BioHiTech Global Reports Second Quarter 2020 Financial Results
Q2 2020 revenues increase by 21.2% to $1.3 million compared to $1.1 million in Q2 2019

CHESTNUT RIDGE, N.Y., Aug. 17, 2020 /PRNewswire/ -- BioHiTech Global, Inc. ("BioHiTech" or the "Company") (NASDAQ: BHTG), a technology and services company that provides cost-effective and sustainable waste management solutions, reported financial results on August 14, 2020 for the second quarter of 2020 ended June 30, 2020. 

Company Highlights

Entered Into an Agreement to Distribute Altapure High-Level Disinfectant Technology That Can Effectively Kill Bacteria, Fungus, C.Difficile Spores, and Viruses Such as Coronavirus 2 (SARS-CoV-2) – The Company entered into an agreement with Altapure, LLC ("Altapure"), a technology developer and manufacturer of ultrasonic based disinfecting products, to distribute its patented line of environmentally-friendly, high-level disinfecting products. Altapure's newest product, the AP-4™, was launched in 2017, and is an enhanced, automated and touchless high-level disinfection sub-micron aerosol system providing a safe process and rapid kill of spores, viruses, and vegetative bacteria, such as but not limited to: COVID-19, Acinetobacter baumannii, Pseudomonas aeruginosa, VRE, MRSA, Bacillus atrophaeus, Geobacillus stearothermophilus, Polio virus, C. auris and Clostridium difficile (C. difficile). 

Partnered with Crestmark and US Equity Funding to Offer Customers Equipment Lease Financing for the Altapure Products  and Began Live Product Demonstrations of the Altapure-AP4 – The Company entered into a financing arrangement to offer lease financing through Crestmark, a leading business to business lender, and US Equity Funding, a full service commercial financing firm, for potential customers of its Altapure high-level disinfection technology distribution business. The Company began conducting product demonstrations of the Altapure-AP4 high-level disinfection system in June of 2020 as it seeks to actively ramp up distribution efforts for this new product category.

Achieved 21% Quarter over Quarter Revenue Growth Despite the Business Disruptions Caused by the COVID-19 Pandemic – Revenue from the Company's HEBioT business increased significantly quarter over quarter as the Company continued to increase utilization rates at its Martinsburg resource recovery facility.  That increase in revenue was partially offset by a slowdown in its food waste digester business largely related to the COVID-19 pandemic and a decline in consulting revenue as the Company transitioned from providing those services.   

Subsequent to the End of the Second Quarter

Received Purchase Orders from Carnival Cruise Lines as it Reinitiated the Installation Program of the Company's Revolution Series Food Waste Digesters on its Ships in Preparation for the Resumption of Cruising – The Company received purchase orders from Carnival Cruise Lines ("Carnival") valued at approximately $1 million.  The purchase orders are part of a previously announced purchase contract between the two companies with an estimated value of up to $14 million.

Completed an $8.2 Million Underwritten Offering of Common Stock  – The Company completed the sale of $8.2 million of common stock at a price of $1.81 per share in July.  The Company intends to use the capital to support operations and the growth of its environmentally responsible technology solutions businesses.

"We continue to position BioHiTech for growth as we navigate through the uncertain business environment arising from the COVID-19 pandemic," stated Frank E. Celli, CEO of BioHiTech.  "Our facility in Martinsburg achieved significant growth both sequentially and year over year and our digester business is poised for a substantial rebound in the second half of 2020 as Carnival has resumed its installation program.  We have also expanded our business into high-level disinfection through our distribution agreement with Altapure and are pleased with the progress we are making in sales demonstrations and discussions for potential product deployments.  We are confident that our new lease finance arrangement for the Altapure-AP4 machine with Crestmark and USA Funding will serve to enhance those efforts.  While we still face challenges related to this uncertain environment that may intermittently affect our business, the recent infusion of equity capital has placed us on solid financial ground moving forward.  We are also continuing to see improving business activity in our digester business as companies emerge from COVID-related business interruptions.  As we move through the second half of 2020, we are focused on maintaining lean operations, growing our revenue streams, and seeking to opportunistically grow our business.  We are confident that this strategy will enable us to achieve significant long-term value for our stockholders."

Financial Highlights for Q2 2020

Revenues: Total revenue in the second quarter of 2020 was $1.3 million, an increase of 21.2% compared to revenue from $1.1 million in the second quarter of 2019. The increase in revenue was due to revenue of $892,889 at the Company's Martinsburg HEBioT facility, a more than threefold year-over-year increase in compared to revenue of $277,041 in the second quarter of 2019 when the facility initiated the commissioning process.  This growth HEBioT revenue was partially offset by decreases in digester rental, service and maintenance resulting from lower service and maintenance revenue, digester equipment sales and management advisory fees as the Company reduces the level of support provided under the agreement in order to maintain adequate focus on the Company's core services.

