LIQT

Image source: The Motley Fool. Wed., Aug. 12, 2026 at 9 a.m. ET Chief Executive Officer - Fei Chen Chief Financial and Chief Operating Officer - David Kowalczyk Operator: Good morning, and welcome to the LiqTech International Reports Second Quarter Fiscal Year 2026 Financial Results Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Robert Blum with Lytham Partners. Please go ahead. Robert Blum: Great. Thank you very much, [ Chloe ]. Good morning, everyone, and thank you for joining us on today's call to discuss LiqTech's second quarter 2026 financial results. Joining us on today's call from the company are Fei Chen, Chief Executive Officer; and David Kowalczyk, the company's Chief Financial and Chief Operating Officer. As the operator mentioned, before I turn the call over to management, I'll remind everyone that there will be a Q&A session at the end of the call today. [Operator Instructions]. Before we begin with prepared remarks, we submit for the record the following statement. This conference call may contain forward-looking statements. Although the forward-looking statements reflect the good faith and judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed during the conference call. The company, therefore, urges all listeners to carefully review and consider the various disclosures made in the reports filed with the Securities and Exchange Commission, including the risk factors that attempt to advise interested parties of the risks that may affect our business, financial condition, operations and cash flows. If one or more of these risks or uncertainties materialize or if the underlying assumptions prove incorrect, the company's actual results may vary materially from those expected or projected. The company, therefore, encourages all listeners not to place undue reliance on these forward-looking statements, which pertain only as of this date and the date of the release and conference call. The company assumes no obligation to update any forward-looking statements to reflect any events or circumstances that may arise after the date of this release and conference call. Now I'd like to turn the call over to Fei Chen, CEO of LiqTech International. Fei, please proceed. Fei Chen: Thank you, Robert, and good day to everyone on the call. Before discussing the quarter, I want to acknowledge an important development for LiqTech and our shareholder base. In June, we completed an underwritten public offering that generated approximately $18 million in net proceeds. The offering brought a number of new shareholders into LiqTech. And I want to thank those investors along with our existing shareholders for the confidence you have placed in our company and our technology. We recognize the rising equity capital comes with significant responsibility to our shareholders. We expect to be judged by how effectively we deploy that capital, how consistently we execute and ultimately, whether we can translate our technology and market opportunities into sustainable financial performance. A portion of the proceeds was used to repay our outstanding senior promissory notes and original issue discount notes, significantly strengthening our balance sheet. The remaining capital provides us with the working capital and financial flexibility to execute our growth priorities. Importantly, having a stronger balance sheet does not change the need for financial discipline. We remain focused on careful capital allocation, disciplined spending and converting our commercial opportunities into revenue and improved profitability. Our priority now is execution and demonstrating measurable progress in our financial results. For shareholders who are newer to LiqTech, I would like to provide just a very brief high-level review of the strategy we have been implementing over the past several years. Our objective is to build a more balanced, repeatable and profitable company around applications where our silicon carbide membrane technology provides a clear performance advantage and where customer adoption can scale. To begin with, commercial pool has become a much more important part of that strategy. We have invested in a standardized and modular QlariFlow platform, expanded our distribution network and built references across multiple geographies. Next, Marine has also reengaged through our joint venture in China, which gives us local sales, sourcing, assembly, development and service capabilities in a market where local execution is essential. Our DPF and membrane business and our plastics business provide a steady base of activity and important manufacturing capabilities. The largest variable in our outlook remains Water for Energy and Water for Industry. These markets represent meaningful revenue opportunities for LiqTech, but sales cycles are typically longer and more complex. Projects often require pilot testing, technical validation, customer approvals, capital budgeting and multiple layers of internal decision-making. As a result, project timing can be difficult to predict and is often influenced by customer processes that are outside our direct control. This means Water for Energy and Water for Industry can be significant drivers of our future growth, but it can also create variability in our quarterly and annual revenue. Our focus is, therefore, on building a broader pipeline, advancing multiple opportunities in parallel and converting more of these projects into firm orders. Over time, we believe this should make the business less dependent on the timing of any single large project. Based on what we have learned from the market, we have refined our go-to-market approach for both Water for Energy and Water for Industry. In Water for Energy, going forward, we will focus on building strategic commercial partnerships that help us accelerate market penetration and convert our technology capabilities into commercial opportunities. In Water for Industry, we will take a more targeted approach, focusing our resources on selected applications where we see clear customer needs and a strong technology fit. The steel industry is a good example, where our recent follow-on order demonstrates the potential to move from initial installation to broader multisystem deployments. Our objective is to build a more visible, repeatable and scalable opportunity pipeline while maintaining disciplined resource allocation. The second quarter illustrates both sides of our strategy. Commercial pool achieved record revenue and the Marine continues to execute against its order book. Since quarter end, the U.S. industry wastewater reuse order and the $2.3 (sic) [ 2.1 ] million follow-on order from a U.S.-based steel manufacturer have further reinforced the progress we are making in selected Water for Industry applications. At the same time, delay in a larger Water for Energy project has reduced our revenue visibility for the remainder of 2026. As a result, we are revising our full year revenue guidance to a range of $20 million to $23 million. Importantly, even at the revised guidance range, we expect to deliver meaningful year-over-year revenue growth, reflecting the underlying process across our business. We are disappointed by this delay, particularly because we had expected this project to contribute revenue this year, but our response is not weak. We are putting greater emphasis and resources behind the markets where we see more repeatable demand, shorter sales cycles and a better revenue visibility. At the same time, we will continue to pursue significant opportunities in Water of Energy, but in a more selective and increasingly partnership-driven manner. This is not a sudden change in direction. Rather, it's a continuation and acceleration of the strategy shift we have discussed it over the past several quarters, informed by what we have learned from the market. We now have a stronger balance sheet, growing commercial platform and significant market opportunities. But ultimately, we need to demonstrate that these strengths translate into improved financial performance. Our priorities are clear: execute on the opportunities in front of us, maintain financial discipline, improve profitability and build a more predictable and sustainable business. And let me be clear, achieving profitability as quickly as possible remains one of our highest priorities. Let us talk about each area in more detail. Commercial Pool was the strongest area of business in the second quarter. Revenue reached a record $1.5 million compared with $0.8 million in both the second quarter of '25 and the first quarter of '26. The performance reflects the work we have done to standardize the QlariFlow platform, strengthen our distribution partnerships and establish a broader base of reference installations. During the quarter, we completed assembly of the systems for the Plumpton Aquatic and Leisure Centre project in Australia and our first U.S. commercial pool project in Worland, Wyoming. The large pool system in Den Helder, Netherlands, which we announced in April is now operating successfully. These projects demonstrate that QlariFlow can serve different facility sizes, project designs and geographics. We are maintaining the advantage of a modular platform. We continue to have our focus in establishing new distribution relationships in the prioritized geographic regions. Expanding the partner network is an important part of the pool strategy because local partners are critical for identifying projects earlier, supporting system design and installation and providing the customer relationships needed to scale efficiently. Pools are attractive to LiqTech because the systems can be more standardized than our many large industry projects. The value proposition is straightforward and each successful installation can help create additional opportunities in the surrounding market and add aftermarket service business. Transitioning to Marine. Marine revenue totaled $0.7 million in the second quarter compared with $0.4 million in the second quarter of '25 and $0.8 million in the first quarter of '26. During the quarter, we received factory acceptance test approval for the first 2 iCER dual-fuel water treatment units. This represents an important execution milestone and reflects the significant progress made by our team and our joint venture in China. We expect to deliver 1 additional iCER dual-fuel water treatment unit and 2 marine scrubber water treatment systems in the third quarter. We also secured a commercial order of 4 water treatment systems for EGR-equipped vessels in China with the first system currently expected to be delivered in December. The China joint venture has allowed us to reestablish a stronger position in Marine by combining LiqTech's membrane technology with localized engineering, sourcing, assembly and service. We continue to manufacture our co-silicon carbon membranes in Denmark. We're using the joint venture to improve competitiveness and responsiveness in the Chinese shipbuilding market. The growing mix of iCER, EGR scrubber systems and related aftermarket opportunities gives us confidence that Marine can become a more consistent contributor over time. Turning to Water for Energy. The most significant change occurred recently. A major customer went through an organizational change that affected the decision-making process for an important Water for Energy project that we had expected to contribute revenue in 2026. New decision-makers became involved and significant part of the customers' internal evaluation and approval process effectively had to restart. As the impact of this delay become clear, we reassessed what we could realistically deliver and recognized as revenue during the remainder of 2026. Given the slower customer decision-making process, combined with the lead time required for certain critical equipment, we concluded that it was no longer prudent to maintain our previous full year revenue guidance. I want to be clear that we are disappointed by this delay. Our team has invested significant time and resources in technical validation, field engagement and commercial development. Importantly, we have not seen any change in the underlying need for our technology and the technical results remain compelling. The project has not been terminated and remains an active opportunity. Our relationship with the customer remains intact, and we continue to engage closely with the new decision makers as they work through their internal evaluation and approval process. Within Water for Industry, the near-term opportunity set is becoming increasingly tangible, particularly in steel and other industry wastewater applications. Yesterday, we announced a $2.1 million follow-on order from a U.S.