Q2 2021 Perma-Fix Environmental Services Inc Earnings Call
[music].
Good day, ladies and gentlemen, and welcome to the Perma fix second quarter 2021 conference call.
Things have been placed on a listen only mode and the floor will be opened for questions and comments. Following the presentation. If you should require any adjusted throughout the conference. Please press star zero on your telephone keypad through July operator at this time. It is my pleasure to China floor over to your host David Walker and the relations Sir.
The floor is yours.
Thank you, Sean and good morning, everyone and welcome to Perma fix environmental services second quarter 2021 conference call on the call with US. This morning are Mark Duff, President and CEO, Dr. Lou Centofanti Executive Vice President of strategic initiatives, and Ben Naccarato, Chief Financial Officer, The company issued a press release this.
Morning, containing second quarter 2021 financial results, which is also posted on the company's website. If you have any questions. After the call or would like any additional information about the company. Please contact crescendo communications at 21267110 to one I'd also like to remind everyone that certain statements contained within this conference.
Call, maybe deemed forward looking statements within the meaning of the private Securities Litigation Reform Act of 1095 and include certain non-GAAP financial measures. All statements on this conference call other than a statement of historical fact are forward looking statements that are subject to known and unknown risks uncertainties and other factors, which could cause actual results and performance of the company.
To differ materially from such statements. These risks and uncertainties are detailed in the Companys filings with the U S Securities and Exchange Commission as well as this morning's press release the company makes no commitment to disclose any revisions to forward looking statements or any facts events or circumstances. After the date hereof that bear upon forward looking statements and.
In addition, today's discussion will include references to non-GAAP measures Perma fix believes that such information provides an additional measurement and consistent historical comparison of its performance a reconciliation of the non-GAAP measures to the most directly comparable GAAP measures is available in today's news release on our website I'd now like to turn the call over to Mark Duff. Please.
Go ahead Mark.
Alright, Thanks, David and good morning, everyone.
During the first half of 2021, we continue to experience the impact of COVID-19 pandemic as the federal government has been much slower than the commercial sector to resume normal operations.
This was not unique to us but has been experienced across the industry by most of our peers as well. Nevertheless, we're able to reported net income of $3 million for the quarter, we have $7 million of cash on the balance sheet and have lowered our bank debt to under.
$1.5 million.
Fortunately, we've begun to see activity pick up heading into the third quarter and expect a solid second half of the year barring any further slowdowns related to COVID-19.
19, new strains are.
Not only do we see things pick up this year, but we also believe we're very well positioned for 2022.
There is a tremendous pent up demand in both our treatment and services segments.
Turning first to our services segments. We are bidding pipeline is more robust than ever as I mentioned last quarter. Our teams have been working around the clock and we've been developing for a five simultaneous proposals at any given time. This is a direct reflection of the improvements we've made internally and specifically within our bidding organization.
As a result, we are now bidding on a wide array of contracts collectively valued in the hundreds of millions of dollars.
That is.
The fact is that we're not losing bids.
The government procurement process has been delayed in these contracts will eventually get awarded just last month, we were awarded a multimillion dollar service contract for the tritium systems demolition disposal project, which is expected to be completed over the next 18 months. We believe this contract is a good illustration of where things are.
We're heading and reflects our competitive edge.
This specific procurement included significant competition.
Several of our toughest competitors as well as larger firms all bidding against us.
Although this particular contract is smaller than some of the contracts were bidding on it does show that the market is starting to open and we expect more contracts to be announced and awarded in the coming weeks and months.
Also worth noting that some of the contracts were bidding on if we are successful could be transformative to the company importantly, these larger site operations and cleanup procurements within the department of energy.
Multibillion dollar awards include substantial small business subcontract and requirements as a percentage of the revenue.
This plays into our strength as perfect plans to remain a small business.
Defined by the government as the under 750 employees.
For the foreseeable future.
While we're working hard to secure teaming relationships.
On the proposal efforts, even if we're not successful in initial awards is still significant future opportunities for sub contracts with these primes on these projects within both of our segments.
Turning to our treatment segment, we're beginning to realize increases in waste treatment activity, both in bidding opportunities receipts and plant production as our services segment.
