Perma-Fix Achieves 36% Year-Over-Year Increase in Revenue to $22.7 Million for the Fourth Quarter of 2023
- Significant increase in gross profit of 113% compared to the same period last year.
- Revenue increase of 35.6% for the fourth quarter and 27.1% for the full year of 2023.
- Positive EBITDA and net income achieved in 2023 despite investments in bidding organization and R&D.
- Strategic wins in Treatment and Services Segments, new awards, and joint venture projects.
- Active bidding on large contracts with U.S. DOE and U.S. Navy, as well as advancements in PFAS contamination treatment technology.
- Expansion of waste treatment services in commercial and international markets, anticipating growth in 2025.
- None.
Insights
Revenue Growth & Profitability: The reported increases in revenue and gross profit for both the fourth quarter and the full year are significant indicators of the company's improving financial health. A 35.6% and 27.1% increase in revenue, coupled with a 112.7% and 70.4% increase in gross profit for the respective periods, suggest that Perma-Fix Environmental Services has effectively scaled its operations while managing costs. The positive EBITDA and net income for 2023 reflect operational efficiency and successful recovery from pandemic-related disruptions. Investors should note the transition from an operating loss in 2022 to operating income in 2023, which may be a sign of sustainable growth and improved management effectiveness.
Strategic Initiatives & Contract Wins: The announcement of new contracts and strategic initiatives, particularly those with government agencies such as the DOE, DOD and EPA, underscore the company's competitive positioning within the environmental services sector. The mention of a joint venture expected to generate up to 50 million Euros over seven years highlights potential for international market expansion and diversified revenue streams. However, the impact of these developments will likely be more significant in the medium to long term, with work ramping up in late 2025.
PFAS Treatment Technology: Advancements in a new technology to treat PFAS contamination could represent a major growth opportunity given increasing regulatory focus on these substances. If the technology proves effective and scalable, it could position Perma-Fix as a leader in a niche but rapidly growing market. The timing for unveiling this technology will be critical and investors should monitor the company's progress closely, as it could materially affect future earnings potential.
Market Dynamics & Outlook: The environmental services industry is experiencing robust demand, driven by heightened regulatory requirements and increased environmental awareness. The company's expansion into commercial and international markets, including central Europe, Mexico and Canada, aligns with the global trend of investing in environmental sustainability. However, the mention of 'lumpiness in performance' due to procurement delays and the Continuing Resolution for the 2024 federal budget highlights the potential for revenue volatility. Stakeholders should be aware that while the long-term outlook appears positive, short-term fluctuations in performance are possible due to the nature of contract-based business and external economic factors.
Segment Performance: The differentiated performance of the Services and Treatment Segments is noteworthy. The Services Segment's substantial revenue increase and improved gross margin suggest successful project execution and efficiency gains. Conversely, the Treatment Segment's lower average price from waste mix, despite higher waste volume, indicates a need to monitor pricing strategies and cost management closely. The slight increase in the Treatment Segment's gross margin, despite higher variable costs, suggests some resilience to cost pressures, which is a positive sign for the segment's profitability.
Regulatory Environment & Technological Innovation: Perma-Fix's focus on bidding for contracts with the DOE and other federal agencies suggests a strategic alignment with the government's environmental priorities, such as the Hanford closure strategy. The ability to provide waste treatment services for the DFLAW facility could offer a steady revenue source, given the long-term nature of such government projects. The development of PFAS treatment technology is particularly pertinent, as these substances are the subject of increasing regulation due to their persistence in the environment and potential health risks. The company's proactive approach to developing solutions for emerging environmental challenges could set it apart from competitors and align it with future regulatory trends.
Gross profit increases
ATLANTA, March 13, 2024 (GLOBE NEWSWIRE) -- Perma-Fix Environmental Services, Inc. (NASDAQ: PESI) (the “Company”) today announced financial results and provided a business update for the fourth quarter and full year ended December 31, 2023.
