MONTREAL (QC), August 12, 2021 – Xebec Adsorption Inc. (TSX: XBC) (“Xebec”), a global provider of clean energy solutions, announced today its 2021 second quarter results, with the following highlights:

  • Record revenues of $32.7 million for the three-month period ended June 30, 2021, compared to $19.6 million for the same period the prior year.
  • Adjusted EBITDA of ($4.6) million for the three-month period ended June 30, 2021, compared to ($0.1) million for the same period last year.
  • Net loss of $7.5 million or ($0.05) per share in the three-month period ended June 30, 2021, compared to a net loss of $0.8 million or ($0.01) per share compared for the same period in the prior year.
  • Working capital of $97.4 million on June 30, 2021, for a current ratio of 2.9:1, compared to working capital of $171.1 million and a current ratio of 4.1:1 on December 31, 2020.
  • Management guidance updated with revenues maintained in the range of $110.0 to $130.0 million and adjusted EBITDA margins lowered in the range of -3.0% to -4.0% from 3.0% to 4.0%. Adjusted EBITDA margin is affected by new investments in supporting higher than originally forecasted future revenues and lower gross margins from RNG projects.
  • As at June 30, 2021, the company had $79.9 million of cash and restricted cash compared to $168.6 million as at December 31, 2020.


Financial Highlights:

  Three months ended
June 30,
% of
Six months ended
June 30,
% of
  2021 2020   2021 2020  
(In millions of dollars) (unaudited) (unaudited)   (unaudited) (unaudited)  
Revenues 32.7 19.6       67% 53.3 31.8 67%
Gross profit 5.0 4.3       16% 9.2 7.3 26%
Gross profit % 15% 22%   17% 23%  
Adjusted EBITDA (1) (4.6) (0.1)   (9.3) 0.3  
Net income (loss) (7.5) (0.8)   (16.7) (1.5)  
Net income (loss) per share – basic ($/share) (0.05) (0.01)   (0.11) (0.02)  
Weighted average number of shares 153,138,535 88,884,226   152,836,023 87,086,137  
As at:       June 30,
Dec. 31
Total assets       420.2 444.7  
Total liabilities       100.8 100.7  
Equity       319.4 344.0  
As at:        August 11,
August 10,
Backlog (2)       75.9 85.5  
(1)     Adjusted EBITDA starts with EBITDA and adjusts for Stock-based compensation expenses, impairment of inventories, exchange gain/loss on the obligation arising from non-controlling interest participation in a subsidiary, foreign exchange loss (gain) and accretion of debt.

(2)     August 11, 2021 backlog amount does not include the 18-unit Biostream agreement because the execution (task) orders have not yet been processed. In addition, as Xebec transitions more towards being a services provider, the backlog will not adequately reflect the future and full revenue profile of the company.


Financial Results

  • Revenues increased by $21.5 million to $53.3 million for the six-month period ended June 30, 2021, compared to $31.8 million for the same period the prior year. The 68% increase is mainly explained by acquisitions in 2020 and 2021, including (1) $15.3 million for services companies and ACS, and (2) $21.5 million for HyGear and Inmatec. This was offset by lower revenues from long-term production-type RNG projects.
  • Gross margin increased from $7.3 million to $9.2 million for the six-month period ended June 30, 2021 compared to the same period the prior year. The gross margin percentage decrease from 23% to 17% is due to working through the company’s lower margin RNG projects.
  • Selling and administrative expenses (“SG&A”) for the six-month period ended June 30, 2021, of $23.2 million were higher by $14.6 million compared to $8.6 million for the same six months of 2020. The increase is primarily due to additional SG&A expenses associated with the newly acquired companies: (1) $3.7 million for services companies and ACS, and (2) $6.1 million for HyGear and Inmatec. In addition, $2.3 million was attributed to transaction, due diligence and integration expenses related to newly acquired and potential future acquisitions. Finally, SG&A expenses increased due to an organizational scale up of employees, hiring fees and associated costs to support the increased level of future sales.
  • Research and development expenses of $1.4 million for the six-month period ended June 30, 2021 were related to the development of the company’s second generation of the Biostream product, and the continued development of biogas upgrading and hydrogen products. As of January 1, 2021, R&D expenses are expensed as they are incurred.
  • Operating loss of $15.9 million for the six-month period ended June 30, 2021 compared to an operating loss of $0.7 million for the same period in 2020. The increase of the operating loss is mainly explained by the above-noted increase in SG&A and lower consolidated gross margin percentage.
  • Net loss of $16.7 million or ($0.11) per share in the six-month period ended June 30, 2021 compared to a net loss of $1.5 million or ($0.02) per share for the same period the prior year.
  • Adjusted EBITDA decreased to ($9.3) million for the six-month period ended June 30, 2021, from $0.7 million for the same period last year.
  • Backlog decreased by $9.6 million over the last 12 months, from $85.5 million on August 10, 2020 to $75.9 million on August 11, 2021.