Operating Expenses: Operating expenses in the second quarter of 2020 increased by $662,298 or 22.2% to $3,639,178, mainly due to a $526,731 increase in HEBioT facility costs related to the increase in activity at the facility. Professional fees also increased by $117,790, or 43.2%, to $390,663 for the second quarter of 2020 as compared to the second quarter of 2019, primarily related to fund raising and strategic activities.

Loss from Operations:  The Company recorded an operating loss of $(2,365,246) in the second quarter of 2020 compared to an operating loss of $(1,925,668) in the second quarter of 2019. The Company recorded a net loss attributable to parent of $(2,664,881) in the second quarter of 2020 compared to ($2,068,641) in the second quarter of 2019.  Net loss per share in the second quarter of 2020 was $(0.16) on 17.4 million weighted average shares outstanding compared to a net loss of $(0.15) per share on 14.9 million weighted average shares outstanding. 

Select Balance Sheet Items: Prior to the completion of its $8.2 million common equity offering in July of 2020 and the underwriter's $1.1 million exercise of its overallotment option in August of 2020, the Company had unrestricted cash of $342,182 with total stockholders equity of $2.8 million as of June 30, 2020 compared to unrestricted cash of $1,847,526 and total stockholders equity of $7.4 million as of December 31, 2019

"With the onset of the COVID-19 pandemic we have taken extensive measures to manage cash including reducing executive cash compensation and temporarily reducing head count, without sacrificing the ability to forward our business opportunities," said Brian C. Essman, CFO of BioHiTech. "Now, having completed our financing, and with Carnival resuming its digester deployment coupled with the opportunities presented by our Altapure distribution business, we believe we are poised to forge a new growth track as we head toward 2021. We continue to make progress at our Martinsburg HEBioT facility despite certain business dislocations related to the COVID-19 pandemic and we are confident in our ability to reach planned capacity in the future. With our newly strengthened balance sheet, we believe we are in the best position in our corporate history to capitalize on the opportunities in front of us for the benefit of our company and its stockholders."

About BioHiTech Global
BioHiTech Global, Inc. (NASDAQ: BHTG), is changing the way we think about managing waste. Our cost-effective technology solutions include the patented processing of municipal solid waste into a valuable renewable fuel, biological disposal of food waste on-site, and proprietary real-time data analytics tools to reduce food waste generation. Our unique solutions enable businesses and municipalities of all sizes to lower disposal costs while having a positive impact on the environment. When used individually or in combination, our solutions lower the carbon footprint associated with waste transportation and can reduce or virtually eliminate landfill usage. For more information, please visit www.biohitech.com.

Forward Looking Statements
Statements in this press release contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended. Without limiting the foregoing, words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "explore," "evaluate," "intend," "may," "might," "plan," "potential," "predict," "project," "seek," "should," or "will," or the negative thereof or other variations thereon or comparable terminology. These forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond the Company's control. These statements are also based on many assumptions and estimates and are not guarantees of future performance. These statements are estimates, based on information available to management as of the date of this release, and are subject to further changes. These statements may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of BioHiTech Global, Inc. to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. BioHiTech Global, Inc. assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future in these forward-looking statements, even if new information becomes available in the future. Further, the Company has only recently begun operations at its HEBioT Facility and there can be no assurance that the Company will be able to meet the projections contained in this release. Our actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including, without limitation those set forth as "Risk Factors" in our filings with the Securities and Exchange Commission ("SEC"). There may be other factors not mentioned above or included in the BioHiTech's SEC filings that may cause actual results to differ materially from those projected in any forward-looking statement. BioHiTech Global, Inc. assumes no obligation to update any forward-looking statements as a result of new information, future events or developments, except as required by securities laws.

