BioHiTech Global Reports Third Quarter 2020 Financial Results

CHESTNUT RIDGE, N.Y., Nov. 19, 2020 /PRNewswire/ -- BioHiTech Global, Inc. ("BioHiTech" or the "Company") BHTG, a sustainable technology and services company, today announces financial results for its third quarter 2020 ended September 30, 2020.

Third Quarter Highlights:

  • Announced that Carnival Corp., the world's largest cruise company, reinitiated its installation program of the BioHiTech's Revolution Series Digesters aboard its ships in preparation for the eventual resumption of cruising
  • Announced a total of $1.4 million in new food waste digester purchase orders for its Revolution Series Digesters from Carnival Corp. as part of its previously announced purchase contract between the two companies with an estimated value of up to $14 million
  • Received first Altapure AP-4™ disinfectant systems purchase contract from Hazelton Area School District in Pennsylvania to protect its schools against COVID-19 and other viral infections
  • Shipped the first Altapure AP-4™ disinfectant system to the cruise industry where it will be installed on the SeaDream I yacht, a mega-yacht boutique ship
  • Closed an $9.5 million (gross) underwritten public offering, including the underwriter's over-allotment, with net proceeds of $8.4 million to the Company

Developments Subsequent to the End of the Third Quarter

  • Appointed Anthony Fuller as Chief Executive Officer
  • Received contract to install seven new food waste digesters at various Hackensack Meridian Health healthcare facility locations
  • Made strategic investment in Rensselaer, NY land venture as a material step to establishing a renewable energy campus, including New York state's first waste conversion facility
  • Announced a total of $1.9 million in new food waste digester purchases, bringing total orders received from Carnival Corp. for the Company's Revolution Series™ food waste digesters to $3.3 million, including $600,000 in digester orders from Princess Cruises, since Carnival reinitiated the installation of digesters on its ships in July 2020

"While the third quarter fell short of our expectations financially, a number of significant events during the quarter and after September 30 provide reasons to believe better quarters are ahead," commented BioHiTech's CEO Anthony Fuller.  "Carnival Corp. has placed $3.3 million worth of food waste digesters orders since July, providing what we believe is an incredible testimony to our technology and ability to solve real-world food waste problems for the travel and hospitality industry.  Additionally, our multi-unit order for food digesters from the Hackensack Meridian Healthcare system provides further validation for our Revolution Series Digesters that convert food waste into a liquid that can be safely discharged through any standard sewer line.

"The Altapure AP-4 disinfectant system saw initial deployments in a school district as well as on a cruise ship, and we are confident it can address future needs across a range of industries, all of which have been affected by COVID-19.  We continue to ascend the learning curve of operating our Martinsburg, W.V. plant using our patented High Efficiency Biological Treatment ("HEBioT") process. In many ways, are still in the commissioning phase with this plant.  We've made notable changes and are pleased with the progress we are seeing.  Our learnings from the Martinsburg facility will prove vital as we progress towards our potential development of a 'renewable energy campus' planned for Rensselaer, N.Y.  Quite simply, BioHiTech provides cost-effective technology solutions for sustainable waste management, whether on a large scale like our Martinsburg resource recovery facility or on a smaller scale via our food waste digesters.

"As we look ahead to 2021 and beyond, and as the newly appointed CEO, we are setting course with enhanced corporate initiatives. These initiatives are designed to maximize shareholder value and help investors better measure our progress moving forward.  I've laid out five goals on which we are focused heading into 2021:  1) increase revenue appreciably, 2) reduce SG&A meaningfully, 3) improve the plant operations measurably, 4) tell the story clearly, and 5) function as a team effectively.  I look forward to elaborating more on these goals in our earnings conference call later this afternoon and throughout the quarter," concluded Mr. Fuller.

