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Perma-Fix Reports Financial Results and Provides Business Update for the Third Quarter of 2021

Treatment Segment revenue increases and Services Segment adds approximately $50 million of new project backlog

ATLANTA, Nov. 11, 2021 (GLOBE NEWSWIRE) — Perma-Fix Environmental Services, Inc. (NASDAQ: PESI) (the “Company”) today announced financial results and provided a business update for the third quarter ended September 30, 2021.

Mark Duff, President and CEO of the Company, commented, “We have started to see an improvement in the business following the pandemic-related decline. Specifically, our Treatment Segment revenues have begun to increase, which has continued to build heading into the fourth quarter. Importantly, we hope to capitalize on the pent-up demand as the industry returns to normal. Similarly, our Services Segment was impacted by a hiatus in new contract awards due to the pandemic, as reflected in our third quarter results. However, the government has begun issuing these awards, and we’re starting to see the positive impact. I’m pleased to report we have already won a number of service contracts, adding approximately $50 million of project backlog since the start of the third quarter, which we believe should have a positive impact on our results beginning in the fourth quarter and into 2022. We also secured numerous Indefinite Delivery/Indefinite Quantity (IDIQ) or multi-award task order contracts (MATOCs), which limit competition and provide an opportunity for quick and low-cost proposal development. In addition, we have continued to define and position for new procurement and market expansion opportunities with the US Navy, the US Department of Defense (DOD) and the US Department of Energy (DOE). These opportunities include work scope directly within our core competencies that will support innovative solutions and the potential for increased revenue within both sectors.”

“We continue to maintain a solid balance sheet, with cash on hand of more than $7.2 million as of September 30, 2021. As a result, we believe that we are capitalized to execute on our business strategy. We feel our recent funding will allow us to accelerate facility upgrades to support potential new revenue streams from Hanford and other government sites that could be a benefit to our Treatment Segment.”

COVID-19
The Company continues to proactively update its ongoing business operations and safety plans to mitigate any potential impact of COVID-19. However, as the situations surrounding COVID-19 remain fluid, the full impact and extent of the pandemic on the Company’s financial results cannot be estimated with any degree of certainty.

Financial Results
Revenue for the third quarter of 2021 was $15.8 million versus $30.2 million for the same period last year. The decrease was primarily within the Services Segment where revenue decreased to approximately $6.9 million for the three months ended September 30, 2021 from $23.1 million for the corresponding period of 2020 resulting primarily from delays in procurement actions and contract awards from the impact of COVID-19 in the first half of 2021 and the completion of a certain large project within the Services Segment in the second quarter of 2021. However, since the end of the second quarter of 2021, our Services Segment has been awarded a number of new contracts, including a fixed price contract awarded to the Company at the end of the third quarter of 2021 with a value of approximately $40.0 million for the decommissioning of a navy ship. We expect to see a ramp-up of activities from these new projects starting in the fourth quarter of 2021. The Company’s Services Segment revenues are project based; as such, the scope, duration and completion of each project vary. As a result, the Services Segment revenues are subject to differences relating to timing and project value. Revenue for the Treatment Segment was approximately $8.9 million and $7.1 million for the third quarter of 2021 and 2020, respectively. Treatment Segment revenue for the third quarter of 2021 included revenue recognized in the amount of approximately $1,286,000 from a request for equitable adjustment (“REA”) under a certain contract. The Company’s revenue within our Treatment Segment for each of the third quarters of 2021 and 2020 continued to be negatively impacted by waste shipment delays from certain key customers primarily due to the impact of COVID-19.

Gross profit for the third quarter of 2021 was $2.2 million versus $4.8 million for the third quarter of 2020. The decrease was entirely within our Services Segment due to lower revenue from fewer projects resulting primarily from delays in contract awards from the impact of COVID-19 and the completion of a certain large project as discussed above.

Operating loss for the third quarter of 2021 was approximately $1.4 million versus operating income of $1.3 million for the third quarter of 2020. Net income attributable to common stockholders for the third quarter of 2021 was approximately $1.4 million or $0.11 per share (both basic and diluted) versus $1.4 million or $0.12 per share (both basic and diluted) for the third quarter of 2020. Net income attributable to common stockholders for the third quarter of 2021 included a tax benefit recorded in the amount of approximately $2.4 million resulting from the release of valuation allowance on the Company’s deferred tax assets.

