Alter NRG Reports Second Quarter 2013 Activities and Financial Results

TSX - NRG 
OTCQX - ANRGF

CALGARY, Aug. 7, 2013 /CNW/ - (TSX - NRG; OTCQX - ANRGF) - Alter NRG Corp., ("Alter NRG" or the "Corporation") is pleased to report on its corporate activities and financial results for the three and six month periods ended June 30, 2013.

The Corporation's focus is the Westinghouse Plasma Gasification Technology which is the worldwide leader in creating energy from waste using plasma gasification. We market and sell the Westinghouse Plasma Technology through our wholly owned subsidiary, Westinghouse Plasma Corporation ("Westinghouse Plasma").  Westinghouse Plasma is the industry leader for the treatment of all types of waste (industrial, household, commercial, hazardous, etc.) using plasma technology and converting it into useable energy such as electricity, syngas (replacement for natural gas), heat, steam, or liquid fuels such as diesel or ethanol.

• Our Vision - To provide the leading technology platform for converting the world's waste into clean energy for a healthier planet.
  
  
• Our Mission - As the industry leader, we will forge and dominate an industry segment that transforms current waste management practices.  We build shareholder value by enabling customers to convert waste into clean energy by providing plasma gasification products, services and solutions that are innovative and environmentally friendly.

Westinghouse Plasma Technology is a commercially proven technology that is used in commercially operating facilities in Japan and India that have been converting waste into energy for more than ten years, and facilities are under construction in China and England.  From an environmental perspective, a plasma facility will have significantly lower emissions than other alternative energy facilities and have an overall emissions profile lower than a natural gas combined cycle power facility, which is considered the cleanest fossil fuel production.  From an economic perspective waste-to-energy projects generally have strong project returns in populous areas, as the projects receive revenues from tipping fees to take the waste and then also receive revenues from the sale of energy.

Alter NRG is pleased to be presenting highlights for its second quarter of 2013 as revenues have increased by 10% over the prior year. This is reflective of an emerging business plan with significant long-term potential.

Q2 HIGHLIGHTS

As of the second quarter ended June 30, 2013 Alter NRG had earned $8.7 million in revenues year to date, which is an increase of 63% over the prior year. This revenue reflects the progress on the fabrication of the large-scale Westinghouse Plasma gasifier for the 50 MW facility under construction by a leading Fortune 500 company. During the first half of 2013 there were three facilities under construction or commissioning which illustrates the commercial growth potential of the Westinghouse Plasma Technology.

WESTINGHOUSE PLASMA

• Sales of $8.7 million for the first half of 2013 which is an increase over the same period of the prior year of 63%.  This reflects the emerging business plan supporting the Westinghouse Plasma Technology and revenues include sales income to three facilities under construction or commissioning as well as plasma torch sales to the China market and licensing fees from developers with emerging business plans.
  
  
• Executed on approximately 96%, cumulatively to date, of the $20 million purchase order from Air Products, a US based Fortune 500 Company, which has previously announced its intention to build four additional advanced gasification facilities in the United Kingdom in the coming years.  They are in late stages of construction of a facility that is using the Westinghouse Plasma Technology to convert 950 tonnes per day of household waste into 50MW of electricity in Northeast England .  The facility is expected to be commissioned in early 2014 and will be the world's largest plasma gasification facility by a significant margin.
  
  
• On October 23, 2012 Air Products announced it is advancing a second project on adjacent lands in Tees Valley, of the same size and configuration as the first project.  The Project has now finalized the power purchase agreement with the UK government and also received planning permission to proceed with the facility.  The second facility by Air Products is advancing quickly; it is expected to result in an equipment sale with similar value to the first project and to occur in late 2013.
  
  
• Wuhan Kaidi ("Kaidi"), who previously ordered engineering and torches, completed construction of its demonstration facility in China, for which the Westinghouse Plasma Gasifier was commissioned during the first quarter of 2013.  The facility is expected to take 100 tonnes per day of biomass waste and convert it into liquid fuels.  Upon successful demonstration (expected in 2013), Kaidi has more than 100 sites identified to take biomass and convert it into power and liquid fuels. Alter NRG is currently advancing technology licensing and further equipment purchasing arrangements with Kaidi.
  
  
• Signed an agreement to provide $12 million of Westinghouse Plasma Torches to Beijing Huanyu Guanchuan Plasma Technology Ltd. ("GuanChuan"). During the first quarter of 2013, GuanChuan ordered the first four torches for an approximate $1 million order which are now being delivered.  GuanChuan is using the torches for their industrial furnace applications related to the steel and iron industry in China which is a promising growth market. The first sale represents a reference case for the industry and GuanChan is expected to order further torches in 2013 and going forward.
  