Company Contact:
BioHiTech Global, Inc.
Richard Galterio
Executive Vice President
Direct: 845.367.0603
[email protected]
www.biohitech.com

Investors: 
[email protected]

 

 

BioHiTech Global, Inc. and Subsidiaries 
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)

 



Three Months Ended June 30,



Six Months Ended June 30,




2020



2019



2020



2019


Revenue













HEBioT (related party)


$

892,899



$

277,041



$

1,383,031



$

277,041


Rental, service and maintenance



356,033




448,937




827,126




936,638


Equipment sales



-




75,234




323,116




75,234


Management advisory and other fees (related party)



25,000




250,000




100,000




500,000


Total revenue



1,273,932




1,051,212




2,633,273




1,788,913


Operating expenses

















HEBioT processing



1,020,277




493,546




1,832,704




493,546


Rental, service and maintenance



151,695




128,311




412,530




331,514


Equipment sales



-




38,726




146,404




38,726


Selling, general and administrative



1,897,442




1,706,324




3,815,865




4,032,686


Depreciation and amortization



569,764




609,973




1,184,966




739,412


Total operating expenses



3,639,178




2,976,880




7,392,469




5,635,884


Loss from operations



(2,365,246)




(1,925,668)




(4,759,196)




(3,846,971)


Other expenses

















Interest (income)



(5,355)




-




(17,622)




-


Interest expense



1,025,319




962,004




2,037,610




1,301,868


Total other expenses



1,019,964




962,004




2,019,988




1,301,868


Net loss



(3,385,210)




(2,887,672)




(6,779,184)




(5,148,839)


Net loss attributable to non-controlling interests



(720,329)




(819,031)




(1,543,006)




(1,130,732)


Net loss attributable to Parent



(2,664,881)




(2,068,641)




(5,236,178)




(4,018,107)


Other comprehensive income

















Foreign currency translation adjustment



(1,437)




3,944




(30,136)




5,197


Comprehensive loss


$

(2,666,318)



$

(2,064,697)



$

(5,266,314)



$

(4,012,910)



















Net loss attributable to Parent


$

(2,664,881)



$

(2,068,641)

)


$

(5,236,178)



$

(4,018,107)


Less – preferred stock dividends



(204,941)




(164,308)




(382,313)




(292,227)


Net loss – common shareholders



(2,869,822)




(2,232,949)




(5,618,491)




(4,310,334)


Net loss per common share - basic and diluted


$

(0.16)



$

(0.15)



$

(0.32)



$

(0.29)


Weighted average number of common shares outstanding - basic and diluted



17,437,068




14,927,846




17,406,788




14,872,597


 

 

BioHiTech Global, Inc. and Subsidiaries 
Condensed Consolidated Balance Sheets

 



June 30,
2020



December 31,
2019




(Unaudited)





Assets









Current Assets









Cash


$

342,182



$

1,847,526


Restricted cash



1,237,097




1,133,581


Accounts receivable, net of allowance for doubtful accounts of $128,321 and $170,038 as of June 30, 2020 and December 31, 2019, respectively (related entity $2,102,095 and $1,370,867 as of June 30, 2020 and December 31, 2019, respectively)



2,807,521




2,155,921


Inventory



352,467




467,784


Prepaid expenses and other current assets



179,906




126,357


Total Current Assets



4,919,173




5,731,169


Restricted cash



2,646,381




2,555,845


Equipment on operating leases, net



1,537,142




1,724,998


HEBioT facility, equipment, fixtures and vehicles, net



36,592,281




37,421,333


Operating lease right of use assets



1,304,142




945,047


License and capitalized MBT facility development costs



8,023,925




8,049,929


Goodwill



58,000




58,000


Other assets



38,799




53,726


Total Assets


$

55,119,843



$

56,540,047


 

 

 

BioHiTech Global, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets, continued:

 



June 30,
2020



December 31,
2019




(Unaudited)





Liabilities and Stockholders' Equity









Current Liabilities:









Line of credit, net of financing costs of $2,050 and $20,152 as of June 30, 2020 and December 31, 2019, respectively


$

1,497,950



$

1,479,848


Advances from related parties



935,000




210,000


Accounts payable (related entity $3,727,095 and $2,531,034 as of June 30, 2020 and December 31, 2019, respectively)



6,036,103




4,688,339


Accrued interest payable



1,255,389




1,148,570


Accrued expenses and liabilities



1,832,068




1,926,965


Deferred revenue



99,563




89,736


Customer deposits



4,890




44,792


Note payable



-




100,000


Senior Secured Note, net of financing costs of $88,508 and unamortized discounts of $587,249 as of June 30, 2020



4,324,243




-


Current portion of WV EDA Senior Secured Bonds payable



2,860,000




1,390,000


Current portion of long term debt and Payroll Protection Program Loan



168,111




4,605


Total Current Liabilities



19,013,317




11,082,855


Junior note due to related party, net of unamortized discounts of $84,110 and $95,043 as of June 30, 2020 and December 31, 2019, respectively



960,367




949,434


Accrued interest (related party)



