SusGlobal Energy Corp. Reports Second Quarter 2019 Financial Results

TORONTO, ON / ACCESSWIRE / August 14, 2019 / SusGlobal Energy Corp. (OTCQB: SNRG), the developer of SusGro®, a revolutionary pathogen-free organic liquid fertilizer, today announced financial results for the second quarter ended June 30, 2019 and provided an update on its operational progress.

Recent Highlights

  • The Company completed the business acquisition of 1684567 Ontario Inc., effective May 24, 2019 including all assets and waste management contracts
  • Through the business acquisition of 1684567 Ontario Inc., the Company now owns the property upon which the organic composting facility is situated comprising 42.18 acres
  • The Company made application to register the Trademarks SusGro,™ Earth’s Journey™ Compost, Leaders
  • in the In The Circular Economy™ and Caring for Earth’s Journey™
  • Revenue increased by over 67% during the second quarter of 2019 compared to the second quarter of 2018

“We continued to work with customers to bring further products to market, while pursuing regulatory certifications. We believe we are making the necessary strategic steps to capture the immense opportunity of processing organic waste, and producing regenerative products, we expect to see increasing tipping fees and compost sales in 2019,” said Marc Hazout, Executive Chairman and President of SusGlobal Energy Corp. “Our goal is to drive revenue and cash flow as quickly as possible as we focus on bringing new processing sites into operation.”

Unaudited 2019 Second Quarter Financial Results

For the second quarter ended June 30, 2019, SusGlobal recorded:

  • Revenue of $381,834
  • Cost of sales of $304,618
  • Operating expenses of $780,167 (GAAP), comprised of $332,500 of stock-based compensation, $150,407 of interest expense and $297,260 in various other expenses including professional fees, office and administration and other operating expenses
  • Net loss of $702,951, or $0.02 loss per basic and diluted share
  • Adjusted EBITDA (a non-GAAP financial measure) loss of $60,729
  • $5,400,565 in total assets at the end of the second quarter, with debt of $6,714,186

About SusGlobal Energy Corp.

SusGlobal Energy Corp. (OTCQB: SNRG) 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 application 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: www.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.

Consolidated Balance Sheets 
As at June 30, 2019 and December 31, 2018 
(Expressed in United States Dollars) 
(unaudited)

    June 30,
2019
    December 31,
2018
 
ASSETS            
Current Assets            
Cash and cash equivalents   $ 25,140     $ 42,711  
Trade receivables     157,322       129,981  
Government remittances receivable     17,925        
Inventory     24,738       18,550  
Prepaid expenses and deposits     33,109       23,172  
                 
Total Current Assets     258,234       214,414  
                 
Intangible Assets     235,926       135,189  
Long-lived Assets, net     4,906,405       3,361,110  
Long-Term Assets     5,142,331       3,496,299  
Total Assets   $ 5,400,565     $ 3,710,713  
                 
LIABILITIES AND STOCKHOLDERS’ DEFICIENCY                
Current Liabilities                
Accounts payable   $ 618,956     $ 353,728  
Government remittances payable           35,169  
Accrued liabilities     713,443       646,003  
Current portion of long-term debt     3,844,309       3,727,778  
Current portion of obligations under capital lease     90,933       81,109  
Convertible promissory notes     1,248,299        
Mortgage payable     1,301,161        
Loans payable to related parties     57,308       201,575  
                 
Total Current Liabilities     7,874,409       5,045,362  
                 
Long-Term Liabilities                
Obligations under capital lease     172,176       207,599  
                 
Total Long-term Liabilities     172,176       207,599  
Total Liabilities     8,046,585       5,252,961  
Stockholders’ Deficiency                
Preferred stock, $.0001 par value, 10,000,000 authorized, none issued and outstanding
Common stock, $.0001 par value, 150,000,000 authorized, 42,484,531 (2018- 40,299,531) shares issued and outstanding
    4,250       4,031  
Additional paid-in capital     7,180,841       5,754,260  
Subscriptions payable           4,600  
Stock compensation reserve     665,000       1,330,000  
Accumulated deficit     (10,337,807)       (8,554,312 )
Accumulated other comprehensive loss     (158,304)       (80,827 )
                 
Stockholders’ deficiency     (2,646,020)       (1,542,248 )
                 
Total Liabilities and Stockholders’ Deficiency   $ 5,400,565     $ 3,710,713  

SusGlobal Energy Corp.
Consolidated Statements of Operations and Comprehensive Loss
For the three-month periods ended June 30, 2019 and 2018
(Expressed in United States Dollars)
(unaudited)

    For the three-month periods ended  
    June 30,
2019
    June 30,
2018
 
             
Revenue     $381,834       $227,423  
                 
Total cost of sales     304,618       324,417  
                 
Gross profit     77,216       35,727  
                 
Operating expenses                
Management compensation-stock- based compensation     332,500       1,582,500  
Management compensation-fees     80,720       83,584  
Marketing     (33,323)        
Professional fees     72,269       76,220  
Interest expense     150,407       91,779  
Office and administration     46,380       12,501  
Rent and occupancy     34,820       34,716  
Insurance     13,951       15,466  
Filing fees     16,414       3,581  
Amortization of financing costs     53,768        
Directors’ compensation     9,748       774  
Repairs and maintenance     2,493       10,760  
Total operating expenses     780,167       1,911,881  
                 
Net loss     (702,951)       (1,826,935 )
Other comprehensive loss                
Foreign exchange loss     (49,972)       (7,300 )
                 
Comprehensive loss     $(752,923)       $(1,834,235 )
                 
Net loss per share-basic and diluted     $(0.02)       $(0.05 )
                 
Weighted average number of common shares outstanding- basic and diluted     42,460,795       39,090,613  

SusGlobal Energy Corp.|
Consolidated Reconciliation of Non-GAAP Information
For the three-month periods ended June 30, 2019 and 2018
(Expressed in United States Dollars)
(Unaudited)

    For the three-month periods ended  
    June 30,
2019
    June 30,
2018
 
Net loss (GAAP)   $ (702,951)     $ (1,826,935 )
Add the following items:                
Interest expense     150,407       91,779  
Depreciation and amortization     159,315       102,187  
Stock-based compensation     332,500       1,582,500  
                 
                 
Adjusted EBITDA (non-GAAP)   $ (60,729)     $ (50,469 )
                 
                 

SOURCE: SusGlobal Energy Corp.

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