SusGlobal Energy Corp. Reports First Quarter 2021 Financial Results

Toronto, Ontario--(Newsfile Corp. - May 25, 2021) - SusGlobal Energy Corp. (OTCQB: SNRG) ("SusGlobal" or the "Company"), the developer of SusGro, a revolutionary pathogen-free organic liquid fertilizer and LEADERS IN THE CIRCULAR ECONOMY®, today announced financial results for the first quarter ended March 31, 2021 and provided an update on its operational progress.

Recent Highlights

  • On February 10, 2021, the Company signed an Agreement of Purchase and Sale (the "APS") for certain assets for $3,578,400 (C$4,500,000), including a vendor take-back mortgage of $1,590,400 (C$2,000,000) at an annual interest rate of 2% maturing two years after closing. A deposit of $159,040 (C$200,000) was paid by the Company on February 10, 2021. The APS was amended on April 8, 2021, to revise the closing date to June 4, 2021, subject to successful completion of the due diligence process and the completion of the Phase II Environmental Site Assessment at a cost of $39,601 (C$49,800), plus applicable harmonized sales taxes, expected on or before May 19, 2021. On May 20, 2021, the Company and the vendor signed a waiver and amending agreement, waiving the due diligence process and revising the closing date to June 16, 2021.
  • On April 8, 2021, the Company completed the purchase of its International Prostar Truck and Trout River Hy-Cube, 53ft wide with a 125.5 cubic yard capacity hauling trailer for a total purchase price of $173,622 (C$218,338), plus the applicable harmonized sales taxes and administrative costs. The Company paid deposits of $39,118 (C$49,193) on this purchase and financed the balance over a period of forty-eight months at a monthly principal and interest payment of $3,659 (C$4,601) at an interest rate of 4.95% per annum.
  • On May 7, 2021, the Company received a signed letter of intent for the purchase of the shares of two corporations which own proprietary processes, manufacture liquid organic fertilizers and other products. The total purchase price will be $15,904,000 (C$20,000,000) consisting of fifty percent in cash and fifty percent in common stock of the Company. The transaction is set to close on August 31, 2021.

Revenue decreased by 44.99% during the first quarter of 2021 to $192,660 compared to the first quarter of 2020 in the amount of $350,197, primarily due to changes in the customer base including an expiring contract at prior year-end and reductions in certain waste disposed of by several customers.

"We continue to process municipal organic waste streams, diverting them from landfills, while producing regenerative products such as Earth's Journey® Organic Compost, as part of our Circular Economy model. We have confidence in a revenue ramp up this year," said Marc Hazout, Executive Chairman, President and CEO of SusGlobal Energy Corp. "Our goal is to complete our regional strategy with a second facility and the commercialization of our proprietary organic liquid fertilizer in order to increase revenue and cash flow, maximizing shareholder value with an objective to up-list to a major exchange."

Unaudited 2021 First Quarter Financial Results

For the first quarter ended March 31, 2021, SusGlobal recorded:

  • Revenue of $192,660.
  • Cost of sales of $310,592.
  • Operating expenses of $593,212, comprised of $163,874 of interest expenses, $144,308 of management compensation, including stock-based compensation of $54,259, $75,215 of office and administration, $64,402 of professional fees, $45,727 of marketing expenses, $32,339 of rent and occupancy and other operating expenses totalling $67,347.
  • Other income of $404,809 consisting of gain on the forgiveness of conversion promissory notes of $359,460 and a gain on the disposal of a long-lived asset of $45,349.
  • Net loss of $306,335, or $0.01 loss per share- basic and diluted.
  • Adjusted EBITDA (a non-GAAP financial measure) income of $72,179.
  • $6,108,081 in total assets and $9,772,324 in total liabilities at the end of the first quarter.

About SusGlobal Energy Corp.

SusGlobal Energy Corp., the developer of SusGro™, a revolutionary pathogen-free organic liquid fertilizer is a renewables company focused on acquiring, developing and monetizing a portfolio of proprietary technologies in the waste to energy and regenerative products applications globally. It is management's objective to grow SusGlobal into a significant sustainable waste to energy and regenerative products provider, as Leaders in The Circular Economy®. For more information, please visit the Company's website at: https://susglobalenergy.com.

Safe Harbor Statement

This news release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the Company's objectives. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects," "plans," "anticipates," "believes," "intends," "estimates," "projects," "aims," "potential," "goal," "objective," "prospective," and similar expressions, or that events or conditions "will," "would," "may," "can," "could" or "should" occur. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward-looking statements as a result of various factors, including, but not limited to, lack of sufficient financial resources; variations in market conditions, currency and our stock; the Company's ability to obtain any necessary permits, approvals, consents or authorizations required for its activities; the Company's ability to produce energy, biogas, compost or organic fertilizer from its properties successfully or profitably, to continue its projected growth, or to be fully able to implement its business strategies and other risk factors described in the Company's filings with the U.S. Securities and Exchange Commission, which may be viewed at www.sec.gov.