The Company recorded Adjusted EBITDA of ($798,000) from continuing operations during the quarter ended September 30, 2021, as compared to Adjusted EBITDA of $2.0 million for the same period of 2020. The Company defines EBITDA as earnings before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA before research and development costs related to the Medical Isotope project and (gain) loss on extinguishment of debt. Both EBITDA and Adjusted EBITDA are not measures of performance calculated in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”), and should not be considered in isolation of, or as a substitute for, earnings as an indicator of operating performance or cash flows from operating activities as a measure of liquidity. The Company believes the presentation of EBITDA and Adjusted EBITDA is relevant and useful by enhancing the readers’ ability to understand the Company’s operating performance. The Company’s management utilizes EBITDA and Adjusted EBITDA as a means to measure performance. The Company’s measurements of EBITDA and Adjusted EBITDA may not be comparable to similar titled measures reported by other companies. The table below reconciles EBITDA and Adjusted EBITDA, both non-GAAP measures, to GAAP numbers for income from continuing operations for the three and nine months ended September 30, 2021 and 2020.

(Unaudited)

(Unaudited)

Three Months Ended

Nine Months Ended

September 30,

September 30,

(In thousands)

2021

2020

2021

2020

Income from continuing operations

$

1,381

$

1,481

$

3,464

$

3,049

Adjustments:

Depreciation & amortization

409

478

1,208

1,189

Interest income

(2

)

(28

)

(23

)

(112

)

Interest expense

77

87

209

306

Interest expense – financing fees

11

58

28

187

Income tax benefit

(2,836

)

(133

)

(2,840

)

(128

)

EBITDA

(960

)

1,943

2,046

4,491

Research and development costs related to Medical Isotope project

162

81

311

221

(Gain) loss on extinguishment of debt

(5,381

)

27

Adjusted EBITDA

$

(798

)

$

2,024

$

(3,024

)

$

4,739

The tables below present certain unaudited financial information for the business segments, excluding allocation of corporate expenses:

Three Months Ended

Nine Months Ended

September 30, 2021

September 30, 2021

(Unaudited)

(Unaudited)

(In thousands)

Treatment

Services

Medical

Treatment

Services

Medical

Net revenues

$

8,893

$

6,904

$

$

24,094

$

30,981

$

Gross profit (negative gross profit)

2,487

(263

)

4,845

701

Segment (loss) profit

1,316

(984

)

(162

)

1,682

(1,731

)

(311

)

Three Months Ended

Nine Months Ended

September 30, 2020

September 30, 2020

(Unaudited)

(Unaudited)

(In thousands)

Treatment

Services

Medical

Treatment

Services

Medical

Net revenues

$

7,066

$

23,106

$

$

24,469

$

52,610

$

Gross profit

1,094

3,656

5,533

7,167

Segment profit (loss)

450

2,811

(81

)

2,742

5,160

(221

)

Conference Call
Perma-Fix will host a conference call at 2:00 p.m. ET on Thursday, November 11, 2021. 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: 592717. 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 Thursday, November 18, 2021 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: 43641.

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: results beginning the fourth quarter and into 2022; revenue increase; capitalized to execute business strategy; new projects; capitalize on pent-up demand; backlog impact; revenue within both sectors; and support potential new revenue streams 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; failure of Congress to provides continuing funding for the DOD’s and DOE’s remediation projects; ability to obtain new foreign and domestic remediation contracts; inability to meet financial covenants; impact of COVID-19; and the “Risk Factors” discussed in, and the additional factors referred to under “Special Note Regarding Forward-Looking Statements” of, our 2020 Form 10-K and Forms 10-Q for quarters ended March 31, 2021, June 30, 2021 and September 30, 2021. 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
[email protected]
+43 316 296 316

PERMA-FIX ENVIRONMENTAL SERVICES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

Three Months Ended

Nine Months Ended

September 30,

September 30,

(Amounts in Thousands, Except for Per Share Amounts)