Shipments of.
<unk> been delayed through most of Q2.
But it's important to reiterate this business has not gone away in fact, the backlog of waste that must be treated Ah continues to grow.
Due to the diversification efforts of our sales team, we've been able to penetrate several new commercial markets and coupled with our typical government acceleration at the end of the fiscal year I would just Q3, we anticipate waste receipts.
Rates closer to normal heading into September and into Q4.
We also continue to expand our waste treatment offering we recently completed design and began fabrication and construction of our new thermal fixed gen three system or third generation vacuum thermal desorption system.
The thermal fixed Gen III unit.
Offers a treatment solution for problematic waste streams, while providing increased efficiency and productivity as well.
With our initial sales launch.
Just a couple of months ago in June of 'twenty, one and even with even before the unit.
Has commenced operations, we've already secured and existing on site waste treatment backlog and inventory.
Large sales pipeline, which underscores the demand for this capability.
In both the commercial and the government sectors were very excited about the system.
And anticipate steady receipts up through <unk>.
Startup in the fourth quarter.
And well into the 2022 timeframe.
Turning to the Testbed initiative, which we refer to as Tbi. It's also referred to as the low level waste off site disposal project.
And make progress and have received strong support from the department of energy.
In terms of providing a supplemental pathway for treatment of level waste from the two 6 million gallons of tank wastes located at the Hanford reservation.
<unk> recently notified the Washington State Department of ecology that they are preparing an environmental assessment on the next phase of the test bed initiative.
The environmental assessment or EBITDA.
Process is one of the final steps required before we can commence phase two of the project, which will include extraction.
Shipment and transportation of 2000 gallons of tank waste to our perfect northwest facility located in Richland, Washington.
<unk> officials have recently stated that shipment of this waste to our facilities should occur.
Higher to next summer.
As recently reported in the local Hanford Arey newspaper, the Tri City Herald use of routing, which is the basis of our process to treat the hanford tank waste.
Save the taxpayer millions or billions of dollars and speed the emptying of the tank waste from the leak prone underground storage tanks.
We've stated in the past.
And we are successful this project can be quite transformative to our company.
And we'll supplement the vitrification unit, which is currently under construction and testing at the D. We average site so to wrap up while we're disappointed in our overall Q2 performance. We believe perfect is well positioned for growth I'm, especially proud of our business development efforts, our team has initiated and completed which high.
Flights, our ability to adapt to the changing market. During this period, we've also invested in our capabilities and our facilities and it.
Built a highly scalable infrastructure with a first class team of folks.
So the next level.
Now with the return of normalization following the pandemic, we truly believe we are well positioned to aggressively grow both sides of the business.
And we're starting to see things pick up.
As we look at our pipeline for the balance of this year and beyond we expect to resume.
Solid organic growth in the near term.
I truly believe that the future is brighter than ever for perma fix and we look forward to driving significant value for our shareholders.
Ill now turn it over to Ben who will discuss the financial results in more detail Ben.
Thank you Mark.
I'll start with revenue, our Covid and as mentioned earlier, the Covid pandemic really impacted our revenue.
In both segments as government sites.
We haven't shipped the way set their historic volumes in <unk>.
Very slow to award or fund.
Projects in the service segment so assets.
Such our total revenue for continuing operations for the second quarter was $16.1 million compared to last year's second quarter, a $22 million.
A decrease of $5.9 million or 26, 8%.
The decrease in the revenues primarily due to the drop in the services segment.
And that totaled about $5.8 million.
Our treatment segment was only marginally down from.
Prior year about 134000.
The drop in the revenue in services was due to the completion of large projects.
Whose revenue we've not been able to replace by another project or projects of equal value.
For the year to day June 30th our revenue was down $7.6 million or 16, 2%.
And this drop in revenue comes from both segments as the service segment has been impacted again by the completion of certain projects.
And is down approximately $5.4 million, while the treatment segment has been impacted by the drop in volume of waste and is down $2.2 million from last year.
Growth from a gross profit standpoint, the quarter was 966000 compared to $3.3 million from second quarter of 2020.
