Release Date: January 30, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- BluMetric Environmental Inc (BLMWF, Financial) reported stable revenues for the fiscal year, with an 8% increase in the fourth fiscal quarter compared to the same period last year.
- The acquisition of Gemini Water is expected to diversify the WaterTech customer base and contribute to results starting in the fiscal first quarter of 2025.
- Gross margins improved to 40% for the fiscal year, up from 35% in the prior year, due to fewer lower-margin pass-through contracts and higher skilled-based services.
- The company has a record order book to execute on in fiscal 2025, indicating strong demand for its WaterTech solutions.
- BluMetric Environmental Inc (BLMWF) successfully raised $4 million in an oversubscribed financing round, strengthening its balance sheet and providing resources for growth.
Negative Points
- Higher costs were incurred due to investments in business development and the acquisition of Gemini Water, impacting net earnings.
- The sales and delivery cycles for WaterTech, particularly in the Military market, continue to be longer than expected.
- Operating expenses increased to $13.4 million for the fiscal year, up from $11.3 million in the prior year, due to various factors including acquisition costs.
- Net earnings for the fiscal year were significantly lower at $64,000 compared to $507,000 in the prior year.
- The acquisition of Gemini Water did not contribute to the income statement in the fiscal fourth quarter due to the timing of the transaction.
Q & A Highlights
Q: Can you give us some understanding about how you're going to prioritize the various moving parts, including the acquisition and new ERP system?
A: Scott Macfabe, CEO: We've focused on staying profitable while growing. We have strong leadership and are investing in new systems to manage better. We've made key hires and added a new Board member to support our operations. We're committed to executing our plans and delivering improvements that will pay off in the long term.
Q: Can you provide some guidance on future revenues?
A: Scott Macfabe, CEO: It's early in the year, and we typically don't provide forward-looking guidance. However, with stable revenues and the acquisition of Gemini, we expect a path towards growth beyond our current $34-$35 million annual revenue.
Q: Can you provide context on the record backlog and how much will impact fiscal 2025?
A: Scott Macfabe, CEO: We have over $50 million in backlog, with some carryover into this fiscal year. Not all backlog is burned in one year as some are multiyear assignments. With Gemini on board, we expect to maintain or increase this backlog.
Q: How is the Gemini acquisition progressing, and when will it start contributing to revenues?
A: Scott Macfabe, CEO: The acquisition closed just before the end of fiscal 2024, so the first quarter of 2025 will show both the costs and the revenue benefits. We expect to see contributions from Gemini starting in Q1 2025.
Q: How are you managing risks of project overruns, especially with new projects like Nevis?
A: Scott Macfabe, CEO: The managing principle at Gemini has extensive experience and a reputation for delivering on time and under budget. We manage projects within our expertise, get upfront payments, and have a QA/QC process before final builds. We also budget for contingencies.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
