Nuclear remediation and waste treatment provider Perma-Fix Environmental Services on Wednesday reported improvements in both revenue and operating losses for the first quarter of 2017.
The Atlanta-based company brought in $12.7 million in revenue for the three months ended on March 31, up from $10 million in the same quarter of 2017.
Revenue in the waste treatment business rose from $7.2 million to $10 million, largely due to higher waste volume, according to a Perma-Fix press release. The segment provides treatment, processing, and disposal at four locations for low-level radioactive and other types of waste.
Revenue in the services business, which offers a broader swath of offerings ranging from on-site waste management to industrial hygiene, slipped slightly on a year-over-year basis, from $2.8 million to $2.7 million.
The company lost $520,000 in the latest quarter, compared to a $3.6 million loss for first-quarter 2016 that contributed to a $14 million loss for the year. The update bodes well for the remainder of 2017.
“We achieved these results despite severe winter weather in the Pacific Northwest, which impacted waste shipments, and despite the fact that the first quarter is typically seasonally our weakest period,” CEO Lou Centofanti said Wedneday during the company’s earnings conference call. Perma-Fix operates a treatment facility for low-level and mixed-low-level radioactive waste in Richland, Wash.
The company also has more than $3 million in cash available and no revolver debt, Centofanti noted.
Another positive sign is the enacted waste treatment budget for fiscal 2017 and proposed budget for the next fiscal year in the Department of Energy’s Office of Environmental Management, Centofanti said. The DOE office, charged with cleanup of legacy nuclear arms sites, received a 3% budget bump to about $6.4 billion in the fiscal 2017 omnibus spending plan President Donald Trump signed last week. EM would receive $6.5 billion in fiscal 2018 in the White House budget proposal outlined in March; the full plan is expected on May 22.
“In the past increased budgets have usually led to an increase in discretionary spending for waste treatment, especially at the end of the government’s fiscal year” on Sept. 30, Centofanti said.
Perma-Fix’s work for the Environmental Management office has included a treatment and disposal subcontract for cleanup of the Hanford Site Central Plateau in Washington state and treatability studies and other work at DOE’s West Valley Demonstration Project in upstate New York. The company is also testing a technology that could treat some portion of high-level radioactive waste now stored at the Hanford Site.
“There’s a tremendous amount of opportunity at Hanford,” the CEO said during the call, but added that he could not say much about the current waste treatment test program. He demurred when an analyst asked whether that treatment option could involve 1 million gallons of high-level waste; Hanford in total today stores 56 million gallons of low-activity and high-level waste in underground tanks.
Centofanti, though, referred analysts to a new Goverment Accountability Office report on options for treatment of waste at the former plutonium production site.
Managment continues to seek new opportunities related to expansion of Perma-Fix’s market base, which should be announced as they are realized, Centofanti said.
Perma-Fix secured 11 contract awards out of 14 proposals in the quarter, according to Chief Operating Officer Mark Duff. It submitted another 17 bids during the three-month period ended March 31.
The company’s medical business, consisting of Perma-Fix Medical S.A. and its Perma-Fix Medical Corp. subsidiary, has yet to produce any revenue, the company said in a new 10-Q form filed with the U.S. Securities and Exchange Commission. The medical branch, which is preparing a means for producing the medical isotope technetium-99m without nuclear weapon-grade uranium, remains in research and development mode.
“During the latter part of 2016, the Medical Segment ceased a substantial portion of its R&D activities due to the need for substantial capital to fund such activities,” the 10-Q says. “The Medical Segment will not resume any substantial R&D activities until it obtains the necessary funding through obtaining its own credit facility or additional equity raise.”
The company said it is continuing talks with an unidentified private investor for the sale of $8 million to $12 million of Perma-Fix Medical stock, which would be the majority of the subsidiaries voting securities.
Meanwhile, the Materials & Energy Corp. mixed low-level waste treatment facility in Tennessee remains scheduled to close by Jan. 21 of next year, when its current lease ends. The M&EC subsidiary had $2.9 million in liabilities as of March 31, but Perma-Fix expects to save up to $5 million annually following its closure.
