Pet Odor Product Continues to Be Lucrative for Clean Tech Co.

Source: Streetwise Reports (8/19/24)

The company this week announced revenues were up, coming in at at a record US$5 million, a 247% increase for the same period from Q2 in 2023. For the six-month period, revenues came in at US$9.7, a 46% increase over the same period from last year, as subsidiary ONM Environmental’s pet odor control product, Pooph, continue to see expanding sales and its engineering services company posted a record quarter.

“For the quarter, Pooph revenues were 70% of total revenues, or ~(US)$3.5M, down from (US)$4.2M in 1Q24 due to timing,” analyst Richard Ryan wrote for Oak Ridge Financial. “Management believes its marketing partner anticipates strong 2H24 sales with new product additions and new retailers added, including Target.”

Ryan noted that BLGO’s marketing partner for the product continues to pursue 20% quarter-over-quarter growth. The company’s management said Pooph is in up to 35,000 retail outlets and its partner goal is getting to 80,000 outlets. Ralph’s and Target have been added, the marketing partner has added Pooph wipes and Litterizer, and puppy pads are on the way.

“Pooph sales should show strong growth again during 2024, approaching ~(US)$20M,” wrote Ryan, who reaffirmed his Buy rating with a US$0.38 per share target price.

In addition, BioLargo said revenues for the first six months of 2024 increased 88% over the year before.

BioLargo did register a net loss for the quarter of US$780,000, which included about US$669,000 in non-cash equity compensation expenses.

Pipeline of PFAS Opportunities ‘Growing’

BioLargo is made up of several subsidiaries that work in different sectors, a “family of companies,” including ONM Environmental, BioLargo Engineering, BioLargo Water, BioLargo Energy Technologies, Clyra Medical Technologies, and the new BioLargo Equipment Solutions & Technologies Inc. (BEST) subsidiary.

Standout products have included Pooph, BEST’s solution to treat water contaminated with the so-called “forever chemicals” that have been getting more attention from environmental regulators, and a new long-last battery that the company said is safer than lithium-ion batteries.

“Pooph sales should show strong growth again during 2024, approaching ~(US)$20M,” wrote Ryan, who reaffirmed his Buy rating with a US$0.38 per share target price.

Forever chemicals, or per- and polyfluoroalkyl substances (PFAS), are a group of thousands of synthetic chemicals used in everything from the linings of fast-food boxes and non-stick cookware to fire-fighting foams and other purposes.

High concentrations of some PFAS may lead to adverse health risks such as cancer, hormonal disruption, and reduced immune system effectiveness, although research is still being conducted. They are called “forever chemicals” because they break down very slowly. Tens of millions of people have been explosed.

BioLargo’s Aqueous Electrostatic Concentrator (AEC) technology removes more than 99% of PFAS chemicals from water, the company said.

Ryan noted that the company has an AEC municipal project in Stockholm, N.J., with a targeted installation of November and “the pipeline of opportunities is large and growing.”

“The large emerging market for PFAS removal and BLGO’s growing validation in this opportunity should not be overlooked,” the analyst wrote. “Modeling expectations are difficult to time, but we endeavored to incrementally include PFAS-related revenues and developed a bull case Price Target of $0.50.”

A Catalyst: A Better Battery

Negotiations continue with potential partners to distribute the company’s copper-iodine would irrigation solution, Clyra, which has secured third-party FDA-compliant manufacturing capabilities. Ryan said Oak Ridge anticipates likely growth for the product in 2025.

Another technology from BioLargo is its liquid sodium prototype battery. Cellinity™ cells have no runaway fires or risk of explosion, don’t decrease in performance over thousands of uses, and store more energy per unit of weight than lithium batteries, the company noted.

The company also said the battery is not self-discharging and does not have outgassing or parasitic load for cooling, and all of the materials in it can be sourced in North America without the need for rare earth elements.

The batteries involve a unique chemistry involving molten salt electrolytes that “imparts substantial benefits over lithium-ion chemistry,” the company noted.

“Management believes the chemistries for its batteries are superior to other battery types and is assessing how it can compete in such a dynamic market environment,” Ryan wrote. “BLGO’s strategy is to sell factories, not batteries, and this puts them in a position to receive a royalty (~6%) and carried interest on the project.”

Important Disclosures:

1. BioLargo Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000.
2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of BioLargo Inc.,  BioLargo Energy Technologies, and Clyra Medical Technologies.
3. Steve Sobek wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
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