Cielo Waste Solutions (CMC) Q1 2025 earnings summary

Executive summary

• Net loss for the three months ended July 31, 2024 was $2.2 million, an improvement of $3.7 million year-over-year, mainly due to reduced impairment, financing, and G&A costs.

• The company remains pre-revenue, focusing on project development and technology acquisition, with no commercial operations to date.

• Cielo acquired exclusive Canadian and partial US rights to Enhanced Biomass to Liquids (EBTL) and Biomass Gas to Liquids (BGTL) technologies in November 2023 for $42.3 million, aiming to accelerate commercialization.

• A binding LOI was signed in June 2024 for the $125 million acquisition of Rocky Mountain Clean Fuels' Carseland facility, expected to expedite revenue generation.

Financial highlights

• Total assets were $53.5 million and total liabilities $12.6 million as of July 31, 2024, down from $54.9 million and $13.7 million respectively at April 30, 2024.

• Working capital deficit stood at $9.2 million at July 31, 2024, unchanged from April 30, 2024.

• Cash used in operating activities was $0.5 million for the quarter; net cash from financing was $0.3 million, mainly from convertible debentures and loans.

• Depreciation and amortization rose to $1.4 million due to the technology acquisition.

• Financing costs decreased by $0.4 million year-over-year, reflecting lower debt levels.

Outlook and guidance

• The primary focus is on completing the Carseland Facility, with Phase I construction expected to start in late 2024 and commissioning in 2026.

• Total capital costs for the Carseland LP are anticipated to be approximately $300 million, with funding from third-party lenders and equity partners.

• The company discontinued the Dunmore Facility project to concentrate resources on Carseland.

• Cielo must secure additional financing to fund operations, project development, and meet short-term obligations.