Viridis Energy reports increased revenue in Q3 results

By Erin Voegele | December 03, 2013

Viridis Energy Inc. has released its third quarter financial results, reporting revenue of $3 million, up 36 percent compared to third quarter 2012 revenue of $2.2 million. Revenue for the quarter was also up 19 percent compared to the second quarter of this year.

Viridis Energy attributes to the improved revenue numbers to strengthened market dynamics and additional production from its new Scotia Atlantic Biomass Co. Ltd. facility, which began operations in September. The facility was acquired in 2012.

The company reported a comprehensive loss of $712,000, or 1 cent per basic share, for the third quarter. This includes final startup costs of $520,000 associated with the Scotia plant and $100,000 of startup costs for the recently announced Viridis Merchants subsidiary. During the same period of 2012, Viridis Energy reported a loss of $598,000, or 1 cent per share. During the second quarter of 2013, the company reported a loss of $491,000, or 1 cent per share.

The startup of the Scotia plant contributed $525,000 of revenue during the quarter, but also incurred two months of operating costs as the company trained personnel. According to Viridis Energy, the Scotia plant is expected to be operating and full capacity soon. The plant is also expected to become financially independent shortly.

Viridis Energy reported a gross profit of $595,000 for the third quarter, up from $367,000 for the same period of 2012 and $465,000 in the second quarter of 2013. According to the company, improvements in capacity utilization and the shift from industrial power to residential heating markets at its Okanagan Pellet Co. supported the continue increase of its gross margin in the third quarter, which reached $19.7 percent. Gross margins for the same period of 2012 and the second quarter of 2012 were 18.8 percent and 16.5 percent, respectively.

For the first nine months of 2013, Viridis Energy reported revenues of $7.8 million, up from $7.1 million for the same period of last year. The comprehensive loss was $2 million, or 2 cents per basic share, for the first nine months of this year, compared to a loss of $2.8 million, or 6 cents per share, during the same period of last year. Operating loss for the nine-month period was $1.6 this year and $2 million last year.

“The third quarter was an incredibly productive period for Viridis,” said Christopher Robertson, Viridis’ CEO, in a statement. “Despite a few unexpected delays, production was renewed at our Scotia plant and we secured the marketing expertise of one of the premiere forest product wholesalers in the world for Scotia’s entire wood pellet production over the next two years. The increasing market activity in the wood pellet industry prompted us to expand our access to product beyond our production capacity. Viridis Merchants will enable us to accommodate commercial orders that exceed our own production capacity, while also positioning us to profit from arbitrage opportunities that arise. Our management team’s vast network of product sources, coupled with our developing network of commercial and industrial buyers, will serve our ultimate objective to gain recognition as the ‘go to’ supplier of wood pellets and other renewable energy materials.”