-based steel manufacturer for 4 additional industry wastewater filtration systems with approximately 75% of the order currently expected to be delivered by the end of 2026. This order builds directly on the successful deployment of customers' initial system, which uses our silicon carbide membrane technology to treat challenging wastewater with high oil content and significant variability as part of the customers' broader water reclamation process. What is particularly important to us is the progressing of this customer relationship. We started with one system, allowing the customer to validate our technology under real operating conditions. Based on successful performance of that system, the customer has now moved forward with 4 additional systems. This demonstrates the potential of our strategy proven the technology in a demanding application, established strong customer reference and then scale from initial installation to a broader deployment. This transition from initial installation to a larger multisystem deployment is exactly the type of development we want to see in Water for Industry. It demonstrates the potential to convert successful technology validation into repeat business and larger commercial opportunities. This week, we also announced an order from a new U.S. customer for a QureFlow QF-6 ceramic membrane filtration system to be installed at its new facility in Freeport, Texas. The system will treat wastewater generated from industry equipment cleaning operation and recycle the treated water back into the facility's wash water supply. This is an important proof point for several reasons. It brings a new U.S. customer to LiqTech, demonstrates the applicability of our standardized QureFlow platform beyond traditional produced water treatment and addresses a challenging and highly variable wastewater stream where consistent remove of suspended solids and oil is critical. Most importantly, it delivers a clear economic and environmental benefit to the customer by reducing both wastewater disposal volumes and freshwater consumption. Together with the new steel industry order, this industry wastewater order reinforces our belief that selected water for industry applications can develop into a more repeatable and scalable business. Our standardized system provide customers with clear economic and sustainability benefits. We are allowing us to deploy proven solutions across similar applications. This is why we are allocating greater resource towards selected industry segments where we see strong technology fit, increasing customer engagement and a better near-term revenue visibility. Finally, our DPF and membrane business remain important foundational part of LiqTech. DPF and membrane revenue was approximately $1 million in the second quarter compared with $1.3 million in both the previous year quarter and the first quarter of '26. The decrease primarily reflected temporary production delays caused by constrained availability of critical raw material. Plastics revenue was $0.9 million compared to $1.2 million in the second quarter of '25 and approximately $1 million in the first quarter of '26. Customer purchasing decisions slowed during the quarter and availability of raw material prices and the broader market uncertainty where both DPF and plastics experienced some pressure during the quarter, they continue to provide an important base of recurring customer activity and continue to the balance of our overall business portfolio. To summarize, the second quarter delivered record commercial pool revenue, continued execution in Marine and meaningful progress in industry wastewater. These achievements were offset by the delay in Water for Energy that has reduced our near-term revenue visibility and lead us to revise our 2026 revenue outlook. While we are disappointed by timing change, we remain optimistic about the direction of the business. We have a stronger balance sheet, a broader shareholder base, growing traction in markets where we can build standardized and repeatable solution and a greater clarity around where to allocate our resources. Our priority now is execution, converting these advantages into more predictable revenue growth, improved margins and ultimately, sustainable profitability. Let me now turn the call over to David to review the financial results in more detail. I will then make a few closing comments before we open the call for your questions. David? David Kowalczyk: Yes. Thank you, Fei, and good day, everyone. I will walk through our second quarter financial results, the revised full year outlook and the impact on the June financing on our balance sheet. The revenue for the second quarter of 2026 was $4.4 million compared with $5 million in the second quarter of '25, representing a decrease of 12%. The quarter included strong year-over-year growth in Commercial Pools and Marine, offset by lower Water for Energy activity, temporary production constraints in DPF and membranes and softer customer purchasing in plastics. Within Commercial Pool, revenue was a record $1.5 million compared with $0.8 million in the prior year quarter. Marine revenue was $0.7 million compared with $0.4 million last year. These increases demonstrate the progress in the strategic growth markets Fei just discussed. DPF and membrane revenue was approximately $1 million compared with $1.3 million in the second quarter of '25. Plastic revenue was approximately $0.9 million compared with $1.2 million in the prior year quarter. As Fei noted, the DPF and membrane comparison was affected by raw material availability, while plastics reflected slower customer purchasing decisions in a volatile raw material environment. Gross profit for the second quarter was $0.4 million, representing a gross margin of 8.4%. This compares with a gross profit of $0.5 million and a gross margin of 9.8% in the second quarter of '25. The year-over-year decline primarily reflected product mix, including a lower contribution from higher-value system activity as well as a lower utilization of manufacturing capacity, while we continue to manage costs carefully. These factors were particularly offset by procurement benefits and lower depreciation expenses. As we have discussed in prior calls, our current revenue level remains below the point where fixed production costs are fully absorbed. Improving gross margins level depends on both revenue scale and mix. Standardized Commercial Pool, Marine and selected industrial systems are important to that effort because they provide opportunities to reuse engineering, improve procurement, simplify manufacturing and create better operating leverage as volume increases. Total operating expenses for the second quarter were $2.7 million compared with $2.6 million in the second quarter of '25, an increase of 4%. Approximately 60% of the increase was related to foreign exchange rate movements, given that a significant portion of our cost base is denominated in Danish crowns and euros. Selling expenses were $0.8 million compared with $0.8 million in the prior year quarter. Excluding currency effects, the increase primarily reflected the annualized impact of hires within the Chinese joint venture, continued investments in sales coverage in the U.S. and Europe and annualized cost for the U.S. service center. General and administrative expenses were $1.6 million compared with $1.5 million in the second quarter of '25. Adjusting for currency movements, G&A remained stable and below general inflation as the cost of filling open positions were offset by savings in other overhead areas. Research and development expenses were $0.3 million compared with $0.2 million in the prior year quarter. The increase primarily related to membrane development and development work for Marine and Commercial Pool systems. We continue to manage operating expenses with discipline while directing investments towards the areas that support commercial growth and more repeatable system platforms. Other expenses for the second quarter were $0.7 million compared with approximately $0.1 million in the comparable period of '25. The increase was primarily attributable to amortization of debt discount accrued and paid interest on the senior promissory notes and losses on foreign currency translation. Net loss for the second quarter of '26 was $3.1 million compared with a net loss of $2.2 million in the second quarter of '25. Adjusted EBITDA was a negative $1.6 million compared with a negative $1.3 million in the prior year quarter, slight decline was due to the lower revenue and gross profit and currency-driven increase on operating expenses. Turning to our outlook. We are revising our expectations for the full year of 2026, adjust to a range of $20 million to $23 million. The revision primarily reflects the movement of Water for Energy projects that were previously expected to contribute in '26, but are now anticipated to be completed beyond the current fiscal year. The range continues to contemplate strong performance from Commercial Pool and Marine, selected Water for Industry opportunities, including the new U.S. steel manufacturing follow-on order and ongoing contributions from DPF membranes and plastics. Approximately 75% of the $2.1 million order is expected to be delivered by the end of '26. The principal variable remains the timing of larger system orders. We have reduced the amount of Water for Energy revenue assumed in the outlook, but we have not removed this opportunity from our commercial pipeline. The revised revenue cadence will affect the timing of operating leverage. Our priorities remain gross margin improvement, disciplined operating spending and careful working capital management. We will continue to align investment with the markets where we see the strongest visibility and the best opportunity to create repeatable, profitable growth. Turning to the balance sheet. We ended the second quarter with cash on hand, including restricted cash of $15.7 million as of June 30. This compares with $2.7 million at the end of the first quarter. The change primarily reflects the June public offering. The offering closed on June 8 and generated approximately $18 million in net proceeds. In connection with the transaction, we eliminated the remaining senior promissory notes and original issued discount notes. As a result, LiqTech ended the quarter with a substantially stronger liquidity position and greater financial flexibility. We intend to use that flexibility carefully. The capital is not a substitute for operating execution. It gives us the ability to support working capital, pursue business development in target markets and make focused investments that can help accelerate growth. We will evaluate those investments against clear commercial milestones and continue to manage cash with discipline. And with that, let me now turn the call back to Fei. Fei Chen: Thank you, David. Before we open the call for questions, I want to return to the message I shared at the beginning. LiqTech is building around a differentiated silicon carbon filtration platform that can solve difficult water and emission challenges across multiple markets. The opportunity is significant, and our responsibility is to translate the opportunity into a business that is more predictable, scalable and profitable. The second quarter demonstrates clear progress in Commercial Pool and Marine. Since quarter end, the new U.S. industry wastewater treatment order and $2.1 million follow-on order from a U.S.-based steel manufacturer have provided further commercial validation of our technology and strengthen our confidence in the opportunity within selected industrial wastewater applications. At the same time, the quarter reinforced the need to remain disciplined in Water for Energy where customer-controlled project timing can create meaningful revenue volatility. We are responding by allocating greater resource towards markets where we have better visibility and a clear path to scale. We are pursuing water for energy opportunities more selectively and increasingly through strategic partnerships. Across the business, we are focused on building repeatable system platforms, expanding our market reach through partnerships and remaining disciplined use of financial flexibility created by the June offering. We appreciate the support of both our long-standing and the new shareholders. We recognize the responsibility that comes with that support, and we are committed to earning it through disciplined execution, more predictable growth and improved financial performance. With that, Robert, we would be happy to take any questions. Robert Blum: Great. Thank you very much, Fei and David, for the prepared remarks. [Operator Instructions] First here, would you speak to where process improvements driving profitability may be realized in the near term. Examples may be sales, assembly, water system engineering or another area for LiqTech. Fei Chen: Very good question. We actually have been working intensively in the past 1 and 2 years really to make the cost reduction for our processes in order to speed up the profitability. I can mention, first of all, we are doing the standardized product across all the applications, as we mentioned, the marine area, the commercial pool area and also the water for industry area, we are now having our product standardized and that reduce the cost and also provide the scales of economy when the sales goes up. And we're also working much more close to our procurement process purchasing for the raw materials and the components, we really improve on that, and that will provide us the cost reduction. And we're also using our joint venture in China to see if there's any other component and materials