Zefiro Methane Corp. Announces Quarterly Earnings with Revenue of USD $6.9 Million

Globe and Mail

14-05-2025

FORT LAUDERDALE, Fla., May 14, 2025 (GLOBE NEWSWIRE) -- ZEFIRO METHANE CORP. (Cboe Canada: ZEFI) (Frankfurt: Y6B) (OTCQB US: ZEFIF) (the 'Company', 'Zefiro', or 'ZEFI') today announced the Company's consolidated financial results for the fiscal quarter that ended March 31, 2025 ('fiscal quarter 3').
Zefiro also today announced that it has received a Notice of Failure to Pay in connection with a $2 million promissory note ("Note"), created in conjunction with the May 12, 2023, acquisition of Plants and Goodwin, 'P&G'.
Zefiro is evaluating all available legal and strategic options in consultation with its legal advisors, including evaluating all documents associated with the Note. Zefiro intends to pursue all appropriate options to protect its interests and the interests of its stakeholders. The notice is subject to customary cure periods; thus at this time it does not constitute an Event of Default and thus places no restrictions on Zefiro's financial flexibility.
For fiscal quarter 3:
Zefiro generated revenue of $6.9 million USD. While this figure can be largely attributed to the widescale economic and federal policy volatility that caused slowdowns across multiple sectors for companies of all sizes, Zefiro's April and May-to-date commercial operations, including expanding its project portfolio in Ohio and Pennsylvania and looming entries into Texas, Oklahoma and Louisiana, indicates a more settled and active marketplace for the remainder of 2025.
The Company yielded a gross profit of $1.0 million USD in fiscal quarter 3, which represents a 73.7% increase from the fiscal quarter that ended on December 31, 2024.
Revenue for the first three quarters of fiscal year 2025 increased approximately 5% to $24.4 million USD as compared to $23.4 million USD for the comparable 2024 period, exhibiting continued growth in core operations.
Please refer to Zefiro's SEDAR+ profile at www.sedarplus.ca/ for full filings containing these financial results.
Zefiro's business strategy updates include:
1) Expanding its operational footprint in regions of the U.S. that contain high numbers of orphaned and abandoned oil and gas wells
Zefiro has continued to increase the number of ongoing and completed projects in numerous key marketplaces, including the Company's efforts to maximize its position in Ohio and Pennsylvania. Specifically, Zefiro subsidiary Plants & Goodwin ('P&G) began work this past quarter on a number of new oil and gas well remediation projects for the Ohio Department of Natural Resources ('ODNR'), a public agency that has access to approximately $78 million in funding to plug the over 36,000 known wells that the agency notes are located throughout the state. At current rates, this pool of resources should ensure well remediation project flow in the state for at least the next four years.
In addition to Zefiro's work on active ODNR projects, the Company also recently announced that the agency will allow Zefiro's team of environmental remediation experts to review a collection of over 1,000 oil and gas wells across the state to determine how many qualify for the Company's recently announced 'Loyal to the Land' initiative. Specifically, landowners with qualifying, unplugged oil and gas wells, which are proven threats to both resident safety and real estate values, on their properties will be able to contact Zefiro to determine if the Company can help remediate their sites at no-cost.
Zefiro also announced this past March that P&G successfully completed a package of Pennsylvania Department of Environmental Protection-funded projects. This tranche of projects included one initiative that required Zefiro's environmental remediation specialists to clean-up a site that was rendering a source of drinking water in Clarion County, PA unusable. Furthermore, Zefiro and Pompano Resource Transformation ('Pompano'), an Oklahoma-based hydrocarbons production company, this week agreed to a long-term contractual relationship in which Zefiro will provide Pompano well retirement services. Specifically, the transaction is designed to accelerate well-plugging activities and reduce long-term environmental liabilities on Pompano's oil fields located across the southwestern United States, including in Texas and Oklahoma.
These developments helped solidify Zefiro's capacity to operate in six states, up from four one year ago, and represents the Company's ambitions to expand and fortify operations across the southcentral U.S., including Texas, Louisiana, and Oklahoma, by the end of 2025.
2) Certifying high-quality carbon offsets to prepare product deliveries to customers
Throughout fiscal quarter 3, Zefiro has made major strides toward delivering the Company's inaugural tranche of high-quality carbon credits to customers throughout the international marketplace, including Mercuria Energy America, LLC and EDF Trading. The demand for these offset products continues to rise as Fortune 1000 companies, energy conglomerates, and technology firms seek to reduce their carbon footprint while investing in operations that require elevated levels of energy production, including data center and various artificial intelligence initiatives. Zefiro's work to gain all necessary certifications from the ACRcarbon ('ACR') registry has ensured that the Company will begin delivering these products to existing customers in the coming weeks and be best positioned to meet this historic market demand in the years ahead.
As part of this registration process, Zefiro this past March announced that it had engaged TÜV SÜD America ('TÜV SÜD'), a technical inspection association that tests, inspects, and determines certifications of technical systems and facilities, as a third-party validation and verification body ('VVB') for the Company's projects listed on the ACR. This agreement follows Zefiro's inaugural project listing on the ACR registry, which served as an important step toward monetizing carbon offsets originated by the Company through its portfolio of environmental remediation projects in the United States.
3) Implementation of innovative technologies to drive commercial expansion and efficiency
To accelerate various commercial initiatives, Zefiro's senior leadership team completed a series of transactions and agreements to deploy revolutionary technologies throughout the Company's operational structure. Specifically, Zefiro worked with industry partners to introduce artificial intelligence-enabled data analytics throughout the Company's operations that are estimated to improve Zefiro's batch efficiency gain, a measurement of the monetary resources allocated per ton of methane gas captured, by approximately 50 percent. Additionally, Zefiro announced the launch of the Zefiro Lifecycle Solution, a data capture and workflow management platform built to help bolster the Company's ability to identify and monitor projects. Furthermore, X Machina Sustainable Technologies ('XMST'), a major sponsor entity of the Company, filed a provisional patent central to forming an industry-leading data portal of orphaned oil and gas wells across North America. This will provide Zefiro's team of well remediation specialists access to a geographical interface that incorporates the automated methane detection figures, including proprietary field quantification data, needed to train an AI model capable of identifying leaking orphaned oil and gas wells at no cost to the Company.
