Capsol Q1 2025 slides: Revenue grows 28% amid expanding project pipeline

Introduction & Market Context

Capsol Technologies (OSL:CAPSL) presented its Q1 2025 results on May 13, highlighting continued revenue growth and significant pipeline expansion in the carbon capture market. The company reported revenues of NOK 24.9 million, up 28% year-over-year, though pre-tax losses widened to NOK 16.1 million as the company continues investing in growth initiatives.

Trading at NOK 10 per share as of May 12, 2025, Capsol positions itself as a licensor of point source carbon capture technology in a market expected to see substantial growth, with EU CO2 prices projected to rise from 65 EUR/mt in 2025 to 194 EUR/mt in 2035.

As shown in the following global presence and key metrics overview:

Quarterly Performance Highlights

Capsol’s Q1 2025 financial results show a company in transition, with growing revenues but increased expenses as it completes its investment program. Operating expenses reached NOK 38.6 million for the quarter, contributing to the pre-tax loss of NOK 16.1 million compared to NOK 7.9 million in Q1 2024.

The financial performance is illustrated in the following revenue and expense charts:

Despite widening losses, Capsol maintains a solid cash position of NOK 58.5 million at the end of Q1, with its current investment program now completed. The company’s cash flow for the quarter is detailed in this waterfall chart:

A significant highlight from the quarter was the final investment decision (FID) for the Stockholm Exergi project, one of the world’s largest bioenergy with carbon capture and storage (BECCS) projects. This flagship project represents an important validation of Capsol’s technology:

Strategic Initiatives

Capsol’s business model centers on generating revenue across multiple project stages, from initial engineering studies to licensing agreements and ongoing operational services. The company targets medium to long-term pre-tax profit margins of 40-60%.

The following chart illustrates Capsol’s revenue generation across the project lifecycle:

A key competitive advantage for Capsol is its cost-efficient technology, which the company claims delivers 20-60% lower capture costs compared to amine-based alternatives. This translates to a payback period of less than one year for the license fee, as demonstrated in this cement plant case study:

The company is also expanding its service offerings to include performance optimization during operations, which could generate recurring revenue of EUR 2+ per tonne of CO2 captured annually:

Forward-Looking Statements

Capsol’s mature project pipeline has grown significantly, up 72% year-over-year and 29% quarter-over-quarter to 22.2 million tonnes per annum (mtpa) of CO2 capture capacity. The pipeline spans multiple industries, with cement representing the largest segment at 12.0 mtpa.

The company has identified 13 projects expected to reach FID in 2026, totaling 6.5 million tonnes of capacity with a contract potential exceeding NOK 900 million:

Capsol is positioning its technology as a preferred solution across three key industries - biomass/energy-from-waste, cement, and gas turbines - with distinct value propositions for each:

Management expects to reach break-even within the next 12 months, driven by higher-value engineering work as projects approach FID. The company has a flexible cost base that can be adjusted based on activity levels, and it maintains strict capital discipline until the next significant revenue from FIDs.

Looking further ahead, Capsol has set ambitious 2030 goals, including achieving a 5-10% global market share in carbon capture technology and maintaining its target license fee of EUR 10-15 per tonne of installed capacity.

After returning to losses in Q1 2025 following its first profitable quarter in Q4 2024, Capsol’s near-term focus will be on converting its growing pipeline into revenue while managing costs to achieve sustainable profitability. With the carbon capture market gaining momentum globally, the company appears well-positioned to capitalize on increasing demand, though execution will be critical to realizing its ambitious growth targets.

Full presentation:

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