Image: Getty Images
Carbonxt’s new year sales are off to a flying start
Mining
share
Special Report: Carbonxt Group has inked some big sales contracts for its carbon pellets, leaving it well positioned to generate positive cashflow in the year ahead.
It may have flown under the radar until now, but Carbonxt is backed by some of the savviest investors around — Lang Walker’s Walker Corp holds around 15 per cent, and both Soul Pattinson and former Stockland boss Matthew Quinn are also large holders.
It’s carbon pellets help industrial users eliminate a range of toxic pollutants and, in the process, help them perform a wide range of critical functions — from meeting emission controls through to recovering solvents and removing nuisance odours.
Carbonxt has announced it has signed a letter of intent with large US air purification products group, Purafil, for the sale of up to $3.2 million of its pellets a year over the next three years.
The final contract is due to be signed in the coming weeks.
Another two new orders for the company’s activated carbon pellets worth $750,000 have been signed in the past few weeks.
“These are the first large orders in a new sector — previous sales have been into the power sector,” Carbonxt managing director Warren Murphy said.
“A year ago, we made the strategic move to enter the pellet-sized activated carbon market.
“We have a significant contract selling into a power station. But this is the first time selling in scale to the industrial sector. It gives us a much larger addressable market.”
The large contracts mean that the usual seasonal slowdown experienced in power station demand in the (northern hemisphere) autumn is expected to be made up through the second quarter.
The flow of new orders, coupled with its early success in penetrating new industrial markets, indicates that Carbonxt is on track for a big year.
And just as important, the new orders mean the new Arden Hills plant in Minnesota is likely to operate at full capacity through the balance of 2019.
Revenue to resume growing in the second quarter of the financial year, Carbonxt said.
“We expect to report revenue growth for the rest of the calendar year as we grow production into announced contract wins and other expected new customer orders.”
