Q4 2026 Progressive Planet Solutions Inc Earnings Call

September 9, 2026

Operator: [Break]

Operator: You have joined the meeting as an attendee and will be muted throughout the meeting.

Speaker #2: Hey, thanks everyone for joining us today for Progressive Planet's Q4 conference call. We are taking questions from the audience, so viewers, please we encourage questions from the audience.

[Company Representative]: Hey, thanks everyone for joining us today for Progressive Planet's Q4 conference call. We are taking questions from the audience, so viewers, please, we encourage questions from the audience. Please type them into the Q&A. Try to keep your questions clean, tight, and clear. If it's long and rambling, a good chance we may not ask it. I will start the official opening comments now. Good afternoon, everyone, and welcome to Progressive Planet's fiscal Q4 2026 earnings call for the period ended 30 April 2026. The financial statements and MD&A have been filed and can be accessed through the SEDAR website. Today is 9 September. CEO Stephen Harpur and interim CFO Kyle Dickson are here and will present the company's financial results and provide a business update, followed by a Q&A session.

Speaker #2: Please type them into the Q&A. Try to keep your questions clean, tight, and clear. If it's long and rambling, there's a good chance we may not ask it.

Speaker #2: So I will start the official opening comments now. Good afternoon, everyone, and welcome to Progressive Planet's fiscal Q4 2026 earnings call for the period ended April 30, 2026.

Speaker #2: The financial statements and MD&A have been filed and can be accessed through the CDAR website. Today is September 9. CEO Stephen Harper and interim CFO Kyle Dixon are here.

Speaker #2: And we'll present the company's financial results and provide a business update followed by a Q&A session. Investors are encouraged to submit their questions via the Q&A box, and they will be addressed at the end of the session.

[Company Representative]: Investors are encouraged to submit their questions via the Q&A box, and they will be addressed at the end of the session. I would remind everyone that certain statements made today may contain forward-looking statements that are subject to known and unknown risks, uncertainties, and other factors. For a complete description of the risks and uncertainties facing the company, please refer to the MD&A and other continuous disclosure filings, which are available on the SEDAR website. Now I turn it over to Stephen Harpur.

Speaker #2: I would remind everyone that certain statements made today may contain forward-looking statements that are subject to known and unknown risks, uncertainties, and other factors.

Speaker #2: For a complete description of the risks and uncertainties facing the company, please refer to the MD&A and other continuous disclosure filings which are available on the CDAR website.

Speaker #2: And now, I turn it over to Stephen Harper.

Speaker #3: Thank you. Thank you, Martin. Can you see the presentation here, Martin?

Stephen Harpur: Thank you. Thank you, Martin. Can you see the presentation here, Martin?

[Company Representative]: It all looks good.

Speaker #2: good.

Speaker #3: And as those of you who have been here before, you'll see a new face. Kyle is not new to our company. Most recently, before becoming interim CFO, was our VP of Finance for our operating sub, Progressive Planet Products.

Stephen Harpur: Those of you who have been here before, you will see a new face. Kyle is not new to our company. Most recently, before becoming interim CFO, was our VP of finance for our operating sub, Progressive Planet Products. Kyle is a CPA like myself. Our CFO, Chris Halsey-Brandt, had an incident where he is required to have a little bit of rest from his doctors. We expect him to be back shortly. He is not gone permanently, just a little bit of rest, and we look forward to having him back shortly. Kyle will then revert back to his VP finance. He stepped in on short notice while Chris is getting some rest to take on the interim CFO for this short period of time. Kyle, we thank you very much for that.

Speaker #3: And Kyle is a CPA like myself. Our CFO, Chris Halsey Brand, had a an incident where he's required to have a little bit of rest from his doctors.

Speaker #3: We expect him to be back shortly. So, he's not gone permanently, just taking a little bit of rest. We look forward to having him back soon, and Kyle will then revert back to his VP, Finance role.

Speaker #3: But he stepped in on short notice while Chris is getting some rest, to take on the interim CFO role for this short period of time.

Speaker #3: And Kyle, we thank you very much for that. So without any further ado, I'm going to start here. Martin already read some of the legalese, so I'm not going to read it again.

Kyle Dickson: Thanks, Steven.

Kyle Dickson: Thanks, Stephen.

Stephen Harpur: Without any further ado, I am going to start here. Martin already read some the legalese, so I am not going to read it again. Progressive Planet at a glance. I had a family office, the gentleman running a family office, all of his own family's money, asked me in the last week, "Describe your company at a very high level. Do not want any high tech, any sort of detail. Describe it in lay terms." It made me think. This is really a summary of Progressive Planet at a glance. Profitable, vertically integrated, clean tech manufacturer. We focus on silicate-based products. Cash flow funds our innovation pipeline. We are not constantly diluting for new products, not diluting our shareholders. That is very important. We have not done an equity financing in years. We also have patent pending solutions poised to disrupt the cement industry.

Speaker #3: So Progressive Planet at a glance. I had a family office a gentleman running a family office all of his own family's money asked me in the last week, "Describe your company at a very high level.

Speaker #3: Don't want any don't want any high-tech, any sort of detail. Describe it in lay terms." And so it made me think. And so this is really a summary of Progressive Planet at a glance.

Speaker #3: We're a profitable, vertically integrated, clean tech manufacturer. We focus on silicate-based products. Cash flow funds our innovation pipeline, so we're not constantly diluting for new products.

Speaker #3: Not diluting our shareholders. That's very important. We haven't done an equity financing in years. So we also have patent pending solutions poised to disrupt the cement industry.

Speaker #3: We own our mineral assets. That's a key advantage. The only exception is the material that we take from Eastern Oregon for the pure DE3 SKUs.

Stephen Harpur: We own our mineral assets. That's a key advantage. The only exception is the material that we take from Eastern Oregon for the PURE DE three SKUs. That is not our material. This is a new one. As I got to thinking, where's the value of Progressive Planet? Well, we have decades of selling branded products that are trusted brands, and people just repeatedly buy these same products. Stall Dry, Activated Barn Fresh, Red Lake Earth, Wundercat, Fresh Coop, Fresh Coop Dust Bath. CAN DRY, and most recently, we just launched a private label version of CAN DRY called Pro Dry. We've just launched this in the Toronto area. Very excited. Of course, we're actively seeking accretive opportunities.