The drop in the gross profit was approximately $2.3 million up $2.3 million was primarily from the services segment, where.
Were reduced project revenue impacted gross profit from both a volume and margin standpoint.
Also lower volume of waste mix had a minimal impact on the treatment segment, while the fixed costs at the plants were.
If we were able to keep that fairly constant.
For the six months ended June 30th gross profit was $3.3 million compared to $7.9 million in prior year.
This drop in gross profit was impacted by the lower volume in both segments as well as reduce margins in the service segment projects.
Our G&A costs for the quarter were $3 million compared to $2.7 million in the second quarter last year.
This increase of 297000 was primarily related to increased salaries and consulting expenses that supported the increased bid and proposal activity.
For the six months ended June 30th G&A costs were $6.2 million compared to $5.6 million in the prior year and again the biggest impact on this variance was the higher bid and proposal expense from labor costs and outside consultants.
Sure.
Our net income attributable to common shareholders for the quarter was $3 million compared to last year's net income of 204000.
The main driver of this improvement was a gain on the extinguishment of debt related to the company's PPP loan.
Which totaled $5.4 million and was forgiven in June of 2021.
Our basic income per share for the quarter was 25 cents compared to income per share.
<unk> in the prior year.
Our year to date basic income per share was <unk> 16, compared to 12 in 2020.
Our adjusted EBITDA from continuing operations for the quarter as defined in this morning's press release.
With a loss of $1.7 million compared to income of 847000.
Last year and this reflects the lower revenue in both segments impacted by the ongoing effects from the Covid pandemic.
Turning to the balance sheet compared to year end 2020, our cash on the balance sheet was at $7.3 million compared to seven 9 million at the end of 2020.
Our unbilled receivables were down $7.1 million, which reflects the reductions in revenue compared to Q4 in the service segment.
Our current liabilities were down $8.8 million as a result of the timing of our payments a reduction in the activity in the service segment and the forgiveness of the PPP loan.
And our backlog at the end of June was $6.7 million, which is down from $7.6 million at year end up slightly from $6.4 million in June of 2020.
And our total debt for the quarter at the end at quarter end was $1.3 million, which is primarily owed to PNC bank credit facility.
Finally, I will talk about cash flow activity in 2021, our cash provided by continuing operations was 803000, our cash used by discontinued operations is $315000.
Cash used for investing in continuing operations was 649000, which is.
It's primarily cap spending.
And our cash used for financing was 439000, which represents our monthly payments on our term loan.
Totaling about 219000, and another 220000 per finance lease and debt issuance costs.
With that operator, I'll now turn the call over to questions.
Okay, Ladies and gentlemen, we have reached a question and answer portion of the call to ask a question. Please press star one telephone keypad at this time.
Yes.
And our first question comes from Howard Browse Howard Please.
Please state your question.
Mark Ben first of all I Hope you and your families are well protected from the Covid has anybody been.
Affected by it.
So far so good Howard thanks for assets.
We'll get the families our high.
Most important thing.
Let me first start with CVI the filing when do you expect that filing.
To the state.
Right now they are working on the Perm the weir permit.
I don't know exactly when thats supposed to go in.
Howard I know that the that day.
I have scheduled.
A hearing for the EAA.
For the based on draft.
Comment.
The comment period.
Supposed to happen in next few months.
And then they will submit the permit to the state.
And they're doing it in sequence as opposed to in parallel which is something we're pushing them to try to consider doing book both at the same time.
But all of that should happen in the next three or four months.
And support.
Getting to a point of beginning to do this extraction in the spring.
Given that permit.
What are they.
Abilities of probabilities that once you start extracting the 2000 gallons.
Pick it stays open.
It's difficult to speculate how we'll certainly keep that option open and we're able to support it staying open we can do up to 300000 gallons a year now with our capabilities and with our permit.
So we are certainly promoting that.
D. We would need to decide to do that there's still some question is whether they're going to use the <unk>.
<unk> system, which is much more elaborate pumping and extraction system or the originally designed what we call pump on a stick that was done just for tbi, which is much slower.
And if they use the <unk> system. It will go very quickly.
