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Bullboard - Stock Discussion Forum Greenlane Renewables Inc T.GRN

Alternate Symbol(s):  GRNWF

Greenlane Renewables Inc. is a Canada-based company, which provides biogas upgrading systems. Its systems produce clean, renewable natural gas from organic-waste sources including landfills, wastewater treatment plants, dairy farms, and food waste, suitable for either injection into the natural gas grid or for direct use as commercial vehicle fuel. The biogas upgrading systems, marketed and... see more

TSX:GRN - Post Discussion

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Post by retiredcf on Mar 11, 2022 8:18am

TD

Looks like we have a few killjoys this morning. GLTA

Greenlane Renewables Inc.

(GRN-T) C$1.16

Q4/21 Results

Event

Greenlane reported Q4/21 results.

Impact: NEGATIVE

Q4/21 Results: Greenlane reported Q4/21 revenue of $17.1 million, above our estimate of $14.0 million. At the EBITDAS level, Greenlane reported a loss of $0.6 million, below our estimate of $0.2 million as higher revenues were offset by lower- than-expected gross margins (24.8% vs. our estimate of 26.9%), and $0.5 million in spending related to "strategic initiatives" (this was added back to the reported Adjusted EBITDA figure). Quarter-end backlog of $50.1 million was slightly below our estimate of $53.1 million due to higher-than-expected revenues in the quarter, with quarterly bookings previously released. Details on page 2.

Conference Call Takeaways

Q4/21 Revenue Strength: The company experienced expedited revenue recognition in the quarter as a portion of sales were fulfilled from equipment held in inventory (typically recognized on a percentage of completion basis). As a result, we view the strong revenue in the quarter as a positive outlier.

Transportation Delays Weighing on Margins: Management is seeing inflationary cost pressure, but contracts are largely structured to pass this on to its customers. That said, the company has been negatively affected by supply-chain and transportation- related delays. The company is no longer providing gross margin guidance, but we expect margins to remain at the lower end of its previously disclosed 25-30% range on a go-forward basis.

Estimate Changes: Despite the strong revenue beat in the quarter, we are not making any material changes to our revenue estimates and we have reduced our margin expectations for continued inflationary pressure and ongoing spending related to the pursuit of strategic initiatives. See page 3 for more details.

TD Investment Conclusion

Greenlane is an asset-light engineering services firm serving a high-growth, low- carbon market at the early stages of commercialization, with a solid reference base of project deliveries and what we believe is a competitive product portfolio. With no major changes in our estimates, we are maintaining our SPECULATIVE BUY rating, with a reduced target price of $2.00 ($2.25 previously)

Comment by GoldenArm on Mar 11, 2022 12:02pm
Decided to peak in. Glad they have higher revenues but they were supposed to be breaking even if not slightly profitable by now. What changed. I would consider getting back in but they can't turn the corner toward positive earnings.
Comment by selfmade666 on Mar 11, 2022 1:32pm
They were projected to post a loss in 2021 and going forward break even. Still got a lot of runway to cover but I'm bullish on this company and it turn the corner. The share price certainly does not reflect the actual value of the company.
Comment by selfmade666 on Mar 11, 2022 1:42pm
going forward break even in 2022*
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