Speaker #3: That is not our material. We have this is a new one. And as I got to thinking, where's the value in Progressive Planet? Well, we have decades of selling branded products that are trusted brands.

Speaker #3: And people just repeatedly buy these same products, stall dry, activated barren fresh, red lake earth, wonder cat, fresh coop, fresh coop dust bass. So can dry, and most recently, we just launched a private label version of can dry called pro dry.

Speaker #3: And so we've just launched this in the Toronto area—very excited. And of course, we're actively seeking accretive opportunities. We have a world-class team of welders, millwrights, mechanical engineers, and operational plant operators.

Stephen Harpur: We have a world-class team of welders, of millwrights, of mechanical engineers, of operational plant operators, and of course, our financial and our management team and our sales team. We're looking to take advantage of all of that expertise in-house to grow the business. Financial position. We had a record Q4 revenue. We still have more than CAD 3 million available in unused credit facilities. Even after the CAD 6.7 million that we spent this year on capital assets, we still have CAD 2.2 million in cash as of 30 April. No further large one-time slotting fees budgeted. We did this once. We'll talk about it in a future slide here. We're very happy with the results of that. Of course, we did have two major one-time costs in the year. The one being the slotting fee that I just referenced, and secondly, we wrote down an inactive mineral property.

Speaker #3: And of course, our financial team, our management team, and our sales team. So we're looking to take advantage of all of that expertise in-house to grow the business.

Speaker #3: Financial position: We had record Q4 revenue. We still have more than $3 million available in unused credit facilities. Even after the $6.7 million that we spent this year on capital assets, we still have $2.2 million in cash as of April 30.

Speaker #3: No further large one-time slotty fees budgeted. We did this once. We'll talk about it in a future slide here. We're very, very happy with the results of that.

Speaker #3: And of course, we did have two major one-time costs in the year. The one being the slotting fee that I just referenced and secondly, we wrote down an inactive mineral property since I got involved in Progressive Planet in 2018.

Stephen Harpur: Since I got involved in Progressive Planet in 2018, we had spent about CAD 8,000 on that from 2018 to 2026. We wrote it down, but it was carried on the books at a historical value of over CAD 1.2 million. Those were the two major items that really affected our profitability. The slotting fee, I've never talked about this until right now, but I want to actually put some numbers out there. When we made this investment, of course, we did not have the benefit of 2020 hindsight. We now do. It was a deliberate investment to double our shelf presence with a top US retail partner. We went from three SKUs in 2,434 stores to six. We made a major investment to procure long-term shelf space. The slotting fee was approximately CAD 500,000.

Speaker #3: We had spent about $8,000 on that from 2018 to 2026. We wrote it down, but it was carried on the books at a historical value of over $1.2 million.

Speaker #3: So those were the two major items that really affected our profitability. The slotting fee—I’ve never talked about this until right now, but I want to actually put some numbers out there.

Speaker #3: So, when we made this investment, of course, we did not have the benefit of 20/20 hindsight. We now do. It was a deliberate investment to double our shelf presence with a top U.S. retail partner.

Speaker #3: So we went from three SKUs in 2,434 stores to six. We made a major investment to procure long-term shelf space. The slotting fee was approximately $500,000 Canadian.

Speaker #3: So the first products for pure DE—and you'll see the three products on the left—the 20-pound bag, the puffer bottle, and the jug.

Stephen Harpur: The first products for PURE DE, and you'll see the three products on the left, the 20-pound bag, the puffer bottle, and the jug. Those three, we started selling them 1 November. We've sold closer to CAD 1.9 million in the 10-month period from 1 November 2025, through to the last week, we've sold over CAD 1.8, closer to CAD 1.9 million. I am not going to get into our gross margins. We don't talk about gross margins on individual products for competitive reasons, but we've paid off the CAD 500,000 fee already in less than a year, and we are just really excited about the future growth of this line of products. Anyone who's dug deep into our financials realize we spent a lot of money this year to essentially provide us with long-term investments. How does that break out?

Speaker #3: Those three, we started selling them November 1st. We've sold over 1.8, closer to 1.9 million Canadian in the 10-month period from November 1st 2025 through to the last week.

Speaker #3: We've sold over 1.8, over 1.8—closer to 1.9 million. I am not going to get into our gross margins. We don't talk about gross margins on individual products for competitive reasons.

Speaker #3: But we've paid off the $500,000 fee already in less than a year, and we are just really excited about the future growth of this line of products.

Speaker #3: So anyone who's dug deep into our financials, realize we spent a lot of money this year to essentially provide us with long-term investments and how does that break out?

Speaker #3: Well, the 6.74 million $3.76 million of that was for the Posglass pilot plant. That was a major building extension. Equipment. It was offset. By grant income, we do not report the grant income in our revenue.

Stephen Harpur: Well, the CAD 6.74 million, CAD 3.76 million of that was for the PozGlass pilot plant. That was a major building extension, equipment. It was offset by grant income. We do not report the grant income in our revenue. It is reported down further on the income statement. When we talk about CAD 23.2 million in revenue, that does not include our grant income. That is reported separately. Then CAD 2.71 million in production equipment. That was the new valve pack line, the new robotic palletizer that does two lines at once and now is doing two lines at once. Then we had about a quarter million dollars, primarily Alberta lab equipment and lab lease capitalization. I think there is real value for people to understand, and I did say in the news release that accompanied our audited financials that we intended to continue to invest for the next fiscal year.

Speaker #3: It's reported down further on the income statement. So when we talk about 23.2 million in revenue, that did not that does not include our grant income.

Speaker #3: That's reported separately. And then $2.71 in production equipment. So that was the new valve pack line, the new robotic palletizer that does two lines at once.

Speaker #3: And now it's doing two lines at once. And then we had about $250,000, primarily Alberta lab equipment and lab lease capitalization.

Speaker #3: I think there's real value for people to understand. And I did say in the news release that accompanied our audited financials that we intended to continue to invest for the next fiscal year.

Speaker #3: But I wanted to define four different projects. These are the four major capital projects underway to be finished in the current fiscal year. POSGlass Phase Two—that will be finishing the equipment installation and commissioning to actually make POSGlass supplementary cementing powder.

