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MYCELX Technologies Corporation
("MYCELX" or the "Company") (AIM: MYX)
15 January 2015
2014 Year End Trading Update & Contract Wins
MYCELX Technologies Corporation (AIM: MYX), the clean water technology company providing patented solutions for commercial industrial markets worldwide, announces a trading update ahead of its 2014 Full Year Results, which will be announced on 20 March 2015.
The Company now expects to report full year revenue of $13.6 million for FY2014. This reduction in revenue results in a pre-tax loss of $5.7 million and an EBITDA of negative $4.2 million.
The Company had expected $1.8 million of revenue from an existing client on a stored waste water
project (lease, service and media). This contract has been delayed to coincide with operational maintenance expected in Q1 2015. An additional $450K of media revenue which was expected from a waste water project with a separate customer in December was not realized as the project was completed ahead of schedule due to lower than expected water volumes. The majority of the remaining shortfall resulted from end of year media sales forecasted from existing customers that did not occur.
Historically, the month of December has always been a strong one for revenue in the context of the Company's respective calendar year with clients spending surplus budgets for the year. This year we anticipated a similar trend. However, following our post year end analysis we believe that clients were reluctant to spend surplus budgets in response to the significant price declines in WTI and Brent prices in the last quarter of 2014. Such material moves in commodity prices, in conjunction with the significant sizes of certain contracts we are working on, makes forecasting extremely challenging.
In reference to the three major projects that the Company has stated that it expects to execute in 2015, the Company has been awarded the contract for the short term waste water project. This is currently capped at $2.9 million. The Company is in discussions relating to the two larger projects and they remain active prospects. However, given the scale of the individual projects and the unpredictability of the timing of the project awards, the revenue forecast related to these projects has been revised downward for 2015. The Company has also received a $3.6 million contract for a lease renewal with one of its major customers in the Middle East.
The Company believes that given the uncertainty and extreme volatility surrounding the oil and gas industry it is not prudent to maintain its present revenue forecast for 2015. Therefore, the Company is revising its 2015 revenue to a range of $24 million to $29 million. Close attention and oversight of expenses is in place to assist EBITDA profitability at the lower end of the range.
Connie Mixon, CEO, commented:
"MYCELX will continue to provide long term value to the oil and gas industry. Cost effectively treating water associated with production and process will remain an important focus even in the difficult environment of volatile oil prices. The Company believes it should be profitable in 2015 by closely managing costs in line with revenue realized throughout the year and will continue to build its business for the future."
For further information please contact:
MYCELX Technologies Corporation
Connie Mixon, CEO
Mark Clark, CFO
+1 888 306 6843
Numis Securities Limited
Corporate Finance
Stuart Skinner
Nathaniel Janks
+44 20 7260 1000
Corporate Broking
James Black
Ben Stoop
+44 20 7260 1000
Bell Pottinger
Nick Lambert
Henry Lerwill
+44 20 3772 2500