Cleantek Industries Inc. Announces Strong First Quarter 2025 Results

Rhea-AI Summary

Cleantek Industries (GLKFF) reported strong Q1 2025 financial results with revenue of $3,705, up 1% year-over-year. The company achieved a gross profit of $2,346 (63% margin) and net income of $449. Adjusted EBITDA increased to $1,266, up $60 from Q1 2024. The company's growth strategy focuses on sustainable lighting solutions and wastewater treatment, with several key initiatives including: EcoSteam deployment targeting 25 units in 2025, DZeroE technology expansion, and SecureTek remote security services integration. Despite political uncertainty and commodity price volatility, Cleantek maintains its 2025 guidance and continues to reduce debt while expanding internationally.

Positive

• Revenue increased by 1% to $3,705 in Q1 2025
• Strong Adjusted EBITDA of $1,266, up $60 from Q1 2024
• Working capital deficit improved by $911
• Successful EcoSteam units exceeding productivity goals
• International expansion with new HALO proof-of-concept trial

Negative

• Gross profit margin decreased from 65% to 63% due to higher transportation costs
• Net income declined by $73 to $449 compared to Q1 2024
• Non-current debt increased by $440
• Decreased HALO sales due to non-recurring domestic sale in Q1 2024

Calgary, Alberta--(Newsfile Corp. - May 22, 2025) - Cleantek Industries Inc. (TSXV: CTEK) ("Cleantek" or the "Company") an innovative provider of patented clean technology solutions that reduce both cost and carbon intensity in the wastewater management and industrial lighting sectors, is pleased to announce its financial and operational results for the first quarter of 2025.

Cleantek's President and Chief Executive Officer, Riley Taggart, commented, "We're very pleased with our financial and operational performance in Q1 2025, particularly as we exceeded a strong Q1 2024 that benefited from a one-time asset sale. Achieving these results through a repeatable, scalable model reinforces my belief in Cleantek's strategy and long-term earnings potential. While the quarter unfolded against a backdrop of political uncertainty and commodity price volatility, the team performed at a high level, positioning us well for the rest of the year."

He added, "We front-loaded our Capex program to accelerate product deployment, and with most of that investment now complete, we're in a strong position to leverage our equipment, generate returns, and continue reducing debt. We remain confident in our outlook and are maintaining our 2025 guidance."

Highlights for the First Quarter 2025 (All amounts are in thousands of Canadian dollars unless otherwise indicated)

• Cleantek generated revenue of $3,705 for Q1 2025, an increase of $35, or 1%, from Q1 2024. The increased revenue in 2025 is primarily due to increased rental revenue partially offset by decreased HALO sales due to a non-recurring domestic HALO sale in Q1 2024;

• Cleantek's gross profit was $2,346 or 63% of revenue for Q1 2025 compared with gross profit of $2,372 and 65% of revenue for Q1 2024 due to increased transportation and mobilization costs;

• Cleantek's net income of $449 for Q1 2025 was down $73 when compared to Q1 2024 net income of $522 due to a Q1 2024 foreign currency gain of $224; and,

• Cleantek's Adjusted EBITDA⁽¹⁾ was $1,266 for Q1 2025 an increase of $60 compared to $1,206 for Q1 2024 due increased revenue and lower general and administrative expenses.

Expansion and Outlook

Cleantek's strategy focuses on delivering innovative and cost-effective solutions that reduce the carbon intensity as well as the capital and operating costs of industrial operations.

The Company's near-term strategy will continue to focus on:

• maximizing utilization rates of its current fleet of sustainable lighting solutions and wastewater treatment assets;

• expanding and growing the Company's fleet of wastewater treatment assets to satisfy increased demand in the oil and gas, midstream, mining, industrial and construction markets;

• advancing its presence in international markets by expanding on current sales activity of sustainable lighting and wastewater solutions;

• evaluating new technology partnerships to diversify product offerings and customer groups;

• evaluate acquisition and merger opportunities to accelerate growth and market diversification.

The Company is uniquely positioned to capture growth opportunities in both wastewater evaporation and sustainable lighting markets. Cleantek expects increasing demand from the oil and gas, municipal grey water, and industrial wastewater sectors.

• International Expansion - Expanding on the Company's success with the recent HALO^TM sales, Cleantek completed a proof-of-concept trial with a larger international customer with its HALO^TM line and is exploring several promising opportunities diversifying Cleantek's geographic focus and customer base. This expansion includes exploring opportunities for rental and/or product sales in both the lighting and waster water divisions.