Stephen Harpur: I wanted to define four different projects. These are the four major capital projects underway to be finished in the current fiscal year. PozGlass phase 2, that will be finishing the equipment installation and commissioning to actually make PozGlass supplementary cementing powder. We intend to start making CanBlast. We have been selling CanBlast for almost 20 years, but it has been made by the only other company in BC that is approved by Recycle BC to accept post-consumer glass. We will be making our own CanBlast. We own that brand, again, one of our long-term brands. Lightweight cat litter. We have fabricated a new piece of equipment. It is quite big. It is about 60 feet long, about 10 feet wide, and about 8 feet high. This will be installed in place before 31 December.

Speaker #3: We intend to start making Canblast. We've been selling Canblast for almost 20 years, but it's been made by the only other company in BC that is approved by Recycle BC to accept post-consumer glass.

Speaker #3: But we will be making our own can blast. We own that brand. Again, one of our long-term brands. Lightweight cat litter. We fabricated a new piece of equipment.

Speaker #3: It's quite big. It's about 60 feet long, about 10 to 12 feet wide, and about 8 feet high. And this will be installed in place before December 31st.

Speaker #3: We are making lightweight cat litter now, but with the installation of this new piece of equipment, we will make it faster and more efficiently.

Stephen Harpur: We are making lightweight cat litter now, but with the installation of this new piece of equipment, we will make it faster and more efficiently. The automated valve pack line, this came from Spain. We have had it for several months, but we are expected to install that by 28 February 2027. Our fine grinding line, which increases our capacity to make fine powders by a factor of about 10. Expected completion by 28 February. Major civil work underway right now. We poured a big pad for the new silo to receive that product last week. Big investment, big 1-inch rebar, 16-inch on center. Major civil works well underway for that project. Those are the four major capital projects. That is it for now. As again, I referenced in our year-end news release, these four projects.

Speaker #3: The automated valve pack line—this came from Spain. We've had it for several months, but we're expected to install that by February 28, 2027.

Speaker #3: And then our fine grinding line, which increases our capacity to make fine powders by a factor of about 10. Expected completion by February 28.

Speaker #3: So major civil work underway right now. We poured a big pad for the new silo to receive that product last week. Big investment, big one-inch rebar, 16-inch on center.

Speaker #3: Major civil works are well underway for that project. So those are the four major capital projects, but that's it for now. As I referenced in our year-end news release, these are the four projects.

Speaker #3: So it is no secret that absorbent spent minimally on infrastructure and equipment for the decade before. It was acquired by Progressive Planet on February 18th, 2022.

Stephen Harpur: It is no secret that Absorbent Products Ltd. spent minimally on infrastructure and equipment for the decade before it was acquired by Progressive Planet on 18 February 2022. We have made the increased capacity and site infrastructure requiring investments. These ones are either they have been completed or they are part of the four projects, and I just gave you the completion dates. In each case of these four projects, they will be done before the end of our current fiscal year. The current capital program is committed, board approved, and on track for completion this fiscal year. Any future capital allocation will shift to growth and return-driven opportunities as demand supports them. If we are approached to do a co-manufacturing by another entity, as an example, we would make an investment decision, looking at the return on investment.

Speaker #3: We've made the increased capacity and site infrastructure requiring investments. These ones are either completed, or they’re part of the four projects that I just gave you the completion dates for.

Speaker #3: So in each case of these four projects, they'll be done before the end of our current fiscal year. So the current capital program is committed.

Speaker #3: Board approved, and on track for completion this fiscal year. Any future capital allocation will shift to growth- and return-driven opportunities as demand supports them.

Speaker #3: So, we're approached to do co-manufacturing by another entity, as an example. We would make an investment decision by looking at the return on investment.

Speaker #3: But for now, we do not have any other major capital programs planned beyond the four that we've just outlined in the last slide.

Stephen Harpur: But for now, we do not have any other major capital programs planned beyond the four that we have just outlined in the last slide. PozGlass pilot plant commissioning is nearly done. For those of you who watch our videos and see what I post on LinkedIn and what Progressive Planet posts on its LinkedIn, we received a full 53-foot tractor trailer of glass about 2 weeks ago and took video of same. We have processed about 30 tons during commissioning. We are waiting. We expect to receive next week, the final piece of equipment to bag our Can Blast. So right now, we are capable of bulking it into 1-ton bulk sacks, which is one form of which large consumers of this product do receive it. But we have been selling it in 50-pound bags for about 20 years, and we will start making those on our own in October 2026.

Speaker #3: Posglass pilot plant. Commissioning is nearly done. For those of you who watch our videos and see what I post on LinkedIn and what Progressive Planet posts on its LinkedIn, we received a full 53-foot tractor trailer of glass about two weeks ago and took video of same. We've processed about 30 tons during commissioning.

Speaker #3: We are waiting. We expect to receive, next week, the final piece of equipment to bag our can blast. So, right now, we are capable of bulking it into one-ton bulk sacks.

Speaker #3: This is one form in which large consumers of this product do receive it. But we've been selling it in 50-pound bags for about 20 years.

Speaker #3: And we will start making those on our own in October of 2026. And, as I referenced on Phase Two, we expect to be commissioned on making our PozGlass cement powder.

Stephen Harpur: As I referenced on phase II, we expect to be commissioned on making our PozGlass cement powder by 31 December or the last day of the calendar year. We expect to be running by then. I am going to pass over to Kyle. Kyle is very much. Well, before he accepted the interim CFO, Kyle is our lead on all things tariff. I am going to hand it over to Kyle to go over some of our financial metrics and talk about tariffs. Then Kyle will hand back to me to close the presentation before we go on to Q&A. But Kyle, just let me know when you want me to flip to the next slide.

Speaker #3: By December 31st, or the last day of the calendar year, we expect to be running by then. So, I'm going to pass over to Kyle.

Speaker #3: Kyle has been very involved even before he accepted the interim CFO position. Kyle is our lead on all things tariffs. I'm going to hand it over to Kyle to go over some of our financial metrics and talk about tariffs, and then Kyle will hand it back to me to close the presentation.

Speaker #3: Before we go on to Q&A—Kyle, just let me know when you want me to flip to the next slide.

