeds from issuance of common stock |
|
5,795 |
|
|
|
1,184 |
|
Net cash provided by financing activities |
|
5,795 |
|
|
|
1,184 |
|
|
|
|
|
||||
Effect of exchange rate differences |
|
(23 |
) |
|
|
27 |
|
Net change in cash, cash equivalents and restricted cash |
$ |
(4,832 |
) |
|
$ |
(4,892 |
) |
Cash, cash equivalents and restricted cash, end of period |
$ |
63,393 |
|
|
$ |
51,566 |
|
ENERGY RECOVERY, INC. SUPPLEMENTAL FINANCIAL INFORMATION (Unaudited) |
|||||||||||||||
Channel Revenue |
|||||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2024 |
|
2023 |
|
vs. 2023 |
|
2024 |
|
2023 |
|
vs. 2023 |
||||
|
(In thousands, except percentages) |
||||||||||||||
Megaproject |
$ |
29,009 |
|
$ |
26,829 |
|
up |
|
$ |
48,924 |
|
$ |
42,283 |
|
up |
Original equipment manufacturer |
|
4,919 |
|
|
5,307 |
|
down |
|
|
15,210 |
|
|
16,845 |
|
down |
Aftermarket |
|
4,656 |
|
|
4,900 |
|
down |
|
|
13,739 |
|
|
12,032 |
|
up |
Total revenue |
$ |
38,584 |
|
$ |
37,036 |
|
up |
|
$ |
77,873 |
|
$ |
71,160 |
|
up |
Segment Activity |
|||||||||||||||||||||||||||
|
Three Months Ended September 30, |
||||||||||||||||||||||||||
|
2024 |
|
2023 |
||||||||||||||||||||||||
|
Water |
|
Emerging
|
|
Corporate |
|
Total |
|
Water |
|
Emerging
|
|
Corporate |
|
Total |
||||||||||||
|
(In thousands) |
||||||||||||||||||||||||||
Revenue |
$ |
38,344 |
|
$ |
240 |
|
|
$ |
— |
|
|
$ |
38,584 |
|
$ |
36,812 |
|
$ |
224 |
|
|
$ |
— |
|
|
$ |
37,036 |
Cost of revenue |
|
13,334 |
|
|
138 |
|
|
|
— |
|
|
|
13,472 |
|
|
11,114 |
|
|
40 |
|
|
|
— |
|
|
|
11,154 |
Gross profit |
|
25,010 |
|
|
102 |
|
|
|
— |
|
|
|
25,112 |
|
|
25,698 |
|
|
184 |
|
|
|
— |
|
|
|
25,882 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
General and administrative |
|
1,803 |
|
|
906 |
|
|
|
4,964 |
|
|
|
7,673 |
|
|
2,039 |
|
|
1,061 |
|
|
|
4,269 |
|
|
|
7,369 |
Sales and marketing |
|
3,777 |
|
|
1,977 |
|
|
|
659 |
|
|
|
6,413 |
|
|
3,272 |
|
|
1,560 |
|
|
|
579 |
|
|
|
5,411 |
Research and development |
|
1,145 |
|
|
2,824 |
|
|
|
— |
|
|
|
3,969 |
|
|
1,098 |
|
|
2,871 |
|
|
|
— |
|
|
|
3,969 |
Total operating expenses |
|
6,725 |
|
|
5,707 |
|
|
|
5,623 |
|
|
|
18,055 |
|
|
6,409 |
|
|
5,492 |
|
|
|
4,848 |
|
|
|
16,749 |
Operating income (loss) |
$ |
18,285 |
|
$ |
(5,605 |
) |
|
$ |
(5,623 |
) |
|
$ |
7,057 |
|
$ |
19,289 |
|
$ |
(5,308 |
) |
|
$ |
(4,848 |
) |
|
$ |
9,133 |
|
Nine Months Ended September 30, |
||||||||||||||||||||||||||||
|
2024 |
|
|
2023 |
|||||||||||||||||||||||||
|
Water |
|
Emerging
|
|
Corporate |
|
Total |
|
Water |
|
Emerging
|
|
Corporate |
|
Total |
||||||||||||||
|
(In thousands) |
||||||||||||||||||||||||||||
Revenue |
$ |
77,351 |
|
$ |
522 |
|
|
$ |
— |
|
|
$ |
77,873 |
|
|
$ |
70,622 |
|
$ |
538 |
|
|
$ |
— |
|
|
$ |
71,160 |
|
Cost of revenue |
|
27,633 |
|
|
427 |
|
|
|
— |
|
|
|
28,060 |
|
|
|
23,136 |
|
|
444 |
|
|
|
— |
|
|
|
23,580 |
|
Gross profit |
|
49,718 |
|
|
95 |
|
|
|
— |
|
|
|
49,813 |
|
|
|
47,486 |
|
|
94 |
|
|
|
— |
|
|
|
47,580 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
General and administrative |
|
5,637 |
|
|
2,908 |
|
|
|
16,226 |
|
|
|
24,771 |
|
|
|
5,837 |
|
|
2,976 |
|
|
|
12,891 |
|
|
|
21,704 |
|
Sales and marketing |
|
11,359 |
|
|
5,484 |
|
|
|
1,826 |
|
|
|
18,669 |
|
|
|
9,567 |
|
|
4,171 |
|
|
|
1,659 |
|
|
|
15,397 |
|
Research and development |
|
3,318 |
|
|
8,946 |
|
|
|
— |
|
|
|
12,264 |
|
|
|
3,121 |
|
|
8,922 |
|
|
|
— |
|
|
|
12,043 |
|
Total operating expenses |
|
20,314 |
|
|
17,338 |
|
|
|
18,052 |
|
|
|
55,704 |
|
|
|
18,525 |
|
|
16,069 |
|
|
|
14,550 |
|
|
|
49,144 |
|
Operating income (loss) |
$ |
29,404 |
|
$ |
(17,243 |
) |
|
$ |
(18,052 |
) |
|
$ |
(5,891 |
) |
|
$ |
28,961 |
|
$ |
(15,975 |
) |
|
$ |
(14,550 |
) |
