Thermal Energy International Inc.

The company said fourth-quarter revenue was CAD 7.1 million, up about 4% year over year, while full-year revenue was almost CAD 34 million, up 13% and a record. Q4 gross profit was down 6% versus last year because the prior year included one-time adjustments, but full-year gross margin was up year over year and gross profit reached CAD 14.2 million, up 48% over the last three years. Adjusted EBITDA was CAD 247,000 in Q4, down 38% year over year, and CAD 1.9 million for the fiscal year, up about CAD 800,000. Net income was essentially flat in Q4 and a record CAD 1.34 million for the year. Order intake was approximately CAD 30 million, backlog ended at CAD 11.8 million, and the company said backlog has risen to about CAD 19 million as of yesterday after receiving an additional CAD 7 million in orders. No formal next-quarter or full-year financial guidance was provided.

CEO William Crossland framed fiscal 2026 as a banner year, saying the company’s earlier investments in sales, marketing, and engineering are now beginning to benefit both top line and profitability. He emphasized that the strategy is to make solutions easier to deploy and more scalable through standardized equipment packages, indirect sales channels, and a broader European push for HeatSponge. His tone was upbeat and confident, but practical, repeatedly noting that the company is focused on leveraging the team and strategy already in place rather than adding significant headcount.

No separate CFO spoke on the call; Crossland covered the financial results. He cited Q4 adjusted EBITDA of CAD 247,000, which would have been about CAD 396,000 excluding a one-time employer obligation adjustment of about CAD 149,000, and said operating expenses were up only CAD 17,000 and fell as a percentage of revenue. He also pointed to strong cash generation over four years of CAD 7.3 million in operating cash flow versus CAD 3.2 million in combined net income, and said that cash was used to pay down more than CAD 3 million in bank loans, including over CAD 300,000 in the last fiscal year, leaving bank debt under CAD 2,000 at year-end. He added that the company repurchased about 3.6 million shares, returning about CAD 500,000 to shareholders.

Analyst questions focused on backlog, geographic mix, sales-team ramp, major equipment package margins, book-to-bill, and the split between Ottawa and Bristol performance. Management said it does not like to discuss pipeline in detail, but said the future looks bright and that the strategy is producing early positive results. On geography, it explained that North America’s strength recently has been driven by pharma and simplified HeatSponge projects, while Europe has had more larger projects at other times; it expects both markets to remain strong. On major equipment packages, management said these projects should have better margins because the company sells the proprietary engineering and equipment while the customer handles installation, and it said the company has not yet disclosed first-quarter intake.