Speaker #2: Okay, thank you, Steve. As discussed, this is a hot topic right now with where tariffs are and tariff exposure. We're speaking on September 9th.

Kyle Dickson: Sounds good. Thank you, Steve. As discussed, this is a hot topic right now with where tariffs is and tariff exposure. We are speaking on 9 September, so anybody who is following this knows this could change as of 10 September, but this is where things stand today. Progressive Planet is not currently exposed to tariffs. What is covered currently are the main categories of motor vehicles, alcoholic beverages, and dairy. It gets much more expansive under those categories, including wooden plywood, furniture, textiles, plastics, and papers with 50% tariffs, even if you are a USMCA qualifying good. As of yesterday, we saw potential outright import bans on certain goods into the United States. For us as a company, we are not impacted. None of our exports and our codes hit any of the annex lists.

Speaker #2: So, if anybody who's following this knows, this could change as of September 10th, but this is where things stand today. Progressive Planet is not currently exposed to tariffs.

Speaker #2: What is covered currently are the named categories of motor vehicles, alcoholic beverages, and dairy. It gets much more expansive under those categories, including wood and and plywood, furniture, textiles, plastics, and papers with 50% tariffs, even if you're a USMCA qualifying good.

Speaker #2: And as of yesterday, we saw potential outright import bans on certain goods in the United States. For us as a company, we are not impacted.

Speaker #2: None of our exports and our codes hit any of the annex list, so we currently are not impacted by tariffs. As well, the counter-tariffs put on by the Canadian government that went into effect yesterday have very minimal impact on our operations, due to the fact that the majority of our inputs come from within BC and Canada, as Steve discussed.

Kyle Dickson: We currently are not impacted by tariffs, as well as the counter-tariffs put on by the Canadian government that went into effect yesterday have very minimal impact on our operations due to the fact the majority of our inputs come from within BC and Canada. As Steve discussed, we own our mineral assets, which allows us to have a lot of control throughout the process and on our costs. But as we know, this environment is very fluid and we are monitoring it daily if there are changes. But for now and for the historical past of the last year, we have been fortunate not to be affected. Now onto the financial performance. If you have been listening to Steve talk over the years, you have heard a lot of talk about growth and need for investment in things like the fine grinding mill.

Speaker #2: We own our mineral assets. So it allows us to have a lot of control throughout the process on our costs. But as we know, this environment is very fluid and we're monitoring it daily.

Speaker #2: If there are changes—but for now, and for the historical past of the last year—we've been fortunate not to be affected. On to the financial performance.

Speaker #2: If you've been listening to Steve talk over the years, you've heard a lot of talk about growth and the need for investment, and things like the fine grinding mill.

Speaker #2: If you're just reviewing the financials, you may not see that growth over the past few years until this year. We've been off and around that $19.5 million mark.

Kyle Dickson: If you're just reviewing the financials, you may not see that growth over the past few years until this year. We've been off and around that CAD 19.5 million mark, but underneath we've seen a loss of a large retailer, which Steve has discussed in the past, a loss of access to our DE in Oregon, which we gained access to and now have PURE DE. Now this is the first year, I think if you're reviewing just at a high level, you can see the growth occurring. It's going from CAD 19.5 to CAD 23.2 million in revenue or about an 18% growth rate. And you can see our quarters last year, other than Q2, we were able to improve our revenue quarter over quarter due to the fact that about 60% of our sales go to the US and that's almost exclusively agriculture.

Speaker #2: But underneath, we've seen a loss of a large retailer, which Steve has discussed in the past, a loss of access to our YTE in Oregon, which we gained access to and now a peer DE.

Speaker #2: So now, this is the first year, I think, if you’re reviewing just at a high level, you can see the growth occurring, with revenue going from $19.5 million to $23.2 million, or about an 18% growth rate.

Speaker #2: And you can see our quarters last year—other than Q2—we were able to improve our revenue quarter over quarter. Due to the fact that about 60% of our sales go to the US, and that's almost exclusively agriculture, we do have a bit of seasonality in our trending, which is why you see our Q2 was down a little bit.

Kyle Dickson: We do have a bit of seasonality in our trending, which is why you see our Q2 was down a little bit. There's things we can't control, such as just weather and ordering patterns, but overall, the trending was up year over year. Now, going into some of the key measures from last year, which again, overall you look like we're mostly down other than the gross profit. And as Steve's discussed, there's been a few key metrics to that overall, with big ones being the CAD 1.2 million write-off of the Z1 Zeolite Quarry asset that was held at historical carrying value, as well as the about CAD 500,000 slotting fee, which reduced the income of the company overall, the net income down. We're talking about CAD 1.7 million.

Speaker #2: There are things we can't control, such as the weather and ordering patterns. But overall, the trend was up year over year. Now, going into some of the key measures from last year, overall, it looks like most were down, except for the gross profit.

Speaker #2: And there's, as Steve's discussed, there's been a few key metrics to that overall. With big ones being the 1.2 million dollar slot or 1.2 million dollar write-off of the Z1 asset that was held at historical carrying value.

Speaker #2: As well as the about 500,000 dollar slotting fee. Which reduced the income of the company overall, the net income down. We're talking about 1.7 million dollars.

Speaker #2: On the adjusted EBITDA portion, which accounts for things like the Z1 write-off and why we're still down, part of that is due to the amount we've invested in our R&D.

Kyle Dickson: On the adjusted EBITDA portion, which accounts for things like the Z1 Zeolite Quarry write-off and why we're still down, part of that is due to the amount we've invested in our R&D for the pilot plant. It's a very high standard to capitalize all of the pilot plant costs, so we've chosen to expense a lot of that as it's investment into PozGlass. And net of grants revenue, that's about CAD 660,000 year over year compared to last year. So that's where you're seeing some of the decreases. But again, these are investments in the future, investments in PURE DE, in PozGlass. We're seeing the gross profit overall increase, and we hope that these investments, we will see the dividends going forward.

Speaker #2: For the pilot plant, it's a very high standard to capitalize all of the pilot plant costs. So we've chosen to expense a lot of that as this investment into Posglass.

Speaker #2: And net of grants revenue, that's about 660,000 dollars. Year over year compared to last year. So that's where you're seeing some of the decreases.

