Earnings call transcript: Anaergia Inc sees strong Q2 2025 revenue growth with strategic expansions

Anaergia Inc reported its Q2 2025 earnings, showcasing significant revenue growth and improved profitability metrics. The company achieved a 36.8% year-over-year increase in revenue, reaching $32.3 million, while gross profit surged by 152.9%. Despite a net loss of $9.5 million, this marked a 29% improvement from the previous year. The company also reported an adjusted EBITDA loss of $2.2 million, a 72.1% improvement. According to InvestingPro, Anaergia’s overall financial health score remains weak at 1.38, though the stock has shown remarkable strength with a 111% return over the past year.

Key Takeaways

• Revenue increased by 36.8% YoY to $32.3 million.
• Gross profit rose by 152.9% YoY, improving gross margins to 32.5%.
• Net loss decreased by 29% from the previous year.
• Strategic expansions in Europe and Asia bolster future growth prospects.

Company Performance

Anaergia’s performance in Q2 2025 reflected robust growth, driven by strategic expansions and operational efficiencies. The company capitalized on the growing demand for waste-to-resource solutions, securing agreements in Europe and expanding projects in Asia. This aligns with broader industry trends favoring sustainable energy solutions.

Financial Highlights

• Revenue: $32.3 million, up 36.8% YoY
• Gross Profit: $10.5 million, up 152.9% YoY
• Gross Margin: 32.5%, up from 17.6% in Q2 2024
• Net Loss: $9.5 million, a 29% improvement YoY
• Adjusted EBITDA Loss: $2.2 million, a 72.1% improvement

Outlook & Guidance

Anaergia remains focused on five strategic pillars: operational efficiency, capital sales, geographic expansion, strategic partnerships, and strengthening its balance sheet. The company aims for profitable growth with disciplined execution, anticipating continued demand for its solutions in converting waste into fuel, clean water, and fertilizer.

Executive Commentary

CEO Asaf Ahn stated, "Energia 2.0 is working. We are scaling smarter," highlighting the company’s strategic progress. CFO Greg Wolf emphasized, "We are building a stronger, more resilient business," while COO Yaniv Sherson reiterated the focus on "profitable growth with disciplined execution."

Risks and Challenges

• Supply chain disruptions could impact project timelines.
• Regulatory changes in key markets may affect operations.
• Competition in the waste-to-resource sector is intensifying.
• Economic downturns could reduce investment in sustainable projects.

Anaergia’s Q2 2025 performance underscores its strategic growth trajectory, driven by innovation and market expansion. As the company continues to refine its operations and capitalize on industry trends, it remains well-positioned to meet future challenges and opportunities. Based on InvestingPro’s Fair Value analysis, the stock appears fairly valued at current levels. Discover detailed valuation metrics, comprehensive financial health analysis, and expert insights in the Pro Research Report, available exclusively to InvestingPro subscribers.

Full transcript - Anaergia Inc (ANRG) Q2 2025:

John, Moderator: Ladies and gentlemen, thank you for joining us, and welcome to the Energia Q2 twenty twenty five Conference Call and Webcast. My name is John, and I will be your moderator for today’s call. After the prepared remarks, we will host a question and answer session. I will now hand the conference over to Darlene Webb, Investor Relations. Please go ahead.

Darlene Webb, Investor Relations, Energia: Thank you very much, operator, and good morning, everyone. On today’s call, we’ll be discussing Energia’s earnings for the 2025, which ended 06/30/2025. If you’re following along with our slide deck, which is available here on our live streaming webcast, or you can also access it directly from the investor sections of our website, My comments relate specifically to Slides one through three. On Slide two, you’ll see that on today’s call, I’m joined by Mr. Essoff Ahn, Energia’s Chief Executive Officer Mr.

Greg Wolf, Energia’s Chief Financial Officer and Doctor. Yaniv Sherson, Energia’s Chief Operating Officer. Before beginning our formal remarks, we would like to refer you to slide three of the presentation, which contains a caution on forward looking information and a note on the use of non IFRS measures. Listeners are reminded as always that today’s discussion may contain forward looking statements that reflect current views with respect to future events. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated in these forward looking statements.

Energia does not undertake to update any forward looking statements except as may be required by applicable laws. Listeners are urged to review the full discussion of risk factors in the company’s prospectus that is filed with Canadian securities regulators. And with that, I’ll turn the call over to Asaf.

Asaf Ahn, Chief Executive Officer, Energia: Thank you, Darlene, and good morning, everyone. Thank you for joining us here today. I am now speaking to slide four. We are now deep into our transformation under Energia two point o, and the results are starting to speak for themselves. Quarter over quarter, year over year, we are seeing clear improvements.

