Ottawa, Ontario--(Newsfile Corp. - April 28, 2026) - Thermal Energy International Inc. (TSXV: TMG) (OTCQB: TMGEF) ("Thermal Energy" or the "Company"), a provider of innovative energy efficiency and carbon emission reduction solutions to major corporations around the world, today reported its financial results for the third quarter ended February 28, 2026. All figures are in Canadian dollars.
Q3 2026 Highlights:
(Compared to Q3 2025)
- Revenue increased 62% to $9.4 million
- Adjusted EBITDAi was $519 thousand, an improvement of $686 thousand
- Net income swung to $338 thousand from a loss of $403 thousand
- Cash position of $4 million and working capital of $3.6 million at quarter end, each up more than $1 million since year end.
- Order backlogii was $14.7 million at quarter end, increasing to $16.3 million as at April 27, 2026.
Overview
"Thermal Energy delivered a standout third quarter, with the highest Q3 revenue in our history and solid performances across both our heat recovery project and GEM businesses," said William Crossland, Thermal Energy CEO. "The higher revenue drove considerable increases in our adjusted EBITDA and net income, with both swinging strongly into the black compared to the losses we reported this time last year. The strength of our second and third quarters drove our trailing four quarters revenue to a record $33.3 million, with adjusted EBITDA of $2.1 million and net income of $1.3 million. These big improvements compared to a year ago are a testament to our growth strategy and the significant reinvestments we made in our business in fiscal 2024 and 2025.
"We received $8.7 million in new orders in the quarter, which was an increase of 26% compared to the third quarter of last year, and helped drive our trailing four quarters order intake to an all-time high of $31.3 million. Order backlog was down slightly as we were more efficient at converting orders to revenue over the last couple quarters, due in part to the investments we made in our engineering team these past couple years. We have a very solid balance sheet with strong cash and working capital positions and virtually no bank debt. We believe we are very well positioned to continue executing our strategy and creating long-term value for our shareholders."
Summary Financial Results
| In thousand except % data | Three months ended Feb. 28, 2026 | Three months ended Feb. 28, 2025 | Nine months ended Feb. 28, 2026 | Nine months ended Feb. 28, 2025 | ||||||||
| Revenue | $ | 9,424 | $ | 5,815 | $ | 26,461 | $ | 22,955 | ||||
| Gross profit | $ | 3,500 | $ | 2,267 | $ | 10,697 | $ | 8,665 | ||||
| Gross margin | 37% | 39% | 40% | 38% | ||||||||
| Operating expenses | $ | 3,065 | $ | 2,517 | $ | 9,186 | $ | 8,240 | ||||
| Net income | $ | 338 | ($403 | ) | $ | 1,121 | ($65 | ) | ||||
| Adjusted EBITDAi | $ | 519 | ($167 | ) | $ | 1,683 | $ | 655 | ||||
| Cash position | $ | 3,957 | $ | 5,143 | $ | 3,957 | $ | 5,143 | ||||
| Working capital | $ | 3,654 | $ | 2,378 | $ | 3,654 | $ | 2,378 | ||||
| Orders received | $ | 8,723 | $ | 6,931 | $ | 26,503 | $ | 17,000 | ||||
| Order backlogii as of February 28 | $ | 14,700 | $ | 14,800 | $ | 14,700 | $ | 14,800 |
Financial Review for the Third Quarter Ended February 28, 2026
Third quarter revenue grew 62% year-over-year to $9.4 million, which is a record for the Company's third quarter. The increase was mainly due to increased revenues from heat recovery projects and GEM. Gross profit increased to $3.5 million, mainly due to increased revenues.
Operating expenses increased by $548 thousand mainly due to an increase in foreign exchange loss of $402 thousand and inflationary increases on salaries and general business costs of $146 thousand.
Adjusted EBITDA increased to $519 thousand and net income increased $338 thousand, compared to losses of $167 thousand and $403 thousand respectively in the third quarter a year earlier.
At the end of February, cash and working capital balances were approximately $4.0 million and $3.7 million, respectively.
