PESI Q2 2026 Earnings Call Summary

1Key Financial Results and Metrics

Revenue: $12.9 million, down from $14.6 million in Q2 2025.

Net Loss: $6.2 million, compared to a net loss of $2.7 million in the prior year.

Loss per Share: $0.32, up from a loss of $0.15 in Q2 2025.

Treatment Backlog: Increased by 29% to $15.7 million from $12.2 million at the end of Q1 2026.

Cash Position: Ended the quarter with $20.5 million in cash, up from $11.8 million at year-end 2025, aided by a $21 million equity offering.

2Strategic Updates and Business Highlights

Master Subcontract Award: Received a master subcontract for Hanford tank waste operations with a maximum value of approximately $4.4 billion, although this amount is shared among subcontractors.

Operational Milestones: Significant progress made in preparing for the Hanford tank waste program, including facility upgrades and workforce expansion.

Nuclear Services Growth: Services revenue grew 44% year-over-year to $4.6 million, supported by new project awards and a backlog of over $17 million.

PFAS Platform: Continued advancements in PFAS treatment technology, with increasing sales and processing revenues.

3Forward Guidance and Outlook

Second Half of 2026: Management expressed confidence in improved performance, anticipating processing of delayed waste streams and continued growth in DFLAW-related receipts.

Long-Term Capacity Plans: The facility is currently permitted for 1.2 million gallons per year, with plans to expand capacity to meet DOE's target of 9 million gallons annually by 2030.

Upcoming Task Orders: Expectation of task orders under the new contract to begin in January 2027, with potential volumes of 60,000 gallons per month starting late 2026.

4Bad News, Challenges, or Points of Concern

Financial Performance: The second quarter results were disappointing, with a significant net loss attributed to delays in waste processing and customer-directed changes in treatment protocols.

Operational Delays: Treatment protocols were altered, causing a mismatch between incurred costs and recognized revenue, impacting Q2 results.

Regulatory Risks: The company is reliant on timely regulatory approvals for permit modifications, which could affect future capacity expansions and operational timelines.

5Notable Q&A Insights

Volume Expectations: Management discussed potential grouting volumes, estimating 60,000 gallons per month starting late 2026, with a long-term goal of 9 million gallons annually by 2030.

Permit Expansion: The timeline for permit modifications is expected to be completed by mid-2027, with ongoing discussions with regulators indicating a collaborative effort to expedite the process.

Market Position: The company highlighted its competitive advantage due to proximity to the Hanford site and its ability to solidify waste locally, contrasting with competitors that transport waste out of state.

Long-Term Revenue Visibility: Management expressed optimism regarding the sustainability of revenue streams from the Hanford project, anticipating less volatility compared to historical patterns. Overall, while the financial results for Q2 2026 were below expectations, the strategic developments and operational milestones position PESI for potential growth in the latter half of the year and beyond.