<unk> out about five times as fast.
So that would that would certainly set this up for more sustainable approach.
Don't know if <unk> made those decisions internally, yet, but certainly one could speculate that if you're treating.
The tank waste successfully that they would continue to support that demonstration with greater volume, but it would be speculation to make that assumption.
Okay fair enough.
Im missing something but is it fair to say that a good number of a mid level executives.
Bowie have not been appointed and Thats part of the problem of the lack of some of these larger awards.
Yes, it is a fair statement.
Howard I think.
Again, it's real difficult to understand whats holding some of these bids up.
We mentioned last several conference calls we haven't.
Sizable spreadsheet of bids that we've submitted.
With significant.
Where'd values and commitments for awards have been just continually delayed.
One could speculate and I would believe Howard that statement is true is that.
There is not a.
Assistant Secretary confirmed by the New administration that there is.
Tendency to wait for that to occur.
And while they do have a good good.
Good team of folks.
Carrying over from the old administration that are managing things.
Theres, just a natural tendency to weighted for the new person to arrive to make these big decisions. So I would speculate across the board Howard.
The lack or delays of getting.
The assistant Secretary has in place in many of these cases.
It has an impact on the procurement process for sure.
Would that be the same for the EPA with the Navajo pitch.
The Navajo what Youre speaking about is the abandon uranium mine program.
And that one is more of a mystery.
I have to assume Youre correct on that I don't follow the EPA organizational chart as much as the OE.
But I have to assume it's a similar situation I know it was at one time. It was funded I don't know if thats changed.
You all know.
It's a significant program that has a very significant future for us and for other participants.
And we were initially informed that task orders would have been <unk>.
Distributed.
Months and months ago, So I don't know whats holding it up we had a difficult time finding information, we're getting information back from it.
But I have to assume you're correct that it's largely because of administration changes.
The settlement was $1.7 billion, the EPA with the Navajo.
The contract like talking about it about $220 million. If my memory serves me correctly is that sound about right.
That's <unk>.
Basically the contract value for that <unk> Thats correct alright.
What about as an example, Moab Lucky Oak Ridge the Navy bids.
Is that all of the similar vein that we're still awaiting.
That's correct Howard there's also even at lower levels, there's a lot of task orders.
$5 million to $10 million range. It don't require that level of approval and the procurement processes are just moving really slow across across the country in all different organizations. We have task order bids or do the corps of engineers. The Navy all waiting for announcement award.
And mobilization.
And it's really every level of procurements have been very lethargic.
And the decision announcement process. So it may not just be the administration issue is I think it's largely COVID-19 related where it's just.
A lot of people working from home.
And.
The rush to get back out in the field is not there yet because our clients are not out in the field yet so.
It's really it's really both.
The larger ones are certainly administrative administration dependent but the smaller ones I think are just.
Slow processes and the procurement cycles.
Mark then we share the best stay safe.
And good luck, thanks very much I appreciate your support Howard appreciate it bye bye.
Sure.
Again, ladies and gentlemen to ask a question. Please press star one at this time again Thats Star one to ask any question next.
Next we have Ryan Hamilton, Brian Please state your question.
Good morning, everyone and thank you for taking my call my questions.
Alright, good morning, Ryan.
Could you you touched.
Takes a little bit in your opening remarks, but could you walk us through the cadence of the quarter.
And maybe start with margin kind of just walk us through how March.
May look compared to April and so on can you just walk us through that if you don't mind.
Yeah Ryan.
March and April and we talked about this several quarters ago.
And we had kind of a fiery discussion I want to say in Q3 and four last year that we expected Q2 to be a tough quarter.
For a number of reasons number one we had targeted and defined.
An unusually large quantity of large procurements.
Like the Moab procurement in a number of others that we are going to require some investment and positioning that we felt we had a real offering that we can be very competitive and.
And we did get that and we got a number of others.
Or is the cadence on the services segment, we saw the project in Seattle, which was very good to us for two years ramped down.
Significant ramp up and proposal efforts, which took a significant investment through Q2.
And the lack of awards of outstanding bids.
<unk> already submitted so all of that together showed demonstrated a drop in revenue.
