Nov. 13 at 1:53 PM
$ANRGF
ANRG.TO: Impressive 3Q25; Reiterate Buy
and C
$5.00 Price Target.
Anaergia posted impressive 3Q25 results with C
$16.4M in revenue upside and
gross margins 7.3% ahead driving profitable adj-EBITDA C
$8.3M above our model.
Capital Sales delivered the revenue upside on broad execution in Europe, Asia and
North America. Q/Q backlog growth of C
$32M reflected strong bookings momentum.
The team booked its first Spanish project to backlog of the 16 total covered by the
recent C
$184M gross agreement. We are increasingly optimistic that BOO projects
become a small positive contribution in 2026. We reiterate our Buy rating and C
$5.00 price target for impressive execution.
• ANRG reported impressive 3Q25 results. ANRG posted 3Q25 Rev/EPS/
adj-EBITDA of C
$51.4M/C
$0.01/C
$2.6M, vs. ROTHe of C
$35.0M/(C
$0.04)/(C
$5.7M). Gross margins were 28.8% (vs. ROTHe at 21.5%), compared to 32.5%
in 2Q25 and 20.7% in 3Q24, supported by strong margins in both the Capital
Sales and Services businesses. OpEx of
$14.2M compared to
$14.6M in 2Q25
and
$16.9M in 3Q24, as ANRG continues to execute on cost saving initatives.
• Backlog shows continued momentum. Backlog of C
$276.7M compares to the
C
$243.9M exiting 1Q25, and the C
$103.1M entering 2025. Backlog consists of
signed capital sales contracts and three years of O&M project revenue. Growth in
backlog was driven by new signed contracts in Italy and North America. In 3Q25,
the company added to backlog the first of 16 Spain-based projects covered by the
$184M gross agreement. Mgmt expects continued backlog expansion in 2026.
• Capital Sales projects drive beat. 3Q25 Capital Sales revenue of C
$44.3M
compared to the C
$23.2M in 2Q25 and C
$19.0M in 3Q24. In Italy, construction
is progressing on ANRG's Livorno facility, and the company's partnerships with
Bioenersys and QGM are advancing on follow-on orders across various projects.
The Italian projects are expected to generate around C
$44M in revenue. In
Spain, ANGR expects to generate C
$7M with its agreement with PreZero for
a biomethane facility located outside of Bilbao. In North America, ANRG's
wastewater co-digestion facility in Riverside, CA secured conditional financing for
EPC and O&M services, which mgmt expects to generate C
$39M of revenue.
• ANRG seeing incremental progress on BOO projects. Mgmt noted its SoCal
Biomethane plant continues to operate efficiently, and ANRG is waiting for
approvals under CA 1440 for the long-term offtake agreement. The Rhode Island
facility is ramping production, providing RNG to Irving Oil, where ANRG is waiting
for the CI score approvals. The Quakertown facility, which had an original contract
value of C
$18.4M was 78% complete at the end of 3Q25.