Speaker #2: But again, these are investments in the future—investments in peer DE and Posglass. We're seeing the gross profit overall increase, and we hope that these investments will pay dividends going forward.

Speaker #1: So I'm going to thank you, Kyle, very much. Share structure: 110.8 million, no warrants. Options of just under 6 million, for a total of just under 117 million.

Stephen Harpur: So thank you, Kyle, very much. Share structure, 110.8 million, no warrants. Options of just under 6 million for a total of just under 117 million shares diluted. Investment highlights. Profitable vertically integrated clean tech manufacturer. End in sight to the major CapEx as outlined in this presentation. Robust cash flow funds the innovation pipeline. Clean cap table. Patent pending solutions poised to disrupt the cement industry. We own the majority of our mineral assets, and we got a disciplined world-class team that just gets better every year. It's a better team we have this year than it was a year ago. And that is it for the presentation. Martin, if you want to go ahead and any of the difficult questions, can you please give them to Kyle? I'll take the easy ones.

Speaker #1: Shares diluted. Investment highlights, profitable vertically integrated clean tech manufacturer. End in sight to the major capex as outlined in this presentation. Robust cash flow funds the innovation pipeline.

Speaker #1: Clean cap table. Patent pending solutions poised to disrupt the cement industry. We own the majority of our mineral assets. And we got a disciplined world-class team.

Speaker #1: That just gets better every year. It's a better team we have this year than it was a year ago. And that is it for the presentation.

Speaker #1: Martin, if you want to go ahead and, any of the difficult questions, can you please give them to Kyle? I'll take the easy ones.

Speaker #3: You got it. Thank you. How much of the 2.07 million of fiscal 2026 selling expenses was the one-time slotting fee?

[Company Representative]: You got it. Thank you. How much of the CAD 2.07 million of fiscal 2026 selling expenses was the one-time slotting fee?

Speaker #2: About 25%, about half a million.

Kyle Dickson: About 25%, about half a million.

Speaker #3: The gross margins on the three new SKUs and the licensed lightweight cat litter carry—how are they relative to the 35.8% company average gross margin?

[Company Representative]: The gross margins on the three new SKUs and the licensed lightweight cat litter carry, how are they relative to the 35.8% company average gross margin?

Speaker #1: I'll answer that, Kyle. As much as investors want to know about individual margins on product categories, we've made a business decision that we will not share our margins, other than our overall margin, for competitive reasons.

Stephen Harpur: I'll answer that, Kyle. As much as investors want to know about individual margins in the product categories, we've made a business decision that we will not share our margins other than our overall margin for competitive reasons. We do not want our competitors to know what we make in a given product category. So, I respectfully won't answer questions on individual margins for competitive reasons.

Speaker #1: We do not want our competitors to know what we make in a given product category. So I respectfully won't answer questions on individual margins.

Speaker #1: For competitive reasons.

Speaker #3: What grant income should we model for fiscal 2027 and 2028? And once the pilot plant is in service, what annual depreciation would add to the cost of sales?

[Company Representative]: What grant income should we model for fiscal 2027 and 2028? Once the pilot plant is in service, what annual depreciation would add to the cost of sales?

Speaker #1: It's for you, Kyle.

Stephen Harpur: That is for you, Kyle.

Speaker #2: For the grant income, we don't want to give guidance on that at this moment. As far as for the depreciation, that's a great question.

Kyle Dickson: For the grant income, we do not want to give guidance on that at this moment. As far as for the depreciation, that is a great question. For the pilot plant itself, the capital equipment that we are capitalizing will depreciate over the life of the project, which will end August 2028. That will show up not in cost of sales, but probably as a separate line under R&D, since it is a material value that will be probably about CAD 600,000 a year. As far as the cost of sales of the investment on the production equipment, you will likely see that this year not depreciate until Q3, Q4, as Steve noted on the timelines for the PPE being equipment or PPE being finished. We will not depreciate until they are ready for use. So you will see probably minimal uptick in 2027 fiscal year.

Speaker #2: For the pilot plant itself, the capital equipment that we're capitalizing will depreciate over the life of the project, which will end August 2028. That will show up not in cost of sales, but probably as a separate line under R&D since it's such a material value.

Speaker #2: That will be probably about 600,000 dollars a year. As far as the cost of sales, of the investment on the production equipment, you will likely see that this year, not depreciate until Q3, Q4, as Steve noted on the timelines for the PPE being equipment or PPE being finished.

Speaker #2: We won't depreciate until they're ready for use. So you'll see probably minimal uptick in the 2027 fiscal year, but the year after, you'll start to see that. It's 10% declining balance, which, as we've noted before, this BC grant for one of those projects—the fine grinding mill—which will offset that grant income.

Kyle Dickson: The year after, you will start to see that it is 10% declining balance, which, as we have noted, the FortisBC grant for one of those projects, the fine grinding mill, which will offset that grant income. So you will probably see, say, a couple hundred grand depreciation a year on the declining balance after that.

Speaker #2: So you'll probably see a couple hundred grand depreciation a year on the declining balance after that.

Speaker #3: Thank you. How long does the slotting fee last until a potential new one is required?

[Company Representative]: Thank you. How long does the slotting fee last until a potential new one is required?

Speaker #1: I'll answer that. We have had this since acquisition. This is the first slotting fee. I have no intention of paying another slotting fee at any time in the near future.

Stephen Harpur: I will answer that. Since acquisition, this is the first slotting fee. I have no intention of paying another slotting fee at any time in the near future. This was a major investment for us and a one and done. If a retailer with substantial size came to us with a value proposition similar to what we had with this one, and we spoke about CAD 1.8 million in revenue in 10 months on a CAD 500,000 fee. We will consider it on a case by case, but this is not a normal course of business for us. It was a one-time. It is the only time we have done it, and I do not want to make this a regular occurrence for us. I do not view this as something that we will repetitively do in the future.

Speaker #1: This was a major investment for us, and a one-and-done. If a retailer with substantial size came to us with a value proposition similar to what we had with this one, and we spoke about $1.8 million in revenue in 10 months on a $500,000 fee, we will consider it on a case-by-case basis.

Speaker #1: But this is not a normal course of business for us. It was a one-time. It's only time we've done it. And I do not want to make this a regular occurrence for us.