in China can be much more cheaper and attractive for us than we're normally purchasing in Europe. So those are very much things we're doing. We're also working very much on the inventory optimization. We're also working on the production efficiency and the quality control, all this contributing to the improvement of our costs. And from the sales perspective, we're also working very much on using our sales pipeline and CRM system really to control where we're going to use the sales resource and where we're really going to invest in the technology and also the whole process to get the commercial results and because that also brings a lot of cost to us. So we also -- so overall from the beginning to the end, we are looking at each of steps to really make the cost reduction. We're still a long way to go because they continuously have the possibility to improve, but we are very much aware to do that. Robert Blum: All right. Very good. Thank you. Next question here. Could you talk about the competitive advantages that the QureFlow system has versus the other systems on the market? And how long did the steel customer have your unit operational before they chose to add 4 more units? Fei Chen: Our crossflow system is based on our silicon carbon membrane. And this is very unique because our membrane has the patented coating, makes it very suitable for the waters with very, very dirty content, high oil content and high suspended particles and also different impurity in the water. And that's actually exactly the reason why our system is really function well in the steel manufacturing industry. On top of our membrane, our system, because we call crossflow, is really a continued operation system, and we're able to have the water recycled continuously in the system, and that makes the system continuously safe cleaning and really reduce the risk for being blocking by the impurity in the water. And the company used our system for the steel manufacturing waters, have been running our system for 10 months. And it has been very stable, and they were so amazed because before they're using polymer membranes and those membranes very easily got blocked and they have to be changed very often. That really brings a lot of OpEx for them, the costing. And also very often, they have to stop the treatment and replace and that really also caused the break in their production process. So our system can run continuously and for all the 10-month period and without any troubles, and we are very stable and keep the promise we have given to them. And that's actually the basis why they have decided to extend another 4 systems because they're really happy for the performance of our system. Robert Blum: Okay. Very good. The next question here is, are you seeing a larger number of pool system sales? Or are you seeing larger sales per system, sort of the size of the system versus the quantity of the systems? Fei Chen: We see both. I mean we -- right now, majority of our sales still is in Europe, especially in North Europe. And -- but we're now coming to U.S. with a strong partner. And also, as you hear, we actually already finished the first pool system. It's going to be installed in U.S. in the quarter 3 -- by the end of quarter 3. So if we continue coming to the U.S., we will continue to come to U.S. In U.S., the systems are bigger. they are much bigger than Europe. And as you also hear, we actually got a very big system in Australia and also in Holland. So we're working on both the bigger system and also the volume. But of course, we would rather go to the bigger system because you got the revenue faster and much more efficient sales, and we're seeing both. Robert Blum: Okay. Very good. Next question here is how many iCER water treatment units do you forecast could be sold in an average year? And how many annual units do you have capacity for? Fei Chen: That's a very good question. I mean the market is quite big, not only iCER, it's iCER combined with EGR because iCER is about 30% of market and EGR is 70% of market. So these 2 technology, they kind of parallel and share the market. And we are very happy. We already got EGR sales order, and we're going to deliver by end of this year. So we are also going to the EGR market. So right now, according to the Internet data, there's 600 boats and vessels to be delivered from now to 2028, '29 and the combination of iCER and EGR. So our goal definitely -- we would like to get a substantial amount of those vessels and really to get our installations. So we are working in China to the assembly part. And what we're doing is we find some very good partners in China do the assembly for us. So in this way, our assembly capacity to be quite flexible. So we're able to increase quite fast in this way. So we don't see that as really a challenge. So what we now really focus on is to finalize the standardize of our system for the marine application, both for iCER, EGR and also for scrubber. So in this way, we're really able to speed up very fast when the sales coming. And we see a very good cadence, both for the sales and also delivery in this area. Robert Blum: Very good. I am showing no further questions here. So with that, Fei, I will turn it back over to you for any closing remarks. Fei Chen: Thank you, Robert. Thank you all very much for joining us today and for your continued interest in LiqTech. We look forward to updating you again next quarter. Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. 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Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management is accelerating a shift toward standardized, modular platforms in Commercial Pool and Marine markets to build a more predictable and repeatable revenue base. The Water for Energy segment remains the largest variable in the outlook due to complex sales cycles and customer-controlled decision-making processes that create significant quarterly volatility. A major Water for Energy project delay was driven by a customer's organizational restructuring, which forced a restart of the internal evaluation and approval process. The China joint venture has successfully localized engineering, sourcing, and assembly, allowing the company to re-engage in the Marine market with improved cost competitiveness. Performance in the steel industry demonstrates a 'land and expand' strategy, moving from initial technology validation to broader multi-system deployments after 10 months of stable operation. Management is transitioning the Water for Energy go-to-market strategy to a partnership-driven model to accelerate market penetration while reducing direct resource intensity. Record revenue in Commercial Pools was driven by the standardization of the QlariFlow platform and the expansion of distribution networks in North Europe and the U.S. Full-year 2026 revenue guidance was revised downward to $20 million to $23 million, primarily reflecting the removal of specific Water for Energy revenue previously expected this year. The revised outlook assumes approximately 75% of the $2.1 million U.S. steel industry follow-on order will be delivered by the end of 2026. Management expects to deliver one additional iCER dual-fuel unit and two marine scrubber systems in Q3, with the first EGR-equipped system delivery slated for December. Profitability goals depend on achieving higher revenue scale to fully absorb fixed production costs, which currently remain under-utilized. Future growth in the U.S. pool market is expected to yield higher revenue per installation compared to European projects due to typically larger facility sizes. Completed an $18 million net proceeds public offering in June, using a portion to eliminate all outstanding senior promissory and original issue discount notes. Temporary production delays in the DPF and membrane business were caused by constrained availability of critical raw materials during the second quarter. Foreign exchange rate movements, specifically in the Danish crown and euro, accounted for approximately 60% of the year-over-year increase in operating expenses. The company is utilizing its China joint venture to source lower-cost components as a primary lever for improving gross margins across all system platforms. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management is focusing on product standardization across all segments to capture economies of scale as volume increases. The company is optimizing procurement by leveraging the China joint venture for cheaper components and improving inventory management and quality control. The silicon carbide membrane's patented coating allows for continuous operation in high-oil and high-solid environments where polymer membranes frequently fail. A key U.S. steel customer placed a follow-on order after 10 months of stable operation without the maintenance shutdowns required by previous solutions. Management cited industry data showing 600 vessels to be delivered through 2029 that require iCER or EGR water treatment technology. Assembly capacity is being kept flexible through Chinese partnerships, allowing the company to scale production rapidly without significant fixed capital investment.

BALLERUP, Denmark, Aug. 12, 2026 (GLOBE NEWSWIRE) -- LiqTech International, Inc. (Nasdaq: LIQT) ("LiqTech"), a clean technology company that manufactures and markets highly specialized filtration technologies, today announced its financial results for the second quarter of 2026. Recent Financial Highlights Q2 2026 revenue was $4.4 million, compared to $5.0 million in Q2 2025. Q2 2026 net loss was $(3.1) million, compared to $(2.2) million in Q2 2025. Q2 2026 Adjusted EBITDA was $(1.6) million, compared to $(1.3) million in Q2 2025 Following the successful completion of the Company’s recent capital raise, cash and cash equivalents were $15.7 million as of June 30, 2026, significantly strengthening the Company’s liquidity position. The Company is now substantially debt-free, providing a stronger balance sheet to support its strategic priorities and growth initiatives. Outlook The Company is revising its FY 2026 revenue guidance to $20 million to $23 million, representing year-over-year growth of approximately 21% to 39% compared to FY 2025. The revised guidance primarily reflects delays in the timing of a Water for Energy project that was previously expected to be delivered during 2026 but is now anticipated beyond the current fiscal year. Recent Operational Highlights Commercial Pool revenue reached a record $1.5 million in Q2 2026, compared to $0.8 million in both Q2 2025 and Q1 2026. During the quarter, LiqTech completed assembly of the Plumpton Aquatic and Leisure Centre project in Australia and its first U.S. commercial pool installation in Worland, Wyoming. The large QlariFlow™ system in Den Helder, announced in April, is now operating successfully Marine revenue totaled $0.7 million in Q2 2026, compared to $0.4 million in Q2 2025 and $0.8 million in Q1 2026. During the quarter, the Company achieved Factory Acceptance Test (FAT) approval for the first two iCER dual-fuel water treatment units. LiqTech expects to deliver one additional iCER dual-fuel water treatment unit and two marine scrubber water treatment systems in Q3 2026. The Company also secured a commercial order for four water treatment systems for EGR-equipped vessels in China, further expanding the application of its marine filtration technology across next-generation engine platforms. Delivery of the first EGR system is expected in Q4 2026. Within the Water for Industry (WFI) business, the Company is seeing improved near-term opportunity visibility, particularly in the steel industry and other industrial water treatment applications. Following Q2 2026, LiqTech secured a $2.1 million follow-on order from a U.S.-based steel manufacturer for four additional QureFlow™ industrial wastewater filtration systems, with approximately 75% of the order expected to be delivered by the end of 2026. The order builds directly on the successful deployment of the customer's initial system in 2025 and expands the relationship from a single installation to a broader five-system deployment. During the third quarter, LiqTech also secured a U.S. order for a wastewater reuse system treating wastewater generated from industrial equipment-cleaning operations, reflecting continued commercial traction in this market. Together, these orders provide additional commercial validation for LiqTech's QureFlow™ platform and support the Company's strategic focus on selected WFI applications that offer more repeatable demand and stronger near-term visibility. Within the Water for Energy (WFE) business, a larger project was delayed due to extended customer decision-making and approval processes. While this delay reduces expected revenue for 2026, the Company continues to work closely with this customer and believes the project remains an active opportunity. Diesel particulate filter (DPF) and membrane revenue totaled $1.0 million in Q2 2026, compared to $1.3 million in Q2 2025 and Q1 2026. The decrease was primarily attributable to temporary production delays resulting from constrained availability of a critical raw material. Plastics revenue totaled $920,000 in Q2 2026, compared to $1.2 million in Q2 2025 and $1.0 million in Q1 2026. The decrease primarily reflected slower customer purchasing decisions amid continued volatility in raw material prices and broader market uncertainty. Management Commentary "Our second quarter results reflected continued progress in our strategic focus growth markets, highlighted by record Commercial Pool revenue and solid execution in our Marine business," commented Fei Chen, CEO of LiqTech. "Since quarter-end, the $2.1 million follow-on order from a U.S.