Perma-Fix Environmental Services is tackling the dirty job of handling radioactive waste

• Positioned to become a leader in the multi-billion-dollar nuclear services and waste treatment market
• Operates in regulated industries with high barriers to entry
• Business consists of two operating segments: Treatment and Services.

What Perma-Fix Environmental Services does:

Perma-Fix Environmental Services Inc (NASDAQ:PESI) (FRA:PFX1) is a nuclear services company and a leading provider of nuclear and waste-management services. The Atlanta-based company also offers engineering-consulting services to the industrial and commercial sectors.

Perma-Fix’s business consists of two operating segments: Treatment and Services.

The company’s Treatment Segment handles a magnitude of contaminated wastes for economic and compliant disposal in its permitted and licensed operating facilities. It has expanded its low-level radioactive waste treatment capacity with the addition of an 8.7-acre facility in Tennessee. The division also serves the commercial nuclear industry. 

Perma-Fix’s Services Segment, meanwhile, employs innovative technology professionals that are trained to provide radiological protection and environmental remediation services.

Its core nuclear waste services business manages and treats radioactive and mixed waste for hospitals, research labs and institutions, and federal agencies, including the Department of Energy (DoE) and the Department of Defense (DoD).

As well, the company’s nuclear services group handles the heavy work of environmental restoration, decontamination and decommissioning while providing radiological protection, safety and industrial hygiene services.

Perma-Fix Environmental Services is led by CEO Mark Duff, who has 34 years of experience in the DOE & DOD environmental and construction markets, and was previously responsible for the successful completion of more than 70 performance-based projects at the Paducah Gaseous Diffusion Plant in Kentucky. 

How is it doing:

In May 2021, Perma-Fix reported first-quarter revenue of $23.1 million, compared to $24.9 million in the same quarter of 2020. The decrease came entirely from the Treatment Segment, which saw revenue decline year-over-year to $7.5 million from $9.6 million as a result of reduced volume from coronavirus (COVID-19) related waste shipment delays.

Revenue from the Services Segment increased year-over-year to $15.6 million from $15.3 million.

In 2020, Perma-Fix was awarded a series of contracts, including two federal deals valued at $3.7 million to separate and treat radioactive materials from over 100,000 tons of soils, debris and dredged materials.

As well, the company inked a new contract in its Services Segment valued at about $7 million over eight months. It was also selected by the US DoE as part of a team to participate in a 10-year waste management contract, making it eligible to compete for up to $3 billion in task orders.

The work under this multi-award contract vehicle supports sites across the US, including at the Office of Environmental Management, the National Nuclear Security Administration, the Office of Naval Reactors and the Office of Science.

And, the company noted it had achieved a milestone target by completing the development of its new Perma-SortSM material sorting and segregation process system. It is a customized, conveyor-based radiological assay system designed to provide 100% characterization of material efficiently with industry-leading measurement quality. 

Inflection points:

• Revenue resurgence as pre-pandemic shipping rates return
• Accelerating sales from its Treatment Segment initiatives 
• Market expansion into the power, municipal and oil & gas industries

What the boss says:

Perma-Fix CEO Mark Duff commented on the company’s outlook for the second half of 2021, when the company posted first-quarter results in May.

“We anticipate a stronger second half of 2021, given our robust pipeline within the services segment and significant pent-up demand within the treatment segment,” Duff said. “In terms of the services segment, we have an unprecedented number and combined value of bids currently submitted and awaiting awards. We also expect to benefit from the government’s fiscal 2020 carryover funds, in addition to 2021 allocations that have been delayed and should help fund an acceleration of projects within the treatment segment.”

He continued: “We are rapidly advancing several initiatives within the treatment segment that we believe have the potential to enhance our revenues at each of our treatment facilities. The foundation of our growth strategy is based on the addition of experienced technical talent in waste management and health physics over the past two years. We believe this foundation, coupled with new technology launches in both services and treatment will continue to provide our clients value and support our growth goals once COVID is behind us.”

Contact Andrew Kessel at [email protected]

Follow him on Twitter @andrew_kessel

Story by ProactiveInvestors