Speaker #1: So I do not view this as something that we will repetitively do in the future.

Speaker #3: How are the lightweight clumping cat litter sales going?

[Company Representative]: How are the lightweight clumping cat litter sales going?

Speaker #1: So we are doing it for a private label customer. There appears to be good uptake for that private label. We're not at liberty to say who.

Stephen Harpur: We are doing it for a private label customer. There appears to be good uptake for that private label. We are not at liberty to say who, but we are pleased. We have not yet launched our own Wundercat lightweight brand, but we will do that at some point in the near future, post-installation of the new equipment, the big steel frame that we have already built and need to put in place over the next several months. Once that is installed, then we will launch our own Wundercat brand of lightweight. I would ask the person that posed that question to ask it again in six months.

Speaker #1: But we are pleased. We have not yet launched our own Wondercat lightweight brand. But we will do that at some point in the near future post-installation.

Speaker #1: Of the new equipment, the big steel frame that we have already built and need to put in place over the next several months. And once that's installed, then we will launch our own Wondercat brand.

Speaker #1: Of lightweight. And I would ask the person who posed that question to ask it again in six months.

Speaker #3: All right. Following the automation and robotics improvement, what does the annual revenue capacity look like?

[Company Representative]: All right. Following the automation robotics improvement, what does the annual revenue capacity look like?

Speaker #1: We have excess grinding, drying, and packaging capacity. This is not a function of machinery now; it's a function of going out and earning the business.

Stephen Harpur: We have excess grinding, drying, and packaging capacity. This is not a function of machinery now, it is a function of going out and earning the business. So we could, with the current infrastructure that we have, we could double the revenue of this company with minimal incremental investment other than what has been made and the four projects that were outlined today. That is not a function of equipment throughput. That is a function of going out and earning that business.

Speaker #1: So we could, with the current infrastructure that we have, we could double the revenue of this company with minimal incremental investment other than what has been made and the four projects that were outlined today.

Speaker #1: But that's not a function of product of equipment throughput. That's a function of going out and earning that business.

Speaker #3: What are CapEx and R&D expectations for fiscal 2027? Should they be at similar levels on a year-to-year basis?

[Company Representative]: What are CapEx and R&D expectations for fiscal 2027? Should they be similar levels on a year-to-year basis?

Speaker #1: Kyle, I'll hand that over to you.

Stephen Harpur: Carl, I will hand that over to you.

Speaker #2: Take care of these, Martin.

Kyle Dickson: Can you repeat that, Martin?

[Company Representative]: I just deleted the question out of the queue. What are CapEx and R&D expenditures expected for 2027, and how does that compare with the last year?

Speaker #3: Deleted the question out of the queue. What are CapEx and R&D expenditures expected for 2027, and how does that compare with last year?

Speaker #2: I think that's similar to the first question we discussed, which is that we're not comfortable giving guidance on that right now, just due to the state of the pause, loss plants, and how much we'll be needed versus being able to give a comfortable guidance number on what that looks like.

Kyle Dickson: I think that's similar to the first question we discussed, which is we're not comfortable giving guidance on that right now, just due to the state of the PozGlass plant and how much will be needed versus being able to give a comfortable guidance number on what that looks like. As well as with active R&D, there's things that we may invest in and I can't give an answer that would be reasonable today.

Speaker #2: As well as with active R&D, there are things that we may invest in, and I just can't give an answer that would be reasonable today.

Speaker #3: All right. How do you plan to generate revenue with Pause Glass?

[Company Representative]: All right. How do you plan to generate revenue with PozGlass?

Speaker #1: I will answer that. I have stated multiple times in a public setting that the pilot plant is not designed to be a profit center.

Stephen Harpur: I will answer that. I have stated multiple times in a public setting that the pilot plant is not designed to be a profit center. It is designed to quantify the cost of scaling up to a full-size plant or a larger plant, as well as to demonstrate the LCA or life cycle assessment number, the carbon footprint when operational. That being said, we are in active discussions for our first commercial PozGlass plant. I am not going to provide any sort of guidance as to size or location, but we are actively looking at where does the first commercial plant go. We have found an interesting location in Canada, but it is very early stage and we have to operate this plant both making Can Blast and PozGlass first. But this pilot plant is not meant to affect our profitability as a company in any sort of contributory way.

Speaker #1: It's designed to quantify the cost of scaling up to a full-size plant or a larger plant. As well as to demonstrate the LCA or life cycle assessment number, the carbon footprint when operational.

Speaker #1: That being said, we are in active discussions for our first commercial pause glass plant. I'm not going to provide any sort of guidance as to size or location.

Speaker #1: But we are actively looking at where the first commercial plant should go, and we have found an interesting location in Canada. But it's still very early stage.

Speaker #1: And we have to operate this plant both making can blast and pause glass first. But this pilot plant is not meant to affect our profitability as a company in any sort of contributory way.

Speaker #1: It’s never been designed to be that. Are there components of this plant that could be utilized in a larger plant? There are some components, but for the most part, it is a pilot plant.

Stephen Harpur: It has never been designed to be that. Are there components of this plant that could be utilized in a larger plant? There are some components, but for the most case, it is a pilot plant. We do plan to dismantle it. It will not be running forever. I think realistically, you are looking at the end of 2028 for dismantling this plant. It is simply not designed to be a cash cow for our operations.

Speaker #1: And at we do plan to dismantle it. It will not be running forever. I think realistically, you're looking at the end of 2028 for dismantling this.

Speaker #1: Plant. And so it is simply not designed to be a cash cow for our operations.

Speaker #3: Will it generate revenue during that time?

[Company Representative]: Will it generate revenue during that time?

Speaker #1: Yes, it will.

Stephen Harpur: Yes, it will.

Speaker #3: Can you quantify or estimate how much that could be?

[Company Representative]: Can you quantify or estimate how much that could be?

Speaker #1: I'm not going to do it. It's not material.

Stephen Harpur: I am not going to do it. It is not material.

Speaker #3: The new plant that you're in early stage discussions on, would the technology, or would that require CapEx and installation by progressive planet?

[Company Representative]: The new plant that you are in early-stage discussions on, would that be a model where you license the technology, or would that require CapEx and installation by Progressive Planet?

