SusGlobal Energy Corp. Reports Second Quarter 2020 Financial Results

Rhea-AI Summary

SusGlobal Energy Corp. (OTCQB: SNRG) reported flat revenue of $382,639 for Q2 2020, compared to $381,834 in Q2 2019. The company highlighted its integration of The Ydro Process into its operations, yielding positive results. It received a trademark registration for 'LEADERS IN THE CIRCULAR ECONOMY' from the USPTO, effective for ten years. Operating expenses reached $526,296, leading to a net loss of $323,171 or $0.01 per share. Despite challenges, the company aims for revenue growth and cash flow improvement, focusing on enhancing shareholder value.

Positive

• Integration of The Ydro Process is yielding positive operational results.
• Acquired trademark registration for 'LEADERS IN THE CIRCULAR ECONOMY,' enhancing brand positioning.
• Revenue from new waste management operations contributes to overall revenue stability.

Negative

• Net loss of $323,171 indicates financial challenges.
• Operating expenses of $526,296 exceed revenue, impacting financial stability.
• Expired land option related to business acquisition could affect operational strategy.

TORONTO, ON / ACCESSWIRE / August 19, 2020 / SusGlobal Energy Corp. (OTCQB:SNRG), the developer of SusGro^™, a revolutionary pathogen-free organic liquid fertilizer, today announced financial results for the second quarter ended June 30, 2020 and provided an update on its operational progress.

Recent Highlights

• On May 27, 2020, the Company commenced The Ydro Process^® integration into the existing operations at the Organic Waste Processing and Composting Facility of its wholly owned subsidiary SusGlobal Energy Belleville Ltd. applying the Ydro Series^® Microorganisms product once during the preparation stage of the batches in the appropriate Gore^® system windrows and continues to see positive results.

• On July 16, 2020, the Company received a Certificate of Registration from the United States Patent and Trademark Office ("USPTO") for the trademark LEADERS IN THE CIRCULAR ECONOMY (the "Mark"). The Mark was registered under Registration Number 6,098,063 on July 7, 2020 on the Supplemental Register. The registration will be in effect for an initial term of ten years, expiring on July 7, 2030, with the option of renewing the registration for successive ten-year terms. Now that the Mark is registered, it is permitted to use indicia of registration (e.g. ®, or phrases such as "Reg. U.S. Pat. and T.M. Office").

• Revenue remained relatively flat during the second quarter of 2020 in the amount of $382,639 compared to the second quarter of 2019 in the amount of $381,834, including the new revenue from the Company's new garbage collection and landfill management operations, in the amount of $49,544.

• During the second quarter of 2020, the Company finalized the purchase price allocation related to the business acquisition of 1684567 Ontario Inc. ("1684567"), which closed on May 28, 2019.

"We continue to process municipal organic waste streams, diverting them from landfills, while producing regenerative products as part of our Circular Economy model. We have confidence in a revenue ramp up for next year," said Marc Hazout, Executive Chairman, President and CEO of SusGlobal Energy Corp. "Our goal is to increase revenue and cash flow as quickly as possible to payoff all outstanding convertible notes, increasing shareholder value with an objective to up-list to a major exchange."

Unaudited 2020 Second Quarter Financial Results

For the second quarter ended June 30, 2020, SusGlobal recorded:

• Revenue of $382,639.

• Cost of sales of $316,815.

• Operating expenses of $526,296 (GAAP), comprised of $283,409 of interest expenses, $107,887 of professional fees, $49,825 of management compensation, $84,635 of foreign exchange income, and $169,810 of other expenses, including, office and administration, amortization of financing fees, rent and occupancy and other operating expenses.

• During the second quarter, the land option the Company acquired on the business acquisition of 1684567 had expired and was written off.

• Net loss of $323,171, or $0.01 loss per share- basic and diluted.

• Adjusted EBITDA (a non-GAAP financial measure) income of $114,779.

• $5,166,750 in total assets at the end of the second quarter, with total liabilities of $9,203,951

About SusGlobal Energy Corp.

SusGlobal Energy Corp. (OTCQB: SNRG) the developer of SusGro™, a revolutionary pathogen-free organic liquid fertilizer is a renewables company focused on acquiring, developing and monetizing a portfolio of proprietary technologies in the waste to energy and regenerative products application globally. It is management's objective to grow SusGlobal into a significant sustainable waste to energy and regenerative products provider, as Leaders in The Circular Economy™. For more information, please visit the Company's website at: www.susglobalenergy.com

Safe Harbor Statement

This news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the Company's objectives. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," "projects," "aims," "potential," "goal," "objective," "prospective," and similar expressions, or that events or conditions "will," "would," "may," "can," "could" or "should" occur. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, lack of sufficient financial resources; variations in market conditions, currency and our stock; the Company's ability to obtain any necessary permits, approvals, consents or authorizations required for its activities; the Company's ability to produce energy, biogas, compost or organic fertilizer from its properties successfully or profitably, to continue its projected growth, or to be fully able to implement its business strategies and other risk factors described in the Company's filings with the U.S. Securities and Exchange Commission, which may be viewed at www.sec.gov.

