Thermal Energy Reports Third Quarter Results
Rhea-AI Summary
Thermal Energy reported mixed Q3 2025 financial results with record year-to-date revenue of $23 million, despite a 4.1% decrease in quarterly revenue to $5.8 million. The company posted a Q3 net loss of $403,000 and negative EBITDA of $167,000.
Key financial metrics include:
- Cash position: $5.1 million
- Working capital: $2.4 million
- Order intake: $6.9 million
- Order backlog: $14.8 million (as of February 28, 2025)
CEO William Crossland highlighted the company's recent investments in engineering and sales teams, which temporarily impacted profitability. While maintaining year-to-date EBITDA positive status, the focus shifts to maximizing investment benefits and growing order intake. The company expects stronger performance in fiscal 2026, with higher revenues contributing more to profitability.
Positive
- Record revenue of $23 million for fiscal year-to-date period, up 25% year-over-year
- Strong cash position of $5.1 million and working capital of $2.4 million
- Healthy order backlog of $17.1 million as of April 28, 2025
- Increased engineering team capacity improving project execution
- Supply chain diversity minimizes tariff impact risks
Negative
- Q3 revenue decreased 4.1% to $5.8 million compared to Q3 2024
- Negative EBITDA of $167k in Q3 2025 vs positive $322k in Q3 2024
- Net loss of $403k in Q3 2025 vs net income of $44k in Q3 2024
- Gross margin declined to 39% from 50% year-over-year
- Order backlog down 28% to $14.8M from $20.4M year-over-year
- Operating expenses increased due to headcount growth and inflation
News Market Reaction 1 Alert
On the day this news was published, TMGEF declined 3.34%, reflecting a moderate negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
Record revenue of
Ottawa, Ontario--(Newsfile Corp. - April 29, 2025) - Thermal Energy International Inc. (TSXV: TMG) (OTCQB: TMGEF) ("Thermal Energy" or the "Company"), a provider of innovative energy efficiency and carbon emission reduction solutions to major corporations around the world, today reported its financial results for the third quarter ended February 28, 2025. All figures are in Canadian dollars.
Q3 2025 Highlights:
- Revenue decreased
4.1% to$5.8 million compared to Q3 2024. - Negative EBITDAi of
$167 thousand and net loss of$403 thousand . - Cash position of
$5.1 million and working capital of$2.4 million at quarter end. - Order intake was
$6.9 million , - Order backlogii was
$14.8 million as at February 28, 2025, and$17.1 million as at April 28, 2025.
Overview
"Our record revenue for the year-to-date period is in part a reflection of the increased capacity of our engineering team and their ability to successfully execute on our order backlog," said William Crossland, Thermal Energy CEO. "Over the past two years, we made significant reinvestments in our business, including growing our engineering and our sales and marketing teams. While this has lowered our profitability over this time, we remained EBITDA positive for the year-to-date and on a trailing four quarters basis. The focus for the next 12 months is to maximize the benefits from those investments. While we have already benefited from the increased capacity of our engineering team, it's time to redouble our focus on converting our already strong business development pipeline and growing our order intake again. As we said last quarter, in fiscal 2026 we expect to start seeing more benefits from the growth investments we made over the last two years, with higher revenues contributing proportionately more to profitability."
"While the tariff landscape remains subject to change, we do not anticipate significant disruptions to our operations due to tariffs or ongoing trade tensions between the U.S. and the countries in which we operate. Our supply chain is both diverse and adaptable; with most of our manufacturing outsourced, we are generally able to partner with manufacturers located in multiple jurisdictions and usually within the same country as our projects. As a result, we believe the tariffs already announced are unlikely to have a material negative impact on Thermal Energy."