Financial Highlights for Q3 2020

Revenues: Total revenue in the third quarter of 2020 was $742,877, a decrease of 48% compared to revenue of $1,426,775 in the third quarter of 2019.  Third quarter revenue decreased primarily due to a reconfiguration process conducted at the Martinsburg (W.V.) High Efficiency Biological Treatment (HEBioT) facility during the quarter by the facility's new management team that temporarily reduced production and caused its revenue to decline by 59% year-over-year to $248,274 prior to a $247,649 negative adjustment in previously estimated take-or-pay contract revenue.  Rental, service, and maintenance revenue declined 13% from $489,555 in the third quarter of 2019 to $423,996 in the third quarter of 2020.  Equipment sales partially offset the declines in the HEBioT and rental, service, and maintenance revenue and rose 370% from $62,565 in the third quarter of 2019 to $293,876 in the third quarter of 2020 due to purchases from Carnival Cruise Lines under their master purchase contract.  Furthermore, management advisory and other fees derived support for Gold Medal, a related entity, decreased from $264,750 in the third quarter of 2019 to $24,380 in the third quarter of 2020 in order for management to devote more focus to the Company's core services.

Operating Expenses: Total Operating Expenses, including $1,256,477 in cost of goods sold and a $917,420 impairment expense at the Martinsburg waste facility, in the third quarter increased 53% from $3,042,020 in the third quarter of 2019 to $4,660,333 in the third quarter of 2020.  Increased production expenses, the aforementioned impairment expense, stock-based compensation, legal and social media expenses, insurance costs at the HEBioT facility, Directors and Officers insurance, and management transition expenses at the HEBioT facility primarily drove the increased operating expenses from the comparable period in 2019.

Loss from Operations: The loss from operations increased from ($1,615,245) in the third quarter of 2019 to a loss of ($3,917,456) in the third quarter of 2020. 

Net Loss: Net loss per share in the third quarter of 2020 was ($0.16) on 22.0 million weighted average shares outstanding, compared to a net loss of ($0.13) per share on 15.6 million weighted average shares outstanding in third quarter of 2019.

Cash: Unrestricted cash at September 30, 2020 was $4,950,112 following an underwritten public offering completed during the third quarter that netted the Company $8,437,480 in proceeds, including the underwriter's over-allotment. 

Earnings Conference Call

Management will host a conference call at 4:30 p.m. ET on Thursday, November 19, 2020 to review financial results and provide an update on corporate developments.  Following management's formal remarks, there will be a question and answer session.

Participants are asked to pre-register for the call via the following link:

https://dpregister.com/sreg/10150010/dd340fff34

Please note that registered participants will receive their dial-in number upon registration and will dial directly into the call without delay.  Those without Internet access or who are unable to pre-register may dial in by calling 1-866-652-5200 (domestic) or 1-412-317-6060 (international).  All callers should dial in approximately 10 minutes prior to the scheduled start time and ask to be joined into the BioHiTech Global call.

The conference call will be available through a live webcast found here:

https://services.choruscall.com/links/bhtg201116.html

It will also be broadcast live through the Company's website with the following link:

http://investors.biohitechglobal.com/events-and-webcasts

A webcast replay of the call can be accessed through the above links and will be available approximately one hour after the end of the call through February 19, 2021.  The call replay can also be accessed by calling 1-877-344-7529 (domestic) or 1-412-317-0088 (international) and using access code 10150010.  The telephonic replay of the call will be available through November 30, 2020.

About BioHiTech Global

BioHiTech Global, Inc. BHTG, is a technology services company focused on providing cost-effective solutions that improve environmental outcomes. Our technologies for waste management include the patented processing of municipal solid waste into a valuable renewable fuel, biological disposal of food waste on-site, and proprietary real-time data analytics tools to reduce food waste generation. When used individually or in combination, our solutions lower the carbon footprint associated with waste transportation and can reduce or virtually eliminate landfill usage. In addition, we distribute a patented technology that achieves high-level disinfection of spaces such as classrooms, hotel or hospital rooms and other enclosed areas to combat the spread of viruses and bacteria without the use of harsh chemicals. Our unique solutions enable businesses, educational institutions and municipalities of all sizes to solve everyday problems in a smarter and more cost-effective way while reducing their impact on the environment. For more information, please visit www.biohitech.com.