- Financial Tables Follow -

SusGlobal Energy Corp.
Interim Condensed Consolidated Balance Sheets
As at June 30, 2020 and December 31, 2019
(Expressed in United States Dollars)
(unaudited)

		June 30, 2020				December 31, 2019
ASSETS
Current Assets
Cash and cash equivalents		$	12,637			$	7,926
Restricted cash-funds held in trust			-				467,798
Trade receivables			115,454				121,276
Government remittances receivable			39,118				38,578
Other receivables			-				20,624
Inventory			-				5,389
Prepaid expenses and deposits			68,461				46,028
Total Current Assets			235,670				707,619
Intangible Assets			242,988				237,271
Long-lived Assets, net			4,688,092				4,762,453
Total Assets		$	5,166,750			$	5,707,343
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
Current Liabilities
Accounts payable		$	964,477			$	958,313
Government remittances payable			116,201				35,187
Accrued liabilities			531,473				487,592
Advance			-				3,255
Deferred revenue			6,441				9,239
Current portion of long-term debt			5,476,357				5,793,677
Current portion of obligations under capital lease			420,063				218,069
Convertible promissory notes			1,556,855				1,406,029
Loans payable to related party			73,380				-
Total Current Liabilities			9,145,247				8,911,361
Long-term debt			58,704				-
Total Long-term Liabilities			58,704				-
Total Liabilities			9,203,951				8,911,361
Stockholders' Deficiency
Preferred stock, $.0001 par value, 10,000,000 authorized, none issued and outstanding
Common stock, $.0001 par value, 150,000,000 authorized, 64,329,157 (December 31, 2019- 51,784,504) shares issued and outstanding			6,435				5,180
Additional paid-in capital			8,544,263				7,450,091
Subscriptions payable			13,000				-
Stock compensation reserve			-				1,000,000
Accumulated deficit			(12,534,941)				(11,449,497	)
Accumulated other comprehensive loss			(65,958)				(209,792	)
Total stockholders' deficiency			(4,037,201)				(3,204,018	)
Total Liabilities and Stockholders' Deficiency		$	5,166,750			$	5,707,343

SusGlobal Energy Corp.
Interim Condensed Consolidated Statements of Operations and Comprehensive Loss
For the three-month periods ended June 30, 2020 and 2019
(Expressed in United States Dollars)
(unaudited)

		For the three-month periods ended
		June 30, 2020				June 30, 2019
Revenue		$	382,639			$	381,834
Cost of Sales
Opening inventory			4,071				26,409
Depreciation			121,158				101,072
Direct wages and benefits			85,063				59,667
Equipment rental, delivery, fuel and repairs and maintenance			96,854				104,916
Utilities			7,963				32,695
Outside contractors			1,706				4,597
			316,815				329,356
Less: closing inventory			-				(24,738	)
Total cost of sales			316,815				304,618
Gross profit			65,824				77,216
Operating expenses
Management compensation-stock- based compensation			-				332,500
Management compensation-fees			49,825				80,740
Marketing			(2,917)				(33,323	)
Professional fees			107,887				72,269
Interest expense and default payments			283,409				150,407
Office and administration			77,000				67,834
Rent and occupancy			28,763				34,820
Insurance			23,921				13,951
Filing fees			8,266				16,414
Amortization of financing costs			30,471				53,768
Directors' compensation			1,853				9,748
Repairs and maintenance			2,453				2,493
Foreign exchange income			(84,635)				(21,454	)
Total operating expenses			526,296				780,167
Net Loss from operating activities			(460,472)				(702,951	)
Land option expired			(58,704)				-
Net loss before deferred taxes recovery			(519,176)				(702,951	)
Deferred taxes recovery			196,005				-
Net Loss			(323,171)				(702,951	)
Other comprehensive loss
Foreign exchange loss			(157,805)				(49,972	)
Comprehensive loss		$	(480,976)			$	(752,923	)
Net loss per share-basic and diluted		$	(0.01)			$	(0.02	)
Weighted average number of common shares outstanding- basic and diluted			63,853,597				42,460,795

SusGlobal Energy Corp.
Interim Condensed Consolidated Reconciliation of Non-GAAP Information
For the three-month periods ended June 30, 2020 and 2019
(Expressed in United States Dollars)
(Unaudited)

		For the three-month periods ended
		June 30, 2020				June 30, 2019
Net loss (GAAP)		$	(323,171)			$	(702,951	)
Add the following items:
Interest expense			283,409				150,407
Depreciation and amortization			124,070				105,546
Stock-based compensation and shares issued for professional services			-				332,500
Amortization of financing costs			30,471				53,768
Adjusted EBITDA (non-GAAP)		$	114,779			$	(60,730	)

Contact

SusGlobal Energy Corp.
Marc Hazout, President and CEO
(416) 223-8500 or Toll Free: 1-866-512-7374
Email: info@susglobalenergy.com

SOURCE: SusGlobal Energy Corp.

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https://www.accesswire.com/602478/SusGlobal-Energy-Corp-Reports-Second-Quarter-2020-Financial-Results

FAQ

What were SusGlobal Energy's financial results for Q2 2020?

SusGlobal Energy reported flat revenue of $382,639 for Q2 2020, with a net loss of $323,171.

What is the significance of the trademark registration for SusGlobal Energy?

The trademark registration allows the company to strengthen its brand identity as 'LEADERS IN THE CIRCULAR ECONOMY' for ten years.

How did operating expenses impact SusGlobal Energy's financial performance?

Operating expenses totaled $526,296, exceeding revenue and leading to financial losses during the quarter.

What future plans does SusGlobal Energy have for revenue growth?

The company aims to increase revenue and cash flow to enhance shareholder value and plans to up-list to a major exchange.