- Financial Tables Follow -

SusGlobal Energy Corp.
Interim Condensed Consolidated Balance Sheets
As at March 31, 2021 and December 31, 2020
(Expressed in United States Dollars)
(unaudited)

      March 31,  December 31, 
      2021  2020 
 ASSETS         
 Current Assets         
 Cash   $166,998 $6,457 
 Trade receivables   67,781  182,871 
 Government remittances receivable   5,832  3,746 
 Other receivable   52,559  - 
 Inventory    45,923  24,740 
 Prepaid expenses and deposits   442,500  94,131 
 Deferred assets   214,704  215,953 
 Total Current Assets   996,297  527,898 
           
 Intangible Assets   193,158  188,180 
 Long-lived Assets, net   4,918,626  5,042,225 
 Long-Term Assets   5,111,784  5,230,405 
 Total Assets  $6,108,081 $5,758,303 
 LIABILITIES AND STOCKHOLDERS' DEFICIENCY       
 Current Liabilities        
 Accounts payable  $1,111,461 $1,073,454 
 Government remittances payable   259,568  229,358 
 Accrued liabilities   979,119  1,206,618 
 Advance    -  15,460 
 Deferred revenue   2,756  4,790 
 Current portion of long-term debt   6,404,823  6,327,520 
 Current portion of obligations under capital lease  177,830  375,140 
 Convertible promissory notes   479,000  1,092,100 
 Loan payable to related party   18,290  33,772 
 Total Current Liabilities   9,432,847  10,358,212 
 Long-term debt    79,520  78,540 
 Obligations under capital lease   176,427  - 
 Deferred tax liability   83,530  82,501 
 Total Long-term Liabilities   339,477  161,041 
 Total Liabilities    9,772,324  10,519,253 
           
 Stockholders' Deficiency        
 Preferred stock, $.0001 par value, 10,000,000 authorized, none issued and outstanding      
 Common stock, $.0001 par value, 150,000,000 authorized, 89,184,951 (2020- 82,860,619) shares issued and outstanding 8,920  8,288 
 Additional paid-in capital   10,451,369  9,045,187 
 Shares to be issued   66,000  8,580 
 Accumulated deficit   (13,775,129) (13,468,794)
 Accumulated other comprehensive loss  (415,403) (354,211)
           
 Stockholders' deficiency   (3,664,243) (4,760,950)
           
 Total Liabilities and Stockholders' Deficiency $6,108,081 $5,758,303 

 

SusGlobal Energy Corp.
Interim Condensed Consolidated Statements of Operations and Comprehensive Loss
For the three-month periods ended March 31, 2021 and 2020
(Expressed in United States Dollars)
(Unaudited)

     For the three-month periods ended
      March 31,  March 31, 
      2021  2020 
           
 Revenue   $192,660 350,197 
           
 Cost of Sales         
 Opening inventory    24,740  5,389 
 Depreciation    136,560  113,109 
 Direct wages and benefits    71,059  76,183 
 Equipment rental, delivery, fuel and repairs and maintenance 105,893  61,302 
 Utilities    18,263  38,277 
 Outside contractors    -  3,573 
      356,515  297,833 
 Less: closing inventory    (45,923) (4,071)
 Total cost of sales    310,592  293,762 
           
 Gross (loss) profit    (117,932) 56,435 
           
 Operating expenses         
 Management compensation-stock- based compensation   54,259  - 
 Management compensation-fees   90,049  51,357 
 Marketing    45,727  2,917 
 Professional fees    64,402  81,448 
 Interest expense and default amounts   163,874  312,291 
 Office and administration   75,215  55,685 
 Rent and occupancy   32,339  28,297 
 Insurance    15,002  18,179 
 Filing fees    18,959  13,880 
 Amortization of financing costs   13,578  92,538 
 Directors' compensation   10,664  (1,420)
 Stock-based compensation   8,073  - 
 Repairs and maintenance   13,189  6,458 
 Foreign exchange (income) loss   (12,118) 150,095 
 Total operating expenses   593,212  811,725 
           
 Net loss from operating activities   (711,144) (755,290)
 Other income    404,809  - 
 Net loss    (306,335) (755,290)
 Other comprehensive (loss) income        
 Foreign exchange (loss) gain   (61,192) 301,639 
           
 Comprehensive loss  $ (367,527)$(453,651)
           
 Net loss per share-basic and diluted $(0.01)$(0.01)
           
 Weighted average number of common shares outstanding- basic and diluted  86,818,361  57,441,740 

 

SusGlobal Energy Corp.
Interim Condensed Consolidated Reconciliation of Non-GAAP Information
For the three-month periods ended March 31, 2021 and 2020
(Expressed in United States Dollars)
(Unaudited)

     For the three-month periods ended 
   March 31, 2021    March 31, 2020 
 Net loss (GAAP)
 $(306,335)
 $(755,290)
 Add the following items:
      
    Interest expense
  163,874    312,291 
    Depreciation and amortization
 138,730    114,932 
    Stock-based compensation
 62,332    - 
    Amortization of financing costs
 13,578   
92,538 
 Adjusted EBITDA (non-GAAP)
$72,179   $(235,529) 

 

Contact

SusGlobal Energy Corp.
Marc Hazout, President and CEO
(416) 223-8500 or Toll Free: 1-866-512-7374
Email: info@susglobalenergy.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/85037

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