Third Fiscal Quarter Financial Highlights (in USD):
For the three months ended March 31,
2025 March 31,
2024
Revenue $6,947,691 $8,539,165
Gross profit $1,011,445 $2,652,422
Total operating expenses ($4,377,816) ($3,444,106)
Net loss and comprehensive loss for the period ($3,488,208) ($885,370)
Basic and diluted loss per share for the period ($0.05) ($0.01)
Weighted average shares outstanding
73,924,956 63,826,973
Net loss for the period ($3,462,056) ($949,890)
Add:
Amortization 944,898 900,516
Share-based compensation 501,629 7,682
Maintenance Capex (33,569) (346,201)
Adjusted Net Income 1 (2,049,098) (387,893)
As at March 31,
2025 June 30,
2024
Cash $245,334 $981,746
Current assets $4,587,528 $10,223,370
Total assets $22,109,207 $28,971,195
Total liabilities $19,640,074 $20,288,328
Total equity $2,469,133 $8,682,867
About Zefiro Methane Corp.
Zefiro is an environmental services company, specializing in methane abatement. Zefiro strives to be a key commercial force towards Active Sustainability. Leveraging decades of operational expertise, Zefiro is building a new toolkit to clean up air, land, and water sources directly impacted by methane leaks. The Company has built a fully integrated ground operation driven by an innovative monetization solution for the emerging methane abatement marketplace. As an originator of high-quality U.S.-based methane offsets, Zefiro aims to generate long-term economic, environmental, and social returns.
On behalf of the Board of Directors of the Company,
ZEFIRO METHANE CORP.
'Talal Debs'
Talal Debs, Founder & CEO
For further information, please contact:
Zefiro Investor Relations
1 (800) 274-ZEFI (274-9334)
[e-mail]
For media inquiries, please contact:
Rich Myers – Profile Advisors (New York)
[e-mail]
[phone]
Forward-Looking Statements
This news release contains 'forward-looking information' within the meaning of applicable Canadian securities legislation. Forward-looking information is often, but not always, identified by the use of words such as 'seeks', 'believes', 'plans', 'expects', 'intends', 'estimates', 'anticipates' and statements that an event or result 'may', 'will', 'should', 'could' or 'might' occur or be achieved and other similar expressions. In particular, this news release contains forward-looking information including statements regarding: the Company's intention to reduce emissions from end-of-life oil and gas wells and eliminate methane gas; the Company's partnerships with industry operators, state agencies, and federal governments; the Company's expectations for continued increases in revenues and EBITDA growth as a result of these partnerships; the Company's intentions to build out its presence in the United States; the anticipated federal funding for orphaned well site plugging, remediation and restoring activities; the Company's expectations to become a growing environmental services company; the Company's ability to provide institutional and retail investors alike with the opportunity to join the Active Sustainability movement; the Company's ability to generate long-term economic, environmental, and social returns; and other statements regarding the Company's business and the industry In which the Company operates. The forward-looking information reflects management's current expectations based on information currently available and are subject to a number of risks and uncertainties that may cause outcomes to differ materially from those discussed in the forward-looking information. Although the Company believes that the assumptions and factors used in preparing the forward-looking information are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed timeframes or at all. Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to: (i) adverse general market and economic conditions; (ii) changes to and price and volume volatility in the carbon market; (iii) changes to the regulatory landscape and global policies applicable to the Company's business; (iv) failure to obtain all necessary regulatory approvals; and (v) other risk factors set forth in the Company's Annual Information Form for the year ended June 30, 2024 under the heading 'Risk Factors'. The Company operates in a rapidly evolving environment where technologies are in the early stage of adoption. New risk factors emerge from time to time, and it is impossible for the Company's management to predict all risk factors, nor can the Company assess the impact of all factors on Company's business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in any forward-looking information. Forward-looking information in this news release is based on the opinions and assumptions of management considered reasonable as of the date hereof, including, but not limited to, the assumption that general business and economic conditions will not change in a materially adverse manner. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information. The forward-looking information included in this news release is made as of the date of this news release and the Company expressly disclaims any intention or obligation to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required by applicable law.
Non-IFRS Financial Measures
Zefiro has included certain performance measures in this press release that do not have any standardized meaning prescribed by International Financial Reporting Standards (IFRS) including: (a) Adjusted EBITDA. Adjusted EBITDA is not a standardized financial measure under IFRS and might not be comparable to similar financial measures disclosed by other issuers. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company's performance and ability to generate cash flow.
(1) Adjusted Net Income
Adjusted Net Income is a non-IFRS measure that excludes from net income (loss): amortization and share-based compensation and includes maintenance capital expenditures attributable to maintaining current activity. Management uses Adjusted Net Income to evaluate the Company's operating performance. The Company presents Adjusted Net Income as it believes that certain investors use this information to evaluate the Company's performance in relation to its peers who present on a similar basis (though Adjusted Net Income does not have a standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other issuers). However, Adjusted Net Income does not represent and should not be considered an alternative to net income (loss) or cash flow provided by operating activities as determined under IFRS.
Statement Regarding Third-Party Investor Relations Firms
www.sedarplus.ca/.