• EcoSteam - Cleantek introduced EcoSteam in 2024, a waste-gas powered solution for efficient wastewater treatment and dehydration. Based on market demand, Cleantek will look to offer twenty-five units to the market in 2025. Operational feedback continues to be excellent with the units exceeding anticipated productivity goals.

• DZeroE Iterative Development - To meet the growing demand for produced water evaporation, the "DZeroE" waste heat water evaporation technology traditionally deployed in drilling rig applications is being retrofitted for use in production facilities. This strategic, cost-effective initiative is expected to significantly improve equipment utilization and provide more consistent year-round usage. The DZeroE has also garnered interest in international markets and will be a primary focus for the company throughout 2025.

• SecureTek - Cleantek's line of remote security services, being offered as a stand-alone system or integrated with our sustainable lighting products, continues to drive higher utilization of existing assets and create an accretive new recurring revenue stream for the Company. Utilizing our existing infrastructure, SecureTek expands our reach into construction, mining, storage, agriculture, and other commercial markets with minimal capital investment.

Operational Update

Cleantek's first quarter 2025 revenue was $3,705, an increase of $35 from same period last year. Cleantek has been able to maintain stable gross margin percentages through its continued employment of lean operating measures. The efficiency centric approach has prompted the re-organization of the Company's operations into a flatter and more accountable organization.

Results of Operations

(Canadian $000's, except						Three months ended March 31
per share amounts and percentages)						2025			2025				Change
Revenue						3,705			3,670				35
Gross profit						2,346			2,372				(26)
Gross profit %						63			65				(2)%
Net income						449			522				(73)
Net income per share - basic ($)						$0.02			$0.02				$0.00
Net income per share - diluted ($)						$0.01			$0.02				$(0.01)
EBITDA(1)						1,193			1,406				(213		)
Adjusted EBITDA(1)						1,266			1,206				60
Capital expenditures						685			150				535

 

As at:			March 31, 2025				December 31, 2024									Change
Total assets			15,192				13,641									1,551
Working capital deficit(1)			(1,028		)		(1,939							)		911
Non-current debt(1)			7,525				7,085									(440				)
Total non-current liabilities			7,525				7,085									(440				)

 

(1) Management considers EBITDA and adjusted EBITDA key metrics in analyzing operational performance and the Company's ability to generate cashflow. EBITDA is measured as net income (loss) before interest, tax, depreciation and amortization. Adjusted EBITDA is measured as EBITDA adjusted for share-based compensation and unusual items not representative of ongoing business performance such as gains and losses on the sale of assets and the impact of unrealized foreign exchange gains and losses. Working capital (or also referred to as net current assets/liabilities) for Cleantek is calculated as current assets less current liabilities per the statement of financial position. Non-current debt includes the non-current portion of long-term debt and lease liabilities per the Non-Current Liabilities on the statement of financial position. These items are not defined and have no standardized meaning under IFRS. Presenting these items from period to period provides management and investors with the ability to evaluate earnings trends more readily in comparison with prior periods' results. Please see "Non-IFRS Measurements" for further discussion of these items, and where applicable, reconciliations to measures calculated in accordance with IFRS.

About Cleantek Industries Inc.

Cleantek is a clean energy technology company focused on ESG-accretive solutions, providing specialized and fully integrated wastewater treatment, disposal equipment, and turnkey sustainable lighting rental solutions. By leveraging patented technology and industry expertise, Cleantek delivers tailored, cost-effective solutions to a diverse client base, including blue-chip exploration and production companies across North America. With a focus on sustainability, safety, and operational excellence, Cleantek is well-positioned to meet the rising water treatment and sustainable lighting market demand. Our proven track record and commitment to innovation drive long-term value creation in the clean technology sector.

Selected financial and operation information is outlined below and should be read in conjunction with Cleantek's unaudited condensed consolidated interim financial statements and management's discussion and analysis ("MD&A") for the three months ended March 31, 2025 and the audited consolidated financial statements for the years ended December 31, 2024 and 2023, which are available on the Company's SEDAR profile at www.sedarplus.ca.

NON-IFRS MEASUREMENTS

Cleantek uses certain financial measures to quantify its results that are not prescribed by IFRS. The following terms: "EBITDA", "adjusted EBITDA", "working capital" and "non-current debt" are not recognized measures under IFRS and may not be comparable to that reported by other companies. Cleantek believes that, in addition to measures prepared in accordance with IFRS, the non-IFRS measurements provide useful information to evaluate the Company's performance and ability to generate cash, profitability and meet financial commitments.