1,651,079




1,510,193


WV EDA Senior Secured Bonds payable, net of current portion, and financing costs of $1,719,392 and $1,792,574 as of June 30, 2020 and December 31, 2019, respectively



28,420,608




29,817,426


Payroll Protection Program Loan



257,461




-


Senior Secured Note, net of financing costs of $113,268 and unamortized discounts of $726,242 as of December 31, 2019



-




4,160,490


Note Payable



100,000






Non-current lease liabilities



1,220,780




915,170


Long-term debt, net of current portion



6,038




8,201


Total Liabilities



51,629,650




48,443,769


Series A redeemable convertible preferred stock, 333,401 shares designated and issued, and 145,312 outstanding as of June 30, 2020 and December 31, 2019



726,553




726,553


Commitments and Contingencies









Stockholders' Equity (Deficit)









Preferred stock, $0.0001 par value; 10,000,000 shares authorized; 3,209,210 and 3,179,120 designated as of June 30, 2020 and December 31, 2019; 1,936,214 and 1,922,603 issued as of June 30, 2020 and December 31, 2019; 869,792 and 856,181 outstanding as of June 30, 2020 and December 31, 2019:









Series B Convertible preferred stock, 1,111,200 shares designated: 428,333 shares issued, no shares outstanding as of June 30, 2020 and December 31, 2019



-




-


Series C Convertible preferred stock, 1,000,000 shares designated, 427,500 shares issued and outstanding as of June 30, 2020 and December 31, 2019



3,050,142




3,050,142


Series D Convertible preferred stock, 20,000 shares designated: 18,850 shares issued and outstanding as of June 30, 2020 and December 31, 2019



1,505,262




1,505,262


Series E Convertible preferred stock, 714,519 shares designated: 714,519 shares issued, 264,519 outstanding as of June 30, 2020 and December 31, 2019



698,330




698,330


Series F Convertible preferred stock, 30,090 shares designated, and 13,611 shares issued and outstanding as of June 30, 2020



1,507,408




-


Common stock, $0.0001 par value, 50,000,000 shares authorized, 17,809,592 and 17,300,899 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively



1,780




1,730


Additional paid in capital



50,267,673




49,597,059


Accumulated deficit



(58,056,529)




(52,785,242)


Accumulated other comprehensive (loss)



(13,002)




(43,138)


Stockholders' (deficit) equity attributable to Parent



(1,038,936)




2,024,143


Stockholders' equity attributable to non-controlling interests



3,802,576




5,345,582


Total Stockholders' Equity



2,763,640




7,369,725


Total Liabilities and Stockholders' Equity


$

55,119,843



$

56,540,047


 

 

BioHiTech Global, Inc. and Subsidiaries 
Condensed Consolidated Statements of Cash Flows (Unaudited)



Six Months Ended
June 30,




2020



2019


Cash flows from operating activities:









Net loss


$

(6,779,184)




(5,148,839)


Adjustments to reconcile net loss to net cash used in operations:









Depreciation and amortization



1,184,966




739,412


Amortization of operating lease right of use assets



53,552




-


Provision for bad debts



61,119




30,000


Share based employee compensation



707,653




531,603


Interest resulting from amortization of financing costs and discounts



265,776




221,078


Loss resulting from write-off of proposed MBT site



-




346,654


Changes in operating assets and liabilities



593,507




1,261,037


Net cash used in operating activities



(3,912,611)




(2,019,055)











Cash flow from investing activities:









Purchases of construction in-progress, equipment, fixtures and vehicles



(50,731)




(4,164,592)


Refund of deposit



5,000




-


MBT facility development costs incurred



(36,996)




(26,269)


MBT facility development costs refunded



-




66,000


Net cash used in investing activities



(82,727)




(4,124,861)











Cash flows from financing activities:









Proceeds from the sale of Series F convertible preferred stock units



1,560,450




-


Proceeds from Payroll Protection Program Loan



421,300




-


Proceeds from the sale of Series D convertible preferred stock units







1,787,500


Affiliate investment in subsidiary







1,400,000


Deferred financing costs incurred







(43,941)


Repayments of long-term debt



(2,496)




(4,549)


Related party advances, net



725,000




210,000


Net cash provided by financing activities



2,704,254




3,349,010


Effect of exchange rate on cash (restricted and unrestricted)



(20,208)




17,398


Net change in cash (restricted and unrestricted)



(1,311,292)




(2,777,508)


Cash - beginning of period (restricted and unrestricted)



5,536,952




9,126,380


Cash - end of period (restricted and unrestricted)


$

4,225,660




6,348,872


 

SOURCE BioHiTech Global, Inc.

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