Perma-Fix Environmental Services on Tuesday reported a 112.3% increase in revenue for the first quarter of 2020, even as the COVID-19 pandemic began to bite into its business.
Sales rose from $11.7 million in the first quarter of 2019 to $24.9 million in the three-month period ending March 31 of this year, according to a press release from the Atlanta-based waste treatment provider.
Quarterly Services revenue skyrocketed 748% on a year-over-year basis, from $1.8 million in 2019 to $15.3 million in 2020. Management attributed the boost to a number of contracts and task orders the company won beginning in early 2019, “resulting from the success of our implemented strategic plan in winning contract bids.”
Revenue in Perma-Fix’s Treatment business drooped slightly, from $9.9 million in first-quarter 2019 to $9.6 million this year. That was largely due to lower waste volumes for treatment, according to the press release.
In total, the latest numbers were good for $1.2 million in first-quarter net income, or $0.10 per share, a significant improvement from a net loss of $672,000, $0.06 per share, in 2019.
Perma-Fix operates three facilities for treatment of low-level and other radioactive waste types, in Florida, Tennessee, and Washington. It provides a broad swath of other environmental services, including remediation and decommissioning of nuclear facilities.
Like many companies, Perma-Fix felt the impact of the COVID-19 health crisis toward the end of the first quarter, as projects were suspended and the number of waste shipments dropped.
“Our Nuclear Services segment began demobilization activities in mid- to late-March and saw a decline in waste receipts from clients at the same time. This resulted in immediate temporary layoffs of workforce for many project personnel along with maximum application of work-from-home policies,” President and CEO Mark Duff said during the company’s quarterly earnings call Tuesday. “This impact was continued – or has continued through the month of April, but we are beginning to realize mobilization on several projects over the next few weeks as field crews are being reactivated to support our field projects.”
Perma-Fix employs nearly 350 people. Roughly 50 U.S. workers were temporarily furloughed in March, but have been recalled after Perma-Fix secured a $5.7 million bank loan under the Paycheck Protection Program component of the federal CARES Act that allowed it to pay those personnel. The employees all worked in the Nuclear Services business – Duff indicated 50 workers had been demobilized in Seattle, but a Perma-Fix spokesman later Tuesday said the company could not discuss further details of its contracts.
Perma-Fix has taken over cleanup of a University of Washington hospital research facility in Seattle that was contaminated by a cesium-137 spill during International Isotopes’ May 2019 removal of a blood irradiator under contract to the National Nuclear Security Administration.
Another 10 to 15 Perma-Fix workers were furloughed in Canada and have not to date been brought back.
No employees are known to have contracted COVID-19, according to the Tuesday release.
A significant amount of Perma-Fix’s project work can be performed remotely, Duff said. New projects duing the quarter required document preparation, training, and other activities that had already been planned from March to May, he said.
A backlog of waste also ensured the three waste treatment plants stayed open, according to Duff, though there was less work for the Florida operation. Shipments are hoped to restart in June to bolster third-quarter earnings.
The company’s Nuclear Services backlog for the quarter was over $55 million, with up to $30 million in bids outstanding.
Responding to a question from a financial analyst, Duff said he could not forecast whether Perma-Fix would stay in the black for the second quarter.
“As we approach the mid-quarter point for the second quarter, we’ve been fortunate that we continue to secure new contracts that will support a similar growth trajectory through 2020, assuming the COVID-19 pandemic begins to subside by the end of May,” he said.