Momentum is building, and the strategy we put in place is delivering. You have heard us talk about our five pillars, operational efficiency, capital sales, geographic expansion, strategic partnerships, and a stronger balance sheet. This quarter, we made real progress on each of these. We are now on Slide five. Our project teams are delivering.

Backlog is being converted into revenue. Execution is picking up pace, and our closing backlog is up 22% over q one and a significant 137% since year end, a strong sign that customer demand and market confidence are both growing, and that confidence is well earned. In Europe, we expanded our agreement with TechBow and signed a multiportion deal with CapWet. In North America, we secured a significant change order on the East County project. These are well established partners coming back to us for more business.

That must say something. Inside the business, we are sharper, leaner, and more disciplined. We are managing cost. We are tightening project controls, and we are staying laser focused on profitable growth. Moving to slide six.

The result, a stronger company, a company that is turning the corner and building real momentum. We are doing it in a market that needs exactly what we offer. So what do we offer? End to end solutions, global reach, proven results. We convert waste into fuel, clean water, and fertilizer, And we do it at the commercial scale in complex environments for customers who need us to deliver.

That includes customers with large projects, small projects, or portfolio that spend both because our model is scalable up or down across geographies and tailored to real world conditions. That combination is rare, and it’s creating real opportunities for Energia. Energia two point o is working. We are scaling smarter. We are winning the right kind of work, and we are building a platform that creates lasting value for our customers, our partners, and our shareholders.

I will now pass the call over to Greg. He will walk you through the numbers and show you exactly how Energia strategy is turning into performance. Greg?

Greg Wolf, Chief Financial Officer, Energia: Thank you, Asaf, and good morning, everyone. I’m now referring to Slides seven and eight. Let Let me take you through how our strategy is starting to translate into performance. Revenue for the second quarter was $32,300,000 an increase of 36.8% or $8,600,000 compared to the same period in 2024 and an increase of $7,400,000 or 30% compared to the first quarter twenty twenty five. This revenue growth was primarily driven by increased capital sales project execution in North America and Italy as well as higher service revenues in North America.

These gains were partially offset by lower move revenues as some facilities continue to ramp towards full production capacity. Regionally, revenue increased in North America, Italy and the broader European region. Revenue in the Asia Pacific region declined slightly, primarily due to decreased activity in the integrated waste management facility capital sale project in Singapore. Gross profit for the quarter was $10,500,000 more than double last year’s figure, up 152.9 percent. The strong performance is driven by improved margins in all three segments of our business: capital sales, booze and O and M services.

Capital sales is leading the way with newer projects now under construction in Italy and North America. Gross margins for the second quarter was significantly higher at 32.5%, up from 17.6% in Q2 twenty twenty four. The overall increase in gross margin reflects better cost management and stronger project delivery across the business. SG and A expenses for Q2 twenty twenty five were $14,300,000 a slight decrease of 3.7% or approximately $600,000 compared to $14,900,000 in Q2 twenty twenty four. This reflects continued cost control with savings in audit and professional fees offset with some increases in net labor cost.

Net loss for the quarter was $9,500,000 an improvement of 29% or $3,900,000 compared to a net loss of $13,400,000 in Q2 twenty twenty four. The improvements in net loss was mainly due to increased revenues and higher gross margins as well as decreases in SG and A. Adjusted EBITDA for the quarter was a loss of $2,200,000 reflecting a large improvement of 72.1% or $5,800,000 improvement compared to a loss of $8,000,000 in Q2 twenty twenty four. As I have noted, the improvement was the result of higher revenues and gross margins coupled with a slight decrease in SG and A in Q2 twenty twenty five compared to Q2 twenty twenty four. Now moving to slide nine.

As of 06/30/2025, our total revenue backlog was $243,900,000 an increase of $140,900,000 or 137% growth compared to 103,100,000.0 backlog at 12/31/2024. Year to date 06/30/2025, we have capital sale backlog of $191,000,000 and O and M services backlog of 52,900,000.0 As a reminder, our definition of backlog is only signed capital sales agreements and three years of modeled revenue from long term O and M contracts, even though many of our O and M contracts have longer terms of ten plus years. In addition, since 06/30/2025, we have announced another $43,800,000 in new capital sales signed contracts. The growth is mainly driven by new contract signings, particularly in Italy and North America, and reflects growing demand for Energia’s solutions across multiple markets. In summary, Q2 marked another large step forward in our transformation.