Financial Review for the Nine Months Ended February 28, 2026
For the nine months ended February 28, 2026, revenue increased by $3.5 million, or 15%, to $26.5 million. The increase was mainly due to increased revenues from heat recovery projects and GEM. Gross profit increased by $2 million because of the increased revenues from both heat recovery projects and GEM.
Operating expenses increased by $946 thousand. The variance was driven by a decrease in foreign exchange gains of $193 thousand, a $150 thousand one-time restoration cost accrued for a leased space, an increase in group incentive cost of $200 thousand, $90 thousand invested in website design and data scoping tool, $169 thousand increase in salary and benefit expense, and $144 thousand in general inflationary cost increases.
Business Outlook and Order Summary
Orders received ("Order Intake") during the third quarter totalled $8.7 million, bringing the year-to-date total to $26.5 million. The Company ended the quarter with an order backlog of $14.7 million.
The Company also received $1.6 million in new orders subsequent to quarter end, bringing the current order backlog to $16.3 million as of April 27, 2026. A list and description of recent order highlights is available on page 16 to 17 of the Management's Discussion and Analysis filed today.
Full financial results including Management's Discussion and Analysis and accompanying notes to the financial results are available on www.sedarplus.ca and investors-thermalenergy.com/en/financial-overview.
Notice of Earnings Call and Webcast
Management of Thermal Energy will host an earnings call and webcast today, April 28, at 8:30 am ET. A question-and-answer session will follow management's prepared remarks, at which time qualified equity analysts will be able to submit questions via the webcast.
The live webcast will be available at https://tinyurl.com/TMG2026Q3. You may join the webcast via MS Teams on your computer, mobile app or room device. Please join the webcast approximately 15 minutes prior to the earnings call to ensure adequate time for registration and admittance to the webcast.
For more information, including dial-in information (audio only), refer to the Company's press release from April 21, 2026.
Readers are encouraged to subscribe to TEI News to receive strategic news and updates directly to their inbox.
ENDS
| For media enquiries, contact: Thermal Energy International Inc. Canada: 613-723-6776 UK: +44 (0)117 917 2179 Marketing@thermalenergy.com | For investor enquiries: William Crossland President and CEO Thermal Energy International Inc. 613-723-6776 Investors@thermalenergy.com |
Notes to editors
About Thermal Energy International Inc.
Thermal Energy International Inc. provides energy efficiency and emissions reduction solutions to Fortune 500 and other large multinational companies. We save our customers money by reducing their fuel use and cutting their carbon emissions. Thermal Energy's proprietary and proven solutions can recover up to 80% of energy lost in typical boiler plant and steam system operations while delivering a high return on investment with a short, compelling payback.
Thermal Energy is a fully accredited professional engineering firm with engineering offices in Ottawa, Canada, Pittsburgh, USA, as well as Bristol, UK, with sales offices in Canada, UK, USA, Germany, Poland, France, and Italy. By providing a unique mix of proprietary products together with process, energy, and environmental engineering expertise, Thermal Energy can deliver unique, site-specific turnkey and custom engineered solutions with significant financial and environmental benefits for our customers.
Thermal Energy's common shares are traded on the TSX Venture Exchange (TSX-V) under the symbol TMG and on the OTCQB under the symbol TMGEF. For more information, visit our investor website at https://investors-thermalenergy.com or company website at www.thermalenergy.com and follow us on Twitter at https://twitter.com/GoThermalEnergy.
