Perma FIX Environmental Services (PESI) Q2 FY26 earnings call: guidance and Q&A

Can you elaborate on potential grouting volumes for late 2026 and 2027, especially with the RFP starting in 2027 and excess capacity on the East side?

Management detailed DOE's public projections for grouting volumes: 60,000 gallons/month from AP-106 starting late 2026 through 2027, and 130,000 gallons/month from AMPS by 2028. They expressed confidence in receiving a task order soon based on DOE's public graphics and plans, and highlighted the long-term goal of 9 million gallons annually by 2030.

“Along within that graph, it also has some anticipated volumes and coming out of the TSCR or coming from AP-106, which, again, as I said before, will be replenished by the TSCR, they're anticipating that they'll be able to ship 60,000 gallons per month beginning in 2026 and which we anticipate to be late in '26 and to maintain that 60,000 gallons a month for grouting through 2027.”

asked by Aaron Spychalla · answered by Mark Duff

How might the recent Class II and Class III permit modifications impact the glass-plus-grout strategy and its schedule?

Management noted the rapid turnaround by state regulators on the permit mods, with a 60-day public comment period ending October 6. This aggressive schedule suggests collaboration between the state and DOE, potentially allowing grouting shipments to begin as early as late Q4, accelerating the full implementation of the dual strategy.

“The state turned this around in just a few days and got this after public comment for a 60-day public comment period, which is right now scheduled to end in, I think, October 6... then DOE will be -- the state will be in a position to provide potentially permit modifications in -- by mid-October, late October, and DOE could be in a position to actually start shipping waste for grouting later in Q4.”

asked by Aaron Spychalla · answered by Mark Duff

The RFP mentioned EMF waste stream inclusion. Will this impact the current EMF program, and how constructive are you on Q3 improvements?

Management expects the EMF program to continue under a new task order within the H2C contract, starting after the first of the year. While current DFLAW waste receipts are nominal (10,000 gallons/month on average, 35,000 in July), they are increasing, and the facility is working through production issues. They anticipate significant increases in waste quantities as DFLAW ramps up.

“What we're anticipating is that because of the modification in this H2C award and as defined in the press release from them, EMF will be a task order within the new contract. We do expect to receive that... Now right now, people are probably wondering how much DFLAW waste we're getting. DFLAW has been chugging along at about 10,000 gallons a month on average... That is increasing. I was told that they did 35,000 gallons in July and are expecting to beat that significantly in August this month.”

asked by Aaron Spychalla · answered by Mark Duff

What is your peak processing capacity, and how long will it take to ramp up to meet H2C demand?

Current capacity is 1.2 million gallons/year (100,000 gallons/month). They are modifying their permit to increase this to over 10 million gallons/year, expecting to be up and running by Q2 FY27. The primary critical path is regulatory approval, but they are confident in meeting DOE's demand, including the 9 million gallons/year target by 2030.

“Right now, our capacity, including our permit and our equipment is 1.2 million gallons a year, about 100,000 gallons a month. And we are modifying our permit to increase that to over $10 million. And we expect that to take, as I mentioned, sometime into Q2 next year.”

asked by Yuan Zhi · answered by Mark Duff

Given the maximum cumulative quantity of 50 million gallons and value of $4.3 billion, is an average revenue per gallon of $88 reasonable?

Management stated it's a tough question to answer specifically due to varying factors. The contract includes different rates for basic waste, surcharges for complex waste (high organics/metals), and significantly higher costs for Class B and C waste. Therefore, the average could be higher or lower depending on the waste mix, making a simple average misleading.

“That's a tough question. I can't answer that specifically. And the reason it's difficult to answer is because there's a lot of factors associated with this contract. For example, there's rates for just your basic 80% of the waste that they're anticipating being a certain type of waste with certain constituents that can be grouted very quickly and easily.”

asked by Yuan Zhi · answered by Mark Duff

Is it true that the vitrification plant is only about 35-40% efficient, generating secondary waste, while your grouting process handles 100% of the waste without generating additional waste?

Management clarified that vitrification processes 100% of the liquids that go in, but it generates secondary waste (e.g., filters, PPE, chemical waste, EMF waste). In contrast, the grouting process handles 100% of the waste without generating additional waste, confirming the distinct difference in waste generation.

“I can say that for grouting, yes, all 100% is done. I think there may be some confusion on behalf of vitrification, all 1,000 gallons that you mentioned when it goes in, it all gets vitrified. So they will vitrify 100% of the liquids that go in. I think what might be confused with is they'll be generating -- the term that's used typically is three gallons of waste for every gallon that goes in. So they do have a lot of waste that comes out of it as part of the treatment process.”

asked by Steve Fein · answered by Mark Duff