NXT Energy Solutions Inc.

In Q4 2023, NXT recorded SFD-related revenue of approximately CAD2.15 million from the Turkish survey. Net loss for the quarter was approximately CAD0.43 million, or CAD0.01 per share, versus a net loss of CAD1.47 million, or CAD0.02 per share, in Q4 2022. For the full year, net loss was approximately CAD5.45 million, or CAD0.07 per share, versus CAD6.73 million, or CAD0.10 per share in 2022. Cash at December 31, 2023 was CAD0.4 million, accounts receivable were CAD1.83 million, and net working capital was negative CAD1.86 million, an improvement from negative CAD3.47 million at September 30, 2023. Management also said the debenture financing finalized January 12, 2024 totaled CAD1.87 million, and CAD0.72 million of that was received in Q1 2024. Forward-looking, management did not provide formal revenue or EPS guidance, but said 2024 should bode well, that the pipeline currently includes two draft contracts, three formal written proposals, and additional detailed customer outlines, and that it aims to support commercial execution in a cost-efficient way.

Bruce Wilcox framed 2023 as a turning point, saying it was a “watershed period” and expressing confidence that 2024 should be better. He described a shift away from relying mainly on large NOC opportunities toward a broader mix of smaller, faster-moving IOC projects, supported by active marketing, better prospect ranking, and more partnerships. He also acknowledged the company’s presentation and website need modernization, but said the team is open to anything that helps bring in business.

Eugene Woychyshyn focused on the quarter’s reported figures and liquidity. He highlighted CAD2.15 million of Turkish SFD revenue, cash of CAD0.4 million, accounts receivable of CAD1.83 million, and a negative working capital position of CAD1.86 million that improved from negative CAD3.47 million at the prior quarter end. He also noted the CAD1.87 million debenture financing finalized in January 2024, of which CAD0.72 million was received in Q1, and reiterated cost reductions including lower salaries, professional fees, and business development spending, plus planned lease and office-space reductions.

The main analyst question centered on the Turkish contract’s economics, including whether margins were lower than expected and how to interpret what looked like negative gross margin for the year. Management said the Turkish survey had lower volume than expected and that overall margins were lower than expected, while Bruce explained that SFD costs include fixed aircraft-related costs, so the business needs more volume to absorb them. Another question pushed management on branding and marketing; Bruce said the company has hired consultant Les Hribar, is upgrading the website and social media presence, and is aiming for more direct C-suite outreach rather than overly technical pitches.