MONTREAL, April 30, 2012 /CNW Telbec/ - PyroGenesis Canada Inc. ("PyroGenesis" or the "Company") (TSXV: PYR), an environmental solutions company that designs, develops and manufactures plasma waste-to-energy systems and plasma torch products, today announced its financial and operational results for the fourth quarter and year ended December 31, 2011.
2011 was a breakthrough year for Pyrogenesis, a year during which:
- The Company became publicly traded on the TSX-V pursuant to a reverse takeover and initial financing of approximately $7,000,000 which was oversubscribed by over 50%.
- Two of Pyrogenesis' proprietary plasma based waste destruction/waste-to-energy systems were delivered and accepted by their end users, namely the US Navy and the US Air Force.
- Pyrogenesis continued to develop its patent portfolio to further secure its technological advantage by seeking protection for the Ozone depleting substance (ODS) destruction capabilities of its torches, as well as for its DROSSRITE technology which enables the metallurgical industry to treat hot dross at the smelter, resulting in improved metal recovery and significantly reducing greenhouse gas generation.
- To mitigate the risks related to the current unstable global economic conditions, as well as the gap period that the Company has entered into following the completion of its two main projects, Pyrogenesis has begun to actively promote its other business lines namely Torch Manufacturing and Engineering Services. In addition, the Company has been, and will continue to seek out, focused and targeted teaming arrangements to accelerate market acceptance of its plasma waste to energy technologies.
Management believes that Pyrogenesis is a strong and credible player in the market for plasma based waste destruction technologies and looking forward, the Company is positioned to take advantage of the global environmental movement, notably in the waste-to-energy sector.
Revenues for the full year in fiscal 2011 totaled $5,065,581, (2010 : $7,715,131), reflecting for the most part a continued focus by the Company on the completion of the Company's two major projects, namely its marine based contract with Newport News Shipbuilding ("NNS"), and its land based contract with the U.S. Air Force, as opposed to focusing its efforts on increasing sales in other areas.
Revenues for the fourth quarter of fiscal year 2011 were $1,781,645 (Q4 2010: $1,928,783). Decreased revenues in the fourth quarter of fiscal year 2011 are mainly attributable to the fact that the Company's two major contracts (NNS and U.S. Air Force) were accepted in the third quarter of 2011, and as a result most of the associated revenues were recognized by the end of the third quarter of 2011.
Cost of Sales
Cost of sales and services decreased by 6% in fiscal 2011 to $5,879,281 (2010: $6,237,319). In 2011 Cost of sales were impacted by a 14-fold increase in amortization of licenses costs, increase in salary expenses, decreased level of tax credits related to R&D activities, and decreased spending in materials and equipment.
Cost of sales and services remained stable for the fourth quarter of 2011 at $1,677,689 (2010: $1,559,332). During this quarter, increases in the amortization of licenses and salaries, were offset by lower spending on materials and equipment and contractors.
Selling, General and Administrative Expenses
For the year ended December 31, 2011, selling, general and administrative expenses were $4,628,504 (2010: $3,391,370). This increase was primarily as a result of $711,035 (2010: $0) in stock options issued in July, 2011 and accounted for as a non cash item; an increase in professional fees associated with PyroGenesis going public; as well as an increase in amortization of machinery and equipment.
For the fourth quarter of 2011, selling, general and administrative expenses were $613,673 (2010: $745,168). Costs in Q4 of 2011 were favorably affected by a reduction in the valuation expense of stock options issued in Q3 of 2011.
The Loss from Operations for the year ended December 31, 2011 was $6,301,393 (2010: $2,205,684). Total Comprehensive Loss for the twelve months ended December 31, 2011 was $6,944,306 (2010: $2,180,884). In 2011, Loss from Operations was negatively affected by a non-cash expense relating to options granted by the Company to management, employees and board members totaling $711,035, and Total Comprehensive Loss was impacted by $694,877 of costs associated with the Company's amalgamation with a public company listed on the TSX-V.
The Loss from Operations for the fourth quarter of 2011 was $762,196 as compared to a loss of $462,523 for the same period ending December 31, 2010. Total Comprehensive Loss for the three months ended December 31, 2011 was $757,097 (2010: $444,657).
These losses are as a result of a decrease in sales due to management's focus on the successful completion of its two projects for the U.S. Airforce and the U.S. Navy. The successful introduction of these systems will, in the opinion of management, be the catalyst to PyroGenesis' return to profitability in the next financial year.
At December 31, 2011, PyroGenesis had cash on hand, net of bank indebtedness, of $241,396 and a negative working capital of $1,085,184.
Subsequent to year-end 2011, Pyrogenesis announced on March 29, 2012, the closing of a short-form prospectus offering for aggregate gross proceeds to the Company of $3,539,644
About PyroGenesis Canada Inc.
PyroGenesis Canada is an environmental solutions company that designs, develops and manufactures plasma waste-to-energy systems and plasma torch products. PyroGenesis' proprietary plasma technologies utilize the intense energy of plasma to gasify and vitrify virtually any type of waste without producing hazardous by-products. PyroGenesis' patented gasification and vitrification technology is different from incineration because it produces a clean synthetic gas from waste, which can be used for power generation. PyroGenesis' technology can also turn waste into a glassy rock that can be utilized as construction material. PyroGenesis has marquee defense industry and civilian customers that are using its technology in marine and land-based applications. For more information, please visit www.pyrogenesis.com
This press release contains certain forward-looking statements, including, without limitation, statements containing the words "may", "plan", "will", "estimate", "continue", "anticipate", "intend", "expect", "in the process" and other similar expressions which constitute "forward-looking information" within the meaning of applicable securities laws. Forward-looking statements reflect the Company's current expectation and assumptions, and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. These forward-looking statements involve risks and uncertainties including, but not limited to, our expectations regarding the acceptance of our products by the market, our strategy to develop new products and enhance the capabilities of existing products, our strategy with respect to research and development, the impact of competitive products and pricing, new product development, and uncertainties related to the regulatory approval process. Such statements reflect the current views of the Company with respect to future events and are subject to certain risks and uncertainties and other risks detailed from time-to-time in the Company's ongoing filings with the securities regulatory authorities, which filings can be found at www.sedar.com. Actual results, events, and performance may differ materially. Readers are cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements either as a result of new information, future events or otherwise, except as required by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information:
Pyrogenesis Canada Inc.
P. Peter Pascali
Chief Executive Officer
E-mail: [email protected]