Mark Duff, President and CEO of the Company, commented, “I am pleased to report solid financial results for the fourth quarter and 2023. Specifically, we achieved a
“Within our Treatment Segment, we benefitted from an improvement in waste volume receipts early in the quarter. Within the Services Segment, we realized several new awards from the Buffalo Corp of Engineers, U.S. Geological Survey (USGS), the U.S. Navy and several commercial clients. At the same time, we developed teaming relationships for several large procurements. In addition, a joint venture in which we have a
“It is important to note, we are actively bidding on large future contracts within the U.S. Department of Energy (DOE) and U.S. Navy, as well as other mid-size procurement initiatives at DOE, the U.S. Department of Defense (DOD) and the U.S. Environmental Protection Agency (EPA) facilities. In addition, we have made important advances on a new technology to treat PFAS (Per-and Polyfluorinated Substances) contamination, which we look forward to unveiling in the near future. Moreover, we believe we are positioned to provide extensive waste treatment services in support of DOE’s Hanford closure strategy, including the treatment of effluent from the DFLAW (Direct-Feed Low-Activity Waste) facility once it commences vitrification operations, which is expected in early 2025. Finally, we are expanding our waste treatment offering within the commercial and international markets, including central Europe, Mexico and Canada. Although there may be some lumpiness in performance resulting from delays in procurements, project starts and waste shipments due, in part, to the Continuing Resolution for the 2024 federal budget, we remain encouraged by the long-term outlook for the business based on what we expect are the growing project opportunities, sales pipeline, and potentially company-changing projects in 2025.”
Financial Results
Fourth-Quarter 2023 Results
Revenue for the fourth quarter of 2023 was
Gross profit for the fourth quarter of 2023 was
Operating loss for the fourth quarter of 2023 was approximately
Net income for the fourth quarter of 2023 was approximately
2023 Financial Results
Revenue in 2023 was
Gross profit in 2023 was
Operating income in 2023 was
Net income in 2023 was approximately
The Company achieved EBITDA of
| Quarter Ended | Twelve Months Ended | ||||||||||||||||
| December 31, | December 31, | ||||||||||||||||
| (Unaudited) | (Unaudited) | ||||||||||||||||
| (In thousands) | 2023 | 2022 | 2023 | 2022 | |||||||||||||
| Income (loss) from continuing operations | $ | 470 | $ | (1,529 | ) | $ | 918 | $ | (3,211 | ) | |||||||
| Adjustments: | |||||||||||||||||
| Depreciation & amortization | 443 | 676 | 2,568 | 2,109 | |||||||||||||
| Interest income | (161 | ) | (30 | ) | (606 | ) | (99 | ) | |||||||||
| Interest expense | 134 | 52 | 323 | 175 | |||||||||||||
| Interest expense - financing fees | 13 | 17 | 93 | 61 | |||||||||||||
| Income tax (benefit) expense | (465 | ) | (231 | ) | 17 | (378 | ) | ||||||||||
| EBITDA | 434 | (1,045 | ) | 3,313 | (1,343 | ) | |||||||||||
| Income from ERC refund claim, net (1) | - | - | - | (1,908 | ) | ||||||||||||
| Adjusted EBITDA | $ | 434 | $ | (1,045 | ) | $ | 3,313 | $ | (3,251 | ) | |||||||
| (1) net of costs incurred in connection with the ERC program in the amount of approximately | |||||||||||||||||
The tables below present certain financial information for the business segments, which exclude allocation of corporate expenses.
* Any references to "Audited" in the headings as noted in the table below and within the financial statements as follows are derived from a previously filed Form 10-K.
| Three Months Ended | Twelve Months Ended | |||||||||||||
| December 31, 2023 | December 31, 2023 | |||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||
| (In thousands) | Treatment | Services | Treatment | Services | ||||||||||
| Net revenues | $ | 10,255 | $ | 12,464 | $ | 43,477 | $ | 46,258 | ||||||
| Gross profit | 1,639 | 2,656 | 6,876 | 9,493 | ||||||||||
| Segment (loss) profit | (390 | ) | 2,782 | 2,228 | 5,716 | |||||||||
| Three Months Ended | Twelve Months Ended | ||||||||||||
| December 31, 2022 | December 31, 2022 | ||||||||||||
| (Unaudited) | (Audited) | ||||||||||||
| (In thousands) | Treatment | Services | Treatment | Services | |||||||||
| Net revenues | $ | 8,609 | $ | 8,148 | $ | 33,358 | $ | 37,241 | |||||
| Gross profit | 1,075 | 944 | 5,243 | 4,366 | |||||||||
| Segment profit | 2 | 117 | 1,767 | 1,698 | |||||||||
Conference Call
Perma-Fix will host a conference call at 11:00 AM Eastern Time on Wednesday, March 13, 2024. The call will be available in the investors section of the Company’s website at https://ir.perma-fix.com/conference-calls, or by calling 888-506-0062 for U.S. callers or +1 973-528-0011 for international callers, and by entering access code: 514355. The conference call will be led by Mark J. Duff, Chief Executive Officer, Dr. Louis F. Centofanti, Executive Vice President of Strategic Initiatives, and Ben Naccarato, Executive Vice President and Chief Financial Officer of Perma-Fix Environmental Services, Inc.
