MONTREAL (QC), April 15, 2020 – Xebec Adsorption Inc. (TSXV: XBC) (“Xebec”), a global provider of clean energy solutions announced today its 2019 fourth quarter and twelve-month period results, with the following highlights:

  • Record revenues of $13.6 million in the fourth quarter of 2019 compared to $6.1 million for the same period in 2018, a 123% increase.
  • Positive EBITDA at $1.4 million for the fourth quarter 2019 compared to ($0.8) million for the same period in 2018.
  • Net loss of ($0.5) million or ($0.01)/share for the fourth quarter 2019, compared to a net loss of ($1.0) million or ($0.02)/share for the same period in 2018. Quarterly earnings were negatively impacted by significantly higher amortization & depreciation, audit, recruiting and consulting expenses.
  • Working capital increased to $36.9 million on December 31, 2019, for a current ratio of 3.2:1 compared with working capital of $5.3 million and a 1.6:1 ratio on December 31, 2018.
  • Cash on hand of $22.7 million on December 31, 2019 compared with $3.9 million on December 31, 2018.

Financial Results

  • Revenues of $49.3 million for the twelve-month period ended December 31, 2019 compared to $20.2 million for the same period in 2018, a 144% increase. The increase is mainly explained by the high volume of major cleantech contracts and a company acquisition.
  • Gross profit of $15.5 million or 31% of revenues for the twelve-month period ended December 31, 2019 compared to $5.7 million for the same period in 2018, a 172% increase compared to the same period in 2018. The company has a higher gross margin in the cleantech segment and a better absorption of the overhead cost due to a higher volume of sales.
  • Net profit of $2.0 million or $0.03 per share for the twelve-month period ended December 31, 2019, compared to a net loss of ($2.9) million or ($0.07) per share for the same period in 2018, an improvement of $4.9 million. The increase is mainly due to higher sales and margin.
  • Positive adjusted EBITDA of $6.3 million for the twelve-month period ended December 31, 2019, compared to ($1.2) million for the same period in 2018, an increase of $7.5 million.
  • Backlog increased by $21.0 million, from $78.3 million on April 16, 2019, to $99.3 million on April 14, 2020.
  • Selling and administrative expenses increased by $4.1 million in the twelve-month period ended December 31, 2019 compared to the same period in 2018. This is primarily due to an organizational scale-up of employees and associated costs to support the increased level of sales, order backlog and building quote log. Acquisition costs related to the acquisition of CDA Systems LLC and additional costs associated with acquisition activities and legal expenses related to the establishment of our Infrastructure segment increased SG&A expenses in the fourth quarter of 2019.
  • Cash on hand as of December 31, 2019 was $22.7 million compared to $3.9 million in 2018 and working capital has increased to $36.9 million compared to $5.2 million on December 31, 2018.
  • Bought Deal for aggregate gross proceeds of $23.0 million closed on December 27, 2019, at a price of $2.10 per share.
  • Acquisition of CDA Systems closed on December 10th, 2019 for a preliminary cash consideration of $6,782,433. The agreed earnout payments are dependent on certain future performance targets.

CEO Quote:

“2019 was a transformative year for Xebec with record revenues, profit and order backlog numbers. I’m proud of what our team has accomplished, leaving us well equipped to deliver another record year in 2020.

With our improved balance sheet, our strong order backlog, our growing quote log, our pipeline of potential acquisitions, and our position as an essential business in a time of crisis, Xebec will be well able to maneuver through what will be a difficult economic environment in the year ahead. We believe that we will emerge from this crisis even stronger than we entered it.

On a more personal note, I am happy to report that Xebec did not have to furlough or lay-off any of our employees. We successfully migrated office work to home-based work, while our production and service staff continue to manufacture and service much-needed products for our healthcare and other essential institutions.

Finally, let me assure everyone that employee health and safety as well as shareholder value creation remain our absolute focus.”
 Kurt Sorschak, President and CEO, Xebec Adsorption Inc.

COVID-19 Operational Update
With operations on three continents, Xebec continues to monitor worldwide developments of the novel coronavirus and its potential impact on its global operations. At our head office location in Québec, the company has been deemed an “essential business” and continues its regular course of operations and manufacturing. Although we remain open, we have shifted our office staff to work from home while we continue to provide service and emergency support through our home-based service technicians. We also maintain our warehouse operations to ship equipment, parts, and provide rentals.

Our operations in Shanghai, China, are fully operational with deliveries having restarted in March, and continue to expand. Manufacturing in our Italian subsidiary remains on hold at this point, and we expect to restart by early to mid-May.

Our service and support subsidiary Compressed Air International Inc. in Toronto remains open and having been deemed an essential business is operating as normal. Xebec’s recent acquisition, CDA Systems in Livermore, California, likewise operates as an essential business. Its office staff has transitioned to home base work, while its service, parts and rental activities continue as normal.

Management Guidance for 2020
Despite the impending global backdrop of economic hardship, Xebec expects to continue its rapid growth and improved profitability in 2020. As a result, the company will maintain its previously announced guidance. With the support of our increasing order backlog of $99.3 million, we expect consolidated revenues for 2020 in the range of $80 to $90 million, net earnings of 7 to 9% and EBITDA margins of 11 to 13%.

More specifically, revenues in our Cleantech Systems segment are expected to be $50 to $55 million and revenues from our Industrial Service & Support segment are expected to grow to $30 to $35 million with half of the revenue attributed to acquisitions, and the rest to organic growth. Lastly, Xebec does not expect to record revenues for our Renewable Gas Infrastructure segment in 2020.