These non-IFRS measures ae intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

EBITDA and Adjusted EBITDA

Management considers EBITDA and adjusted EBITDA key metrics in analyzing operational performance and the Company's ability to generate cash flow. EBITDA is measured as net income (loss) before interest, tax, depreciation and amortization as differences in accounting treatments may distort our core business results. Adjusted EBITDA is measured as EBITDA adjusted for certain non-cash items, including share-based compensation, gains and losses on sale of assets, impact of unrealized foreign exchange gains and losses as well as unusual items not representative of ongoing business performance such as litigation expense and settlements and executive severance.

The following table provides a reconciliation of the non-IFRS measures, EBITDA and adjusted EBITDA, to the applicable IFRS measurements for Cleantek:

	Three months ended March 31
(Canadian $000's)		2025			2024
Net income (loss)		449			522
Tax expense		22			36
Depreciation and amortization		506			593
Finance costs		216			255
EBITDA		1,193			1,406
Share-based compensation		26			29
(Gain) loss on disposal of assets		41			(4	)
Unrealized FX (gain) loss		6			(224	)
Adjusted EBITDA		1,266			1,206

 

Working capital

Working capital (or also referred to as net current assets/liabilities) for Cleantek is calculated as current assets less current liabilities per the statement of financial position. The following table provides a reconciliation of working capital, a non-IFRS measure to the applicable IFRS measurements for the Company:

		March 31			December 31
(Canadian $000s)		2025			2024
Current assets		4,766			3,228
Current liabilities		5,794			5,167
Working capital deficit		(1,028	)		(1,939	)

 

Non-current debt

Management considers non-current debt in analyzing the Company's capital structure. Cleantek's capital structure consists of working capital, non-current debt and shareholders' equity. Non-current debt measures the long-term borrowings of the Company. Non-current debt for Cleantek is calculated as the non-current portions of long-term debt and lease liabilities. The following table provides a reconciliation of non-current debt, a non-IFRS measure to the applicable IFRS measurements for the Company:

		March 31			December 31
(Canadian $000s)		2025			2024
Long-term debt - non-current portion		7,036			6,534
Lease liabilities - non-current portion		489			551
Non-current debt		7,525			7,085

 

For Further Information:

Riley Taggart, President & Chief Executive Officer
E-mail: rtaggart@cleantekinc.com
Tel: 403-567-8700
www.cleantekinc.com
LinkedIn
X

Forward-Looking Statements

This news release contains certain "forward looking statements" including, for example, statements relating to expected improved financial flexibility, additional growth, potential middle east expansion, expansion of Cleantek's fleet of sustainable lighting solutions and EcoSteam wastewater treatment assets, the expected deployment of Cleantek's assets, available liquidity, Cleantek's outlook for the future and near-term strategy. Such forward-looking statements involve risks and uncertainties, both known and unknown. The results or events depicted in these forward-looking statements may differ materially from actual results or events. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding and are implicit in, among other things: receipt of regulatory approvals, the state of the capital markets, the ability of the Corporation to successfully manage the risks inherent in pursuing business opportunities in the oilfield services industry and outside the North American market, and the ability of the Corporation to obtain qualified staff, equipment and services in a timely and cost efficient manner to develop its business. Any forward-looking statement reflects information available to Cleantek as of the date of this news release and, except as may be required by applicable securities laws, Cleantek disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/253070

FAQ

What were Cleantek Industries (GLKFF) key financial results for Q1 2025?

In Q1 2025, Cleantek reported revenue of $3,705 (up 1% YoY), gross profit of $2,346 (63% margin), net income of $449, and Adjusted EBITDA of $1,266.

How many EcoSteam units does Cleantek plan to deploy in 2025?

Cleantek plans to offer twenty-five EcoSteam units to the market in 2025, based on market demand.

What caused the decrease in Cleantek's Q1 2025 gross profit margin?

Gross profit margin decreased from 65% to 63% due to increased transportation and mobilization costs.

What are Cleantek's main growth initiatives for 2025?

Key initiatives include maximizing utilization of sustainable lighting solutions, expanding wastewater treatment assets, advancing international market presence, exploring technology partnerships, and evaluating acquisition opportunities.

How is Cleantek's SecureTek service contributing to business growth?

SecureTek, offering remote security services integrated with sustainable lighting products, drives higher asset utilization and creates new recurring revenue streams with minimal capital investment.