CEO Quote:

“In Q2 we delivered record quarterly revenues as we continued to build the organisational foundations which will support us to manage and operate a significantly larger and more diversified cleantech company. While we still saw a meaningful impact from our legacy production type RNG contracts, I am happy to report that this impact will be reduced going forward. The rest of our verticals in hydrogen, oxygen, nitrogen, and the Cleantech Service Network, are EBITDA profitable and continue to perform very well from a revenue growth and margin perspective.

A significant commercial milestone this quarter was the Biostream contract signed with one of the leading U.S. dairy RNG developers. Our continued improvements in the Biostream product will allow us to target a large addressable market with a one-of-its-kind offering. This standardized product will have better scalability and margins than our previous customized systems and will become a major contributor to our future organic RNG segment growth. Given the positive market reception of our Biostream product, we have started the production of 30 units in our Canadian facility, which represents a significant expansion of our existing manufacturing capacity.

2021 has been challenging so far, but we anticipate improved performance for the rest of the year accompanied by strong year-over-year revenue growth as we prepare for continued growth into 2022 and beyond. Over the next few quarters, we also expect a progressive return to normal EBITDA performance. I am proud of the foundation the team is building as we tackle the long-standing need for renewable and decentralized on-site gas generation solutions around the world,” stated Kurt Sorschak, Chairman, President and CEO of Xebec Adsorption Inc.

Current Market Outlook
Xebec continues to see increasingly favourable political and regulatory backdrop for its products and services, as evidenced by the recent master service agreement for 18 BGX Biostream with a leading US dairy RNG developer, as referred to above. North America, particularly the U.S., continues to be seen as a high-growth geography for the company as the country aims to increase its renewable gas production to support decarbonization goals, circular economies, and the rural sector. Similar trends are expected in other parts of the world, such as Europe, South and Southeast Asia, the Middle East, and China, contributing to the growth in demand for our products.

While consolidated gross margins continue to be impacted by the previously announced loss making long-term, production-type RNG contracts, the company expects that this impact will be tapered down in subsequent quarters. Xebec has implemented learnings from these contracts and expects that with its new standard Biostream product, its improved quoting processes and adjusted installation and integration processes, margins will start to revert to normal levels with new contracts.

Continued strong demand for our products has led Xebec to commence investments in its renewable natural gas, hydrogen, oxygen, and nitrogen generation segments. These investments include continued improvements and expansion in Biostream sales and production capacity, significantly increasing Inmatec’s production floorspace and expanding sales and production staffing which will allow for future revenue growth. Xebec believes that these are necessary investments to achieve a larger market presence, taking advantage of growing market opportunities.

Systems – Cleantech

Renewable Natural Gas (RNG)
Xebec achieved a significant commercial win that serves to accelerate its shift towards standardized biogas upgrading products for the agriculture RNG market, as underlined by the agreement with a leading dairy RNG developed for 18 Biostream units referred to earlier. The supply agreement provides important validation of the new product that was launched last year. To date, several first-generation Biostream units have been delivered to customers in California and Idaho and preparation for assembly of second-generation units is starting in Q3 2021 and deliveries expected in early 2022.