Speaker #1: It would involve much bigger entities than ourselves as partners, and I'm not prepared to discuss it any further than that at this point in time.

Stephen Harpur: It would involve much bigger entities than ourselves as partners, and I am not prepared to discuss it any further than that at this point in time.

Speaker #3: We may have covered this, but when can we expect any potential licensing revenue from the established PozGlass pilot plant and commercializing opportunity? That's—

[Company Representative]: We may have covered this, but when can we expect any potential licensing revenue from the established PozGlass pilot plant and commercializing opportunity?

Stephen Harpur: That question doesn't really make sense to me. There would be no licensing revenue from a pilot plant. Licensing revenue would be a function of a commercial plant. I've just spoken about the fact that we are in discussions and looking at a first potential location, but we are very early stage.

Speaker #1: That question doesn't really make sense to me. There would be no licensing revenue from a pilot plant—licensing revenue would be a function of a commercial plant.

Speaker #1: And I've just spoken about the fact that we are in discussions and looking at a first potential location. But we are at a very early stage.

Speaker #3: Are you still collaborating with PyroGenesis?

[Company Representative]: Are you still collaborating with PyroGenesis?

Speaker #1: We do not have any active work going on with PyroGenesis right now.

Stephen Harpur: We do not have any active work going on with PyroGenesis right now.

Speaker #3: What is the timeline for the pause glass trial with Holcomb?

[Company Representative]: What is the timeline for the PozGlass trial with Holcim?

Speaker #1: With Holcomb?

Stephen Harpur: With Holcim?

Speaker #3: Yes.

[Company Representative]: Yes.

Speaker #1: So that's a little bit of going back on a naming convention. So Holcim bought Lafarge, I believe, in 2014. Lafarge Holcim changed its name.

Stephen Harpur: That is a little bit of a going back on a naming convention. Holcim bought Lafarge, I believe, in 2014. LafargeHolcim changed its name in the last 18 months to Amrize. We have a commercial agreement with Amrize. They have to, for the next several years, take up to 3,500 tons of material, PozGlass, if we choose to make that amount in the pilot plant. We are not necessarily committed to making that full amount, especially if it is not making money. But we envision in the spring of 2027 to begin delivering commercial amounts for testing in the local markets in conjunction with Amrize Canada.

Speaker #1: In the last 18 months to Amrise. So we have a commercial agreement with Amrise they have to for the next several years take up to 3,500 tons of material pause glass if we choose to make that amount in the pilot plant.

Speaker #1: We are not necessarily committed to making that full amount. Especially if it's not making money. But we envision in the spring of 2027 to begin delivering commercial amounts for testing in the local markets in conjunction with Amrise Canada.

Speaker #3: How much of a price advantage does LCD cement have over LC3 cement? Because LCD doesn't need the more expensive metakaolin.

[Company Representative]: How much of a price advantage does LCD cement have over LC3 cement because LCD does not need the more expensive metakaolin?

Stephen Harpur: There's more than one variable. I can't comment unless you were talking about a specific source of metakaolin versus a specific source of waste powdered DE. What I will say is that the grinding energy and the heat energy are dramatically smaller than in the production of Portland cement, and the amount of heat that is needed to activate limestone calcined diatomite is lesser than that for limestone calcined clay, where the activated material is kaolinite that's activated into metakaolin. But I can't get into specifics without having more details and comparing apples to apples.

Speaker #1: There’s more than one variable. I can’t comment unless you were talking about a specific source of metakaolin versus a specific source of waste powdered DE.

Speaker #1: What I will say is that the grinding energy and the heat energy are dramatically smaller than in the production of Portland cement. And the amount of heat that is needed to activate limestone-calcium diatomite is less than that for limestone-calcium clay.

Speaker #1: Where the activated material is kaolinite, that's activated into metakaolin. But I can't get into specifics without having more details and comparing apples to apples.

Speaker #3: What has been learned from phase one of the pause glass pilot, and what is the status of phase two?

[Company Representative]: What has been learned from phase I of the PozGlass pilot, and what is the status of phase II?

Speaker #1: Well, can't talk a lot about what's being learned as we're not operating it in a steady state yet. So we still we're still going through inspections and commissioning and permitting.

Stephen Harpur: Well, can't talk a lot about what's being learned as we're not operating it in a steady state yet. So we're still going through inspections and commissioning and permitting. We still have one piece of equipment even to start bagging. And we haven't, of course, produced any PozGlass yet, so that question is premature.

Speaker #1: There, we still have one piece of equipment, even to start bagging. So, and we haven't, of course, produced any PozGlass yet. So that question is premature.

Speaker #3: What are the next steps for the LCD cement product, timing, testing, marketing, and expenditures?

[Company Representative]: What are the next steps for the LCD cement product, timing, testing, marketing, and expenditures?

Speaker #1: So we've laid out the CapEx that we put into opening our Calgary plant. That was in you can see that in one of the slides.

Stephen Harpur: We've laid out the CapEx that we put into opening our Calgary plant. You can see that in one of the slides. We employ two PhDs in inorganic chemistry at that lab. The bulk of their work is on perfecting a plasticizer or water reducing agent that we are calling Planet LCD Flow, in addition to testing multiple sources of diatomite to produce LCD from different waste. I can't get into it, but there will not be the same sort of CapEx that's required because there's no contamination, there's no garbage. With post-consumer glass, you're taking residential waste and essentially using a whole bunch of very sophisticated equipment to segregate the glass from the other, the metal, the aluminum, the plastic, the paper, the fabric, ceramics. In the case of Planet LCD, it is a much, much simpler plant.

Speaker #1: We employ two PhDs in inorganic chemistry at that lab. The bulk of their work is on perfecting a plasticizer or water-reducing agent.

Speaker #1: That we are calling Planet LCD flow. We in addition to testing multiple sources of diademite to produce LCD from different wastes. But I can't get into it, but there is not the sort of there will not be the same sort of CapEx that's required because we are there's no contamination there's no garbage so with post-consumer glass, you're taking residential waste and essentially using a whole bunch of very sophisticated equipment to segregate the glass from the other the metal, the aluminum, the plastic, the paper.

Speaker #1: The fabric, ceramics—in the case of Planet LCD, it is a much, much simpler plant. So, we will not spend the kind of money that we have spent on the PozGlass to pilot this, but we do not have a pilot plant planned for the immediate future right now.

