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Alter NRG Reports Third Quarter 2012 Activities and Financial Results

Tuesday, November 13, 2012 6:43 PM


TSX - NRG

OTCQX - ANRGF

CALGARY, Nov. 13, 2012 /CNW/ - (TSX: NRG); (OTCQX: ANRGF) - Alter NRG Corp., ("Alter NRG" or the "Corporation") is pleased to report on its corporate activities and financial results for the three month period and six months ended September  30, 2012

The Corporation's focus is the Westinghouse Plasma Gasification Technology which is the worldwide leader in creating energy from waste using plasma gasification. We market and sell the Westinghouse Plasma Technology through our wholly owned subsidiary, Westinghouse Plasma Corp. ("Westinghouse Plasma"). Westinghouse Plasma is the industry leader for the treatment of all types of waste (industrial, household, commercial, hazardous, etc.) using plasma technology and converting it into useable energy such as electricity, syngas (replacement for natural gas), heat, steam, or liquid fuels such as diesel or ethanol.

  • Our Vision - To provide the leading technology platform for converting the world's waste into clean energy for a healthier planet.
  • Our Mission - As the industry leader, we will forge and dominate an industry segment that transforms current waste management practices. We build shareholder value by enabling customers to convert waste into clean energy by providing plasma gasification products, services and solutions that are innovative and environmentally friendly.

Westinghouse Plasma is a commercially proven technology that is used in two commercially operating facilities in Japan that have been converting waste into energy for more than 9 years, as well as facilities operating in India and under construction in China and England. From an environmental perspective, a plasma facility will have significantly lower emissions than other alternative energy facilities and have an overall emissions profile lower than a natural gas combined cycle power facility, which is considered the cleanest fossil fuel production. From an economic perspective waste-to-energy projects have strong project returns in populous areas, as the projects receive revenues from tipping fees to take the waste and then also receive revenues for the sale of energy.

Alter NRG is pleased to be presenting highlights for its third quarter of 2012 as revenues have increased by 55% over the prior year. This is reflective of a maturing business plan with significant long-term potential.

Q3 HIGHLIGHTS

The third quarter of 2012 had $3.2 million in revenues, a 55% increase year to date over prior year. This revenue reflects the progress on the fabrication of the scale gasifier for the 50MW facility under construction by a leading Fortune 500 company.

Westinghouse Plasma

  • Sales of $3.2 million which is a year to date increase over prior year of 55%. Revenue is expected to continue to increase in 2012 and 2013 as the pace of fabrication increases as well as further licensing opportunities which are expected to transact before year-end.
  • Executed on approximately 37% cumulatively of the $20 million purchase order from Air Products, a US based Fortune 500 Company, which has previously announced its intention to build 4 more advanced gasification facilities in the United Kingdom in the coming years. On October 23rd, 2012 Air Products announced it is advancing a second project on adjacent lands in Tees Valley of the same size and configuration as the first project.
  • Advanced project development with a developer, PGP Terminal a.s. ("PGPT"), which previously purchased site licenses in the Czech Republic and Slovakia for $4.375 million, with 10% being paid upfront. The developer has been working for several years on waste-to-energy projects and has a portfolio of projects that it is currently advancing in their home market. They expect to begin engineering on the first facilities in late 2012 with the intention of ordering equipment in 2013.
  • Finalized scope with SMS Infrastructure ("SMS") (who has already constructed two hazardous waste facilities utilizing Westinghouse Plasma technology) on two projects which have advanced into the formal regulatory approval phase with an expected equipment order in early to mid 2013. These are the more advanced projects within a larger pipeline of projects, which SMS is developing and marketing in India and the Middle East. SMS is a licensee of the Westinghouse Plasma Gasification Technology and provides turnkey hazardous waste facilities to the market and has approximately 140 people in their gasification division.
  • Wuhan Kaidi ("Kaidi"), which ordered engineering and torches previously, continued construction of its demonstration facility in China which is approximately 90% complete. Westinghouse Plasma personnel are gearing up to commission the site in Q4 of this year. Upon successful demonstration (expected in Q4 or early 2013), Kaidi has more than 100 sites identified to take biomass and convert it into power and liquid fuels.
  • Supported a hazardous waste demonstration facility in Shanghai China being constructed by GTS Shanghai. We have previously delivered the detailed engineering and torches, however, during the quarter they ordered additional equipment for their facility. The facility has finalized its feedstock agreement, with a large Chinese waste company and its site location and they are advancing the site plan.
  • Advanced negotiations on several torch orders in international markets. One negotiation in China has advanced to a signed agreement with delivery dates in 2012 and 2013. The agreement is awaiting final approvals and receipt of the mobilization payment before work will commence.
  • Finalized the detailed engineering for the standard design of the 200 tonne per day Westinghouse Plasma Gasification Technology for a project in Minnesota being developed by the Koochiching Development Authority. The standard gasifier is expected to sell for $12 million and the project has now applied for regulatory approval.
  • With the introduction of Walter Howard as the newly appointed Chief Executive Officer, the Corporation began creating a structure for its investment options in current projects, to provide a more formal funding structure for the following investment options. Alter NRG has options to invest with key customers, including Air Products, which allow the Corporation to elect on the option after the project receives regulatory approval but without any promoted costs. This is a favorable option for the Corporation as it does not have to deploy the risky development capital but can participate in the project level annuity cashflow after the project has been de-risked.