2021

2020

2021

2020

Net revenues

$

15,797

$

30,172

$

55,075

$

77,079

Cost of goods sold

13,573

25,422

49,529

64,379

Gross profit

2,224

4,750

5,546

12,700

Selling, general and administrative expenses

3,348

3,308

9,550

8,935

Research and development

243

157

538

598

Loss on disposal of property and equipment

1

1

27

(Loss) income from operations

(1,368

)

1,285

(4,543

)

3,140

Other income (expense):

Interest income

2

28

23

112

Interest expense

(77

)

(87

)

(209

)

(306

)

Interest expense-financing fees

(11

)

(58

)

(28

)

(187

)

Other

(1

)

180

189

Gain (loss) on debt extinguishment of debt

5,381

(27

)

(Loss) income from continuing operations before taxes

(1,455

)

1,348

624

2,921

Income tax benefit

(2,836

)

(133

)

(2,840

)

(128

)

Income from continuing operations, net of taxes

1,381

1,481

3,464

3,049

Loss from discontinued operations, net of taxes

(43

)

(67

)

(285

)

(266

)

Net income

1,338

1,414

3,179

2,783

Net loss attributable to non-controlling interest

(64

)

(32

)

(123

)

(87

)

Net income attributable to Perma-Fix Environmental Services, Inc. common stockholders

$

1,402

$

1,446

$

3,302

$

2,870

Net income (loss) per common share attributable to Perma-Fix Environmental Services, Inc. stockholders – basic:

Continuing operations

$

.12

$

.13

$

.29

$

.26

Discontinued operations

(.01

)

(.01

)

(.02

)

(.02

)

Net income per common share

$

.11

$

.12

$

.27

$

.24

Net income (loss) per common share attributable to Perma-Fix Environmental Services, Inc. stockholders – diluted:

Continuing operations

$

.12

$

.13

$

.29

$

.25

Discontinued operations

(.01

)

(.01

)

(.02

)

(.02

)

Net income per common share

$

.11

$

.12

$

.27

$

.23

Number of common shares used in computing net income (loss) per share:

Basic

12,198

12,145

12,181

12,134

Diluted

12,406

12,371

12,416

12,337

PERMA-FIX ENVIRONMENTAL SERVICES, INC.
CONSOLIDATED BALANCE SHEET

September 30,

December 31,

2021

2020

(Amounts in Thousands, Except for Share and Per Share Amounts)

(Unaudited)

(Audited)

ASSETS

Current assets:

Cash

$

7,222

$

7,924

Account receivable, net of allowance for doubtful accounts of $60 and $404, respectively

11,816

9,659

Unbilled receivables

5,696

14,453

Other current assets

4,675

4,577

Assets of discontinued operations included in current assets

18

22

Total current assets

29,427

36,635

Net property and equipment

18,363

17,783

Property and equipment of discontinued operations

81

81

Operating lease right-of-use assets

2,570

2,287

Intangibles and other assets

24,963

22,133

Total assets

$

75,404

$

78,919

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities

$

21,948

$

32,065

Current liabilities related to discontinued operations

332

898

Total current liabilities

22,280

32,963

Long-term liabilities

11,264

13,253

Long-term liabilities related to discontinued operations

802

252

Total liabilities

34,346

46,468

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, 12,304,265 and 12,161,539 shares issued, respectively; 12,296,623 and 12,153,897 shares outstanding, respectively

12

12

Additional paid-in capital

109,954

108,931

Common Stock subscriptions

4,387

Accumulated deficit

(71,153

)

(74,455

)

Accumulated other comprehensive loss

(189

)

(207

)

Less Common Stock held in treasury, at cost: 7,642 shares

(88

)

(88

)

Total Perma-Fix Environmental Services, Inc. stockholders’ equity

42,923

34,193

Non-controlling interest in subsidiary

(1,865

)

(1,742

)

Total stockholders’ equity

41,058

32,451

Total liabilities and stockholders’ equity

$

75,404

$

78,919

https://finance.yahoo.com/news/perma-fix-reports-financial-results-133000287.html