Summary Financial Results
| In thousand except % data | Three months ended Feb. 28, 2025 | Three months ended Feb. 29, 2024 | Nine months ended Feb. 28, 2025 | Nine months ended Feb. 29, 2024 | ||||||||
| Revenue | $ | 5,815 | $ | 6,063 | $ | 22,955 | $ | 18,352 | ||||
| Gross profit | $ | 2,267 | $ | 3,061 | $ | 8,665 | $ | 9,317 | ||||
| Gross margin | ||||||||||||
| Operating expenses | $ | 2,517 | $ | 2,896 | $ | 8,240 | $ | 8,155 | ||||
| Net (loss) income | ( | ) | $ | 44 | ( | ) | $ | 692 | ||||
| EBITDAi | ( | ) | $ | 322 | $ | 655 | $ | 1,566 | ||||
| Cash position | $ | 5,143 | $ | 7,536 | $ | 5,143 | $ | 7,536 | ||||
| Working capital | $ | 2,378 | $ | 3,378 | $ | 2,378 | $ | 3,378 | ||||
| Orders received | $ | 6,931 | $ | 8,320 | $ | 17,000 | $ | 24,408 | ||||
| Order backlogii as of February 28/29 | $ | 14,800 | $ | 20,400 | $ | 14,800 | $ | 20,400 |
Financial Review for the Third Quarter Ended February 28, 2025
Third quarter revenue decreased
Operating expenses were
The Company had negative EBITDA of
At the end of February 28, cash and working capital balances were approximately
Financial Review for the Nine Months Ended February 28, 2025
For the nine months ended February 28, 2025, revenue was
Operating expenses amounted to
R&D expense increased by
The Company achieved EBITDA of
Business Outlook and Order Summary
Orders received ("Order Intake") during the third quarter totalled
The Company received
Full financial results including Management's Discussion and Analysis and accompanying notes to the financial results are available on www.sedarplus.ca and investors-thermalenergy.com/en/financial-overview.
Notice of Earnings Call and Webcast
Management of Thermal Energy will host an earnings call and webcast today, April 29, at 8:30 am ET. A question-and-answer session will follow management's prepared remarks, at which time qualified equity analysts will be able to submit questions via the webcast.
The live webcast will be available at https://bit.ly/TMG2025Q3. You may join the webcast via MS Teams on your computer, mobile app or room device. Please join the webcast approximately 15 minutes prior to the earnings call to ensure adequate time for registration and admittance to the webcast.
For more information, including dial-in information, refer to the Company's press release from April 17, 2025.
Readers are encouraged to subscribe to TEI News to receive strategic news and updates directly to their inbox.
ENDS
| For media enquiries contact: Thermal Energy International Inc. Canada: 613-723-6776 UK: +44 (0)117 917 2179 Marketing@thermalenergy.com | For investor enquiries: William Crossland President and CEO Thermal Energy International Inc. 613-723-6776 Investors@thermalenergy.com |
Notes to editors
About Thermal Energy International Inc.
Thermal Energy International Inc. provides energy efficiency and emissions reduction solutions to Fortune 500 and other large multinational companies. We save our customers money by reducing their fuel use and cutting their carbon emissions. Thermal Energy's proprietary and proven solutions can recover up to
Thermal Energy is a fully accredited professional engineering firm with engineering offices in Ottawa, Canada, Pittsburgh, USA, as well as Bristol, UK, with sales offices in Canada, UK, USA, Germany, Poland, France, and Italy. By providing a unique mix of proprietary products together with process, energy, and environmental engineering expertise, Thermal Energy can deliver unique, site-specific turnkey and custom engineered solutions with significant financial and environmental benefits for our customers.
Thermal Energy's common shares are traded on the TSX Venture Exchange (TSX-V) under the symbol TMG and on the OTCQB under the symbol TMGEF. For more information, visit our investor website at https://investors-thermalenergy.com or company website at www.thermalenergy.com and follow us on Twitter at https://twitter.com/GoThermalEnergy.
