Phoslock Environmental Technologies Limited (ASX: PET) Reports December 2024 Quarterly Activities
Financial Overview
Phoslock Environmental Technologies Limited (ASX: PET) reported a cashflow deficit from operating activities of $576,000 for the December quarter 2024. This represents an increase from $357,000 in the September quarter. Lower receipts from customers contributed significantly to this shift, totalling $487,000, notably down from $940,000 in the previous quarter.
Operating cash outflows were recorded at $1.1 million, a slight reduction from the $1.3 million in the preceding quarter. As of December 31, the company held a cash position of $7.9 million, showing only a minor decline despite a forex gain of $509,000 primarily from the USD component of the cash reserves.
Operational Performance
Sales during the quarter totalled just 32 tonnes, significantly lower than the 1,237 tonnes sold in 2023. For the fiscal year to date, sales stand at 227 tonnes. Inventory levels at the end of December were at 2,384 tonnes, with notable quantities stored in China and Belgium.
Research and development activities resumed after a five-year pause, yielding promising advancements in new lanthanum modified bentonite products. A pilot plant is now operational, with production samples sent to laboratories and potential customers globally.
On January 6, Phoslock announced a partnership with The Orion Companies as the exclusive distributors of its products in the USA, which is expected to drive future sales growth.
Future Outlook
The company anticipates increased sales in the March quarter, with 45 tonnes already recorded in European markets and a significant purchase of 105 tonnes by Hydro Science in Brazil pending.
Legal and Corporate Developments
Trading of Phoslock shares remains suspended on the ASX platform. The board plans to petition for the lifting of this suspension upon the release of the half-year financial statements for 2024. Ongoing investigations by the Australian Federal Police into former company officers and associated class actions are resulting in considerable legal expenses for Phoslock.
This report has been approved by the Chairman, Mr Fred Bart.
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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