Carbonxt Group (ASX:CG1) riding high on US economic recovery tailwinds

Highlights

• Carbonxt Group is witnessing strong macro tailwinds catalysed by the widespread and successful rollout of vaccination programs in the United States.
• The Company now does not depend upon third-party carbon and uses its unrivalled R&D expertise to create new activated carbon pellet formulations.
• The Company is developing HydRestorTM technology, which can limit the consequences of nutrient run-off in water bodies.

ASX-listed cleantech company Carbonxt Group Limited (ASX:CG1) continues to witness encouraging developments amid the ongoing economic recovery in the United States. The widespread and successful rollout of vaccination programs has allowed the States to open up, offering a favourable landscape for Carbonxt’s growth.

As a result of the buoyant economic momentum, the use of Powdered Activated Carbon (PAC) edged up in late FY21 in the power generation sector. This boded well for an increase in 1H FY22 revenue, said CG1 Chairman and Managing Director Warren Murphy at the recent Annual General Meeting.

CG1 develops and markets specialised activated carbon products, catering to the wastewater treatment, industrial air purification, and other liquid and gas phase markets.

RELATED ARTICLE: Carbonxt Group clocks 81% increase in September quarter customer receipts

Building self-reliant AC pellet capabilities

With the utilisation of a third-party, high-surface area carbon in industrial AC pellets impacting gross margins, Carbonxt was quick to suspend the production of industrial AC pellets at the Arden facility. As a result, the Company reduced US$1 million per annum from its operating costs.

What’s more, the Company now does not depend upon third-party carbon and uses its unrivalled R&D expertise to create new AC pellet formulations.

Carbonxt has also agreed to a commercial partnership with Kentucky Coal Processors, LLC, which would fund and build a 5,000-ton AC pellet manufacturing facility at its Kentucky operations in the US. The construction work is anticipated to commence shortly, with the production of industrial AC pellet products expected in 2H FY22.

In addition, Carbonxt has continued to develop kiln-activated carbon based on its Black Birch material. It will provide another raw material source for the Company’s industrial and specialised AC pellets over the near term.