In the services side of the house.
And we were not able to replace quickly enough.
Seattle project that was generating significant revenue for us so.
We're anticipating we'll win our share of these awards.
And as soon as this thing has awarded will be back in action to replace that Seattle project. The one we did win with the.
Princeton plasma physics lab.
We will start to do that it is ramping up quickly we have a number of others.
Are smaller and we have a couple of others that were expecting to hear about any day.
So we expect those two to start impacting our end of our Q3 on the treatment side of the house as far as.
Your term cadence goes we did start seeing things pick up they've ramped up a little bit every month, we had a couple of very sizable.
Receipts bump from.
June into July and August.
That lowered it a little bit towards the end of June we're starting to see our backlog creep up.
And but more importantly, we're seeing a lot of opportunities to bid on waste receipts.
And as I mentioned before we're getting some backlog and inventory for our new system in Florida the BTT.
So all of those things together.
And knowing where our clients are going with backlog to move before the end of the fiscal year, we're anticipating looking at a better Q3 than we did Q2.
On the waste side.
Side of the house, particularly so we're seeing some things pick up were from.
Our sales team is very busy now.
Asked about kind of contrast in March we werent flying anywhere our clients Werent meeting with us because they had restrictions on visitors.
Now our entire sales team when I look down the hallway offices are dark.
And they are out in the field meeting with folks going.
Going to conferences meeting with commercial clients.
Presentations, all that kind of stuff. So it's a lot different energy than it was just in March.
That's ramped up through the quarter and provides kind of the energy and optimism we have for the waste treatment side have gone kind of a long winded answer Ryan.
No that's great I appreciate the color you touched on backlog could you break out once you have between treatment and services currently.
Well I think I'll, let Bert jump in I think Ben mentioned.
Seven.
1 million backlog at the end of June I believe then that was just for treatment from remember correctly and with our services, it's a little bit more that you want address that event.
Yes.
$6 seven was the treatment backlog.
Services is in around the 30 to 32 range.
At the end of at the end of the quarter.
Okay.
Interest funding right.
Alright.
I'm, sorry, what was that.
That's funded backlog.
We track various looks at backlog into service segment, because theres projects with high that you may have one, but it's not funded and there is some that are high probability, but what kind of assurance thing is the funded backlog and that was at about the 30 to 35 range.
Perfect.
Touched on SG&A being up a little bit on on wages and a couple of other things and you.
Assuming the COVID-19 kind of drags out.
A little longer here are there any other <unk>.
Big ticket items that you can kind of extract out of SG&A.
These cost at all.
Yes, we're pretty lean on G&A. There is always some you can depending on.
Urgent PC.
But.
We are a smaller public company and certain costs.
Don't go away and Thats why were so dependent on and the needle moves so quickly on revenue shifts.
Again, there is always certain costs and we're always looking at them on a regular basis.
But.
If you look at the history of our G&A number good and bad years, it's always kind of been in a certain range.
Got you.
And then kind of along those lines as far as increasing wages are you.
Just on your bidding activity are you increasing price.
That's a good question Ryan its pretty its pretty flat on the services side of the house.
It is very competitive as our competitors are quite Hungary as well.
If you listen to some of the other.
Earnings calls from the Big Boys.
We team with as well as some of the smaller private companies everyone's waiting for the same bids waiting for things to be awarded.
And.
From our projects are being completed same same view of everyone's really going through the same for similar cycle.
So there is.
A more of a tendency to reduce your fee and your margins.
But wages are pretty consistent.
And we're not seeing that changed dramatically.
Year over year overall and.
That's really what is important to have a technology that can.
Cut costs, which we have got several that are in our procurement. So we're hopeful.
Able to show greater value on some of our bid.
Excellent.
Kind of along those lines as far as bidding activity goes.
You've touched a little bit on it could you maybe go into maybe the size of the job that youre seeing.
Putting out bids on number of bidders kind of just walk us through that just a little bit more.
But the bidding activity.
Question, Ryan, but in general we've got large bids like like the Moab, one that's been talked about.