Forward Looking Statements

Statements in this press release contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. Without limiting the foregoing, words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "explore," "evaluate," "intend," "may," "might," "plan," "potential," "predict," "project," "seek," "should," or "will," or the negative thereof or other variations thereon or comparable terminology. These forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the Company's control. These statements are also based on many assumptions and estimates and are not guarantees of future performance. These statements are estimates, based on information available to management as of the date of this release, and are subject to further changes. These statements may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of BioHiTech Global, Inc. to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. BioHiTech Global, Inc. assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future in these forward-looking statements.  Our actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including, without limitation those set forth as "Risk Factors" in our filings with the Securities and Exchange Commission ("SEC"). There may be other factors not mentioned above or included in the BioHiTech's SEC filings that may cause actual results to differ materially from those projected in any forward-looking statement. BioHiTech Global, Inc. assumes no obligation to update any forward-looking statements as a result of new information, future events or developments, except as required by securities laws.

Company Contact:

BioHiTech Global, Inc.

Richard Galterio

Executive Vice President

Direct: 845.367.0603

rgalterio@biohitech.com

www.biohitech.com

Investors: 

ir@biohitech.com

 

BioHiTech Global, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)







Three Months Ended September 30,





Nine Months Ended September 30,







2020





2019





2020





2019



Revenue

























HEBioT (related party)



$

625





$

609,905





$

1,383,656





$

886,947



Rental, service and maintenance





423,996







489,555







1,251,122







1,426,193



Equipment sales





293,876







62,565







616,992







137,799



Management advisory and other fees

(related party)





24,380







264,750







124,380







761,750



Total revenue





742,877







1,426,775







3,376,150







3,212,689



Operating expenses

































HEBioT processing





945,810







786,680







2,778,514







1,309,176



Rental, service and maintenance





139,665







176,651







552,195







508,164



Equipment sales





171,002







17,776







317,406







56,502



Selling, general and administrative





1,924,293







1,449,545







5,740,158







5,450,282



Impairment expense





917,420







-







917,420







-



Depreciation and amortization





562,143







611,368







1,747,109







1,350,780



Total operating expenses





4,660,333







3,042,020







12,052,802







8,674,904



Loss from operations





(3,917,456)







(1,615,245)







(8,676,652)







(5,462,215)



Other (income) expenses

































Gain on sale of affiliate investment





-







(562,617)







-







(562,617)



Interest (income)





(108)







(46,180)







(17,730)







(46,180)



Interest expense





1,023,165







979,202







3,060,775







2,281,071



Expense incurred in warrant valuation

and conversions





-







49,160







-







49,160



Total other (income) expenses





1,023,057







419,565







3,043,045







1,721,434



Net loss





(4,940,513)







(2,034,810)







(11,719,697)







(7,183,649)



Net loss attributable to non-controlling

interests





(1,647,782)







(728,337)







(3,190,788)







(1,859,069)



Net loss attributable to Parent





(3,292,731)







(1,306,473)







(8,528,909)







(5,324,580)



Other comprehensive income

































Foreign currency translation adjustment





71,067







(32,676)







40,931







(37,873)



Comprehensive loss



$

(3,221,664)





$

(1,339,149)





$

(8,487,978)





$

(5,362,453)





































Net loss attributable to Parent



$

(3,292,731)





$

(1,306,473)





$

(8,528,909)





$

(5,324,580)



Preferred stock dividends





(205,115)







(255,847)







(587,428)







(548,075)



Deemed dividend on down round

feature





(21,738)







(405,324)







(21,738)







(405,324)



Net loss – common shareholders





(3,519,584)







(1,967,644)







(9,138,075)