  
• Finalized scope with SMS Infrastructure ("SMS") (who has already constructed two hazardous waste facilities utilizing Westinghouse Plasma technology) on two projects which have advanced into the formal regulatory approval phase.  These are the more advanced projects within a larger pipeline of projects which SMS is developing and marketing in India and the Middle East for hazardous waste treatment facilities between 50 and 100 tonnes per day.  SMS is a licensee of the Westinghouse Plasma Gasification Technology and provides turnkey hazardous waste facilities to the market and has approximately 140 people in their gasification division.
  
  
• Supported a hazardous waste demonstration facility in Shanghai China being constructed by GTS Shanghai.  We have previously delivered the detailed engineering and torches.  During the year they ordered additional equipment for their facility which will be delivered in 2013.   The facility is in the late stages of construction  and is expected to begin commissioning in the third quarter of 2013. This is a reference facility that is complementary to the incineration market and turns an incinerator's hazardous ash (and other industrial feedstocks) into an environmentally friendly slag and has the dual benefit of providing additional energy production.
  
  
• Advanced business development efforts with Waste2Tricity which announced an approximate 250 tonne per day project in England which began with the concept design study.  Business development has also advanced in the Thailand market with a variety of projects including larger scale 1,000 tonne per day projects.  Waste2Tricity has a common shareholder with Alter NRG Ervington Investments Limited ("Ervington") which is a company that has Roman Abramovich as its ultimate beneficial owner, and is aggressively pursuing development opportunities including licensing for certain regions.
  
  
• Advanced project development with a developer, PGP Terminal a.s. ("PGPT"), which previously purchased site licenses in the Czech Republic and Slovakia for $4.375 million, with 10% being paid up front.  The developer has been working for several years on waste-to-energy projects and has a portfolio of projects that it is currently advancing in their home market. They expect to begin engineering on the first facilities in 2013 with the intention of ordering equipment in late 2013 or early 2014.
  
  
• Continued due diligence and financing efforts related to the Company's investment options in current projects, to participate in the annuity cashflows of projects through a partnership structure with Alter NRG as the general partner.  Alter NRG has options to invest with key customers, including Air Products, which allow the Corporation to elect on the option after the project receives regulatory approval but without any promoted costs.  This is a favourable option for the Corporation as it does not have to deploy the risky development capital but can participate in the project level annuity cashflow after the project has been de-risked.
  
  
• In addition to the highlights above, customers around the globe continue to advance their business development efforts using the Westinghouse Plasma Gasification Solution.  This includes exclusive license agreements for territories that are in advanced negotiations.

CORPORATE

• Announced the closing of a financing with a strategic shareholder, Ervington Investments Limited ("Ervington"), which is a company that has Roman Abramovich, a successful entrepreneur, as its ultimate beneficial owner.  Ervington has complementary investments in the waste-to-energy space and has the potential to be part of a larger group that will consider participating in waste-to-energy projects. The financing, led by Ervington, was for 34.2 million shares at a price of $0.325 for a total investment of $11.1 million and closed in January 2013.

CEO'S MESSAGE

The Westinghouse Plasma Technology continues to gain commercial momentum.  It may not always be obvious, but significant progress is being made.  This includes three projects that are under construction and/or commissioning in China and England, that provide further reference plants in addition to those in Japan and India.  This is especially true of the 50MW, facility that is nearing completion in Northern England, which is using a more efficient combined cycle configuration and is at a scale that is a meaningful breakthrough in the industry.  We have established ourselves as a commercially proven product that is getting recognized in the market.

Our evolution to a recognized commercial leader has been very evident through the quality of the speaking opportunities to which we are being invited.  Recently, we were a featured company for the U.S Energy Administration at their annual event and I had the good fortune to discuss our commercial success in front of some of the nation's top energy Companies.  This year we have been featured as a speaker at other conferences around the world and are able to show that we have crossed from a concept to a commercial product.

More importantly, the commercial success is being recognized in our pipeline.  We have had several world class and very sizable engineering companies now formally vet and endorse our technology within their business development activities.  It is a very different meeting arriving with a multinational engineering company to a meeting with a customer they have had a relationship with for many years. The larger facility design that is being modeled in Tees Valley is applicable to many industrial companies for multiple applications and the market has been waiting for this clean syngas solution at scale.

