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Why now is the time to invest in Canadian-based plasma technology maker PyroGenesis?

From waste disposal to ink for 3D printers, Plasma technology is the way of the future
By: Galit Solomon

Company: PyroGenesis – TSX-V: PYR, OTCQB: PYRNF, FRA: 8PY
President & CEO:  Peter Pascali – BSc (Physiology) and MBA (Finance/International Business)
Headquarters: Montreal, Quebec, Canada

Number of locations: 2 (Head office and factory)
In current role: Since 1992
Prior job: Investment Banker, M&A (Fortune 1,000), NYC

To say that this has been a busy time for Montreal based plasma manufacturing company, PyroGenesis, would be an understatement. “Since November, we have teamed up with two multi-million-dollar companies, one in Asia, the other in Europe, and we’ve been put on notice by the US Military, a long-standing client of ours, that our largest contract to date, $12.5 million, is imminent,” says the company’s President and CEO, Peter Pascali. A former Wall Street investment banker, Pascali worked on mergers and acquisitions of fortune 1,000 companies in the 1980’s. When he came across PyroGenesis in 1992, it was a small team of four people with revenues of less than $100-thousand. Since that time, under Mr. Pascali’s leadership, the company has grown to approximately 80 people with a market cap of over $75 million, and he has participated in almost every financing to the point where he is now the company’s largest shareholder.

PyroGenesis is a world leader in the design, development, manufacturing and commercialization of advanced plasma processes and products. “When we say plasma, we are speaking about the fourth state of matter. Plasma is a heat source. When you heat up a gas, it turns to plasma.” The company has more than 60 patents focusing on such areas as plasma waste processes, plasma atomized powders and plasma torches, which service three different industries: military/environment, 3D Printing, mining and metallurgy.

PyroGenesis started out as a plasma based environmental solutions company catering almost exclusively to the US Military. “The U.S. was looking for a way to handle waste on its aircraft carriers. Working with a client like this gave us credibility. The US military operates with some of the most stringent standards in the world, and that is how PyroGenesis began to commercialize plasma application.” After millions of dollars invested by the Military, PyroGenesis developed a compact lightweight plasma-based system for handling waste onboard aircraft carriers. Today, PyroGenesis plasma-based systems is specified into the design of US aircraft carriers, having delivered two systems to date. Another two systems are expected to be ordered any week now for at least $12.5M.

What should make PyroGenesis interesting to investors these days is the recent agreements the company has entered into. In the last 6 months, the company has signed contracts with two multi-billion-dollar companies in each of its other business segments (1. DROSRITE™, and 2. 3D Printing) which will effectively accelerate growth. As Pascali says “These entities have done their due diligence, and teamed up with us. One may assume that to move forward, it must have moved the needle for these companies, and if it moves the needle for a multi-billion-dollar company, it is off the charts for us.”

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Pascali has been with PyroGenesis for nearly three decades. He believes the secret to longevity in any business lies with the people that surround you. “It’s my most significant accomplishment – being able to maintain a core group of highly motivated and talented individuals.” Asked about how he has managed to keep his team together, Pascali borrows from French novelist, Antoine de Saint-Exupery: “If you want to build a ship, don’t drum up people to collect wood and don’t assign them tasks and work, but rather teach them to long for the endless immensity of the sea.”

Pascali concludes, “We are doing things that some people would say are impossible. Some of our biggest investors originally were skeptical. Our approach to skeptics over the years has been: ‘just watch us.’”

A growing number of international contracts is just one of several reasons, says Pascali, that savvy investors should take note of PyroGenesis now.

  1. Multi-billion-dollar companies have done their due diligence and recently partnered with PyroGenesis.
  2. Largest contract to date is imminent ($12.5M contract vs Annual revenues ~ $6-7M).
  3. Significant disconnect between recent press releases and stock price.

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