In addition to the highlights above, customers around the globe continue to advance their business development efforts using the Westinghouse Plasma Gasification Technology. This includes exclusive license agreements for territories that are in advanced negotiations.

Corporate

  • Closed the sale of CleanEnergy, the Corporation's geoexchange division, for $5 million of shares so that the Corporation could focus exclusively on the plasma gasification business.
  • Announced the addition of a strategic shareholder, Roman Abramovich, who is a Russian billionaire with complementary investments in the waste to energy space and who intends to finance various waste to energy projects. The financing, led by Mr. Abramovich, was for 30,769,230 shares at a price of $0.325 for a total investment of $10 million.

CEO'S MESSAGE

During the third Quarter we strengthened the Alter NRG balance sheet. While everyone dislikes dilution it was important to give our world-leading technology a foundation that is stable, and shows customers and investors that we are here for the long-term. As I stated in my previous CEO's messages, I am convinced this technology has hit the tipping point and is positioned for significant success. However, technology development takes time and now we have a stable foundation for that growth.

Commercially, we are continuing to gain traction. Even in the short time since I have been CEO, I have witnessed a pronounced improvement in the quality of customers and developers with whom we are doing business. It started late last year when we announced the sale of a full-scale gasifier to Air Products, a Fortune 500 Company. The Tees Valley project is providing us the opportunity to substantiate our technology and engineering in a very big way - not only to Air Products, but to the industry as a whole. It is a paradigm shifting project in many ways due to its large scale, its more efficient energy production and also the fact it is being advanced by a world leading Fortune 500 company.

The commercialization of Westinghouse Plasma Gasification Technology continues to gain momentum, and on October 23rd I was very pleased when Air Products announced the development of their second project in Tees Valley of a similar size. This facility will be built on adjacent lands which should streamline the regulatory process and speaks directly to revenues in 2013. This will put Air Products investment into our technology to over $800 million and I cannot think of a more compelling vote of confidence we could receive.

This quarter, I had a chance to travel and meet some of our other leading customers and was very impressed by their progress and their broad business plans using our technology. This included a visit to China where I met with Wuhan Kaidi and was able to witness first-hand the large scale demo facility that is nearing completion. Although it has been a slow process to this point, they are now completing their first plant with aggressive plans for construction of additional facilities in China in 2013. I also met SMS Infrastructure of India this quarter, which has already built two facilities and is advancing a portfolio of additional projects in India and the Middle East. Two projects are now in the advanced stages of development and regulatory approval and we agreed upon scope and other key business dealings during this meeting. I expect both of these customers to accomplish great things over the coming years.

As important as talking to the more advanced stage customers, I also had the chance to advance negotiations with other customers and developers that we do not always mention, in our quarterly reports as we focus on the here and now. From many of the other developers in China, India, and Europe I got the profound sense that things are moving more quickly than before, and that they are on the right track. Our job is to translate this into long-term relationships that provide cashflow to the Company for the benefit of our shareholders. We are making steady progress.