We delivered strong year over year improvements in revenue, gross profit and adjusted EBITDA, which is the result of disciplined execution and focused delivery across our business. Margins improved and backlog more than doubled since year end twenty twenty four, providing a clear line of sight of future revenue. We’re building a stronger, more resilient business, one that’s grounded in execution, disciplined approach and cost management and a growing pipeline of high quality projects. With that, I’ll turn it over to Yaniv for an update on our operations and the progress we are making on the project pipeline. Yaniv?

Yaniv Sherson, Chief Operating Officer, Energia: Thank you, Greg, and good morning, everyone. I’m addressing Slide 10 now. In the second quarter, we advanced key projects across our Build Own Operate and Capital Sales segment. We also grew our closing backlog by 22% over Q1, reflecting continued commercial traction and momentum across our global platform. Each of the projects I’ll touch on today plays an important role in Energia’s long term strategy.

They demonstrate how we’re deploying our technology to generate an increasing backlog, strengthening our operational track record, and building market credibility. Let’s start with our asset owned portfolio. At Soka BioMethane, the facility continues operating profitably, serving the organic waste recycling needs of dozens of customers, including blue chip companies such as Amazon and Costco, while supplying RNG to Southwest Gas Natural Pipeline. Recently, Southwest Gas submitted an advice letter to the California Public Utilities Commission seeking approval of a long term RNG supply contract under Senate Bill fourteen forty. The asset demonstrates a repeatable model of retrofitting existing digestion infrastructure at municipal wastewater treatment plants with energy and technology and operations know how.

In New England, the Rhode Island Bioenergy Facility continues ramping up, converting food waste from across New England into RNG that is supplied to Irving Oil on a long term supply contract. The asset continues to have its carbon intensity score under review by ECCC as part of credit generation in the Canadian Clean Fuel Regulation, or CFR, program. Turning to capital sales on Slide 11. In Singapore, the execution of the Tuas Nexus integrated waste management facility continues, recognizing $1,200,000 in revenue this quarter. This is a landmark contract for the region, valued at over SGD35 million with a globally recognized client, Singapore’s national and environment agency.

Once completed, the facility will process 400 tons per day of organic waste. We announced important new developments this quarter that further strengthen both our global footprint and our global backlog. In Italy, we expanded the scope of our existing contract with TechBow to supply anaerobic digestion equipment for biomethane production. Initially covering five sites in Southern Italy, the agreement now includes seven facilities, with total expected revenue of over $36,000,000 These plants will be connected to Italy’s gas pipeline grid and are scheduled to be completed by mid-twenty twenty six. In parallel, we signed a binding Letter of Intent with CAPWA to supply nine advanced biomethane facilities across Portugal, Spain and Italy.

These sites will process agroindustrial waste and are expected to generate more than $60,000,000 in revenue. The first contract for a facility in Central Italy, as METINEX, is valued at approximately $7,300,000 is now underway. And these projects demonstrate repeatable biogas solutions with Tier one clients. And in California, our work with the East County Advanced Water Purification Project expanded engineering and equipment supply of approximately $8,600,000 in revenue to our previously announced contract. The project continues to move towards firming up supply of an integrated food waste and renewable power package.

Altogether, these projects reflect meaningful progress across our five strategic pillars. They have substantially increased our backlog with top tier customers endorsing energy with multiproject and expanding scope contracts. As we scale globally, our focus remains on profitable growth with disciplined execution. Back to you, Asaf.

Asaf Ahn, Chief Executive Officer, Energia: Thank you, Yaniv. I’m now on slide 12. This quarter results would make one thing clear, and the GR two point o is delivering. We are winning the right project, building lasting partnerships, and converting backlog into profitable growth. Our technology, our people, and our disciplined approach are driving measurable improvements, and we are just getting started.

For the market, the the the market we work in are growing. Around the world, customers are looking for proven solution to turn waste into fuel, clean water, and fertilizer. Few companies can deliver that at our scale, in the environment where we operate, with a track record we have built. That is why demand is strong and the reason that our pipeline continues to grow. We have the right strategy.

We have the right team, and we are executing with focus and discipline to create long term value for our customers, our partners, and our shareholders. Thank you for your time today and for your continued confidence in Energia. I look forward to updating you on our progress next quarter. Darlene?

Darlene Webb, Investor Relations, Energia: Thank you, Asaf, and thank you, everyone. As always, for additional information or should you have any questions, please contact the IR team at irenergia dot com or visit us online at energea.com. Thank you all again for your time today. And operator, you may now end the call.

John, Moderator: This concludes today’s call. Thank you for attending. You may now disconnect.

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