Birchtech (BCHT) Sidoti Small-Cap Virtual Conference summary

Business overview and strategy

• Focuses on clean coal and water purification, leveraging patented SEA Technologies used at over 80% of U.S. coal-fired power plants with sorbent-based mercury removal systems.

• Transitioning expertise to water purification, targeting PFAS/PFOA compliance, with new technologies aimed at reducing projected $1.5 billion annual compliance costs.

• Offers customized, high-efficacy solutions for air and water, not commodity products, with a customer-first approach.

• Maintains a strong IP portfolio, with recent legal wins including a $57 million jury verdict for patent infringement.

• Recurring revenue model with average utility customer contracts of $2 million annually and 30% gross margins.

Financial performance and projections

• Trailing 12-month average revenues at $16.2 million, excluding significant IP legal win proceeds.

• Secured $35 million from legal claims and license agreements, with additional settlements pending.

• Revenue run rate expected to reach $40 million by end of 2026, with core business guidance of at least $23 million for 2025, excluding licensing and water revenue.

• All debt repaid, now debt-free except for a profit share tied to IP wins.

• Share repurchase program of $5 million announced for the second half of 2025, contingent on legal outcomes and cash position.

Water purification market entry and growth plans

• Building on air purification legacy, expanding into water with new labs in North Dakota and Pennsylvania to support advanced solutions.

• Launching proprietary granular activated carbon (GAC) products with 50% gross margin targets, matching current market prices.

• Initial $7 million feedstock secured, with commercialization of water products set for the second half of 2025.

• Construction of new GAC manufacturing facilities planned for 2025 in the southeastern U.S.

• Targeting both municipal and industrial water markets, aiming to capture significant share from incumbents like Calgon Carbon.