Forward-Looking Statements
This press release contains forward-looking statements relating to, and amongst other things, based on management's expectations, estimates and projections, the anticipated effectiveness of the Company's products and services, the timing of revenues to be received by the Company, the expectation that orders in backlog will become revenue, the anticipated benefits of the Company's current efforts at training and business improvement efforts, opportunities for growth, the Company's belief that it can capitalize on opportunities, the size of markets and opportunities open to the Company, expectations that order intake will bounce back, and the Company's expectations as to the impact of tariffs and ongoing trade tensions. Information as to the amount of heat recovered, energy savings and payback period associated with Thermal Energy International's products are based on the Company's own testing and average customer results to date. Statements relating to the expected installation and revenue recognition for projects, statements about the anticipated effectiveness and lifespan of the Company's products, statements about the expected environmental effects and cost savings associated with the Company's products and statements about the Company's ability to cross-sell its products and sell to more sites are forward looking statements. Statements about the Company's expectations as to the impact of tariffs and ongoing trade tensions are based on currently available information. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, some of which are outside of the Company's control, could cause events and results to differ materially from those stated. Fulfilment of orders, installation of product and activation of product could all be delayed for a number of reasons, some of which are outside of the Company's control, which would result in anticipated revenues from such projects being delayed or in the most serious cases eliminated. Actions taken by the Company's customers and factors inherent in the customer's facilities but not anticipated by the Company can have a negative impact on the expected effectiveness and lifespan of the Company's products and on the expected environmental effects and cost savings expected from the Company's products. Any customer's willingness to purchase additional products from the Company and whether orders in the Company's backlog as described above will turn into revenue is dependent on many factors, some of which are outside of the Company's control, including but not limited to the customer's perceived needs and the continuing financial viability of the customer. Volatility with respect to tariffs and trade regulation may continue and may impact the Company in ways not currently anticipated. The Company disclaims any obligation to publicly update or revise any such statements except as required by law. Readers are referred to the risk factors associated with the Company's business as described in the Company's most recent Management's Discussion and Analysis available at www.sedarplus.ca.
Non-IFRS Financial Measures
The Company believes the following non-IFRS financial measures provide useful information to both management and investors to better understand the financial performance and financial position of the Company.
EBITDA
Management believes that EBITDA (earnings before interest, taxation, depreciation, amortization, impairment of intangible assets, and share-based compensation expense) is a useful performance measure as it approximates cash generated from operations, before tax, capital expenditures and changes in working capital, and excludes impairment of intangible assets. EBITDA also assists comparison among companies as it eliminates the differences in earnings due to how a company is financed. EBITDA does not have a standardized meaning prescribed by International Financial Reporting Standards ("IFRS") and therefore may not be comparable to similar measures presented by other companies. There is no direct comparable IFRS measure for EBITDA.
A reconciliation of net (loss) income to EBITDA is shown below.
| Three months ended | Nine months ended | |||
| Feb 28, 2025 $ | Feb 29, 2024 $ | Feb 28, 2025 $ | Feb 29, 2024 $ | |
| Total net (loss) income attributable to owners of the parent | (416,630) | 29,011 | (125,362) | 651,031 |
| Total net income attributable to non-controlling interest | 13,994 | 15,440 | 59,870 | 40,789 |
| Interest charge | 70,211 | 94,213 | 235,657 | 322,116 |
| Interest revenue | (7,962) | - | (51,900) | - |
| Income tax expense | 14,440 | 17,115 | 49,451 | 112,107 |
| Depreciation and amortization | 96,815 | 100,488 | 294,927 | 267,745 |
| Share based compensation | 61,638 | 65,307 | 192,250 | 171,945 |
| EBITDA | (167,494) | 321,574 | 654,893 | 1,565,733 |
Order Backlog
Order backlog is a useful performance measure that Management uses as an indicator of the short-term future revenue of our Company resulting from already recognized orders. The Company includes in "order backlog" any purchase orders that have been received by the Company but have not yet been reflected as revenue in the Company's published financial statements. It is important to note that once an order or partial order is recorded as revenue, the order backlog is reduced by the amount of the newly reported revenue. Order backlog does not have a standardized meaning prescribed by International Financial Reporting Standards and therefore may not be comparable to similar measures presented by other companies.
For additional details on non-IFRS financial measures, please refer to the Company's most recent Management's Discussion and Analysis available at www.sedarplus.ca for more details about these non-IFRS financial measures.
Neither 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 release.
i EBITDA represents earnings before interest, taxation, depreciation, amortization, impairment of intangible assets, and share-based compensation expense. See note below about non-IFRS measures.
ii Order backlog represents any purchase orders that have been received by the Company but have not yet been reflected as revenue in the Company's published financial statements. See note below about non-IFRS measures.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/250063
FAQ
What caused Thermal Energy (TMGEF) Q3 2025 revenue to drop by 4.1%?
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