Pyrogenesis Canada Inc V.PYR

PYR Q2 2020 YE GUIDANCE HIGHLIGHTED SUMMARY

[developbc]

Hey guys here is what I gleaned from the news release for fwd looking outlook...bit shorter but lot to unpack...good to arm yourselfs for the basher frenzie future looks very bright!!:

1. “Percent complete revenue recognition in our major projects, which is the revenue recognition method we are mandated to follow by GAAP,[NOTE Very important as this is shown as a liability...Billings in excess of costs and profits on uncompleted contracts  is as stated. Percentage completion -Accounting anomaly whereas collect faster than work completed but IF company stops this amount is NOT payable] is such that it is not linear, but exponential, and as such Q1 2020 may not have reflected the results one might have expected given recent announcements. However, using this same revenue recognition method we can safely provide the following guidance for Q2 2020, and for the year ending December 31st, 2020 as follows: 
2. We expect that Q2 2020 and the six months ending June 30, 2020 will be profitable as will year end results. As such, management has modified several notes in the financials, for the first time since inception, to reflect this outlook,”
3. To date, in 2020 we have not only received significant payments under existing contracts, but have retired the $3MM convertible debenture in full, bought back approximately 1.2 million shares, increased our investment in HPQ, and further benefited from early conversions of warrants maturing in 2021 of over $3MM. 
4. $10MM of in-the-money warrants and options expiring in 2020 and 2021 alone. 
5. Over $50MM in tax loss carryforwards (roughly evenly distributed between federal and provincial tax regimes) which is not reflected as an asset on the balance sheet.
6. Company is undeniably well positioned to execute on, and build upon, the backlog of signed contracts which currently stands in excess of $30MM. With the eagerly anticipated US Navy contract in hand backlog of signed contracts will be in excess of $40MM.
7.  All in all, 2020 can now be described as the year that we have been expecting for some time.”
8. Management Guidance for Q2 2020

• Revenues of $2-2.25MM are expected in Q2 2020,
• Management expects that Q2 2020 and the six months ending June 30, 2020 will be profitable.

 

Management Guidance for the remainder of 2020:

• Overall, Management expects significant revenue growth in 2020
• Management expects that the year ending December 31st, 2020 will also be profitable.

Management has reason to believe that interest in the Company will only increase over the foreseeable future. As such, Management has decided that several strategies that have been articulated in the past (up listings, spinoffs) can now be accelerated as many of the impediments to moving quickly have been removed and have taken steps to do so.

Having a larger market capitalization has also helped in discussions with potential customers who take comfort from the possibility that a higher market capitalization may translate into easier access to capital. For the record, there is no intention at this time to raise capital for working capital purposes.

2020 is without a doubt the year that the long awaited breakout, which began in the second half of 2019, takes place; it is in fact already upon us:

 

To date during 2020 PyroGenesis has:

 

 

 

 

 

1. received significant payments under the $22MM contract with DROSRITE™ International thereby validating announcements made during 2019,
2. established a relationship with a US based tunneling company (contracts and payments ongoing),
3. Established itself in the iron ore pelletization industry as a potential supplier of torches geared to replacing existing burners and thereby reducing GHGs. Interest is also spilling over into other industries with GHG reduction targets,
4. Established a relationship with an OEM in North America with the intent to eventually supply powders for their 3D printing needs. This augments our relationship with Aubert & Duval, while at the same time de-risking our dependence on them,
5. bought back approximately 1.2 Million shares under the existing Normal Course Issuer Bid,
6. increased Company’s investment in HPQ, who has subsequently also experienced a significant increase in market capitalization,

 

This provides a solid cornerstone upon which PyroGenesis can:

1. continue to build on the recent successes with the Company’s DROSRITE™ offering
2. Leverage off of the recent successes with the Company’s torch offerings to (i) the iron ore pelletization industry, and (ii) a tunneling client.
3. Accelerate activities with Aubert & Duval in the Additive Manufacturing sector as well as HPQ in the Mining and Metallurgical sector, both of which did not progress as fast as management would have liked in 2019. Significant attention will be placed on both these activities in 2020.

Specifically, with Aubert & Duval the goal will be to complete the integration of the cutting-edge advances PyroGenesis has made to the powder production process.

With respect to HPQ, the goal would be to accelerate the game changing PUREVAP™ family of processes which we are developing for HPQ, namely:

• The PUREVAP™ “Quartz Reduction Reactors” (QRR), an innovative process (patent pending), which will permit the one step transformation of quartz (SiO2) into high purity silicon (Si) at reduced costs, energy input, and carbon footprint that will propagate its considerable renewable energy potential; and
• The PUREVAP™ Nano Silicon Reactor (NSiR), a new proprietary process that use PUREVAPTM QRR silicon (Si) as feedstock, to make spherical silicon nanopowders and nanowires;