WARRENVILLE, Ill. - Fuel Tech , Inc. (NASDAQ: NASDAQ:FTEK), a leader in emissions control systems and water treatment technologies, has announced a new commercial contract to implement its TIFI® Targeted In-Furnace Injection™ technology at a large coal-fired boiler for a Midwest utility. This development follows a successful demonstration phase at the unit, leading to a commercial program that could yield annual revenues of $1.5 to $2.0 million, assuming full-time operation by the customer.
The TIFI® chemical program has been credited with improving boiler availability and reliability, as well as reducing maintenance downtime, thereby enhancing the power generation capacity of the unit. Vincent J. Arnone, Chairman, President, and CEO of Fuel Tech, expressed satisfaction with the transition from demonstration to commercial application, noting significant operational improvements such as reduced maintenance and extended runtimes at high load factors.
Fuel Tech's proprietary TIFI® processes are applied to a range of fuel-burning units, including those using coal, heavy oil, biomass, and municipal waste. The comprehensive programs offered by the company include design, modeling, equipment, reagent, and service, all aimed at improving plant operations and ensuring a return on investment. These solutions also assist in meeting emission regulatory requirements.
The company has a strong track record in nitrogen oxide (NOx) reduction and particulate control, with its technologies installed on over 1,300 units across utility, industrial, and municipal sectors. Fuel Tech's FUEL CHEM® technology focuses on enhancing the efficiency and environmental performance of combustion units.
In addition to air pollution control, Fuel Tech offers water treatment solutions such as DGI® Dissolved Gas Infusion Systems, which deliver supersaturated oxygen solutions and other gas-water combinations for various applications in water and wastewater industries.
Fuel Tech's capabilities are supported by advanced Computational Fluid Dynamics modeling and visualization software, reinforcing its position as a provider of environmentally sustainable and cost-effective technologies. This contract underscores the company's ongoing commitment to innovation and customer support in the energy and environmental sectors.
The information for this article is based on a press release statement from Fuel Tech, Inc.
In other recent news, Fuel Tech, Inc. has secured approximately $5 million in air pollution control (APC) orders, marking a significant development for the company. These orders include a new contract for a renewable energy project, as well as repeat contracts from existing customers in Europe and the United States. One notable order from a new European client involves multiple ammonia delivery and injection systems for renewable energy facilities, contributing to green hydrogen production.
In addition, Fuel Tech has reported a decrease in Q1 2024 revenues to $5 million, down from $7.3 million in Q1 2023, but an increase in consolidated gross margins to 41% of revenues. The company's net income for Q1 2024 was $281,000, boosted by an extraordinary income of $1.7 million. Despite some customer-driven delays and weather-related challenges, Fuel Tech maintains a positive outlook, anticipating revenues to surpass the previous year's total.
Fuel Tech is also investing in new technologies and capitalizing on a favorable interest rate environment. The company's technology allows coal-fired units to operate with lower-quality coal during high demand periods, highlighting Fuel Tech's strategic initiatives and strong financial foundation. These recent developments underscore the company's commitment to navigating market challenges and potential expansion opportunities.
InvestingPro Insights
Fuel Tech's recent contract win for its TIFI® technology aligns with the company's focus on innovative emissions control systems. According to InvestingPro data, Fuel Tech's market capitalization stands at $31.32 million, reflecting its position as a niche player in the environmental technology sector.
An InvestingPro Tip indicates that Fuel Tech holds more cash than debt on its balance sheet, which could provide financial flexibility to support the implementation of projects like the newly announced TIFI® commercial contract. This strong liquidity position is further supported by another InvestingPro Tip noting that the company's liquid assets exceed its short-term obligations.
Despite the positive news of the contract, which could generate annual revenues of $1.5 to $2.0 million, it's worth noting that Fuel Tech's revenue for the last twelve months as of Q2 2023 was $26.33 million, with a revenue growth of -5.23% over the same period. However, the company showed a quarterly revenue growth of 28.95% in Q2 2023, which could indicate a positive trend in line with the new contract announcement.
Investors should be aware that Fuel Tech is currently not profitable, with a negative operating income of $3.08 million for the last twelve months. This context makes the potential revenue from the new contract particularly significant for the company's financial outlook.
For those interested in a deeper analysis, InvestingPro offers additional tips and metrics that could provide further insights into Fuel Tech's financial health and market position. There are 7 more InvestingPro Tips available for Fuel Tech, which could be valuable for investors looking to make informed decisions about this environmental technology company.
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