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spk00: good day and welcome to the me2c environmental second quarter earnings conference call during today's presentation all parties will be in a listen only mode following the presentation the conference will be open for questions this conference is being recorded today august 17 2022 the earnings press release accompanying this conference call was issued at 8 a.m eastern time today on the call is me2c environmentals president and chief executive officer Richard McPherson, as well as Chief Financial Officer Jamie Sutherwaite. Before we begin, we want to note that you should read the forward-looking statements in the company's earnings press release. During today's call, management will make certain predictive statements that reflect its current views about future performance and financial results. The company bases these statements and certain assumptions and expectations on future events that are subject to risks and uncertainties The company's 2021 Form K lists some of the most important risk factors that could cause actual results to differ from its predictions. Please also note that the company's earnings press release and this conference call make reference to adjusted EBITDA and non-GAAP financial measures. The company views adjusted EBITDA as an operating performance measure, and as such, the company believes that the GAAP financial measures most directly comparable to it is net loss or income. For further information, please refer to the earnings press release and the company's periodic filings with the Securities and Exchange Commission. At this time, I would like to turn the call over to Richard McPherson, Chief Executive Officer of ME2C Environmental. Sir, please go ahead.
spk03: Thank you, operator, and thank you all for joining us for ME2C's environmental second quarter 2022 earnings call. At this midway point of the year, we're showing significant growth and continued developments across a number of fronts. The ramp in revenue growth that was projected at the beginning of this year is continuing through the second quarter. And additionally, we've had developments in other key areas, including our ongoing litigation proceedings and new technology developments as well. Before moving into updates of the three key segments of the company, I'd like to provide an overview of our reported financials for the second quarter and our outlook for the remainder of this year. Our financials will be discussed in detail with our Chief Financial Officer, Jamie Featherway, shortly. As we began to see late last year, the market demand for our mercury emission control technologies, which includes our patented sorbent products, continues to be very strong, strongly driven by the growing need across the industry for lower-cost energy production. We reported revenues of over $5 million this past quarter, which is an increase of 125% over the same period last year. And as announced earlier this year, we've begun a ramp-up in revenue results that we expect to continue. Our revenue increases in Q2 were largely driven by increased sales in our core business, which we expect to grow through the summer and in through the fall months as well. We anticipate additional revenue from new license and supply agreements moving through the last half of this year as we continue to negotiate new deals with power plants using our patented two-part process. Overall, we expect to see robust demand for our supply side through this year and into 2023 and beyond. And we believe that we remain on track to reach a projected revenue forecast for 2022. We're also seeing growth in our core business from the successful outreach program across the U.S., Coal Fired Fleet, managed by Caldwell, Cassidy, and Curry, our keen IP legal team based in Dallas, to address unlicensed users of our core mercury emissions technology. To these unlicensed users, we offer either a license and or supply agreement to continue operating our patented technologies. These communications continue to be met with positive responses, such as the contract that we announced yesterday. Our patent position, coupled with our considerable expertise in mercury capture, continue to receive recognition and validation across the industry. The demand for coal-fired generation is very strong these days, and it appears it will stay strong for the foreseeable future. The demand continues to rise in 2022, and it's expected to reach a plateau through 2025. The only thing slowing down coal as a growth energy source is the availability of coal itself. As long as coal continues to be available, we will continue to show significant increases in our core business. Our emerging sorbent technologies for processing rare earth elements began in 2018 and has yielded thus far consistently positive results. We continue to prepare for commercialization. Our development is now focused on identifying and enhancing present extraction technologies for these rare earths. Last fall, we completed the validation testing of the technology at Penn State's Department of Earth and Mineral Sciences, and in late 2021, we began a second phase of testing with Penn State. Earlier this year, we also began testing at a commercial lab based in Florida to refine the processing protocol with extracted rare earths. This lab's observations have remained positive, although not entirely conclusive. We're continuing to refine our results and move forward in this field. Moving into our updates regarding litigation, there is strong potential for significant additional supply-side business from these previous refined cold users as we gain new license partners as well as any damage or rewards from the litigation itself. Discovery ends late next month and we're very pleased with the results today. We believe that the litigation process continues to progress in a very positive manner with certain claim arguments issued by Caldwell, Cassidy, Curry as part of discovery approved by the court during the second quarter of this year. So let's turn the call over now to our CFO, Jamie Featherweight, for an overview of our second quarter financial results. Jamie?
spk02: Thank you, Rick. Hello, everyone. We're very pleased with the second quarter results and expect to continue to strengthen our financial position in 2022 as our current sorbent business remains strong and we enter into new supply and licensing agreements. Revenue in the second quarter was $5.1 million, an increase of 125% compared to $2.3 million in the same quarter last year. Total costs and expenses in the second quarter of 2022 were $5.5 million compared to $4 million in the same quarter last year. The net loss in the second quarter of 2022 was $357,000 or $0 per basic and diluted share. However, adjusted EBITDA in the second quarter of 2022 was positive $468,000. As of June 30th, 2022, the company had approximately $509,000 in cash and $2.9 million in accounts receivable on the balance sheet, resulting from strong sales in the quarter. Overall, we had a very positive second quarter with significant improvement over the prior year. We are in a good position for continued growth as we move into the last half of 2022. With that, I will hand the call back over to Rick for his concluding remarks. Rick?
spk03: Thanks, Jamie. So, folks, a few closing comments. We're very pleased with the current state of the company and our position as we pivot into the last half of this year. Our goals in the last half of 2022 are to maximize our sales potential and profit positions. Our financials reinforces confidence with increasingly positive operating cash and higher sales revenues quarter over quarter. We're also excited to see our strategic endeavors over the last few years come to fruition with the realization of new licensed partners and a growing supply chain. We'll continue to pursue the development of our chemisorption-based technologies that address crucial environmental concerns. Our successful legal team, Caldwell Cassidy Currie, are on top of the litigation with refined coal defendants, as well as managing our outreach program to utilities now using our patented technologies without a license to do so. Those two efforts should provide significant increase in our enterprise value as they come to fruition. On behalf of ME2C management team, we'd like to thank our shareholders for long-term commitment and to all of you listening today for your interest in our company. And with that, Turn the call back over to the operator so that we can begin the question and answer session. Operator?
spk00: At this time, we'll be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove your question from the queue. For participants using speaker equipment, it may be necessary for you to pick up your handset before pressing the star keys. Please limit yourself to one question. One moment while we poll for questions. As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad. A confirmation symbol indicating your line is in the question queue. you may press star 2 to remove your question from the queue. For participants using speaker equipment, it may be necessary for you to pick up your handset before pressing the star keys. One moment while we poll for questions.
spk01: I would like to turn this call back over to Mr.
spk00: Richard McPherson for closing remarks.
spk03: Thank you, operator. Folks, thank you very much for joining us today. We're very much on track with the strategy and plan that we started with at the start of the year and look forward to moving through into another strong quarter in the fall of 2022. And I look forward to keeping you all updated with the information as we develop the company's profile. Thank you so much, and we'll sign off for now.
spk00: This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation. Enjoy the rest of your day.
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