-based steel manufacturer has further reinforced the opportunity we see in selected Water for Industry applications. At the same time, our financial performance was impacted by a delay in a larger Water for Energy project, resulting from extended customer decision-making processes. This delay has reduced our near-term revenue visibility and led us to revise our full-year revenue guidance." "Over the past year, we have refined our strategy based on our market experience. We are reducing our reliance on large, project-driven opportunities and increasing our focus on markets that offer more repeatable demand, shorter sales cycles and greater scalability. The progression from a successful initial installation to a four-system follow-on order with the U.S.-based steel manufacturer is an important example of this model. Accordingly, we are reallocating resources toward Commercial Pool, Marine and selected Water for Industry applications, where customer engagement and revenue visibility are stronger, while pursuing Water for Energy opportunities more selectively through strategic partnerships." "The record Commercial Pool performance in the second quarter, continued Marine order execution and two recent U.S.-based Water for Industry orders demonstrate that this strategy is gaining momentum. Our priority remains to improve the predictability and quality of our revenue while driving operational improvements and positioning LiqTech for sustainable, profitable growth." Q2 2026 Financial Results Revenue for the three months ended June 30, 2026 was $4,363,752 compared to $4,957,489 for the same period in 2025, representing a decrease of $593,737, or 12.0%. The decrease was solely attributable to a reduction in system sales, reflecting a significant Water for Energy delivery in 2025 that did not recur in 2026. Within the Systems segment, sales to both the Pool and Marine segments increased significantly. Furthermore, deliveries of Filters were on par with last year, while Components declined during the period. Gross profit for the three months ended June 30, 2026 was $365,539 (representing a gross profit margin of 8.4%) compared to a gross profit of $484,578 (representing a gross profit margin of 9.8%) for the same period in 2025, marking a decline of $119,039, or 24.6%. This decline was driven by mix towards, less high value system sales, lower utilization of our manufacturing capacity to preserve costs partly offset by procurement effects. Included in the gross profit was depreciation of $274,530 and $412,291 for the three months ended June 30, 2026, and 2025, respectively. Total operating expenses for the three months ended June 30, 2026 were $2,697,356, representing an increase of $102,909, or 4.0%, compared to $2,594,447 for the same period in 2025. Approximately 60% of the increase continue to be related to foreign exchange rate developments, as the average USD/DKK exchange rate for the three months ended June 30th, was 6.43 in 2026 and 6.58 in 2025. Selling expenses for the three months ended June 30, 2026 were $835,836 compared to $812,568 for the same period in 2025, representing an increase of $23,268, or 2.9%. Excluding the impact of foreign exchange rate developments, costs increased primarily due to the full-year effect of hires within the joint venture in China, Nantong JiTRI LiqTech Green Energy Technology Co., Ltd. (the “JV”), as well as continued investments in the sales organization across the U.S. and Europe, and annualization of the Service Center cost in the U.S. General and administrative expenses for the three months ended June 30, 2026 were $1,589,775 compared to $1,539,323 for the same period in 2025, representing an increase of $50,452, or 3.3%. Adjusting for foreign exchange rate developments, expenses remained stable and below general inflation, as filing of open positions were covered by savings on other overhead expenses. Included in general and administrative expenses were non-cash compensation of $218,252 and $230,552 for the three months ended June 30, 2026, and 2025, respectively. Research and development expenses for the three months ended June 30, 2026 were $271,745 compared to $242,556 for the same period in 2025, representing an increase of $29,189, or 12.0%. The increase was primarily attributed to membrane development costs and cost related to development of Marine systems and new generation of Pool systems. Other expenses for the three months ended June 30, 2026 were $720,248 compared to other expenses of $51,277 for the comparable period in 2025, representing an increase of $668,971, or 1304.6%. The change was primarily attributable to amortization of debt discount, paid interests on the senior promissory notes and losses on foreign currency transactions for the three months ended June 30, 2026. Net loss for the three months ended June 30, 2026 was $(3.1) million compared to $(2.2) million for the comparable period in 2025. Adjusted EBITDA (see Table included) for the three months ended June 30, 2026 was $(1.6) million compared to $(1.3) million for the comparable period in 2025. As a result of the capital raise, concluded June 8th, cash on hand (including restricted cash) on June 30, 2026, was $15.7 million. As part of the raise a senior note of $6.0 was repaid, resulting in the company being close to debt free. Conference Call Details Date and Time: Wednesday, August 12, 2026, at 9:00 a.m. Eastern time Webcast: Interested parties can access the conference call via a live webcast, which is available in the Investor Relations section of the Company's website at https://www.liqtech.com/investor-relations/ or at https://app.webinar.net/dP6qnar1gkL. Replay: A webcast replay will be available at https://app.webinar.net/dP6qnar1gkL. About LiqTech International Inc. LiqTech International, Inc., a Nevada corporation, is a high-tech filtration technology company that provides state-of-the-art ceramic silicon carbide filtration technologies for gas and liquid purification. LiqTech's silicon carbide membranes are designed to be used in the most challenging purification applications, and its silicon carbide filters are used to control diesel exhaust soot emissions. Using nanotechnology, LiqTech develops products using its proprietary silicon carbide technology, resulting in a wide range of component membranes, membrane systems, and filters for both microfiltration and ultrafiltration applications. By incorporating LiqTech's SiC liquid membrane technology with the Company´s extensive systems design experience and capabilities, LiqTech offers unique, modular designed filtration solutions for the most difficult water purification applications. For more information, please visit www.liqtech.com Follow LiqTech on Linkedln: http://www.linkedin.com/company/liqtech-international Follow LiqTech on Twitter: https://twitter.com/LiqTech Forward–Looking Statement This press release contains "forward-looking statements."  Although the forward-looking statements in this release reflect the good faith judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed in these forward-looking statements.  Readers are urged to carefully review and consider the various disclosures made by us in the reports filed with the Securities and Exchange Commission, including the risk factors that attempt to advise interested parties of the risks that may affect our business, financial condition, results of operation, and cash flows.  If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those expected or projected.  Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. We assume no obligation to update any forward-looking statements to reflect any event or circumstance that may arise after the date of this release. LiqTech Company Contact                                         Susan Keegan ElleskovHead of MarketingLiqTech International, Inc.Phone: +45 31315941www.liqtech.com LiqTech Investor Contact                                         Robert BlumLytham Partners, LLC                                 Phone: [email protected] Use of Non-GAAP Financial Measures In order to provide greater transparency regarding our operating performance, the financial results in this press release refer to a non-GAAP financial measure that involves adjustments to GAAP results. Non-GAAP financial measures exclude certain income and/or expense items that management deems are not directly attributable to the Company's core operating results and/or certain items that are inconsistent in amounts and frequency, making it difficult to perform a meaningful evaluation of our current or past operating performance. Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) is defined by LiqTech as net (loss) or income adjusted for (i) taxes, (ii) [other expenses], (iii) depreciation and amortization, (iv) amortization of right-to-use assets, and (v) stock based compensation. Management believes that the presentation of operating results using this non-GAAP financial measure provides useful supplemental information for investors by providing them with the non-GAAP financial measure used by management for financial and operational decision making, planning and forecasting and in managing the business. This non-GAAP financial measure does not replace the presentation of financial information in accordance with U.S. GAAP. These non-GAAP financial results should not be considered a measure of liquidity and is unlikely to be comparable to non-GAAP financial measures provided by other companies.

This article first appeared on GuruFocus. Revenue: $4.4 million in Q2 2026, down 12% year-over-year from $5 million. Commercial Pool Revenue: Record $1.5 million, up from $0.8 million in Q2 2025. Marine Revenue: $0.7 million, up from $0.4 million in Q2 2025. DPF and Membrane Revenue: Approximately $1 million, down from $1.3 million in Q2 2025. Plastics Revenue: Approximately $0.9 million, down from $1.2 million in Q2 2025. Gross Profit: $0.4 million, with a gross margin of 8.4%, down from 9.8% in Q2 2025. Operating Expenses: $2.7 million, up 4% year-over-year from $2.6 million. Selling Expenses: $0.8 million, flat year-over-year. General and Administrative Expenses: $1.6 million, up from $1.5 million in Q2 2025. Research and Development Expenses: $0.3 million, up from $0.2 million in Q2 2025. Other Expenses: $0.7 million, up from approximately $0.1 million in Q2 2025. Net Loss: $3.1 million, compared with a net loss of $2.2 million in Q2 2025. Adjusted EBITDA: Negative $1.6 million, compared with negative $1.3 million in Q2 2025. Cash and Restricted Cash: $15.7 million as of June 30, up from $2.7 million at the end of Q1 2026. Full-Year 2026 Revenue Guidance: Revised to a range of $20 million to $23 million. Warning! GuruFocus has detected 5 Warning Signs with LIQT. Is LIQT fairly valued? Test your thesis with our free DCF calculator. Release Date: August 12, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Record commercial pool revenue of $1.5 million in Q2 2026, up from $0.8 million year-over-year, driven by standardized Clariflow platform and expanded distribution. Marine revenue grew to $0.7 million in Q2 2026, up from $0.4 million year-over-year, with key milestones like factory acceptance test approval for ISO dual-fuel units. Strengthened balance sheet with $18 million net proceeds from June public offering, used to repay senior promissory notes and improve financial flexibility. Received a $2.1 million follow-on order from a US steel manufacturer for four additional systems, demonstrating successful technology validation and repeat business potential. New US customer order for a CureFlow QF6 system in Freeport, Texas, expands application beyond produced water and highlights economic and environmental benefits. Revised full-year revenue guidance of $20-$23 million still implies meaningful year-over-year growth, reflecting underlying business progress. Q2 2026 revenue decreased 12% year-over-year to $4.4 million, with lower water for energy activity and softer plastics purchasing. Gross margin declined to 8.4% from 9.8% year-over-year, due to product mix and lower manufacturing capacity utilization. Net loss widened to $3.1 million in Q2 2026 from $2.2 million year-over-year, with adjusted EBITDA negative at $1.6 million. A major water for energy project was delayed due to customer organizational changes, reducing near-term revenue visibility and leading to revised guidance. DPF and membrane revenue fell to $1.0 million from $1.3 million year-over-year, due to temporary raw material availability constraints. Plastics revenue declined to $0.9 million from $1.2 million year-over-year, as customer purchasing slowed amid raw material price volatility and market