On July 22, 2021, U.S. Senators Sherrod Brown (D-OH) and John Thune (R-SD) reintroduced bipartisan legislation to encourage investment in biodigester and nutrient recovery systems. Their bill, known as the Agriculture Environmental Stewardship Act, provides a 30 percent investment tax credit to help offset the upfront costs associated with building biodigester systems. If passed, this legislation, alongside other initiatives, are expected to result in a rapid build out of U.S. RNG projects.

According to the American Biogas Council, it is estimated that 8,574 dairy, poultry, and swine farms are primed for biogas and renewable natural gas production. Based on data from the U.S. EPA’s Livestock Anaerobic Digester Database, Biostream is estimated to cover more than 80% of these animal manure use cases with multiple standardized configurations which range in capacity between 55 to 840 SCFM (90 to 1350 NCMH).

Due to anticipated market demand, Xebec is initially targeting production of 30 Biostream units for delivery over the next year in its Canadian manufacturing facility. The manufacturing facility is also being modified and is expected to allow for the annual production of approximately 30 to 40 Biostream units. Furthermore, Xebec is exploring new capacity in the U.S. as more purchase orders are signed.

Overall, Xebec expects that Biostream will lead to a stronger organic revenue growth profile for the segment, more predictable cost management and improved gross margins. With larger quantities of standardized components and parts, Xebec has started to see significant improvements in economies of scale as it prepares for assembly of the second-generation Biostream. This is an improvement over the less predictable and lower gross margins seen in its long-term, production-type RNG contracts, which have experienced cost overruns.

Xebec’s hydrogen activity through HyGear continues to be robust.  The key developments in Q2 2021 including signing its second hydrogen refueling station supply contract in the Netherlands, signing a 10-year gas-as-a-Service agreement with one of the largest glass manufacturers in the world, and commissioning a Gas-as-a-Service hydrogen generation unit for Turkey’s first lubricant recycling plant. In Q3 2021, we expect to see several projects commissioned including a 300kg H2/day installation in the Czech Republic to a globally active German lighting company for tungsten manufacturing.

In addition, HyGear is making the successful transition from one-time equipment sales to deploying Gas-as-a-Service assets. As a result of the transition to this business model, the company will see more recurring and profitable revenue streams as it shifts towards selling hydrogen molecules instead of equipment.

Xebec continues to see increased interest for its hydrogen PSA purification platform worldwide as more hydrogen generation systems and refueling stations come online. For example, a $1.2 million hydrogen PSA order was received in Q2 2021 from a customer in Poland for a hydrogen refueling station producing approximately 160kg/hr of hydrogen. The company is in advanced discussions with several parties and expects to receive larger-scale hydrogen purification contracts in the next few months.

Oxygen and Nitrogen
Inmatec continues to see record production levels primarily due to the heightened demand caused by the COVID-19 pandemic for sustainably and reliably sourced medical-grade oxygen. In Q2 2021, a lease was signed to double Inmatec’s production space to support further growth in medical oxygen and nitrogen generators. After receiving several large follow-on contracts from India and many other countries, order activity continues to be driven by countries hardest hit by COVID-19 or those in preparation for subsequent waves.

On-site oxygen and nitrogen generation significantly reduces the burden on the environment and costs for customers. Generating gases on-premises results in more environmentally friendly gas generation through reduced CO2 emissions by avoiding the transportation of gases, leading to a reduction of particulate matter, delivery bottlenecks and congestion on the road network. In addition, Inmatec’s on-site oxygen generators are used in biogas and renewable natural gas plants as a component within the desulphurization process.

Inmatec’s on-site oxygen and nitrogen generation revenues are now being included under the “Systems – Cleantech” segment due to the nature of its products.