10 to 15 year contract and Lucky as 10 years, as well, which is a site in Ohio and those are big bids with lots of competitors. So it's difficult to really plan on those because they can go many different directions. Most of our other projects are between five and $10 million task orders.
Probably 10 of those were waiting to hear on.
And then we have a couple.
<unk> 2000 and $50 million.
We're also pretty optimistic about.
And we are pursuing a couple of new markets, particularly with the Navy.
<unk>.
Ship program and revitalization program.
At a normal naval shipyard in Virginia.
Where we're taking our expertise that we've developed in the market for decontamination and decommissioning and applying it to the Navy.
And there are programs for decommissioning as well so we're optimistic about that number of bids there.
And as I mentioned, a lots of lots of smaller task force here and there through some of the IDI cues that we have also been a number of IDI cues or while you are waiting to hear on.
Maybe seven or eight IV iqs, which.
Pretty much a license to bid.
And there'll be more bids once those are awarded.
Optimistic that we're going to win in five or six of those.
And know that they are well funded.
Again, it's just a real slow they've got award the IDI cues and then run start running task force through them.
Like everybody else waiting for that to happen.
And as we continue to wait for awards to be.
I guess he handed out.
At what point do these facilities just overbuilt.
At some point I would imagine they can no longer delaying it becomes.
Almost a crisis as it is this a rate it yet.
No.
What you are speaking about as more of the operational waste streams that we get there is a certain amount of that that does occur over most of the projects I'm speaking of.
Our our cleanup projects.
You can kick that can down the road on cleanup.
And it doesn't necessarily.
<unk> achieved the scenario you just mentioned.
So.
Those projects will remain.
Usually those projects are holding up something else in other words, if you've got a contaminated building going to get rid of it because you want to put something else there.
We meet our milestones so there was a driver typically.
And that's what we're hoping we'll start getting into place here in next couple of quarters.
Okay. Okay. Thanks, a lot for your time guys I appreciate it thanks, Brian.
Again, ladies and gentlemen to ask a question at this time. Please press star one on your telephone keypad.
And then for questions. Please press star one at this time.
Yeah.
Next we have Steven Steven volume. Please state your question.
How are you guys.
Good to hear everyone's okay, Hi, how are you doing.
What's an IV.
I never heard that term.
Okay.
Next year.
<unk> indefinite delivery indefinite quantity contracts. So it's like what they call. It may talk which is a multi award task order contract.
And it's basically the government does is the award.
<unk>.
Somewhere between three and 10 contractors and what the value of that is Steven is when they make those awards.
Have to shoot up.
Full rfps for every project. They are basically pre qualify you on your experience on your financials and your capability and all that and then just send out a scope of work and a price sheet and it can do task orders very quickly.
For a pre defined or pre qualified group of bidders for companies. So it's a way to accelerate.
Sure.
Contracts that have lots of different task orders to go through them or projects that go through them.
In the next five years kind of a thing.
When you win a contract like that an IV IQ you don't want any value so.
So we don't take a value on it but.
We are in a position with reduced competition and reduced investment for when the task orders come out you can be quickly they award quickly and it doesn't it's not a big investment.
Alright.
The $5 million that was forgiven was that money used up or is that.
Is that money there or was it used up.
Well, it's part of it.
It wasn't a timing thing we got it last year.
We got in April of 2020.
We're at some point.
Seven three now so.
It just was all part of the bank accounts.
So there is actually cash here or is it just an accounting thing.
No no no the cash balance on the balance sheet in our cash balance here alright, alright.
And while I have you been when when you mentioned there was a $30 million backlog.
For service is that.
Suppose really going to be multi quarter business or just the next quarter or this quarter, yes, yes that is all our projects at the point in time.
And therefore.
Some contracts might be they may run over a year, a year and a half others may be short short burn.
So that really doesn't give you an indication of yes.
So I think we'll give you an idea alright and then the other the other question is when you were talking about your cost of goods you mentioned that in there.
He is.
Costs related to bidding how much is that.
That was that would be in the G&A not.
Bidding yes, yes. So we were about we were about 300 K over from prior year.
And a large chunk of that is two fold one we as Mark mentioned a few times.