uncertainty. Q: Could you talk about the competitive advantages that the CureFlow system has versus other systems on the market, and how long did the steel customer have your unit operational before they chose to add four more units? A: Fei Chen (CEO): Our CureFlow system is based on our patented silicon carbide membrane, which is uniquely suited for very dirty water with high oil content and suspended particles. The system operates continuously, reducing the risk of blocking. The steel customer ran our system for 10 months with stable performance, unlike their previous polymer membranes that frequently blocked and required costly replacements. This successful validation led them to order four additional systems. Q: Would you speak to where process improvements driving profitability may be realized in the near term? Examples may be sales, assembly, water system engineering, or another area for LiqTech. A: Fei Chen (CEO): We have been intensively working on cost reduction over the past one to two years. This includes standardizing products across applications (marine, commercial pool, water industry) to achieve economies of scale, improving procurement processes, leveraging our China joint venture for cheaper components, optimizing inventory, and enhancing production efficiency and quality control. We are also using our sales pipeline and CRM system to better allocate sales resources and investments. Q: Are you seeing a larger number of pool system sales or are you seeing larger sales per system? A: Fei Chen (CEO): We are seeing both. Currently, the majority of sales are in Europe, particularly Northern Europe, but we are entering the US market with a strong partner. US systems are typically much larger than European ones. We are also working on very large systems in Australia and Holland. While we see both, we prefer larger systems as they generate revenue faster and are more sales-efficient. Q: How many IMO water treatment units do you forecast could be sold in an average year and how many annual units do you have capacity for? A: Fei Chen (CEO): The market is significant, with IMO representing about 30% and EGR 70% of the market. We have already secured an EGR sales order for delivery by year-end. According to industry data, there are 600 vessels to be delivered from now to 2028-29 combining IMO and EGR. Our goal is to secure a substantial portion of these. We are using partners in China for assembly, giving us flexible capacity to scale quickly. Our focus is on finalizing the standardization of our marine systems to accelerate delivery as sales come in. Q: Can you provide more detail on the delay in the water for energy project and its impact on the revised guidance? A: Fei Chen (CEO): A major customer underwent an organizational change that affected the decision-making process for an important water for energy project expected to contribute revenue in 2026. New decision-makers became involved, and a significant part of the internal evaluation and approval process had to restart. The project has not been terminated and remains active, but the delay, combined with lead times for critical equipment, reduced our revenue visibility. As a result, we revised our full-year 2026 revenue guidance to a range of $20 million to $23 million. Q: What is the status of the marine business and the China joint venture? A: Fei Chen (CEO): Marine revenue totaled $0.7 million in Q2, up from $0.4 million in the prior year quarter. We received factory acceptance test approval for the first two IMO dual-fuel water treatment units, a significant execution milestone. We expect to deliver one additional IMO unit and two marine scrubber water treatment systems in Q3. We also executed a commercial order for four water treatment systems for EGR-equipped vessels in China, with the first delivery expected in December. The China JV combines our membrane technology with localized engineering and assembly to improve competitiveness. Q: How is the company addressing the lower gross margin and path to profitability? A: David Kowalczyk (CFO): Gross margin for Q2 was 8.4%, down from 9.8% in the prior year, primarily due to product mix and lower manufacturing capacity utilization. Our current revenue level remains below the point where fixed production costs are fully absorbed. Improving gross margins depends on both revenue scale and mix. Standardized commercial pool, marine, and selected industrial systems are important to this effort as they provide opportunities to reuse engineering, improve procurement, and create better operating leverage as volume increases. Q: Can you elaborate on the new orders announced since quarter end and their significance? A: Fei Chen (CEO): We announced a $2.1 million follow-on order from a US-based steel manufacturer for four additional industry wastewater filtration systems, with approximately 75% expected to be delivered by the end of 2026. This order validates the progression from initial installation to broader multi-system deployment. We also announced an order from a new US customer for a CureFlow QF6 system in Freeport, Texas, which will treat wastewater from equipment cleaning operations and recycle it back into the facility's wash water supply, demonstrating the applicability of our platform beyond traditional produced water treatment. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

CECO Environmental (CECO) came out with quarterly earnings of $0.47 per share, beating the Zacks Consensus Estimate of $0.24 per share. This compares to earnings of $0.24 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +95.83%. A quarter ago, it was expected that this maker of air pollution controls and industrial ventilation systems would post earnings of $0.12 per share when it actually produced earnings of $0.36, delivering a surprise of +200%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. CECO, which belongs to the Zacks Pollution Control industry, posted revenues of $284.96 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 1.97%. This compares to year-ago revenues of $185.39 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. CECO shares have added about 18.5% since the beginning of the year versus the S&P 500's gain of 13.3%. While CECO has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for CECO was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #1 (Strong Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.59 on $378.34 million in revenues for the coming quarter and $2.09 on $1.3 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Pollution Control is currently in the top 27% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, LiqTech International, Inc. (LIQT), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 12. This company is expected to post quarterly loss of $0.19 per share in its upcoming report, which represents a year-over-year change of +13.6%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. LiqTech International, Inc.'s revenues are expected to be $6 million, up 21% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CECO Environmental Corp. (CECO) : Free Stock Analysis Report LiqTech International, Inc. (LIQT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Management to Host Conference Call on Wednesday, August 12, 2026, at 9:00 a.m. Eastern time BALLERUP, Denmark, Aug. 06, 2026 (GLOBE NEWSWIRE) -- LiqTech International, Inc. (NASDAQ: LIQT), a leading clean technology company specializing in advanced filtration systems, will report second quarter 2026 financial results for the period ended June 30, 2026, on Wednesday, August 12, 2026, before the market opens. The Company has scheduled a conference call that same day, Wednesday, August 12, 2026, at 9:00 a.m. Eastern time, to review the results. Q2 2026 Conference Call Details Date and Time: Wednesday, August 12, 2026, at 9:00 a.m. Eastern time Webcast: Interested parties can access the conference call via a live webcast, which is available in the Investor Relations section of the Company's website at https://www.liqtech.com/investor-relations/ or at https://app.webinar.net/dP6qnar1gkL. Replay: A webcast replay will be available at https://app.webinar.net/dP6qnar1gkL. ABOUT LIQTECH INTERNATIONAL, INC. LiqTech International, Inc. is a clean technology company that manufactures and markets highly specialized filtration products and systems for liquid and gas applications. Founded in 2000, LiqTech’s patented silicon carbide (SiC) membrane technology is designed to treat the most challenging fluids in commercial swimming pools, marine water treatment, industrial and municipal water treatment, and oil and gas applications. For more information, please visit: www.liqtech.com Follow LiqTech on LinkedIn: http://www.linkedin.com/company/liqtech-international Forward-Looking Statements This press release contains “forward-looking statements.” Although the forward-looking statements in this release reflect the good faith judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed in these forward-looking statements. Readers are urged to carefully review and consider the various disclosures made by us in the reports filed with the Securities and Exchange Commission, including the risk factors that attempt to advise interested parties of the risks that may affect our business, financial condition, results of operation, and cash flows. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those expected or projected. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. We assume no obligation to update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this release. LiqTech Company Contact                                         Susan Keegan ElleskovHead of MarketingLiqTech International, Inc.Phone: +45 31315941www.liqtech.com LiqTech Investor Contact                                         Robert BlumLytham Partners, LLC                                 Phone: [email protected]

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management is shifting the business model away from large, unpredictable one-off projects toward standardized, repeatable platforms to improve revenue visibility. The year-over-year revenue decline was primarily attributed to a significant water-for-energy delivery in 2025 that did not repeat in the current period. Gross margin expansion of 280 basis points was driven by a more favorable product mix, improved manufacturing utilization, and disciplined procurement. The commercial pool segment is emerging as a primary growth engine, with revenue increasing from $300 thousand to $800 thousand year-over-year. The company successfully entered the US market with its first pool system order, validating the technology's fit for aging infrastructure and high water quality standards. Strategic investments in a Chinese joint venture and local service infrastructure are stabilizing order flow and execution in the marine dual-fuel engine market. A disciplined approach to the oil and gas sector remains, with management focusing on pilot programs to validate performance without relying on single large project wins. Reiterated full-year 2026 revenue guidance of $23 million to $27 million, representing projected growth of 39% to 64% over 2025. Management expects a record quarter for the commercial swimming pool vertical in Q2 2026 based on current order book strength. The financial trajectory assumes gradual quarter-over-quarter improvements as 2025 operational changes and new order conversions take full effect. Future profitability is contingent on scaling standardized systems to fully absorb fixed production costs and achieve a target 40% steady-state margin. Operating leverage is expected to improve as the company converts its pipeline in pool, marine, and component segments while maintaining strict overhead control. Operating expenses increased by $400 thousand, with approximately 60% of that rise driven by unfavorable foreign exchange developments. The company continues to operate below the revenue level required for full fixed-cost absorption in its manufacturing platform. Cash management remains a critical focus, with $2.7 million on hand as the company balances growth investments with the path to positive adjusted EBITDA. The timing of large-scale water-for-energy projects remains a known headwind to short-term forecasting accuracy. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management targets a steady-state gross margin of approximately 40%, with individual projects currently realizing between 30% and 50%. Further margin upside is expected through volume-driven scaling effects and lower production costs for membranes and systems. The $23 million to $27 million guidance implies a quarterly ramp-up to between $6.3 million and $7.6 million for the remaining periods. Growth will be driven by commercial pools, marine, and DPF segments, with water-for-energy projects viewed as potential upside rather than baseline requirements. While previously focused on retrofits, the company is now actively winning new-build projects through expanded distributor partnerships in the UK and Netherlands. The modular design of the ClariFlow system is cited as a key competitive advantage for both new construction and space-constrained retrofits.

