NXT Energy Solutions Announces Third Quarter 2023 Results
15 November 2023 - 8:10AM
NXT Energy Solutions Inc. ("NXT" or the "Company") (TSX: SFD;
OTCQB: NSFDF) today announced the Company's financial and operating
results for the three and nine months ended September 30, 2023. All
dollar amounts herein are in Canadian Dollars unless otherwise
identified.
Financial and Operating
Highlights
Key financial and operational highlights are
summarized below:
- on September 5, 2023. NXT announced
that it has executed a contract to provide an SFD® survey to an
independent oil and gas exploration company in Turkiye;
- the second tranche of the
convertible debenture with strategic partner Ataraxia Capital
contributed $0.27 million of cash;
- cash at September 30, 2023 was
$0.37 million;
- net working capital was ($3.47)
million at September 30, 2023;
- the Company recorded SFD®-related
revenues of $nil;
- a net loss of $1.70 million was
recorded for Q3-23, including stock-based compensation expense
("SBCE") and amortization expense of $0.48 million;
- a net loss of $5.03 million was
recorded for YTD 2023, including SBCE and amortization expense of
$1.50 million;
- net loss per common share for Q3-23
was $0.02 basic and $0.02 diluted;
- net loss per common share for YTD
2023 was $0.07 basic and $0.07 diluted;
- cash flow used in operating
activities was $0.95 million during Q3-23 and $3.36 million YTD
2023; and
- general and administrative
("G&A") expenses decreased by $0.12 million (13%) in Q3-23 as
compared to Q3-22 and G&A expenses decreased by $0.28 million
(10%) in YTD 2023 as compared to YTD 2022.
Key financial and operational highlights
occurring subsequent to Q3-23 are summarized below:
- mobilization of
the SFD® survey in Turkiye is expected to commence in November,
2023; and
- US$1,000,000
(CDN$1,379,000) of a convertible debenture was received.
On September 5, 2023 NXT announced that it has
executed a contract to provide an SFD® survey to an independent oil
and gas exploration company in Turkiye, which is strategically
located at the junction of Eastern Europe, Central Asia and the
Middle East. Operation planning for this contract has commenced and
NXT’s interpretations and recommendations are expected to be
delivered during the fourth quarter of 2023.
To support this SFD® Survey and other working
capital needs, on November 9, 2023 NXT announced it is offering a
multi-tranche convertible debenture (the "Debenture") under which
the subscribers will be able to purchase a principal amount of up
to US$2,500,000 (approximately CAD$3,447,500.) The Debentures bear
interest at 10.0% per annum, paid quarterly in arears, and are due
and payable two years after issuance of the Debenture. The
Debentures are convertible into common shares of NXT at a
conversion price of US$0.1808 (CAD$0.25) per common share.
US$1,000,000 (approximately CAD$1,379,000) of the Debenture has
already been subscribed by MCAPM, LP and Michael P. Mork.
The Company intends to complete the remaining
US$1,500,000 of the Debenture offering on or before December 15,
2023.
Commenting on the Debenture offering, Bruce G.
Wilcox, Interim CEO of NXT said, “NXT continues to make progress on
its business development plans. We have the capital necessary to
complete the SFD® contract in Turkiye and continue with other
negotiations for the deployment of our SFD® technology in other
regions. MCAPM LP and Michael P. Mork have been significant
shareholders of the Company for over 20 years and we appreciate
their confidence in the potential of NXT.”
The securities described herein have not been,
and will not be, registered under the United States Securities Act
of 1933, as amended (the "1933 Act"), or any state securities laws,
and accordingly, may not be offered or sold within the United
States except in compliance with the registration requirements of
the 1933 Act and applicable state securities requirements or
pursuant to exemptions therefrom. This news release shall not
constitute an offer to sell or the solicitation of an offer to buy
nor shall there be any sale of the securities in the United States
or in any other jurisdiction in which such offer, solicitation or
sale would be unlawful.
Summary highlights of NXT's 2023 third quarter
financial statements (with comparative figures to 2022) are noted
below. All selected and referenced financial information noted
below should be read in conjunction with the Company's third
quarter 2023 unaudited condensed consolidated interim financial
statements, the related Management's Discussion and Analysis
("MD&A").
