Desert Control releases its Q1 2023 Report and Year-to-Date Company Update
Sandnes, Norway, 25 May 2023 – Desert Control AS (DSRT) announces its first-quarter report and interim financial results for the fiscal period ending 31 March 2023.
Desert Control completed the second phase of the Limoneira project, secured five strategic pilots, and received official approval for organic farming. The company closed the first quarter with a positive cash balance of NOK 56.7 Million and has no interest-bearing debt.
Q1 and Year-to-Date Highlights
In Q1 2023, Desert Control focused on sales and enhancing the efficiency and scalability of operations. This focus has shaped the Company’s customer conversion model, designed to build trust and demonstrate the impact and practical application of Liquid Natural Clay (LNC).
In Q1, the Company reached an efficiency rate of treating an impressive 500 trees per day in the second stage of the Limoneira deployment, marking a 30X improvement since the initial pilot in July 2022. This progress in efficiency coincided with the expansion of the Company’s project portfolio by securing additional commercial pilot contracts. These pilots underscore Desert Control’s commitment to broadening its reach and present an opportunity to apply LNC to a broader range of crops and application areas.
Desert Control’s sales strategy focuses on a staged customer conversion model designed to engage potential customers and build trust by demonstrating LNC's effectiveness. The customer conversion model has guided the Company’s Q1 focus, achieving significant milestones, including the successful stage 2 deployment with Limoneira, securing five additional commercial pilots, and expanding LNC application capabilities. Furthermore, LNC's official approval and certification for organic farming in the UAE during Q1 opens for further customer base expansion.
Looking ahead, Desert Control remains committed to its sales strategy and customer conversion model. The Company is confident in its ability to secure a minimum of five new pilot projects per quarter, targeting a 50% conversion to larger deployments – in line with the target shared in the Company’s Q4-2022 update on 28 February 2023. Desert Control’s goal is to secure the first contract for large-scale deployment by the end of the year, contingent on the continued success of pilots. Desert Control’s systematic and progressive approach to sales and operational delivery reflects the Company’s commitment to building the pipeline for a robust future order book while continuing to enhance efficiency and scalability.
Financial Highlights
The company closes Q1-23 with a positive cash balance of NOK 56.7 Million and has no interest-bearing debt.
First Quarter 2023
[first quarter 2022 in brackets]
• Revenue NOK 1.9M [NOK 0.6M]
• EBITDA NOK -23.4M [NOK -22.8M]
• Net Income NOK -19.3 [NOK -23.7M]
• Gross R&D expenses NOK 0.3M [NOK 1.6M]
• Total cash balance 31.03.23 (incl. other current financial assets) NOK 56.7M [NOK 153.3M]
• Equity 31.03.2023 NOK 86M (equity ratio 89%) [NOK 170.6M(92.5%)]
Outlook
Desert Control's sales strategy for 2023 focuses on generating revenue and developing a pipeline of opportunities through commercial pilots and pre-projects, with the objective to start converting pre-projects into contracts for large-scale deployment by the end of the year.
The Q1 report and presentation will be made available at https://www.desertcontrol.com/investors
For more information, please contact:
Ole Kristian Sivertsen
President and Group CEO
Email: oks@desertcontrol.com
Mobile (NOR): +47 957 77 777
Mobile (USA): +1 650 643 6136
Mobile (UAE): +971 52 521 7049
Marianne Vika Bøe
Chief Financial Officer
Email: marianne.boe@desertcontrol.com
Mobile: +47 406 36 356
About Desert Control:
Desert Control specializes in climate-smart AgTech solutions to combat desertification, soil degradation, and water scarcity. Its patented Liquid Natural Clay (LNC) restores and enhances soil ecosystems to reduce water usage and improve the efficiency of fertilizers and natural resources for agriculture, forests, and green landscapes. LNC enables sandy and arid soil to retain water and nutrients, thus increasing crop yields, plant health, and ecosystem resilience while preserving water and natural resources by up to 50%.
For more about Desert Control, visit https://www.desertcontrol.com
Cautionary Note
Disclaimer related to forward-looking statements
This release contains forward-looking information and statements relating to the business, performance, and items that may be interpreted to impact the results of Desert Control and/or the industry and markets in which Desert Control operates.
Forward-looking statements are statements that are not historical facts and may be identified by words such as "aims", "anticipates", "believes", "estimates", "expects", "foresees", "intends", "plans", "predicts", "projects", "targets", and similar expressions. Such forward-looking statements are based on current expectations, estimates, and projections, reflect current views concerning future events, and are subject to risks, uncertainties, and assumptions, and may be subject to change without notice. Forward-looking statements are not guaranteeing any future performance, and risks, uncertainties, and other important factors could cause the actual business, performance, results, or the industry and markets in which Desert Control operates in, to differ materially from the statements expressed or implied in this release by such forward-looking statements.
No representation is made that any of these forward-looking statements or forecasts will come to pass or that any forecasted performance, capacities, or results will be achieved, and you are cautioned not to place any undue reliance on any forward-looking statements.
Q1 Report 2023
The information enclosed is subject to the disclosure requirements pursuant to sections 5-12 in the Norwegian Securities Trading Act.
https://newsweb.oslobors.no/message/591555
Webcast Company Update Recording: https://vimeo.com/desertcontrol/dsrt2023q1