|
$ |
(1,564 |
) |
Share-based Compensation |
|||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||
|
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
|
(In thousands) |
||||||||||
Stock-based compensation expense charged to: |
|
|
|
|
|
|
|
||||
Cost of revenue |
$ |
176 |
|
$ |
158 |
|
$ |
980 |
|
$ |
555 |
General and administrative |
|
954 |
|
|
905 |
|
|
3,372 |
|
|
2,628 |
Sales and marketing |
|
845 |
|
|
436 |
|
|
2,767 |
|
|
1,684 |
Research and development |
|
437 |
|
|
292 |
|
|
1,393 |
|
|
944 |
Total stock-based compensation expense |
$ |
2,412 |
|
$ |
1,791 |
|
$ |
8,512 |
|
$ |
5,811 |
ENERGY RECOVERY, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (1) (Unaudited) |
|||||||||||||||
This press release includes certain non-GAAP financial information because we plan and manage our business using such information. The following table reconciles the GAAP financial information to the non-GAAP financial information. |
|||||||||||||||
|
Quarter-to-Date |
|
Year to Date |
||||||||||||
|
Q3'2024 |
|
Q3'2023 |
|
Q3'2024 |
|
Q3'2023 |
||||||||
|
(In millions, except shares, per share and percentages) |
||||||||||||||
Operating margin |
|
18.3 |
% |
|
|
24.7 |
% |
|
|
(7.6 |
)% |
|
|
(2.2 |
)% |
Share-based compensation |
|
6.3 |
|
|
|
4.8 |
|
|
|
10.9 |
|
|
|
8.2 |
|
Executive transition costs |
|
2.9 |
|
|
|
— |
|
|
|
6.4 |
|
|
|
— |
|
Adjusted operating margin |
|
27.5 |
% |
|
|
29.5 |
% |
|
|
9.7 |
% |
|
|
6.0 |
% |
|
|
|
|
|
|
|
|
||||||||
Net income (loss) |
$ |
8.5 |
|
|
$ |
9.7 |
|
|
$ |
(0.4 |
) |
|
$ |
1.7 |
|
Share-based compensation |
|
2.4 |
|
|
|
1.8 |
|
|
|
8.5 |
|
|
|
5.8 |
|
Executive transition costs (2) |
|
1.0 |
|
|
|
— |
|
|
|
4.4 |
|
|
|
— |
|
Share-based compensation discrete tax item |
|
0.1 |
|
|
|
(0.1 |
) |
|
|
(0.1 |
) |
|
|
(0.7 |
) |
Adjusted net income |
$ |
12.0 |
|
|
$ |
11.4 |
|
|
$ |
12.4 |
|
|
$ |
6.8 |
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per share |
$ |
0.15 |
|
|
$ |
0.17 |
|
|
$ |
(0.01 |
) |
|
$ |
0.03 |
|
Adjustments to net income (loss) per share (3) |
|
0.06 |
|
|
|
0.03 |
|
|
|
0.23 |
|
|
|
0.09 |
|
Adjusted net income per share |
$ |
0.21 |
|
|
$ |
0.20 |
|
|
$ |
0.22 |
|
|
$ |
0.12 |
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) |
$ |
8.5 |
|
|
$ |
9.7 |
|
|
$ |
(0.4 |
) |
|
$ |
1.7 |
|
Share-based compensation |
|
2.4 |
|
|
|
1.8 |
|
|
|
8.5 |
|
|
|
5.8 |
|
Depreciation and amortization |
|
1.0 |
|
|
|
1.1 |
|
|
|
3.1 |
|
|
|
3.1 |
|
Executive transition costs |
|
1.1 |
|
|
|
— |
|
|
|
5.0 |
|
|
|
— |
|
Other income, net |
|
(1.8 |
) |
|
|
(1.0 |
) |
|
|
(4.8 |
) |
|
|
(2.4 |
) |
Provision for (benefit from) income taxes |
|
0.3 |
|
|
|
0.5 |
|
|
|
(0.7 |
) |
|
|
(0.9 |
) |
Adjusted EBITDA |
$ |
11.6 |
|
|
$ |
12.0 |
|
|
$ |
10.6 |
|
|
$ |
7.3 |
|
|
|
|
|
|
|
|
|
||||||||
Free cash flow |
|
|
|
|
|
|
|
||||||||
Net cash provided by (used in) operating activities |
$ |
(3.0 |
) |
|
$ |
7.7 |
|
|
$ |
11.6 |
|
|
$ |
12.3 |
|
Capital expenditures |
|
(0.2 |
) |
|
|
(0.3 |
) |
|
|
(1.2 |
) |
|
|
(1.2 |
) |
Free cash flow |
$ |
(3.2 |
) |
|
$ |
7.4 |
|
|
$ |
10.4 |
|
|
$ |
11.1 |
|
___________ | ||
(1) |
Amounts may not total due to rounding. |
|
(2) |
Amounts presented are net of tax. | |
(3) |
Refer to the sections “Use of Non-GAAP Financial Measures” for description of items included in adjustments. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241030567814/en/
Investor Relations
ir@energyrecovery.com
Source: Energy Recovery, Inc.
FAQ
What were Energy Recovery's Q3 2024 revenue and net income?
How did Energy Recovery's gross margin perform in Q3 2024?
What is the adjusted EBITDA for Energy Recovery in Q3 2024?
What are the cash and investment holdings of Energy Recovery as of Q3 2024?