(6,277,979)



Net loss per common share - basic and

diluted



$

(0.16)





$

(0.13)





$

(0.49)





$

(0.41)



Weighted average number of common

shares outstanding - basic and diluted





22,044,540







15,649,174







18,787,566







15,134,301



 

BioHiTech Global, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets







September 30,

2020





December 31,

2019







(Unaudited)









Assets

















Current Assets

















Cash



$

4,950,112





$

1,847,526



Restricted cash





1,287,138







1,133,581



Accounts receivable, net of allowance for doubtful accounts of $194,066 and $170,038

as of September 30, 2020 and December 31, 2019, respectively (related entity

$2,227,224 and $1,370,867 as of September 30, 2020 and December 31, 2019,

respectively)





3,311,519







2,155,921



Inventory





627,261







467,784



Prepaid expenses and other current assets





240,939







126,357



Total Current Assets





10,416,969







5,731,169



Restricted cash





2,646,448







2,555,845



Equipment on operating leases, net





1,417,260







1,724,998



HEBioT facility, equipment, fixtures and vehicles, net





36,338,727







37,421,333



Operating lease right of use assets





1,285,292







945,047



License and capitalized MBT facility development costs





8,018,853







8,049,929



Goodwill





58,000







58,000



Other assets





33,749







53,726



Total Assets



$

60,215,298





$

56,540,047





Continued on following page.

 

BioHiTech Global, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets, continued:







September 30,

2020





December 31,

2019







(Unaudited)









Liabilities and Stockholders' Equity

















Current Liabilities:

















Line of credit, net of financing costs of $2,050 and $20,152 as of September 30, 2020

and December 31, 2019, respectively



$

1,497,950





$

1,479,848



Advances from related parties





935,000







210,000



Accounts payable (related entity $2,021,940 and $2,531,034 as of September 30, 2020

and December 31, 2019, respectively)





6,363,168







4,688,339



Accrued interest payable





627,112







1,148,570



Accrued expenses and liabilities





2,075,576







1,926,965



Deferred revenue





95,331







89,736



Customer deposits





753,046







44,792



Note payable





-







100,000



Senior Secured Note, net of financing costs of $75,767 and unamortized discounts of

$515,719 as of September 30, 2020





4,408,514







-



Current portion of WV EDA Senior Secured Bonds payable





2,860,000







1,390,000



Current portion of long term debt and Payroll Protection Program Loan





261,787







4,605



Total Current Liabilities





19,877,484







11,082,855



Junior note due to related party, net of unamortized discounts of $78,596 and $95,043

as of September 30, 2020 and December 31, 2019, respectively





965,881







949,434



Accrued interest (related party)





1,729,605







1,510,193



WV EDA Senior Secured Bonds payable, net of current portion, and financing costs of

$1,691,516 and $1,792,574 as of September 30, 2020 and December 31, 2019,

respectively





28,448,484







29,817,426



Payroll Protection Program Loan, net of current portion





163,839







-



Senior Secured Note, net of current portion, net of financing costs of $113,268, and

unamortized discounts of $726,242, as of December 31, 2019





-







4,160,490



Note Payable





100,000







-



Non-current lease liabilities





1,231,144







915,170



Long-term debt, net of current portion





4,936







8,201



Total Liabilities





52,521,373







48,443,769



Series A redeemable convertible preferred stock, 333,401 shares designated and issued,

and 125,312 and 145,312 outstanding as of September 30, 2020 and December 31, 2019,

respectively





626,553







726,553



Commitments and Contingencies

















Stockholders' Equity

















Preferred stock, $0.0001 par value; 10,000,000 shares authorized; 3,209,210 and

3,179,120 designated as of September 30, 2020 and December 31, 2019;

1,936,214 and 1,922,603 issued as of September 30, 2020 and December 31, 2019;

848,292 and 856,181 outstanding as of September 30, 2020 and December 31, 2019:

