This article first appeared on GuruFocus. Release Date: May 13, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. LiqTech International Inc (NASDAQ:LIQT) reported a 32% increase in revenue compared to Q4 2025, with gross margin expanding by approximately 1,290 basis points. The company is seeing strong growth in its commercial pool and marine segments, with pool deliveries totaling $0.8 million in Q1 2026, up from $0.3 million in Q1 2025. LiqTech International Inc (NASDAQ:LIQT) has successfully entered the U.S. market with its first pool system order, which is expected to open additional opportunities. The marine business is gaining momentum, supported by a joint venture in China, which is expected to drive sustainable order flow throughout 2026. The company is reiterating its full-year 2026 revenue outlook of $23 million to $27 million, indicating confidence in continued growth across its business segments. Year-over-year revenue for Q1 2026 decreased by 10.4% compared to Q1 2025, primarily due to the non-repeat of a significant water for energy delivery. Operating expenses increased to $2.7 million in Q1 2026 from $2.3 million in Q1 2025, with foreign exchange developments contributing to the rise. Net loss for Q1 2026 was $2.7 million, compared to a net loss of $2.4 million in Q1 2025, driven by higher operating and other expenses. Adjusted EBITDA remained negative at $1.5 million for Q1 2026, slightly worse than the negative $1.4 million in Q1 2025. The company is still operating below the revenue level needed to fully absorb fixed costs, impacting its gross margin potential. Warning! GuruFocus has detected 5 Warning Signs with LIQT. Is LIQT fairly valued? Test your thesis with our free DCF calculator. Q: What does a steady-state margin structure look like for the new LiqTech? How should we model gross margins? A: (Unidentified_3) On a project basis, we are realizing margins between 30% to 50%, averaging around 40%. With increased volume, we should approach a steady-state margin of 40%. Additionally, volume increases could lead to further reductions in production costs for systems and membranes. Q: You are guiding revenue of $19 to $23 million for the rest of the year. What are the major drivers of this steep revenue growth, and how much does water for energy or industry contribute to this revenue? A: (Unidentified_1) The first quarter had minimal contributions from water for energy and industry, but we have a promising pipeline. Significant growth is expected in commercial pools, marine, and DPF and membrane sectors, which will drive the revenue increase throughout the year. Q: Do you have any information on how revenue will be distributed between Q2, Q3, and Q4? A: (Unidentified_3) We expect gradual improvements throughout 2026, with a noticeable increase in Q2 compared to Q1. (Unidentified_1) Our strong order book, especially in marine and commercial pool systems, indicates a record revenue quarter for commercial pools in Q2. Q: The order highlighted in the Netherlands is for a new pool. Is new sales a new opportunity for the company? A: (Unidentified_1) Initially, our focus was on retrofit pools, but with new distributors in the UK and Lotic, we are now actively pursuing both retrofit and new pool projects. Our system's advantages apply to both segments. Q: What are the expectations for the full year 2026 revenue? A: (Unidentified_3) We are reiterating our expectations for full-year 2026 revenue to be in the range of $23 million to $27 million, representing a growth of approximately 39% to 64% compared to full-year 2025. This growth will be driven by commercial pool, marine, and continued activity across water for energy and industrial applications. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

BALLERUP, Denmark, May 13, 2026 (GLOBE NEWSWIRE) -- LiqTech International, Inc. (Nasdaq: LIQT) ("LiqTech"), a clean technology company that manufactures and markets highly specialized filtration technologies, today announced its financial results for the first quarter of 2026. Recent Financial Highlights Q1 2026 revenue of $4.1 million compared to $4.6 million in Q1 2025. Q1 2026 net loss of $(2.7) million compared to $(2.4) million in Q1 2025. Q1 2026 Adjusted EBITDA of $(1.5) million compared to $(1.4) million in Q1 2025. Ending cash balance of $2.7 million on March 31, 2026. Outlook The Company is reiterating its expectation for FY 2026 revenue between $23 million and $27 million, which would represent an increase of 39% to 64% over FY 2025. Recent Operational Highlights Elevated Commercial Pool activity with strong deliveries during the quarter totaling $0.8 million compared to $0.3 million in the prior-year quarter, with new orders setting the stage for improved pool results in the second quarter and throughout 2026. Key new orders include: the first U.S. pool system order for three systems to be installed at the Weston County School District #1 Aquatic Center in Newcastle, Wyoming; one in partnership with Lotec for a new large-scale commercial pool project in Den Helder, Netherlands; and a follow on record order in partnership with Waterco Limited for 10 systems for the Plumpton Aquatic and Leisure Centre in Fraser Rise, Victoria, Australia. Two systems delivered during the first quarter for marine dual-fuel engine water treatment for LNG vessels with two more expected to be delivered during the second quarter. Further sustainable order flow is expected throughout 2026 driven by the Company’s China JV. First quarter revenue from the marine business totaled $0.8 million compared to $0.2 million in the prior-year quarter. Commenced a new pilot program in West Texas for produced water treatment with an energy services and solutions company. Diesel particle filters (DPF) and membrane business experienced growth during the first quarter to $1.3 million compared to $1.0 million in the prior-year quarter, driven by strong order flow from both existing and new customers and renewed focus within this segment. Plastic revenue increased 5%, totaling $1.0 million during the quarter and driven primarily by strong activity within food processing. Management Commentary “LiqTech’s first quarter results were in line with our expectations and reflect the continued execution of our strategy to place a greater emphasis on more predictable end markets,” commented Fei Chen, CEO of LiqTech. “Importantly, we are reiterating our 2026 outlook for revenue growth, which we believe underscores the progress we are making in building a more balanced business. We believe that the nature of our business and associated sales cycle mean that the improvements we made in 2025 will show gradual improvements quarter over quarter in 2026. The year-over-year revenue comparison was impacted by a significant Water for Energy delivery in 2025 that did not repeat in the quarter along with the timing of order conversion. We saw strong momentum across several of our priority end markets, including Commercial Pool, Marine, DPF and Membrane, and Plastics.” “Our strategy focused on reducing reliance on larger, one-off projects and increasing exposure to repeatable, scalable markets,” Chen continued. “Commercial Pool is a strong example of this strategy, with growing customer adoption, increasing order activity, and opportunities to scale across multiple geographies. Based on our order book, we expected a record quarter for commercial swimming pool and continued delivery of marine water treatment systems in Q2 2026. At the same time, our water for industry/energy pipeline remains active, and we continue to expect order activity in 2026. By focusing on markets where our silicon carbide membrane technology offers clear value, while maintaining a disciplined cost structure, we believe LiqTech is well positioned to advance toward durable, profitable growth.” Q1 2026 Financial Results Revenue for the three months ended March 31, 2026 was $4.1 million compared to $4.6 million for the same period in 2025, representing a decrease of 10.4%. The decrease was attributable to a reduction in system sales, reflecting a significant Water for Energy delivery in 2025 that did not recur in 2026. Within the Systems segment, sales to both the Pool and Marine segments increased significantly. Furthermore, deliveries of Filters, Membranes, and Components increased during the period. Gross profit for the three months ended March 31, 2026 was $0.4 million (representing a gross profit margin of 9.5%) compared to a gross profit of $0.1 million (representing a gross profit margin of 2.7%) for the same period in 2025. This increase was primarily driven by mix in system sales, better utilization of our manufacturing capacity, procurement effects on prices, and low depreciation expenses. Total operating expenses for the three months ended March 31, 2026 were $2.7 million compared to $2.3 million for the same period in 2025. Approximately 60% of the increase relates a 9.9% weakening of the US dollar versus Danish kroner for the three months ended March. Selling expenses for the three months ended March 31, 2026 were $1.0 million compared to $0.7 million for the same period in 2025. Excluding the impact of foreign exchange developments, costs increased primarily due to the full-year effect of hires within our joint venture in China with JiTRI as well as continued investments in the sales organization across the United States and Europe. General and administrative expenses for the three months ended March 31, 2026 were $1.4 million compared to $1.4 million for the same period in 2025. Adjusting for FX foreign exchange rates, expenses remained stable and below general inflation, as the hiring of open positions was offset by savings from other overheads. Included in general and administrative expenses were non-cash compensation of approximately $0.2 million for the three months ended March 31, 2026, and 2025, respectively. Research and development expenses for the three months ended March 31, 2026 were $0.3 million compared to $0.2 million for the same period in 2025. The increase was primarily attributed to membrane development costs and expenses related to the development of Marine systems. Other expenses for the three months ended March 31, 2026 were $0.4 million compared to other expenses of $0.2 million for the comparable period in 2025. The change was primarily attributable to losses on foreign currency transactions, lower interest income, and accrued interests on the senior promissory notes, partly balanced by lower amortization of debt discount, and a decrease of net interest expenses for the three months ended March 31, 2026. Net loss for the three months ended March 31, 2026 was $(2.7) million compared to $(2.4) million for the comparable period in 2025. Adjusted EBITDA (see Table included) for the three months ended March 31, 2026 was $(1.5) million compared to $(1.4) million for the comparable period in 2025. Cash on hand (including restricted cash) on March 31, 2026, was $2.7 million. Conference Call Details Date and Time: Wednesday, May 13, 2026, at 9:00 a.m. Eastern time Webcast: Interested parties can access the conference call via a live webcast, which is available in the Investor Relations section of the Company's website at https://www.liqtech.com/investor-relations/ or at https://app.webinar.net/WaNVyXlyEGe. Replay: A webcast replay will be available at https://app.webinar.net/WaNVyXlyEGe. About LiqTech International Inc. LiqTech International, Inc., a Nevada corporation, is a high-tech filtration technology company that provides state-of-the-art ceramic silicon carbide filtration technologies for gas and liquid purification. LiqTech's silicon carbide membranes are designed to be used in the most challenging purification applications, and its silicon carbide filters are used to control diesel exhaust soot emissions. Using nanotechnology, LiqTech develops products using its proprietary silicon carbide technology, resulting in a wide range of component membranes, membrane systems, and filters for both microfiltration and ultrafiltration applications. By incorporating LiqTech's SiC liquid membrane technology with the Company´s extensive systems design experience and capabilities, LiqTech offers unique, modular designed filtration solutions for the most difficult water purification applications. For more information, please visit www.liqtech.com Follow LiqTech on Linkedln: http://www.linkedin.com/company/liqtech-international Follow LiqTech on Twitter: https://twitter.com/LiqTech Forward–Looking Statement This press release contains "forward-looking statements." Although the forward-looking statements in this release reflect the good faith judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed in these forward-looking statements. Readers are urged to carefully review and consider the various disclosures made by us in the reports filed with the Securities and Exchange Commission, including the risk factors that attempt to advise interested parties of the risks that may affect our business, financial condition, results of operation, and cash flows. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those expected or projected. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. We assume no obligation to update any forward-looking statements to reflect any event or circumstance that may arise after the date of this release. LiqTech Company Contact Susan Keegan Elleskov Head of Marketing LiqTech International, Inc. Phone: +45 31315941 www.liqtech.com LiqTech Investor Contact Robert Blum Lytham Partners, LLC Phone: 602-889-9700 [email protected] Use of Non-GAAP Financial Measures In order to provide greater transparency regarding our operating performance, the financial results in this press release refer to a non-GAAP financial measure that involves adjustments to GAAP results. Non-GAAP financial measures exclude certain income and/or expense items that management deems are not directly attributable to the Company's core operating results and/or certain items that are inconsistent in amounts and frequency, making it difficult to perform a meaningful evaluation of our current or past operating performance. Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) is defined by LiqTech as net (loss) or income adjusted for (i) taxes, (ii) [other expenses], (iii) depreciation and amortization, (iv) amortization of right-to-use assets, and (v) stock based compensation. Management believes that the presentation of operating results using this non-GAAP financial measure provides useful supplemental information for investors by providing them with the non-GAAP financial measure used by management for financial and operational decision making, planning and forecasting and in managing the business. This non-GAAP financial measure does not replace the presentation of financial information in accordance with U.S. GAAP. These non-GAAP financial results should not be considered a measure of liquidity and is unlikely to be comparable to non-GAAP financial measures provided by other companies.

