Blumetric Environmental (BLM) investor relations material

Executive summary

• Q3 revenue reached $14.7M, up from $8.0M–$8.1M year-over-year, driven by WaterTech USA (Gemini) acquisition and strong organic growth, with revenues more than doubling since acquisition.

• Military market revenue increased 76% year-over-year due to new production contracts, while government and mining segments faced delays and slowdowns.

• Professional services segment experienced lower utilization and profitability due to project delays and increased non-billable labor, but a rebound began at the end of Q3.

• Management retained staff during slow periods to ensure readiness for contract upticks, prioritizing long-term growth over short-term cost cuts.

• Working capital improved to $8.5M and net cash to $3.4M as of June 30, 2025.

Financial highlights

• Q3 revenue was $14.7M, up 81% year-over-year, mainly due to WaterTech USA's growth; nine-month revenue reached $44.6M.

• Gross margin declined to 36% from 44% year-over-year, reflecting a shift in sales mix toward WaterTech.

• Operating expenses increased to $5.6M from $3.4M, primarily due to Gemini, but economies of scale were achieved.

• EBITDA for Q3 was $308K–$0.3M, down from $356K–$0.4M year-over-year; nine-month EBITDA rose to $2.2M.

• Net loss of $451K–$0.5M reported, compared to net earnings of $27K or breakeven in the prior year.

Outlook and guidance

• Q4 and Q1 are expected to be seasonally strong for professional services, with utilization at an all-time high entering Q4.

• Management targets improved EBITDA margins, expecting 6–7% in Q4, with a long-term goal of 10% at $100M revenue.

• Anticipates continued growth in WaterTech and professional services, with benefits from new ERP system expected next year.

• M&A remains a focus, with a pipeline of accretive, low-debt targets in the 4–6x EBITDA range.

• Ongoing assessment of Professional Services acquisitions to strengthen operations.