Series B Convertible preferred stock, 1,111,200 shares designated: 428,333 shares

issued, no shares outstanding as of September 30, 2020 and December 31, 2019





-







-



Series C Convertible preferred stock, 1,000,000 shares designated, 427,500 shares

issued and outstanding as of September 30, 2020 and December 31, 2019





3,050,142







3,050,142



Series D Convertible preferred stock, 20,000 shares designated: 18,850 shares

issued; 17,350 and 18,850 outstanding as of September 30, 2020 and December 31,

2019





1,365,696







1,505,262



Series E Convertible preferred stock, 714,519 shares designated: 714,519 shares

issued, 264,519 outstanding as of September 30, 2020 and December 31, 2019





698,330







698,330



Series F Convertible preferred stock, 30,090 shares designated, and 13,611 shares

issued and outstanding as of September 30, 2020





1,507,408







-



Common stock, $0.0001 par value, 50,000,000 shares authorized, 23,354,130 and

17,300,899 shares issued and outstanding as of September 30, 2020 and December 31,

2019, respectively





2,334







1,730



Additional paid in capital





59,775,963







49,597,059



Accumulated deficit





(61,403,226)







(52,785,242)



Accumulated other comprehensive (loss)





(84,069)







(43,138)



Stockholders' equity attributable to Parent





4,912,578







2,024,143



Stockholders' equity attributable to non-controlling interests





2,154,794







5,345,582



Total Stockholders' Equity





7,067,372







7,369,725



Total Liabilities and Stockholders' Equity



$

60,215,298





$

56,540,047



 

BioHiTech Global, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Unaudited)







Nine Months Ended

September 30,







2020





2019



Cash flows from operating activities:

















Net loss



$

(11,719,697)







(7,183,649)



Adjustments to reconcile net loss to net cash used in operations:

















Depreciation and amortization





1,747,109







1,350,780



Impairment expense





917,420







-



Amortization of operating lease right of use assets





72,402







-



Provision for bad debts





126,119







45,000



Share based employee compensation





1,537,915







741,188



Interest resulting from amortization of financing costs and discounts





419,715







333,782



Share based vendor compensation





297,835







-



Gain on sale of affiliate investment





-







(562,617)



Loss resulting from write-off of proposed MBT site





-







346,654



Warrant modifications





-







49,160



Changes in operating assets and liabilities





(909,507)







(1,137,810)



Net cash used in operating activities





(7,510,689)







(6,017,512)





















Cash flow from investing activities:

















Purchases of construction in-progress, equipment, fixtures and vehicles





(207,173)







(4,619,883)



Proceeds from sale of investment in affiliate





-







2,250,000



Refund of deposit





5,000







-



MBT facility development costs incurred





(62,949)







(59,013)



MBT facility development costs refunded





-







66,000



Net cash used in investing activities





(265,122)







(2,362,896)





















Cash flows from financing activities:

















Proceeds from common stock issuance, net of offering costs





8,437,480







3,035,557



Proceeds from the sale of Series F convertible preferred stock units





1,560,450







-



Proceeds from Payroll Protection Program Loan





421,300







-



Proceeds from the sale of Series D convertible preferred stock units





-







1,772,500



Affiliate investment in subsidiary





-







1,400,000



Deferred financing costs incurred





-







(62,151)



Repayments of long-term debt





(3,544)







(6,846)



Related party advances, net





725,000







210,000



Net cash provided by financing activities





11,140,686







6,349,060



Effect of exchange rate on cash (restricted and unrestricted)





(18,129)







12,721



Net change in cash (restricted and unrestricted)





3,346,746







(2,018,627)



Cash - beginning of period (restricted and unrestricted)





5,536,952







9,126,380



Cash - end of period (restricted and unrestricted)



$

8,883,698







7,107,753



 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/biohitech-global-reports-third-quarter-2020-financial-results-301177585.html

SOURCE BioHiTech Global, Inc.

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