Part of our growth will be co-investment into projects that are being developed by capable partners and have strong financial returns. We will leave it to the developers to advance the time-consuming and often expensive process of project development in their local jurisdictions. We will focus on the options to invest along-side the developers once the projects have achieved their major commercial milestones. I have built a career financing energy projects and believe this an area where we can add significant shareholder value.

Strengthening our balance sheet was important to our long-term success as a leading infrastructure technology and I am very pleased to have achieved this milestone. From our strengthened foundation, it is now our mandate to translate our significant customer base into cashflow, and continue to strengthen that customer base. I am very confident from my travels that this is not only possible, but inevitable for this technology.

SELECT FINANCIAL RESULTS ($)

     
Balance Sheet September 30, 2012 December 31, 2011
     
Total assets $ 64,151,840  $ 63,173,939
Total liabilities 25,809,145 20,050,857
Total equity 38,342,695  43,123,082

                
Income Statement Three months ended Nine months ended
  September 30, 2012 September 30, 2011 September 30, 2012 September 30, 2011
         
Sales $  3,214,980 $  2,928,468 $  8,556,721 $  5,513,628
Income (loss) from continuing operations (1,622,162) 915,650 (6,012,803) (3,367,695)
Loss from discontinued operations (65,738) (6,173,683) (668,651) (15,710,993)
Basic and diluted loss per share - continuing operations (0.01) 0.01 (0.08) (0.06)
Basic and diluted loss per share -
discontinued operations
- (0.10) (0.01) (0.25)
         
         

For more information on the Corporation's financial results please visit www.alternrg.com or www.sedar.com to view Alter NRG's 2012 Third Quarter Report.

The Toronto Stock Exchange does not accept responsibility for the adequacy or accuracy of this release.

Advisory Respecting Forward-Looking Statements:

This news release contains certain forward-looking information and statements within the meaning of applicable securities laws. The use of any of the words "expect", "anticipate", "continue", "estimate", "objective", "ongoing", "may", "will", "project", "should", "believe", "plans", "intends", "confident", "might" and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: availability and cost of key materials and labour and availability of funds with respect to the amount of capital expenditures and scheduled commencement of operations; timing of regulatory approval including various permits from the applicable government authorities; the assessment of capital markets including the availability of debt and equity in current market conditions; commodity prices resources that impact the Corporation's operations directly and indirectly; extent of investment by government authorities in infrastructure projects; the financial and operational health of key partners in various projects; the continued development of the Corporation's technology and its use in various applications and other expectations, beliefs, plans, goals, objectives, assumptions, information and statements about possible future events, conditions, results of operations or performance. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release.

The forward-looking information and statements included in this news release are not guarantees of future performance and should not be unduly relied upon. Forward-looking statements reflect management's current beliefs and assumptions, based on information currently available to management. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, many of which are beyond the control of the Corporation. Among the material factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: that the information is of a preliminary nature and may be subject to further adjustment; unforeseen environmental effects; the completion of strategic partner's projects; arrangements with key suppliers; potential product liability and other claims; other business risks outlined in this news release, including risks associated with the proprietary technology; the possible unavailability of financing at competitive rates and the related effect on development activities; the effect of energy price fluctuations; changes in government regulation, including changes to environmental regulations; the effects of competition; the dependence on senior management and key personnel, and fluctuations in currency exchange rates and interest rates, as well as those factors discussed in or referred to under the heading "Risk Factors" in the Corporation's Annual Information Form dated March 28, 2012 available at www.sedar.com.  Such information and statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information or statements.

The Corporation cautions that the foregoing list of assumptions, risks and uncertainties is not exhaustive. The forward-looking information and statements contained in this news release speak only as of the date of this news release, and the Corporation assumes no obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable securities laws.

SOURCE: Alter NRG Corp.

Walt Howard, Chief Executive Officer
(403) 806-3877           whoward@alternrg.ca

Daniel Hay, Chief Financial Officer
(403) 214-4235           dhay@alternrg.ca

(Source: CNW )
(Source: Quotemedia)

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