The challenge remains that the energy business and utility type projects are a long sales cycle and highly complex, both technically and commercially.  Internally, we can feel the momentum and the commercial success is palpable in our daily activity and the amount of opportunities ahead.  The challenge is to effectively convert this into cashflow to our shareholders and balance short-term cashflow requirements with long-term value added activities.  I believe we have ample opportunities both short and long-term and I am confident this will be evident to the market over the next six months.

The pipeline now includes both new opportunities and also follow-on opportunities with our existing customer base.  The Tees Valley 1 flagship facility, which will produce 50MW, is nearing completion in Northern England and already the second facility is under late stage development and has recently signed its power purchase agreement, as well as achieved its planning permission.   These are both very significant milestones that indicate another large sale in the short-term.  As well, a company that has already constructed two facilities in India, has an additional two facilities in India that are expecting regulatory approval before year-end and an aggressive build-out thereafter.  The repeat business of our key customers shows sustainability in our business plan; they did not just build a single facility but our customers are executing upon a business plan using the Westinghouse Plasma Technology.

The stock market is often a lagging indicator, especially for technology companies with long lead time sales. We appreciate our investors' patience and believe it will be rewarded as we transition our industry leading market position into tangible news and cashflow in the short-term. Closing transactions internationally can sometimes take longer than anticipated but the commercial momentum we are building is obvious.

Our commercial momentum continues to build and I am optimistic we will be able to translate this into significant shareholder value in both the short and long-term. Stay tuned.

SELECT FINANCIAL RESULTS ($)
Balance Sheet	June 30, 2013	December 31, 2012
Total assets	$62,814,126	$57,566,565
Total liabilities	21,071,832	23,430,697
Total equity	41,742,294	34,135,868

Income Statement	Three months ended					Six months ended
	June 30, 2013		June 30, 2012			June 30, 2013	June 30, 2012
Sales	$  4,343,618		$  3,963,284			$  8,709,429	$ 5,341,741
Gross profit	506,597		1,111,466			1,196,153	1,383,227
Loss from continuing operations	(2,644,906)		(1,797,533)			(4,404,135)	(4,390,641)
Loss from discontinued operations	-		(252,606)			-	(602,913)
Basic and diluted loss per share - continuing operations	(0.02)		(0.03)			(0.04)	(0.07)
Basic and diluted loss per share - discontinued operations	-		-			-	(0.01)

For more information on the Corporation's financial results please visit www.alternrg.com or www.sedar.com to view Alter NRG's 2013 Second Quarter Report.

The Toronto Stock Exchange does not accept responsibility for the adequacy or accuracy of this release.

Advisory Respecting Forward-Looking Statements:

This news release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends", "confident", "might" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: availability and cost of key materials and labour and availability of funds with respect to the amount of capital expenditures and scheduled commencement of operations; timing of regulatory approval including various permits from the applicable government authorities; the assessment of capital markets including the availability of debt and equity in current market conditions; commodity prices resources that impact the Corporation's operations directly and indirectly; extent of investment by government authorities in infrastructure projects; the financial and operational health of key partners in various projects; the continued development of the Corporation's technology and its use in various applications and other expectations, beliefs, plans, goals, objectives, assumptions, information and statements about possible future events, conditions, results of operations or performance. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release.

The forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Forward-looking statements reflect management's current beliefs and assumptions, based on information currently available to management. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, many of which are beyond the control of the Corporation. Among the material factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: that the information is of a preliminary nature and may be subject to further adjustment; unforeseen environmental effects; the completion of strategic partner's projects; arrangements with key suppliers; potential product liability and other claims; other business risks outlined in this news release, including risks associated with the proprietary technology; the possible unavailability of financing at competitive rates and the related effect on development activities; the effect of energy price fluctuations; changes in government regulation, including changes to environmental regulations; the effects of competition; the dependence on senior management and key personnel, and fluctuations in currency exchange rates and interest rates, as well as those factors discussed in or referred to under the heading "Risk Factors" in the Corporation's Annual Information Form dated March 27, 2013 available at www.sedar.com.  Such information and statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information or statements.

The Corporation cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking information and statements contained in this news release speak only as of the date of this news release, and the Corporation assumes no obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable securities laws.

 

SOURCE: Alter NRG Corp.

Walt Howard, Chief Executive Officer
[phone]
[email protected]

Daniel Hay, Chief Financial Officer
[phone]
[email protected]