The bidding activity was pretty intense and so we had to bring in health contract Alright I.
Contract costs and then the other the other piece of that and it kind of goes back to an earlier question about.
Managing our G&A.
Many times, we'll bring in costs costs related that would be available in other times and that increases the G&A number because you use amount of bid and proposal project. So.
When you win a new project comes in they move into cost of goods sold and are tied to revenue and that kind of is another way that <unk>.
Manages your G&A costs.
Got it okay. So is it.
I guess I'll direct this to mark.
Understanding everything that's going on is it do you think it's feasible.
That will equal last year.
This year, I mean do $100 million.
Steve I don't I don't believe a $100 million is attainable this year.
Okay based upon just based on what.
What's happening in cope with Covid right now in Q3.
If you would've asked me last quarter, probably would have felt a little bit more optimistic about it but.
Bowie as is.
Kind of weighted doing all the wait and see on where things are with getting back in the field to a certain degree.
Having said all that I think we can get real close to fourth quarter.
It would represent a $100 million burn so in other words $25 million.
Thanks, guys.
Yes, if they get if they get these things some things are awarded.
Winning end of them.
With regard to Covid are you requiring your people to get vaccinated.
I was wondering if we get that question, Steve took a while to get to get to that question.
We are not at this point, but we are on that path, we're heading in that direction and we are waiting for a couple of things to happen right now.
We just did a survey internally.
Yes.
<unk>.
We're in about the mid 70% vaccinated, which is pretty far above our national average.
We have about 15% of our staff.
They have said that they intend to get vaccinated.
I feel confident that we can be in.
Mid eighty's.
Our percentage of vaccinated in the next couple of weeks based on that survey.
Having said that so I'm pretty pretty comfortable there. We don't have a lot of cases overall in the company, but we do in the areas that we live in.
Having said all that if the government goes to a mandate.
Will likely follow those mandates and right now you've probably heard.
<unk>.
Yes, so if the government has a further government contractors.
I can't say for certain that we would implement right away but.
I certainly think it's highly likely we will.
I saw that encourage that the military was being.
They were required in the military to be but.
Wherever you are for lack of a better word politically.
And with all that's going on and you got enough troubles.
With the business and so forth.
Certainly.
One would not throw into the pot.
One would think.
The possibility that somebody on vaccinated could.
Impact.
You are crippled operations at this point, so I am not a very strong long on that thing.
Essential.
Alright.
That business out in.
What was the transuranic. It was added that you would get from CHF two out enhance hurt is that true that stance.
From.
Yes.
Got it.
Are you getting that back or what.
What happened was the change contractors out there on the plateau contract in hand for which is a enormous contract as you know.
The administration has changed and headquarters the headquarters and.
They determined they needed to make some adjustments to the way they ship waste, which is not a big adjustment, but it does require some permit changes.
From a changes have been ongoing.
And for shipping.
And those are expected to be in place.
In the next month or two and once those are done then they'll start to resume shipping again for the Trans Atlantic and Thats been a very big impact to us.
Overall to get that program back in place.
And we're optimistic that that will be in place in September timeframe, maybe October.
And get back to normal as those shipments.
Just as a.
I guess for lack of a better word a sarcastic comment.
I note that the new contracts.
Winner for that that you would see a gen two.
Includes people from <unk> Khan, who at.
At least from my reads have been instructed to you in the past.
Again on things.
Its amount online on that line.
Alright.
With regard with regard to the tbi, while the sudden I mean, if you did.
The three gallons.
You didn't have to an environmental study before the free gallons.
I mean wireless services may want to define the study for the 2000 gallons.
I'm trying to recall it was there any day for the three gallons do you remember.
No.
Determined they didn't need it for that size project.
Not.
Not required for the three gallons. It was a fund that yes, so finding of no significant impact because it was so small that's right yes.
Okay, well I just fine.
And these are my statements. Okay. So I just find this whole situation.
The deeper I get in insane.
I mean, there was a <unk> <unk>.
May of this year.
Who was it Gary Peterson and Bob Purgason came out with an article in the pay per hour.
Try.
Tri City paper and in there they point out that the present.
The present.