Forward-Looking Statements
This press release contains forward-looking statements relating to, and amongst other things, based on management's expectations, estimates and projections, the anticipated effectiveness of the Company's products and services, the timing of revenues to be received by the Company, the expectation that orders in backlog will become revenue, the anticipated benefits of the Company's current efforts at training and business improvement efforts, opportunities for growth, the Company's belief that it can capitalize on opportunities, the size of markets and opportunities open to the Company and the impact of investments that the Company has made on the Company's ability to scale. Information as to the amount of heat recovered, energy savings and payback period associated with Thermal Energy International's products are based on the Company's own testing and average customer results to date. Statements relating to the expected installation and revenue recognition for projects, statements about the anticipated effectiveness and lifespan of the Company's products, statements about the expected environmental effects and cost savings associated with the Company's products and statements about the Company's ability to cross-sell its products and sell to more sites are forward looking statements. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, some of which are outside of the Company's control, could cause events and results to differ materially from those stated. Fulfilment of orders, installation of product and activation of product could all be delayed for a number of reasons, some of which are outside of the Company's control, which would result in anticipated revenues from such projects being delayed or in the most serious cases eliminated. Actions taken by the Company's customers and factors inherent in the customer's facilities but not anticipated by the Company can have a negative impact on the expected effectiveness and lifespan of the Company's products and on the expected environmental effects and cost savings expected from the Company's products. Any customer's willingness to purchase additional products from the Company and whether orders in the Company's backlog as described above will turn into revenue is dependent on many factors, some of which are outside of the Company's control, including but not limited to the customer's perceived needs and the continuing financial viability of the customer. Volatility with respect to tariffs and trade regulation may continue and may impact the Company in ways not currently anticipated. The Company disclaims any obligation to publicly update or revise any such statements except as required by law. Readers are referred to the risk factors associated with the Company's business as described in the Company's most recent Management's Discussion and Analysis available at www.sedarplus.ca.
Non-IFRS Financial Measures
The Company believes the following non-IFRS financial measures provide useful information to both management and investors to better understand the financial performance and financial position of the Company.
EBITDA and Adjusted EBITDA
Management believes that EBITDA (earnings before interest, taxation, depreciation and amortization) and Adjusted EBITDA (EBITDA plus share-based compensation expense) are useful performance measures. The Adjusted EBITDA approximates cash generated from operations, before tax, capital expenditures and changes in working capital. Adjusted EBITDA also assists comparison among companies as it eliminates the differences in earnings due to how a company is financed. EBITDA and Adjusted EBITDA do not have a standardized meaning prescribed by International Financial Reporting Standards ("IFRS") and therefore may not be comparable to similar measures presented by other companies. There is no direct comparable IFRS measure for EBITDA or Adjusted EBITDA.
A reconciliation of net income to EBITDA and Adjusted EBITDA is shown below.
| Three months ended | Nine months ended | |||
| Feb 28, 2026 $ | Feb 28, 2025 $ | Feb 28, 2026 $ | Feb 28, 2025 $ | |
| Total net income attributable to owners of the parent | 322,627 | (416,630) | 1,047,766 | (125,362) |
| Total net income attributable to non-controlling interest | 14,949 | 13,994 | 73,454 | 59,870 |
| Interest charge | 30,382 | 70,211 | 91,339 | 235,657 |
| Interest revenue | (6,088) | (7,962) | (16,845) | (51,900) |
| Income tax expense | 13,951 | 14,440 | 71,088 | 49,451 |
| Depreciation and amortization | 74,340 | 96,815 | 224,692 | 294,927 |
| EBITDA | 450,161 | (229,132) | 1,491,494 | 462,643 |
| Share based compensation | 68,407 | 61,638 | 191,683 | 192,250 |
| Adjusted EBITDA | 518,568 | (167,494) | 1,683,177 | 654,893 |
Order Backlog
Order backlog is a useful performance measure that Management uses as an indicator of the short-term future revenue of our Company resulting from already recognized orders. The Company includes in "order backlog" any purchase orders that have been received by the Company but have not yet been reflected as revenue in the Company's published financial statements. It is important to note that once an order or partial order is recorded as revenue, the order backlog is reduced by the amount of the newly reported revenue. Order backlog does not have a standardized meaning prescribed by International Financial Reporting Standards and therefore may not be comparable to similar measures presented by other companies.
For additional details on non-IFRS financial measures, please refer to the Company's most recent Management's Discussion and Analysis available at www.sedarplus.ca for more details about these non-IFRS financial measures.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
i Adjusted EBITDA represents earnings before interest, taxation, depreciation, amortization, and share-based compensation expense. See note below about non-IFRS measures.
ii Order backlog represents any purchase orders that have been received by the Company but have not yet been reflected as revenue in the Company's published financial statements. See note below about non-IFRS measures.
To view the source version of this press release, please visit https://www.newsfilecorp.com/release/294529
Source: Thermal Energy International Inc.
