PyroGenesis reports FY2018 earnings, anticipates “imminent contracts” of $32 million

Plasma torch developer and high grade metal powder producer PyroGenesis has announced its financial results for fiscal year 2018, ended 31 December 2018.

Choosing to focus on developing strategic partnerships rather than increasing revenue throughout the year, the company reported a 30% decrease in revenue compared to 2017. As such, for FY2018 revenue was reported at $5 million, compared to FY2017’s revenue of $7.2 million. P. Peter Pascali, President and CEO of PyroGenesis has asked that the financial statements be viewed in light of the company’s strategic focus, expecting the fruits of their labor to be reflected in FY2019.

“2018 was significantly affected by management’s decision to pursue strategic partnerships at the expense of revenues,” states Pascali, “However, as a result, we have press released imminent contracts in excess of $32MM with associated future revenues in excess of that.”

“Therefore if 2018 was the year in which the Company successfully positioned itself with unique and strategic partnerships, geared to effectively accelerate commercialization, then 2019 is the year that bears the fruit of that strategy.”

The PyroGenesis Industrialization Plan 

Founded in 1991, PyroGenesis Canada Inc. develops plasma torch technology and process for disposing of industrial waste and producing fine metal powders. In additive manufacturing, it is one of the few companies in the world using plasma technology to develop metal powders. Spherically uniform, the powders from this process are of a higher grade than others on the market, returning their quality to end use 3D printed parts.

Throughout 2018, the company has worked hard on its R&D, reporting expenses of $892 thousand for FY2018, a 208% increase compared to R&D expenses in FY2017 which were $290 thousand. Plasma torch and plasma atomization processes have both benefited from this expenditure. Announcements in powder production throughout the year have included successfully eliminating tungsten contamination from batches, and the readiness of its NexGen® Plasma Atomization System, which can churn out powders at a rate of over 25kg/h. The latter development was a key milestone for the company’s industrialization plan. Introduced by Pascali in February 2018, this plan is applied to the company’s additive manufacturing business, PyroGenesis Additive. Its goal is to attain continuous, round-the-clock manufacturing of powdered materials.

Metal alloy powder. Photo via PyroGenesis
Metal alloy powder. Photo via PyroGenesis

Strategic partnerships

As suggested in Pascali’s statement about activity throughout FY2018, the company has made several strategic announcements throughout its businesses, including a “Plasma Torch System Contract with European Entity” scheduled for delivery in Q2 2019, and a contract with a large Japanese trading house for its DROSRITE tolling services. In additive manufacturing, at the start of 2019 the company has made a number of public announcements about its partnerships. These include a signed MoU with French metal processing specialist Albert & Duval, and the shipping of its first batch of speciality metal powder to an unnamed government entity in the U.S., which was confirmed in December 2018.

As of April 30, 2018, PyroGenesis reported a signed contract backlog of $7.7 million. Imminent contracts at the company, expected to deliver in excess of $32 million in revenue, include a two-ship deal for it Plasma Arc Waste Destruction System (PAWDS) valued at approximately $12.5 million, and a recently announced potential contract with projected first year revenues of $20 million.

PyroGensis' Plasma Arc Waste Destruction System (PAWDS) for the marine industry. Image via PyroGenesis
PyroGenesis’ Plasma Arc Waste Destruction System (PAWDS) for the marine industry. Image via PyroGenesis

The company reported a net loss of $7.8 million for FY2018, compared to a net loss of $6.2 million in FY2017. The company started FY2018 with $623 thousand in cash, and ends the year with $645 thousand. For comparison, in FY2017 the company started with $385 thousand in cash, finished the year with $623 thousand.

PyroGenesis Canada Inc.’s Financial Statements for FY2018 can be viewed online here.

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Featured image shows firing on all plasma jets: Gas plasma jets as used in the metal atomization process. Photo via PyroGenesis.