Arq Reports Third Quarter 2024 Results

In This Article:

Arq, Inc.
Arq, Inc.

Record PAC revenue and profitability driven by ongoing and sustainable improvements

Strategic GAC project at Red River remains on target for first deliveries in Q1 2025 with modular commissioning already underway; capex, timing and contracting advancing in-line with expectations

Expect to ramp Red River GAC run-rate to 25 million nameplate by end of Q1 2025; identified potential to increase GAC nameplate capacity by 10-20% with no anticipated additional capex required

GREENWOOD VILLAGE, Colo., Nov. 07, 2024 (GLOBE NEWSWIRE) -- Arq, Inc. (NASDAQ: ARQ) (the "Company" or "Arq"), a producer of activated carbon and other environmentally efficient carbon products for use in purification and sustainable materials, today announced its financial and operating results for the quarter ended September 30, 2024.

Financial Highlights

  • Generated revenue of $34.8 million in Q3 2024, up 17% over the prior year period, driven largely by higher ASP, positive changes in product mix

  • Improved gross margin to 38.6% in Q3 2024, an improvement of approximately 800 basis points vs. 30.6% in the prior year period, driven by higher revenue, continued focus on profitability over volume, and ongoing operational cost management

  • Increased ASP in Q3 2024 by approximately 15% over the prior year period, reflecting the 6th consecutive quarter of double-digit YoY percentage growth in ASP

  • Reported Net income of $1.6 million in Q3 2024, reflecting a significant improvement over the prior year period Net loss of $2.2 million

  • Adjusted EBITDA of $5.1 million in Q3 2024 vs. Adjusted EBITDA of $0.9 million in the prior year period(1)

  • Raised approximately $27 million of net equity proceeds during September 2024 in an oversubscribed confidentially marketed public offering met by strong institutional demand; increased YTD 2024 net equity raised to approximately $42 million

  • Exited Q3 2024 with cash and restricted cash of $57.4 million

  • Capital expenditure forecasts for full year 2024 remain at $60-$70 million, with $20-$25 million remaining to be spent in Q4 2024

(1) Adjusted EBITDA is a non-GAAP financial measure. Please refer to the paragraph titled “Non-GAAP Measures” for the definitions of non-GAAP financial measures and reconciliations to GAAP measures included in this press release.

Recent Business Highlights

  • Modular commissioning at Red River facility underway; on target to achieve first deliveries in Q1 2025 following decision to take general contracting activities in house

  • Continued strong granular activated carbon (“GAC”) contracting activity, reaching approximately 60% of our 25 million pound per year nameplate capacity

  • In negotiation for the remaining nameplate capacity at Red River; expect to be fully contracted by the time nameplate run-rate capacity is achieved in Q1 2025

  • Identified potential to increase Red River’s 25 million pound per year nameplate capacity by 10-20% with no anticipated additional capex required; upsized production run-rate expected to be achievable by Q3 2025

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