Support – Industrial Products & Services
Xebec continues to make solid progress in its roll-up strategy by acquiring compressed air service companies to build out the company’s Cleantech Service Network. In Q2 2021 a new U.S. global headquarters for the industrial group was established in Mooresville, NC, a top region for compressed air and gas expertise. The successful integration of these acquisitions remains a key focus for Xebec and growth is being supported by the company’s newly implemented ERP and CRM systems.

Xebec closed two important and complementary acquisitions of Tennessee-based Nortek Belair Corporation (“Nortec”) and United Kingdom-based Tiger Filtration in Q2 2021.

Nortec became the company’s first U.S. manufacturing facility and will become a dedicated “Center of Excellence” for engineering of dehydration-based products such as compressed air, CNG/RNG and hydrogen dryers.  In addition, Xebec is transitioning all its dryer business from Canada to Nortec to allow for higher production rates of the second generation Biostream products in its Quebec facility. Tiger Filtration further bolsters Xebec’s strategy to become more service and support driven by allowing the company to vertically expand aftermarket consumables manufacturing. Tiger Filtration is expected to allow Xebec to capture immediate sales and costs synergies and create new consumable products for the energy transition.

Xebec expects additional acquisitions this year, and is targeting a yearly revenue run rate in the segment of approximately $250 million by 2025.

Renewable Gas Infrastructure
Xebec is addressing the renewable gas infrastructure opportunity through GNR Quebec Capital L.P. (“GNRQC”), a fund created in partnership with The Fonds de solidarité FTQ (“Fonds”), the largest capital development fund in Québec. Xebec is an equal equity investor alongside the Fonds and will participate in the sale of renewable natural gas equipment alongside long-term parts & service agreements for the equipment.

The fund has evaluated 24 projects to date and is actively engaged with 20 of both greenfield and brownfield varieties in agriculture, municipal, landfill and industrial waste applications. Several projects are in advanced stages and once the detailed engineering phase is completed, GRNQC expects to announce these investments.

Management Guidance for 2021
For fiscal full-year 2021, Xebec is updating its guidance with revenues maintained in the range of $110.0 to $130.0 million and adjusted EBITDA margins lowered in the range of -3.0% to -4.0% from 3.0% to 4.0%. The adjusted EBITDA margin is a result of the loss making RNG contracts in combination with higher SG&A investments required to build the necessary organizational foundations for future growth.

Xebec to Host Live Investor Webinar to Discuss Q2 2021 Results
An investor webinar for shareholders, analysts, investors, media representatives, and other stakeholders will be held today, August 12, 2021, at 8:30AM EDT (5:30AM PDT).

Register here:

A recording of the webinar and supporting materials will be made available later today in the investor’s section of the Company’s website at

2021 Second Quarter Financial Statements and Management’s Discussion and Analysis
The complete financial statements, notes to financial statements, and Management’s Discussion and Analysis for the three-month period ended June 30, 2021, are available on the company’s website at or on the SEDAR website at

Related links:

For more information:
Xebec Adsorption Inc.
Brandon Chow, Director, Investor Relations
+1 450.979.8700 ext 5762
[email protected]

About Xebec Adsorption Inc.
Xebec is a global provider of clean energy solutions for renewable and low carbon gases used in energy, mobility and industry applications. The company specializes in deploying a portfolio of proprietary technologies for the distributed production of hydrogen, renewable natural gas, oxygen and nitrogen. By focusing on environmentally responsible gas generation, Xebec has helped thousands of customers around the world reduce their carbon footprints and operating costs. Headquartered in Québec, Canada, Xebec has a worldwide presence with seven manufacturing facilities, eight Cleantech Service Centers and five sales offices spanning over four continents. Xebec trades on the Toronto Stock Exchange under the symbol (TSX: XBC). For more information,