Stephen Harpur: We will not spend the kind of money that we have spent on the PozzGlass to pilot this, but we do not have a pilot plant planned for the immediate future right now.

Speaker #3: I think you've addressed this, but what would be the potential cost for the company if we go ahead with the first commercial pilot plant?

[Company Representative]: I think you've addressed this, but what would be the cost potentially for the company if a go ahead for the first commercial pilot plant happens? Do we bear a burden of a cost to build, or is it more of a licensing fee?

Speaker #3: And do we bear a burden of a cost to build or is it more of a licensing fee?

Speaker #1: We have stated at multiple times in the past that we believe the biggest expense will be the pilot plant, and we are looking at licensing as the preferred option.

Stephen Harpur: We have stated multiple times in the past that we believe the biggest expense will be the pilot plant, and we are looking at licensing as the preferred option. If there's an opportunity for us where there are incremental benefits to be an equity owner in a special situation, we will absolutely look at that. But we've stated on multiple occasions in the past that our plan is to co-locate these at cement plants and for them to be owned by the cement plant owner and for us to have a licensing. It's our intention to invite the CEOs of the big cement companies throughout the world to come and visit our plant in 2027. If you're a CEO of a meaningful sized cement company, you will get an invite to come and see the pilot plant.

Speaker #1: If there's an opportunity for us where there are incremental benefits to being an equity owner in a special situation, we will absolutely look at that.

Speaker #1: But we've stated on multiple occasions in the past that our plan is to co-locate these at cement plants and for them to be owned by the cement plant owner and for us to have a licensing it's our intention to invite the CEOs of the big cement companies throughout the world to come and visit our plant in 2027.

Speaker #1: If you're a CEO of a meaningful-sized cement company, you will get an invite to come and see the pilot plant. We cannot collaborate with anyone other than Amrise, but we will welcome everybody to come and see the plant.

Stephen Harpur: We cannot collaborate with anyone other than Amrize, but we will welcome everybody to come and see the plant.

Speaker #3: Can you keep making can blasts after dismantling the wet end?

[Company Representative]: Can you keep making Can Blast after dismantling the wet end?

Speaker #1: 100%.

Stephen Harpur: 100%.

Speaker #3: Can you provide an update on the Calgary lab?

[Company Representative]: Can you provide an update on the Calgary lab?

Speaker #1: I think I just did. We have two full-time PhDs working in that lab. It's fully equipped. We also utilize, on a part-time basis, Dr. Gerhard Albrecht, who has about 100 patents to his name and was the primary inventor of polycarboxylate water reducers—patents from around 1980 through to 2000.

Stephen Harpur: I think I just did. We have two full-time PhDs working in that lab. It is fully equipped. We also utilize, on a part-time basis, Dr. Gerhard Albrecht, who has about 100 patents to his name, who was the primary inventor of polycarboxylic water reducers, patents from around 1980 through to 2000. He continues to work with us on a regular basis. The lab is working as intended. I hope that answers the question.

Speaker #1: He continues to work with us on a regular basis. The lab is working as intended. I hope that answers the question.

Speaker #3: Thank you. That concludes the questions from the audience. Would you like to make any final statements before we wrap this up?

[Company Representative]: Thank you. That concludes the questions from the audience. Would you like to make any final statements before we wrap this up?

Speaker #1: I think the sentiment to our investors—and we appreciate that you've dedicated some of your heart or capital to being co-owners of this company.

Stephen Harpur: I think the sentiment to our investors, and we appreciate that you've dedicated some of your hard-earned capital to being co-owners of this company. We had to spend a lot of money to get the plant to where we want it to be to enable the next stage of growth. The investments that we make, they last for decades. This equipment, you have wearable parts, but we have pieces of equipment literally in our facility. We have a roller mill from 1946, a Raymond roller mill. That's being replaced by an air classifying mill, and that one will produce 10 times as much output per hour. But it wears out blades. The body of these things, they wear out. You get abrasion, but these pieces of equipment last for decades. I wanted our investors to see that there's a finite period.

Speaker #1: We had to spend a lot of money to get the plant to where we want it to be, to enable the next stage of growth.

Speaker #1: The investments that we make, they last for decades. This equipment, you have wearable parts, but we have pieces of equipment literally in our facility.

Speaker #1: We have a roller mill from 1946, a Raymond roller mill. Now that's being replaced by an air classifying mill, and that one will produce 10 times as much output per hour.

Speaker #1: But it wears out blades. The body of these things, they just they wear out you get abrasion, but these pieces of equipment last for decades.

Speaker #1: And I wanted our investors to see that there's a finite period—by April 30th of this year, we're done with the major investments in this core business.

Stephen Harpur: By 30 April of this year, we're done with the major investments in this core business. Most of the money on PozGlass, the capital equipment, no further investments after phase 2. No large investments. The heavy lifting of all of the equipment. The big dryers, the grinding equipment, the optical sort, the roll mills, these are all purchased. That's not to say that we are still not interested in international expansion. We've discussed that, and that's very much a part of our growth plan. Any new CapEx in Canada will have a compelling return on investment, and we are essentially done with the big-ticket items by the end of this fiscal year, 30 April 2027.

Speaker #1: And most of the money on PozGlass, the capital equipment—no further investments after Phase Two, no large investments. The heavy lifting of all of the equipment, the big dryers.

Speaker #1: The grinding equipment, the optical sort, the roll mills. These are all purchased. So that's not to say that we are still not interested in international expansion.

Speaker #1: We've discussed that, and that's very much a part of our growth plan. But any new capital expenditures in Canada will have a compelling return on investment.

Speaker #1: And we are essentially done with the big ticket items by the end of this fiscal year April 30th, 2027.

Speaker #3: Thank you. And that concludes today's earnings call. Thank you for joining us and have a good day.

[Company Representative]: Thank you. That concludes today's earnings call. Thank you for joining us, and have a good day.

Speaker #1: Thank you, Martin.

Stephen Harpur: Thank you, Martin.

Speaker #2: Martin.

Kyle Dickson: Martin.

Operator: Goodbye.

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Q4 2026 Progressive Planet Solutions Inc Earnings Call

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