Vitrification plant dysfunction that it'll create a gallon away for every gallon that they treat.
And so.
No.
With the escalating costs and so forth.
So the whole thing.
It's just insane absolutely makes no sense.
<unk>.
Yes.
It's just.
And then.
We're witnessing with all with the fact, we are witnessing.
The effects of climate change, which has the key.
Which one reasonable person with what we think will continue.
<unk>.
Or where are they going to find money to pay.
Sure.
Extra money, that's obviously cost index escalated.
Escalated there right.
I think what is it two years ago. They said it went up to about $4.500.
Million $1 billion and with all of the money has been pumped in the economy I guess it will be more expensive.
The whole thing is.
The whole thing from me as Jess.
It just doesn't make sense.
It's just been saying that what you can offer.
I mean, the process from what I understand the process has been proven in Savannah.
The science is proven it just seems to me maybe again.
Being cynical that.
People do not want you to succeed but.
I made my comments.
There was a.
Clearly.
The world out there once that communication, whether it's real or not my last question, which I didn't understand as you spoke about his.
His scar.
System versus what is that the average tech system.
What is it what is it.
Rob.
Thanks, Steve are pointing that out I didn't mentioned just because that's an acronym that from sure very few people know about it it's the pink side season removal system, which is a.
Very well engineered system that <unk>.
And as contractors have developed.
To remove tank waste quick.
Quickly and efficiently and take out some.
Some of the higher level.
Ray neutralize sees them in an out of the.
The process stream in other words as the.
The wages rising through the system it will move it through.
Non exchange system. So what that does is it takes out some of the renewed <unk>. Two so we can call. This low level waste incentive to us to treat it that system, which is very very very similar to the one I'd say on railroad that you just mentioned is operating very well.
As in development and testing at Hanford now.
And that system could be used.
To extract.
Tank weighs very quickly and efficiently.
And once it's gone through the readiness process and demonstration process.
Or we could put the system and it was designed for this application just for us.
Either way, we will take the 2000 gallons or we can get it but the <unk> system.
This is the one to developing now would.
It would be very efficient and will demonstrate how it works and could be used very efficiently.
And provide the opportunity to keep the waste coming.
After they do the demonstration.
So my readings were.
Is this just your system you have stuff.
The average tech is by that is this next to the tank.
Yes.
So how does this differ.
I've read that they actually.
<unk>.
<unk> and tech system and they read an article subsequent to that were supposedly they purchase huge containers, where they were going to store the way seem to the containers and then.
Go for treatment so.
Is that the same thing we're talking about.
It's the same thing we're talking about yes, yes, yes, okay.
Alright, alright.
Alright, well I.
The net.
Thing I guess look I think you guys.
Your attitude is great.
You couldn't ask for.
It's a tough area.
And I applaud the effort and everything but.
This tbi think disturbs me because number one.
<unk>.
Even if you looked at this as a support function for <unk>.
For the day plan, which as I understand is not going to be big enough to handle everything.
<unk> businessman would have a backup.
And the way this is move the way it is structured we after all this time.
Reminds me of how long it took you to get the free gallons and we're talking next summer and why next summer.
Why can't this why can't there be a large and see but again, that's that's my thought process.
My hope is with all this other stuff youre doing that you'll become a $200 million company by the end of 'twenty, two or thereabouts and.
And if something like this happens it happens and so forth, but again mark.
It's tough times I applaud you guys I, most importantly, applaud your attitude I think your attitudes fabulous.
Youre looking ahead, you're gone through tough times, and just keep it up because.
The old story is the people and when you're when you're in are in yen.
Don't give up thank you all.
Thank you Steve I appreciate the kind words.
Yes.
There are no further questions at this time, ladies and gentlemen, this does conclude today's Q&A.
I'd now like to turn the call over to management for any closing remarks.
Alright. Thank.
Thank you very much I'd like to thank everyone for participating in our second quarter Conference call. As we said we remain extremely bullish on the outlook for business and believe we're extremely well positioned for growth. We appreciate the continued support of our shareholders.
And look forward to providing further updates as developments unfold. Thank you.
Okay.
[music].