(All in Canadian $)
|
Q3-23 |
Q3-22 |
2023 YTD |
2022 YTD |
Operating results: |
|
|
|
|
SFD®-related revenues |
$ |
- |
|
$ |
- |
|
$ |
- |
|
$ |
- |
|
SFD®-related costs, net |
|
348,169 |
|
|
230,518 |
|
|
968,199 |
|
|
974,292 |
|
General & administrative expenses |
|
841,200 |
|
|
963,433 |
|
|
2,644,261 |
|
|
2,922,660 |
|
Amortization and other expenses |
|
514,587 |
|
|
454,037 |
|
|
1,412,952 |
|
|
1,366,575 |
|
Net loss |
|
(1,703,956 |
) |
|
(1,647,988 |
) |
|
(5,025,412 |
) |
|
(5,263,527 |
) |
|
|
|
|
|
Loss per common share, basic
and diluted: |
$ |
(0.02 |
) |
$ |
(0.03 |
) |
$ |
(0.07 |
) |
$ |
(0.08 |
) |
|
|
|
|
|
Common shares outstanding as
at end of the period |
|
77,958,928 |
|
|
65,585,902 |
|
|
77,958,928 |
|
|
65,585,902 |
|
Weighted average of common
shares, basic and diluted: |
|
77,735,682 |
|
|
65,386,959 |
|
|
77,283,442 |
|
|
65,333,954 |
|
|
|
|
|
|
Cash provided by (used in): |
|
|
|
|
Operating activities |
$ |
(953,051 |
) |
$ |
(533,787 |
) |
$ |
(3,363,362 |
) |
$ |
(2,229,816 |
) |
Financing activities |
|
253,114 |
|
|
(25,694 |
) |
|
3,469,891 |
|
|
(24,573 |
) |
Investing activities |
|
- |
|
|
500,000 |
|
|
- |
|
|
550,000 |
|
Effect of foreign rate changes
on cash |
|
18,921 |
|
|
16,481 |
|
|
(558 |
) |
|
20,376 |
|
Net cash inflow (outflow) |
|
(681,016 |
) |
|
(43,000 |
) |
|
105,971 |
|
|
(1,684,013 |
) |
Cash
and cash equivalents, beginning of the period |
|
1,050,424 |
|
|
616,842 |
|
|
263,437 |
|
|
2,257,855 |
|
Cash
and cash equivalents, end of the period |
|
369,408 |
|
|
573,842 |
|
|
369,408 |
|
|
573,842 |
|
Short-term investments |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Total
cash and short-term investments, end of the period |
|
369,408 |
|
|
573,842 |
|
|
369,408 |
|
|
573,842 |
|
|
|
|
|
|
Net working capital balance |
$ |
(3,468,900 |
) |
$ |
(1,060,858 |
) |
$ |
(3,468,900 |
) |
$ |
(1,060,858 |
) |
NXT's 2023 third quarter financial and operating
results have been filed in Canada on SEDAR at www.sedarplus.ca, and
will soon be available in the USA on EDGAR at www.sec.gov/edgar, as
well as on NXT's website at www.nxtenergy.com.
About NXT Energy Solutions
Inc.
NXT Energy Solutions Inc. is a Calgary-based
technology company whose proprietary SFD® survey system utilizes
quantum-scale sensors to detect gravity field perturbations in an
airborne survey method which can be used both onshore and offshore
to remotely identify traps and reservoirs with hydrocarbon and
geothermal exploration potential. The SFD® survey system enables
our clients to focus their exploration decisions concerning land
commitments, data acquisition expenditures and prospect
prioritization on areas with the greatest potential. SFD® is
environmentally friendly and unaffected by ground security issues
or difficult terrain and is the registered trademark of NXT Energy
Solutions Inc. NXT Energy Solutions Inc. provides its clients with
an effective and reliable method to reduce time, costs, and risks
related to exploration.
Contact Information
For investor and media inquiries please contact:
Eugene Woychyshyn |
Michael
Baker |
Vice President of Finance &
CFO |
Investor Relations |
302, 3320 – 17th AVE SW |
302, 3320 – 17th AVE SW |
Calgary, AB, T3E 0B4 |
Calgary, AB, T3E 0B4 |
+1 403 206 0805 |
+1 403 264 7020 |
nxt_info@nxtenergy.com |
nxt_info@nxtenergy.com |
www.nxtenergy.com |
www.nxtenergy.com |
Forward-Looking
Statements
Certain information provided in this press
release may constitute forward-looking information within the
meaning of applicable securities laws. Forward-looking information
typically contains statements with words such as "anticipate",
"believe", "estimate", "will", "expect", "plan", "schedule",
"intend", "propose" or similar words suggesting future outcomes or
an outlook. Forward-looking information in this press release
includes, but is not limited to, information regarding: timing of
the delivery of interpretation and recommendations of the Turkish
SFD® survey, business negotiations, opportunities and discussions,
including the timing thereof, business strategies, and timing of
the receipt and amount of the final tranche of the Debenture.
Although the Company believes that the expectations and assumptions
on which the forward-looking statements are based are reasonable,
undue reliance should not be placed on the forward-looking
statements because the Company can give no assurance that they will
prove to be correct. Since forward-looking statements address
future events and conditions, by their very nature they involve
inherent risks and uncertainties. Actual results could differ
materially from those currently anticipated due to a number of
factors and risks. Additional risk factors facing the Company are
described in its most recent Annual Information Form for the year
ended December 31, 2022 and MD&A for the three and nine month
periods ended September 30, 2023, which have been filed
electronically by means of the System for Electronic Document
Analysis and Retrieval (“SEDAR”) located at www.sedarplus.ca. The
forward-looking statements contained in this press release are made
as of the date hereof, and except as may be required by applicable
securities laws, the Company assumes no obligation to update
publicly or revise any forward-looking statements made herein or
otherwise, whether as a result of new information, future events or
otherwise.
Non-GAAP Measures
This news release contains disclosure respecting
non-GAAP performance measures including net working capital which
does not have a standardized meaning prescribed by US GAAP and may
not be comparable to similar measures presented by other entities.
This measure is included to enhance the overall understanding of
NXT’s ability to assess liquidity at a point in time. Readers are
urged to review the section entitled "Non-GAAP Measures” in NXT’s
MD&A for the three and nine month periods ended September 30,
2023 which is available under NXT's profile on SEDAR at
www.sedarplus.ca, for a further discussion of such non-GAAP
measures. The financial information accompanying this news release
was prepared in accordance with US GAAP unless otherwise noted.
Management's discussion and analysis of financial results and the
unaudited condensed consolidated interim financial statements and
notes for the three and nine months ended September 30, 2023, are
available through the Internet in the Investor Relations section of
www.nxtenergy.com or under NXT's SEDAR profile at
www.sedarplus.ca.
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