Cleantech Systems
Our renewable gas solutions continue to deliver expected results. Our efforts to expand into more geographies and win market share are gaining traction and we expect this to continue in the coming quarters. We regard quote activity as an early indicator for future order activity. Our current quote log exceeds $937.0 million (as of March 13th, 2020), and our order backlog is $99.3 million, a record for Xebec.

Xebec has had recent success in the U.S dairy market with $27.0 million in orders announced in February 2020. We see this as a reflection of more customers recognizing Xebec’s competitive advantages which are lowest lifecycle costs and local service and support offerings through our North American Xebec Service Subsidiaries.

Furthermore, we are seeing growth across all geographies, most notably in China where revenues in 2019 have increased nearly 400% and are expected to double in 2020. This growth is primarily driven by hydrogen purification systems for petrochemical, refinery and by-product hydrogen applications. In 2020 Xebec will increase its effort in Europe and North America to market and sell its new BGX Biostream™ product to gain market share in the small to medium size biogas upgrading segment.

Industrial Service & Support
Xebec continues to pursue organic and inorganic growth opportunities. The company views acquisitions as a critical component in supporting Cleantech’s growth by enabling service and support throughout North America. On December 10th, 2019, we announced our 2nd acquisition as part of this strategy, and we expect another two to three acquisitions in 2020.

The company’s acquisitions strategy so far is performing better than expected with our first acquisition (Compressed Air International Inc.) organically growing revenues by 35% year-over-year. This is reflective of management’s objective to not only achieve a competitive advantage in the Cleantech segment through these service company acquisitions, but to also increase sales in the core industrial air treatment business and growing associated margins and EBITDA.

Revenue in this segment is expected to triple from $11.5 million in 2019 to $30 to $35 million in 2020, while gross margins should start improving from around 30% towards the targeted 40% range. The introduction of additional air dehydration, accessories and filtration products combined with an improved product mix should help gross margins over the coming quarters.

Renewable Gas Infrastructure
Xebec has started to actively participate in renewable gas projects and act as an investor through strategic partnerships. These partnerships support the growth of companies developing renewable gas and waste recovery projects.

On February 18th, 2020, Xebec announced its first renewable natural gas (RNG) infrastructure investment located in Québec, Canada. The $28 million project will be an integrated facility to process various organic wastes to produce renewable natural gas and biofertilizer. The plant is expected to be commissioned in early to mid-2021.

This marked a key milestone for Xebec’s newest business segment, which aims to drive predictable recurring and profitable revenue through 20-year Gas Purchase Agreements (GPAs) with utilities, tipping fees and bio-fertilizer sales.

In addition, Xebec is finalizing the establishment of a significant partnership to co-invest into multiple renewable gas infrastructure projects in Canada and expects to announce this partnership in the near future. This will allow the company to rapidly scale up its efforts to invest in high-quality renewable gas assets.

Xebec to Host Live Investor Webinar to Discuss Q4 and Year End 2019 Results
An investor webinar for shareholders, analysts, investors, media representatives, and other stakeholders will be held today, April 15, 2020 at 11:00AM EDT (8:00AM PDT).

Register here:

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

2019 Fourth 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 twelve-month period ended December 31, 2019, are available on the company’s website at or on the SEDAR website at 

Related links:

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

About Xebec Adsorption Inc.

Xebec Adsorption Inc. is a global provider of gas generation, purification and filtration solutions for the industrial, energy and renewables marketplace. Its customers range from small to multi-national corporations and governments looking to reduce their carbon footprints. Headquartered in Montreal (QC), Xebec designs, engineers and manufactures innovative and transformative products, and has more than 1,500 customers worldwide. With two manufacturing facilities in Montreal and Shanghai, as well as a sales and distribution network in North America, Europe, and Asia, Xebec trades on the TSX Venture Exchange under the symbol XBC. For additional information on the company, its products and services, visit Xebec at

Cautionary Statement

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accept responsibility for the adequacy or accuracy of this release. This news release contains forward-looking statements and forward-looking information (together, “forward-looking statements”) within the meaning of applicable securities laws. All statements, other than statements of historical facts, are forward-looking statements and subject to risks and uncertainties. Generally, forward-looking statements can be identified by the use of terminology such as “plans”, “seeks”, “expects”, “estimates”, “intends”, “anticipates”, “believes”, “could”, “might”, “likely” or variations of such words, or statements that certain actions, events or results “may”, “will”, “could”, “would”, “might”, “will be taken”, “occur”, “be achieved” or other similar expressions. Forward-looking statements, including statements concerning future capital expenditures, revenues, expenses, earnings, economic performance, indebtedness, financial condition, losses and future prospects as well as the expectations of management of Xebec with respect to information regarding the business and the expansion and growth of Xebec operations, involve risks, uncertainties and other factors that could cause actual results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements are subject to business and economic factors and uncertainties, and other factors that could cause actual results to differ materially from these forward-looking statements, including the relevant assumptions and risks factors set out in Xebec’s public documents, including in the most recent annual management discussion and analysis and annual information form, filed on SEDAR at Furthermore, should one or more of the risks, uncertainties or other factors materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward-looking statements or information. These risks, uncertainties and other factors include, among others, the uncertain and unpredictable condition of the global economy, Xebec’s capacity to generate revenue growth, a limited number of customers, and other factors. Although Xebec believes that the assumptions and factors used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed times frames or at all. Except where required by applicable law, Xebec disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.