LiqTech Intl (NASDAQ:LIQT) held its first-quarter earnings conference call on Wednesday. Below is the complete transcript from the call. This content is powered by Benzinga APIs. For comprehensive financial data and transcripts, visit https://www.benzinga.com/apis/. The full earnings call is available at https://app.webinar.net/WaNVyXlyEGe LiqTech International Inc reported a year-over-year revenue decrease of 10.4% for Q1 2026, primarily due to a non-repeated significant water for energy delivery from the previous year. The company saw a 32% revenue increase from Q4 2025, with gross margin expanding by 1,290 basis points, driven by increased activity in commercial pool, marine, and DPF and membrane sectors. LiqTech International Inc reiterated its full-year 2026 revenue outlook of $23 million to $27 million, indicating a growth of 39% to 64% from the previous year, and highlighted strong order books for marine and pool systems. The company emphasized strategic focus on building repeatable and scalable platforms, especially within commercial pool and marine sectors, supported by joint ventures and local capabilities. Management noted disciplined resource allocation, particularly in sales and marine development, while maintaining careful overhead management to drive toward profitability. OPERATOR Good morning and welcome to the LiqTech International Inc First Quarter Fiscal Year 2026 Financial Results Conference Call. After today's presentation, there will be an opportunity to ask questions. To submit a question, you may type it into the Ask A Question box on the webcast screen. Please note that this event is being recorded. I would now like to turn the conference over to Robert Bloom with Litham Partners. Please go ahead, sir. Robert Bloom (Moderator) All right, thank you very much Operator and good morning everyone. Thank you all for joining us on today's conference call, as the operator indicated, to discuss LiqTech International Inc's first quarter 2026 financial results. Joining us on today's call from the company are Faye Chen, Chief Executive Officer and David Kwalchek, the Company's Chief Financial and Chief Operating Officer. Before I turn the call over to management, let me remind listeners that there will be a Q and A session at the end of the call. Again, to ask a question through the webcast portal, simply type your question through the Ask A Question feature in the webcast player there. Before we begin with prepared remarks, we submit for the record the following statement. This conference call may contain forward looking statements. Although the forward looking statements reflect the good faith and judgment of management, forward looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed during the call. The Company therefore urges all listeners to carefully review and consider the various disclosures made in their reports filed with the securities and Exchange Commission, including risk factors that attempt to advise interested parties of the risks that may affect their business, financial condition, operations and cash flows. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, the Company's actual results may vary materially from those expected or projected. The Company therefore encourages all listeners not to place undue reliance on these forward looking statements which pertain only as of this date and the date of the release and conference call. The Company assumes no obligation to update any forward looking statements to reflect any events or circumstances that that may arise after the date of this release and conference call. Now I'd like to turn the call over to Faye Chen, CEO of LiqTech International. Faye, please proceed. Faye Chen (Chief Executive Officer) Thank you, Robert and good day to everyone on the call. The fourth quarter was in line with our expectations and represented a continued step forward in transition we have been describing over the past several quarters. Our focus remains on building a more balanced, repeatable and ultimately more profitable LiqTech by placing greater emphasis in the markets where our technology delivers clear value and where customer adoption can scale in a more predictable way. The year over year revenue comparison was impacted by a significant water for energy delivery in the first quarter of 2025 that did not repeat in the first quarter of 2026 as well as timing of order conversion. However, the underlying activities across the business were encouraging. Commercial, pool, marine, DPF and membrane all showed meaningful activity in the quarter and the new pool and marine orders are setting the stage for improved results in the second quarter and throughout 2026. Compared to quarter four in 2025, revenue increased by 32%. Our gross margin expanded by roughly 1,290 basis points. The nature of our business and the sales cycle time means that all the improvements we have made in 2025 will show gradual improvements quarter over quarter in 2026. We are therefore reiterating our full year 2026 outlook for revenue of $23 million to $27 million. David will go through the financial details in a few minutes, so I will focus on operating progress, customer activity and strategic direction. The main message is that our strategy is advancing. We are building around a portfolio of opportunities where our silicon carbon membrane technology can be deployed in repeatable platforms, supported by stronger service capabilities and scaled across geographies. Our commercial pool business continues to be one of the clearest examples of this strategy. During the first quarter, pool deliveries totaled revenue of 0.8 million compared to 0.3 million in the first quarter 2025. More importantly, the order activity we have announced since the beginning of the year reinforces our confidence that Clariflo is getting traction as a differentiated solution for modern commercial aquatic facilities. In fact, based on our order book, we expect a record quarter for commercial swimming pool in quarter two. 2026. A key milestone was our first US pool system order consisting of three systems to be installed at the Western County School District Number one Aquatic center in Newcastle, Wyoming. Entering the US Market has been an important objective for us because it is a large market with aging infrastructure, high water quality expectations and a growing need for more automated and space efficient filtration solutions. We view this first US Order as an important proof point that can help open additional opportunities over time. We also received consecutive record selling pool system orders internationally. One was in partnership with LOTEC for a new large scale commercial pool project, Eden Hayden, Netherlands. The next was the follow on Record Order in partnership with Watercolor Limited for 10 systems for Plumpton Aquatic and Leisure center in Fraser Rice, Victoria, Australia. These wins demonstrate that our solution is being adopted across different geographies, project types and the partner channels Clariflo is well suited to this market because it addresses several customer needs at the same time. Our systems are compact, modular and designed for stable water quality, automation and efficient operation. For retrofit projects, the smaller footprint can be a meaningful advantage where equipment room space is limited for new build facilities. The modular design gives customers a flexible solution that can be planned into the project from the beginning. From a business model perspective, pools are attractive because the systems are becoming more standardized and repeatable. This is different from large one off projects which often require more customization and can be more difficult to forecast as pool adoption grows. We believe this vertical can contribute to better revenue visibility, improved execution and a stronger margin profile over time. Our marine business also continued to build momentum in the first quarter. We delivered 2 systems under the quarter for marine dual fuel engine water treatment for LNG vessels and we expect two more systems to be delivered during the second quarter. Marine revenue totaled 0.8 million in the first quarter compared to 0.2 million in the first quarter 2025. Faye Chen (Chief Executive Officer) The growth in this vertical is being supported by our joint venture in China, which we believe can help drive more sustainable order flow throughout 2026. As we discussed on our last call, we have invested in local capabilities to support the marine market, including development and the localization activities and regional service infrastructure. This is important because the marine market requires reliable execution, responsive service and a cost competitive localized supply chain. Faye Chen (Chief Executive Officer) We believe silicon carbon membrane technology has a strong fit in marine applications, particularly for vessels equipped with dual fuel engines. These resources require advanced water treatment solutions that can support onboard wastewater purification and reuse. We are meeting demanding operating requirements. Marine is also attractive because it has the potential to become more repeatable as adoption grows. Each Vessel project has its own delivery schedule, but the underlying system platform can be standardized and supported through our regional presence. Faye Chen (Chief Executive Officer) Turning to water for energy and industry applications, our view remains balanced and disciplined. Oil and gas continue to be an opportunity for LiqTech and our pipeline remains active at the same time. As we have said before, the timing of larger projects can be difficult to predict. During the quarter, we commenced a new pilot program in West Texas for produced water stream treatment with an energy services and solutions company. This type of field activity is important because it gives customers the opportunity to validate the performance of our technology in demanding operating conditions prior to their investment decision for large size commercial projects and it allows us to further demonstrate the value proposition of silicon carbon membranes in produced water treatment. We continue to believe our technology is well positioned for difficult water streams where durability, chemical resistance and stable filtration performance are critical. Produced water and industry wastewater are both areas where customers are looking for solutions that can handle high variability, reduce operational disruptions, and support environmental and water reuse objectives. Faye Chen (Chief Executive Officer) At the same time, we are being careful in how we allocate resources. We are not basing our operating plan on the timing of any single large oil and gas project. We will continue pursuing attractive opportunities, but we will do so in a way that supports the broader strategy of building a more balanced business. Beyond systems, our DPF and membrane business and our plastic business remain important contributors to LiqTech in the first quarter. DPF and membrane revenue increased to 1.3 million from 1 million in the prior year quarter. Faye Chen (Chief Executive Officer) This was driven by strong order flow from both existing and the new customer. Following our renewed focus within this March, vertical plastic revenue increased approximately 5% in the quarter and totaled about 1 million, driven by strong external interest, especially in food processing. Looking ahead, our priorities are clear. We are reiterating our 2026 outlook and remain focused on executing against the revenue growth and the adjusted EBITDA improvement we have communicated. Faye Chen (Chief Executive Officer) The path to achieving this outlook is not depending on a single large oil and gas order. It is based on continued progress across commercial pool, marine industry application and the components market with potential upside from water for energy and as opportunities convert. The most important strategic priority is to improve the quality of our growth marks where solutions can be standardized, partners can extend our reach, service infrastructure supports customer confidence and volumes can support better margins. Faye Chen (Chief Executive Officer) We believe the first quarter will provide encouraging evidence that this transition is working. Pool orders are expanding geographically, marine deliveries are increasing, supported by China, joint venture, DPF and membrane is benefiting from renewed commercial focus and the water for energy remains active but we are approaching it with appropriate discipline. Let me now turn the call over to David to review the financials in more detail. I will then make a few closing comments and look to open the call for your questions. David Kwalchek (Chief Financial and Chief Operating Officer) thank you Fei and good day everyone. Let me take some time to walk through our first quarter financial results in a bit more detail and add some color to what was included in the press release. As Fay noted, the quarter was generally in line with our expectations, the expectations we provided in our year end call. My remarks today will focus primarily on the year over year changes for the first quarter and on how those results fit into the full year outlook that we are reiterating today. David Kwalchek (Chief Financial and Chief Operating Officer) Let's start with revenue. So revenue for the first quarter of 2026 was 4.1 million compared with 4.6 million in the first quarter of 2025. This represents a decrease of 10.4%. Broken down by verticals, sales for the year were as