A webcast will also be archived on the Company’s website and a telephone replay of the call will be available approximately one hour following the call, through Wednesday, March 20, 2024, and can be accessed by dialing 877-481-4010 for U.S. callers or +1 919-882-2331 for international callers and entering access code: 50109.
About Perma-Fix Environmental Services
Perma-Fix Environmental Services, Inc. is a nuclear services company and leading provider of nuclear and mixed waste management services. The Company's nuclear waste services include management and treatment of radioactive and mixed waste for hospitals, research labs and institutions, federal agencies, including the DOE, the DOD, and the commercial nuclear industry. The Company’s nuclear services group provides project management, waste management, environmental restoration, decontamination and decommissioning, new build construction, and radiological protection, safety and industrial hygiene capability to our clients. The Company operates four nuclear waste treatment facilities and provides nuclear services at DOE, DOD, and commercial facilities, nationwide.
Please visit us at http://www.perma-fix.com.
This press release contains “forward-looking statements” which are based largely on the Company's expectations and are subject to various business risks and uncertainties, certain of which are beyond the Company's control. Forward-looking statements generally are identifiable by use of the words such as “believe”, “expects”, “intends”, “anticipate”, “plans to”, “estimates”, “projects”, and similar expressions. Forward-looking statements include, but are not limited to: long-term growth; key initiatives impactful to our business in 2024 and throughout 2025; revenue up to 50 million Euros generated under JV over the next 7 years; scope of work for the Company to ramp up in later phases of JV contract; treatment of effluent from DFLAW facility in early 2025; and long-term outlook based on growing project opportunities, sales pipeline, and potentially company-changing projects in 2025. These forward-looking statements are intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. While the Company believes the expectations reflected in this news release are reasonable, it can give no assurance such expectations will prove to be correct. There are a variety of factors which could cause future outcomes to differ materially from those described in this release, including, without limitation, future economic conditions; industry conditions; competitive pressures; our ability to apply and market our new technologies; the government or such other party to a contract granted to us fails to abide by or comply with the contract or to deliver waste as anticipated under the contract; inability to win bid projects; Congress fails to provides continuing funding for the DOD’s and DOE’s remediation projects; inability to obtain new foreign and domestic remediation contracts; inability to meet financial covenants; full or partial government shutdown; and the “Risk Factors” discussed in, and the additional factors referred to under "Special Note Regarding Forward-Looking Statements" of, our 2023 Form 10-K. The Company makes no commitment to disclose any revisions to forward-looking statements, or any facts, events or circumstances after the date hereof that bear upon forward-looking statements.
FINANCIAL TABLES FOLLOW
Contacts:
David K. Waldman-US Investor Relations
Crescendo Communications, LLC
(212) 671-1021
Herbert Strauss-European Investor Relations
herbert@eu-ir.com
+43 316 296 316
| PERMA-FIX ENVIRONMENTAL SERVICES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||
| December 31, | December 31, | |||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||
| (Amounts in Thousands, Except for Per Share Amounts) | (Unaudited) | (Unaudited) | (Audited) | |||||||||
| Net revenues | $ | 22,719 | $ | 16,757 | $ | 89,735 | $ | 70,599 | ||||
| Cost of goods sold | 18,424 | 14,738 | 73,366 | 60,990 | ||||||||
| Gross profit | 4,295 | 2,019 | 16,369 | 9,609 | ||||||||
| Selling, general and administrative expenses | 4,006 | 3,617 | 14,975 | 14,652 | ||||||||
| Research and development | 221 | 90 | 561 | 336 | ||||||||
