Water Alliance member NX Filtration N.V. (Euronext Amsterdam: NXFIL), the global provider of breakthrough direct nanofiltration (dNF) technology for pure and affordable water with strong sustainability benefits, today reports its half-year 2023 revenue and increasing lead-time in pilot conversion, resulting in an adjusted full-year 2023 revenue outlook.
NX Filtration is experiencing a delay in revenue growth that is caused by longer lead times to convert pilot projects into large full-scale projects. This accounts for both pilot trajectories taking longer than anticipated, as well as longer lead times towards larger projects after the pilot phase amongst others caused by permitting lead times, decision making and engineering.
Half-year 2023 revenues came in at €3.7m (similar as in the first half-year of 2022), lower than anticipated, caused by longer lead times to convert pilot projects into large full-scale projects. Full-year 2023 revenue is still expected to increase substantially from full-year 2022, but anticipated to come in lower than our previous outlook of €18m to €22m. For the full-year 2023, NX Filtration revises its outlook on total revenues to €10 to €14m. Gross margins remain strong at 58.9% in the first half-year of 2023, an increase compared to 55.3% in the first half-year of 2022.
All underlying business drivers continue to develop in a very favorable direction, and our medium- and long term objectives on revenue growth and profitability remain unchanged.
- 104 pilots projects in the first half-year of 2023, 28% more than in the first half-year of 2022), with strong results and therewith planting the seeds for future growth.
- Strong and rapidly growing pipeline of commercial opportunities that is more than 50% larger than at the end of the first half of 2022.
- Major steps forward with key OEMs (e.g. Veolia, Aqualia, Suez, Greentech and NijhuisSaur) who further intensified their pilot programs, entered into cooperation agreements with NX Filtration, and started offering NX Filtration’s products in full-scale projects.
- Stronger than ever market trends to address global water issues, driven by droughts and pollution, causing many countries to implement regulations and investment plans: e.g. in France (53 new measures to combat droughts in summer period), Spain (recently announced a €2.2bn package amongst others for wastewater reuse), and in the US (proposal for the first-ever national drinking water standard for PFAS).
- Strong recognition by industry institutions for our technology: Global Water Intelligence Distinction Awards for Water Technology Company of the Year and Water Project of the Year and Frost & Sullivan award for exceptional performance in the global industrial water and wastewater treatment membrane market.
- On-track with our new megafactory: strong progress on the construction, with completion anticipated by Q1 2024 and start-up in H1 2024, within the anticipated Capex budget.
Jeroen Pynenburg, CEO of NX Filtration, states:
“I am thrilled to have joined NX Filtration and am excited to work with a global team that has such a strong drive and competence to make an impact on the water transition. Unfortunately today we have to update the market on the delay in our revenue growth. Although we have to adjust our full-year 2023 revenue outlook, I am highly confident that we are on the right track of our future growth path. The current delay in revenue growth is caused by longer lead times to convert pilots into large full-scale projects. This accounts for both pilot trajectories taking longer than anticipated, as well as longer lead times towards larger projects after the pilot phase amongst others caused by permitting lead times, decision making and engineering.
We remain closely collaborating with our customers and continue to be positive on the conversion of our pilots. Our major opportunities that we had planned to deliver in the first half of 2023 are still part of our pipeline today. In fact, the underlying drivers for our business are stronger than ever: the market is developing very favorably, our pipeline continues to grow, and we experience great traction with major customers that are clearly entering the next stage of roll-out of our technology. We put our shoulders to the wheel and continue to stick to our medium- and long-term objectives.”
Source: NX Filtration