Cautionary Statement

This press release contains forward-looking statements within the meaning of applicable Canadian securities law. These statements relate to future events or future performance and reflect the expectation of Management regarding the growth, results of operations, performance and business prospects and opportunities of the Corporation or its industry. Forward-looking statements typically contain words such as “believes”, “expects”, “anticipates”, “continues”, “could”, “indicates”, “plans”, “will”, “intends”, “may”, “projects”, “schedules”, “would” or similar expressions suggesting future outcomes or events, although not all forward-looking statements contain these identifying words. Examples of such statements include, but are not limited to, statements concerning: (i) actions expected to be undertaken to achieve the Company’s strategic goals; (ii) the key market drivers impacting the Company’s success; (iii) intentions with respect to future renewable gas work; (iv) expectations regarding business activities and orders that may be received in fiscal 2021 and beyond; (v) trends in, and the development of, the Company’s target markets; (vi) the Company’s market opportunities; (vii) the benefits of the Company’s products, (viii) the intention to enter into agreements with partners; (ix) future outsourcing; (x) expectations regarding competitors; (xi) the expected impact of the described risks and uncertainties; (xii) intentions with respect to the payment of dividends; (xiii) the management of the Company’s liquidity risks in light of the prevailing economic conditions; (xiv) the Company’s cost reduction plan; (xv) the search for additional financing over the next months; (xvi) statements regarding the merits of the class action complaints filed against the Company; and (xvii) 2021 revenue and EBITDA guidance.

These statements are neither promises nor guarantees but involve known and unknown risks and uncertainties that may cause the Company’s actual results, level of activity or performance to be materially different from any future results, levels of activity or performance expressed in or implied by these forward-looking statements. These risks include, generally, risks related to revenue growth, operating results, industry and products, technology, competition, the economy, the sufficiency of insurance and other factors which are discussed in greater details in this press release and in the Annual Information Form of the Corporation filed on SEDAR at

Forward-looking statements contained herein are based on a number of assumptions believed by the Corporation to be  reasonable as at the date of this press release, including, without limitations,  assumptions about trends in certain market segments, the economic climate generally, the pace and outcome of technological development, the identity and expected actions of competitors and customers, assumptions relating to the merits of the class action complaints filed against the Company and their impact, the value of the Canadian dollar and of foreign currency fluctuations, interest rates, working capital requirements, the anticipated margins under new contracts awards, the state of the Corporation’s current backlog, the regulatory environment, the sufficiency of internal and disclosure controls, the ability of the Corporation to successfully integrated acquired business, and the acquisition and integration of businesses in the future. Other assumptions, if any, are set out throughout this press release.  If these assumptions prove to be inaccurate, the Corporation’s actual results may differ materially from those expressed or implied in the forward-looking statements. The forward-looking statements contained herein are made as of the date of this press release and are expressly qualified in their entirety by this cautionary statement. Except to the extent required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements contained herein. Readers should not place undue reliance on forward looking statements.

Non-IFRS Measures

This press release refers to financial measures that are not recognized under International Financial Reporting Standard (“IFRS”). A non-IFRS financial measure is a numerical indicator of a company’s performance, financial position or cash flow that excludes or includes amounts or is subject to adjustments that have the effect of excluding or including amounts that are included or excluded in most directly comparable measures calculated and presented in accordance with IFRS. Non-IFRS measures do not have any standardized meaning under IFRS and therefore are unlikely to be comparable to similar measures presented by other companies having the same or similar businesses.

The Corporation believes these measures are useful supplemental information. The following non-IFRS measures are used by the Corporation in this press release: EBITDA, EBITDA margin, Adjusted EBITDA, Adjusted EBITDA margin, backlog of Xebec.

Please find below definitions of non-IFRS financial measures used by herein:

“EBITDA” means the earnings before interest, income taxes, depreciation and amortization, where interest is defined as net finance costs as per the consolidated statement of comprehensive income.

“EBITDA margin” being EBITDA as a percentage of revenues. 

“Adjusted EBITDA” means starting with EBITDA and adjust for Stock-based compensation expenses, impairment of inventories, exchange gain/loss on the obligation arising from non-controlling interest participation in a subsidiary, foreign exchange loss (gain) and accretion of debt.

“Adjusted EBITDA margin” being Adjusted EBITDA as a percentage of revenues.

“Backlog” means contracts that have been received and considered as firm orders.