| Loss on disposal of property and equipment | 77 | 17 | 77 | 18 | ||||||||
| Loss (income) from operations | (9 | ) | (1,705 | ) | 756 | (5,397 | ) | |||||
| Other income (expense): | ||||||||||||
| Interest income | 161 | 30 | 606 | 99 | ||||||||
| Interest expense | (134 | ) | (52 | ) | (323 | ) | (175 | ) | ||||
| Interest expense-financing fees | (13 | ) | (17 | ) | (93 | ) | (61 | ) | ||||
| Other | - | (16 | ) | (11 | ) | 1,945 | ||||||
| Income (loss) from continuing operations before taxes | 5 | (1,760 | ) | 935 | (3,589 | ) | ||||||
| Income tax benefit (expense) | (465 | ) | (231 | ) | 17 | (378 | ) | |||||
| Income (loss) income from continuing operations, net of taxes | 470 | (1,529 | ) | 918 | (3,211 | ) | ||||||
| Loss from discontinued operations, net of taxes | (389 | ) | (164 | ) | (433 | ) | (605 | ) | ||||
| Net income (loss) | 81 | (1,693 | ) | 485 | (3,816 | ) | ||||||
| Net income (loss) per common share attributable to | ||||||||||||
| Perma-Fix Environmental Services, Inc. stockholders - basic and diluted: | ||||||||||||
| Continuing operations | $ | .04 | $ | (.12) | $ | .07 | $ | (.24) | ||||
| Discontinued operations | (.03) | (.01) | (.03) | (.05) | ||||||||
| Net income (loss) per common share | $ | .01 | $ | (.13) | $ | .04 | $ | (.29) | ||||
| Number of common shares used in computing | ||||||||||||
| net income (loss) per share: | ||||||||||||
| Basic | 13,619 | 13,324 | 13,506 | 13,280 | ||||||||
| Diluted | 13,838 | 13,324 | 13,739 | 13,280 | ||||||||
| PERMA-FIX ENVIRONMENTAL SERVICES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| December 31, | December 31, | |||||||
| 2023 | 2022 | |||||||
| (Amounts in Thousands, Except for Share and Per Share Amounts) | (Unaudited) | (Audited) | ||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash | $ | 7,500 | $ | 1,866 | ||||
| Account receivable, net of allowance for credit losses of | 9,722 | 9,364 | ||||||
| Unbilled receivables | 8,432 | 6,062 | ||||||
| Other current assets | 4,893 | 6,219 | ||||||
| Assets of discontinued operations included in current assets | 13 | 15 | ||||||
| Total current assets | 30,560 | 23,526 | ||||||
| Net property and equipment | 19,009 | 18,957 | ||||||
| Property and equipment of discontinued operations | 81 | 81 | ||||||
| Operating lease right-of-use assets | 1,990 | 1,971 | ||||||
| Intangibles and other assets | 27,109 | 26,363 | ||||||
| Total assets | $ | 78,749 | $ | 70,898 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current liabilities | $ | 25,678 | $ | 22,346 | ||||
| Current liabilities related to discontinued operations | 269 | 362 | ||||||
| Total current liabilities | 25,947 | 22,708 | ||||||
| Long-term liabilities | 12,472 | 9,749 | ||||||
| Long-term liabilities related to discontinued operations | 953 | 908 | ||||||
| Total liabilities | 39,372 | 33,365 | ||||||
| Commitments and Contingencies | ||||||||
| Stockholders' equity: | ||||||||
| Preferred Stock, $.001 par value; 2,000,000 shares authorized, | ||||||||
| no shares issued and outstanding | - | - | ||||||
| Common Stock, $.001 par value; 30,000,000 shares authorized, | ||||||||
| 13,654,201 and 13,332,398 shares issued, respectively; | ||||||||
| 13,646,559 and 13,324,756 shares outstanding, respectively | 14 | 13 | ||||||
| Additional paid-in capital | 116,502 | 115,209 | ||||||
| Accumulated deficit | (76,951 | ) | (77,436 | ) | ||||
| Accumulated other comprehensive loss | (100 | ) | (165 | ) | ||||
| Less Common Stock held in treasury, at cost: 7,642 shares | (88 | ) | (88 | ) | ||||
| Total stockholders' equity | 39,377 | 37,533 | ||||||
| Total liabilities and stockholders' equity | $ | 78,749 | $ | 70,898 | ||||
FAQ
What was the percentage increase in revenue for the fourth quarter of 2023 compared to the same period last year?
What was the gross profit increase for the fourth quarter of 2023 compared to the same period last year?
What key initiatives are Perma-Fix Environmental Services, Inc. focusing on for future growth?
What positive achievements were highlighted in the PR?
What financial results were reported for the full year of 2023?
What segments did Perma-Fix report financial information for?