follows. Distance and aftermarket sales were 1.8 million compared to 2.7 million in the prior year quarter. DPF and membrane sales were 1.3 million compared to 1.0 million in the prior year quarter. And finally, plastic components revenue was 1 million compared to approximately 1 million in 1Q25. David Kwalchek (Chief Financial and Chief Operating Officer) The year over year revenue decline was solely attributable to lower system sales, specifically the fact that we had a significant water for energy delivery in 1Q25. This did not repeat in 1Q26. That comparison is important because the underlying activity in several of our priority areas stronger than the headline revenue number might suggest. Within systems, both commercial pool and marine showed meaningful improvements. Commercial pool revenue was approximately 0.8 million for the quarter compared with approximately 0.3 million in the prior year quarter. David Kwalchek (Chief Financial and Chief Operating Officer) Marine revenue was also approximately 0.8 million compared with approximately 0.2 million in 1Q25. Those increases were offset by the non repeat of the larger water for energy delivery last year. Outside of systems, DPF and membrane sales increased meaningfully driven by strong order flow from both existing and new customers. Following our renewed focus within that market, vertical components also increased during the quarter supported by continued external interest, especially within food processing. These are important contributors because they provide a more stable base for recurring activities while we continue to scale the high growth system opportunities. Turning to gross margins, gross profit for the quarter was 0.4 million representing a gross margin of 9.5%. That compares to a gross profit of 0.1 million or a gross profit of 2.7% in 1Q25. The improvement in gross margin is an important point. Even though total revenue was lower year over year, our gross profit dollars actually increased and our gross margin expanded by roughly 280 basis points. The improvement was primarily driven by mix in system sales, better utilization of our manufacturing capacity, procurement efforts on prices, and lower depreciation expenses. As we have discussed before, we are still operating below the revenue level where our production platform can fully absorb fixed costs. As a result, our gross margin is not yet where we believe it can be over time. That said, the first quarter shows the benefit of improving mix, continued operating discipline and greater focus on repeatable applications where our cost structure and system design can become more efficient as volume increases, gross margin improvement remain a key priority. Scaling standardized system in commercial pool and marine along with continued strength in our component business should help Support a better margin profile as we move through 2026. Turning to operating expenses, the total operating expenses for the first quarter were 2.7 million compared to 2.3 million in 1Q25. Approximately 60% of this increase was related to foreign exchange development. Because the majority of our cost base is denominated in Danish krona or euros, the year over year currency movement affected how expenses translate into US Dollars breaking operating expenses down by category. Selling expenses for the first quarter were 1.0 million compared to 0.7 million in the prior year quarter. Excluding foreign exchange effects, the increase was primarily related to the full year effect of hires within our Chinese joint venture as well as continued investment in the sales organization across the United States and Europe. General and Administrative expenses were 1.4 million compared to 1.4 million compared to in 1Q25. Adjusting for foreign exchange development, G and A expenses remained stable and below general inflation. We continued to manage overhead carefully and the filling of open position was balanced by savings in other areas. Research and development expenses were 0.3 million compared to 0.2 million in the prior year quarter. The increase was primarily tied to membrane development costs and development work related to marine systems. Overall, our approach to operating expenses remains disciplined. We are investing where we see clear commercial returns, particularly in sales coverage, marine development and capabilities that support the scaling of repeatable system platforms. At the same time, we are carefully managing overhead and focusing resources on the areas of the business that are most important to our path towards profitability. Other expenses for the quarter were 0.4 million compared to other expenses of 0.2 million in the comparable period for 25. The change was primarily attributable to losses on foreign exchange transactions due to the US Dollar development compared to Euro lower interest income and accrued interest on the senior promotionary note partly balanced by lower amortization of debt discount and a decrease of net interest expenses. Net loss for 1Q26 was 2.7 million compared to a net loss of 2.4 million in 1Q25. The year over year change was primarily driven by the higher operating expenses and other expense levels that I just discussed, particularly offset by the improvement in gross Profit for the first quarter. Adjusted EBITDA was a negative 1.5 million compared to a negative 1.4 million in 1Q25, while the year over year comparison was relatively stable. We continue to believe the most important drivers of adjusted EBITDA improvements are revenue scale, stronger system mix and increased utilization. Disciplined operation Expense control We are making investments in targeted areas, but our objective remains to convert revenue growth into meaningful operating leverage as the year progresses. Turning to our outlook, we are reiterating our expectations for the full year of 2026 revenue to be in the range of 23 to 27 million. This would represent a growth of approximately 39 to 64% compared to full year 25. As Fay discussed, the growth outlook is expected to be driven primarily by commercial pool, marine and continued activity across water for energy and industrial applications, supported by stable contributions from DPF and membranes and plastic components. We expect improved pool Results in the second quarter and through 2026, supported by recent order activity including the first US pool system order, an additional larger international improved projects in Marine. We delivered 2 systems during the first quarter and expect 2 more systems to be delivered during the second quarter, with further sustainable order flow expected through the year supported by our Chinese joint venture. The quarterly cadence of revenue will continue to be influenced by system and delivery time. As a result, we do not view the first quarter as a full year indicator. We remained focused on executing against backlog, converting the order pipeline and maintaining cost discipline as the business scales. And finally, from a cash perspective, we ended the first quarter with cash on hand, including restricted cash of 2.7 million as of March 31, 2026. Our focus remains on disciplined cash management and careful allocation of resources. We are aligning spending with the verticals that we believe can support repetitive growth, improved margin performance and better revenue visibility over time. As we move through 26, we will continue to balance investments in growth with the need to preserve flexibility and drive the business towards positive adjusted ebitda. And with that, let me now turn the call back to Faye. Faye Chen (Chief Executive Officer) Thank you David. Before we open the call for questions, I want to reiterate that our first quarter results were in line with our expectations and reflect continued progress against our strategic plan. We are building LiqTech around end markets that can support more predictable repeatable growth, particularly commercial, pool, marine, DPF membrane and plastic compound. We believe the results this year will continue to highlight these transitions. At the same time, we remain encouraged by long term opportunity in water for energy, but we are being disciplined in how we plan the business and allocate resources. Our focus is on markets where our silicon carbon technology delivers clear performance advantages and where we can scale profitably with that. Robert, we would be happy to take any questions. Robert Bloom (Moderator) Thank you very much Faye and David for your prepared remarks there. As a reminder to everyone listening through the webcast portal there, if you would like to ask a question, you can Type it into the ask a question feature on the webcast player. We do have a few questions already in the queue here. So Faye and David, I'll begin. First question here is what does a quote steady state margin structure look like for the new Lick tech? How should we model gross margins? David Kwalchek (Chief Financial and Chief Operating Officer) Yeah, that's a good question. And so essentially what we have told before and what we you can say continue to see is that on a project basis we are realizing margins between 30 to 50%. So essentially you can say on average 40%. So with a volume increase we should be closing in on a steady state margin of 40. Of course on top of that we with the volume increase you will see additional scaling effects leaving you can say opportunity open for lowering the production cost further for systems and membranes. Robert Bloom (Moderator) Okay, very good. There are a few questions here regarding guidance for the year, so I'll try to combine them together. You are guiding revenue of 19 to 23 million dollars for the rest of the year here, which implies 6.3 to 7.6 million per quarter. What are the major drivers of this steep revenue growth and how much does water for energy or industry contribute to this revenue? Faye Chen (Chief Executive Officer) Robert, that was a very good question. And your numbers correct. In the first quarter we do not have very much contribution from water for energy and water industry but we do have a pipeline with some very interesting projects with high probabilities. So we expect in the year going forward we will see some project go through from these two areas, waterfall energy and water for industry. But very importantly also we see really significant growth in our commercial pools, Marines and also DPF and membrane from for the rest of the year. So this whole together will contribute the increase quarter by quarter. Robert Bloom (Moderator) Okay, very good. And as a sort of extension of that, do you have any information you can provide relating to how revenue will be distributed between Q2, Q3 and Q4? David Kwalchek (Chief Financial and Chief Operating Officer) Yes, so we definitely and as we said you can see also in the presentation of the result, we expect the implementations of, you can say changes in how we operate in 25 to show gradual improvements through 26. So we definitely do expect to see a gradual ramp up. But Also with the Q2 you can say increase compared to Q1 of this year already. Faye Chen (Chief Executive Officer) Yeah, I would like to add, as I mentioned in my speech before, if we look at our old book, we already can see for example for marine and especially commercial pool, pool system we already have very strong order book. So we know at the quarter two for the, for the commercial pool will be a record quarter on revenue because there's a time difference between the commercial order and the revenue conversion. And that's, you know, always make it complicated when the revenues come in. But we have a very strong order book so we can really see what's happening next quarter. Robert Bloom (Moderator) All right, very good. Again, as a reminder, if you'd like to ask a question, feel free to type it into the Ask a Question feature on the webcast player. And if there are any follow ups that need to be submitted, please send those along as well. Next question here is regarding commercial pools. The order that you highlighted in the Netherlands is for a new pool. This person's understanding is that you focused on retrofits. Is new sales a new opportunity for the company? Faye Chen (Chief Executive Officer) That's a very, very good question. I mean, two years ago, I think our pool system has been very much focused on the retrofit. It very much depends on the distributors because at that time our distributor in UK was Total Pool. Their focus was and still is Richer Fit Swimming Pools. And now we have started building up the new distributors, both in UK with the Binary and also in Logtech. They are the ones really very active both on the retrofit and the new project. So now we see the new projects also coming. So I would like to emphasize we're actually working both on the retrofit and the new pool, new build pools because our system has really strong advantages for both segments. Robert Bloom (Moderator) All right, very good. I'm showing no further questions in the queue here. So with that, Faye, I will turn it back over to you for closing remarks. Faye Chen (Chief Executive Officer) Thank you, Robert. Thank you all very much for being with us today. We look forward to communicating with you soon again. Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice. Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga: LIQTECH INTERNATIONAL (LIQT): Free Stock Analysis Report This article Full Transcript: LiqTech Intl Q1 2026 Earnings Call originally appeared on Benzinga.com ﾩ 2026 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.