Canadian pellet producer reports improved margins
Viridis Energy Inc. recently released its third quarter financial results, reporting a gross profit of $367,000 for the three months ended Sept. 30, a significant improvement over the gross profit of $186,000 reported the preceding quarter and the negative gross profit reported during the same quarter of last year.
According to information released by Viridis Energy, it generated a gross margin of 17 percent during the quarter, an increase over the 7.7 percent gross margin reported during the second quarter of 2012. “In 2012, the gross margin has increased sequentially each quarter, and this trend is likely to continue into the fourth quarter, as revenue mix shifts towards the higher margin residential market during the home heating season,” said the company in a statement.
Viridis Energy reported a comprehensive loss of $598,000, or 1 cent per basic share, for the quarter. A loss of $1.4 million, or 4 cents per share, was reported during the third quarter of 2011, with a loss of $972,000, or 2 cents per share, reported for the second quarter of 2012. According to the company, the decreased loss reflects lower general and administrative expenses, lower financing costs and improved margins.
In the release, Viridis Energy stresses that it has been carrying the costs associated with the development of the Scotia Atlantic Biomass pellet plant. That plant is expected to begin generating revenue during the second quarter of 2013. According to the company, the new facility is scheduled to become fully operational before April 2013, when the U.K. Department of Energy & Climate Change’s revised Renewables Obligation plan comes into effect.
“We plan to have our Scotia Atlantic Biomass pellet plant in full operation to address the increased demand for wood pellets when the RO plan takes effect in early 2013,” said Christopher Robertson, CEO and director of Viridis Energy. “The revenue contribution generated from our Scotia plant, coupled with improved results from our existing plant, is expected to position Viridis Energy for profitability in 2013. Our efforts in fine tuning our operations, diversifying into the commercial market, securing raw material sources, and expanding our production capacity have enabled Viridis to establish itself as a leading source of wood pellets, worldwide. We have confidence the fruits of our efforts will materialize in the upcoming year.”