Progressive Planet reports gross margin of 38.6%, its highest ever
Operational income surged to $1.05 million in Q2, up from $257K in the same period last year
Rising profitability allows recognition of deferred income tax assets on the balance sheet
KAMLOOPS, BC, Dec. 4, 2024 /CNW/ - Progressive Planet Solutions Inc. (TSXV: PLAN) (OTCQB: ASHXF) ("Progressive Planet", "PLAN", or the "Company") is pleased to announce its financial results for its second quarter ending on October 31, 2024.
The Company's implementation of its cost cutting plan beginning in late fiscal 2023, and its parallel focus on transitioning to higher-margin products, have contributed to a significant improvement in profitability during the second quarter, as compared to the prior year's second quarter.
"In fiscal 2024, we focused on cost controls and positioning for long-term growth. This strategy paid off with a standout second quarter, driven by higher-margin products and disciplined execution. These record profits reflect our team's dedication to delivering sustainable shareholder value. I couldn't be prouder of what our team has achieved—and this is just the beginning.," stated Steve Harpur, CEO.
Q2 Fiscal 2024 vs. Q2 Fiscal 2025:
Increased EBITDA1 by $697K, from $205K to $902K
Revenue increased from $5.438 million to $5.468 million
Gross profit increased by 32%, from $1.593 million to $2.110 million
Gross margin2 increased from 29.3% to 38.6%
Income from operations improved by $795K, from $257K in to $1.052 million
Net income improved from net loss of $(182K) to $623K net income
"Our record net income and the sale of under-utilized assets boosted our cash balance to over $2.9 million in Q2," said Harpur. "As noted in September, our engineering team has been focused on enhancing productivity in our valve pack powder bagging and palletizing line. With engineering work nearly complete, we plan to begin equipment procurement in the first quarter of 2025 (January to March 2025). While our financial results were strong, they were impacted by a write-down on a private company investment."
When Progressive Planet acquired Absorbent Products Ltd. in 2022, The Company inherited over $12 million in historical tax losses. At the time, these losses were not recorded as a future tax benefit on PLAN's balance sheet due to a lack of profitability. However, with significant improvements in profitability over the past 18 months, Progressive Planet now expects to generate taxable income moving forward, unlocking the value of these historical tax assets. After consulting with its auditors, Progressive Planet has added $486,000 as a deferred income tax asset3 to its balance sheet. This amount which represents the estimated income tax liability for the next 12 months, which can be offset using the historical tax losses.
"We have taken a measured approach to recognizing the value of deferred income assets. We will review, and adjust as necessary, the deferred income tax asset value on our balance sheet every quarter going forward," stated Chris Halsey-Brandt, CFO.
EBITDA is a non-IFRS financial measure. This ratio expresses earnings before interest, income taxes, depreciation, and amortization. It assists in explaining the Company's results from period to period. There is not directly comparable IFRS measure.
Gross margin is a non-IFRS financial measure. This ratio expresses gross profit as a percentage of revenue for a given period. It assists in explaining the Company's results from period to period and measuring profitability. This ratio is calculated by dividing gross profit for a period by the corresponding revenue for the period. There is no directly comparable IFRS measure.
Deferred income tax asset is a IFRS measure which reflects the amount of income taxes recoverable in future periods in respect of deductible temporary differences; the carryforward of unused tax losses; and the carryforward of unused tax credits.
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Progressive Planet provides regular information for investors on its website: progressiveplanet.com/investors/. This includes press releases and other information about financial performance, patents filed, and information on corporate governance.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accept responsibility for the adequacy or accuracy of this release.
About Progressive Planet:
Progressive Planet, based in Kamloops, British Columbia, is redefining sustainability with our Products for a Healthy Planet™. By leveraging owned mineral assets and recycled materials, we develop patented and patent-pending innovations that promote a healthier planet.
Our C-Quester™ Centre of Sustainable Solutions leads advancements in low-carbon cement technologies, while our second on-site lab focuses on sustainable solutions for agriculture and animal care. Progressive Planet's products are proudly available in over 10,000 retail locations across North America. For more information, visit progressiveplanet.com.
Forward-Looking Statements: Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding the matters described herein including statements regarding the NCIB and the repurchases thereunder as well as the effect of those repurchases, statements regarding the future of the Bromley Creek Zeolite Mine and statements regarding the development of future products. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations, or intentions regarding the future. Such statements are subject to risks and uncertainties that may cause actual results, performance, or developments to differ materially from those contained in the statements. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. These forward-looking statements reflect management's current views and are based on certain expectations, estimates and assumptions which may prove to be incorrect. A number of risks and uncertainties could cause our actual results to differ materially from those expressed or implied by the forward-looking statements, including factors beyond the Company's control. These forward-looking statements are made as of the date of this news release.
Disclaimer: This news release, required by Canadian laws, does not constitute an offer of securities and is not for distribution or dissemination outside Canada.
