Morning, everybody. Thank you for coming. My name is Scott MacFabe. I am the CEO of BluMetric. Before I start the presentation, as I always do, I want to thank all our existing shareholders who supported us and continue to as we ascend in our business, and look forward to meeting some new ones as we are here for the next couple of days. I am not going to read you the disclaimer because even I am having a hard time reading it from here, so I will just pass on. Who is BluMetric? Decentralized water and infrastructure leader. Really, it is a business that is comprised of a technology group and an advisory or professional services business. It is called a tech-visory for the natural and built environment, solving the world's most challenging water and environmental problems to positively impact people and the communities they live in.
We have quite a broad field of view in terms of access to markets, delivery of services, design, and execution of technology, mostly related to water solutions. Our people, we currently have about 335 full-time equivalents people. We have been around over 50 years. The initial business was an advisory in the water space based out of Canada, started at the University of Waterloo, which is also where I graduated from, days gone by, right after the glacier receded. Currently, we are at about 10,000 or so projects executed. Well over 300 water tech solutions executed. 74 million USGPD of total water capacity under operation. 16 offices, three manufacturing facilities, two in Canada, one down in Gainesville, North Florida, and four laboratories associated with materials testing. It is a fulsome business. In terms of our financials, we have a history of driving profitability and growth.
In 2025, we finished the year at a top line of about CAD 62 million, almost CAD 63 million. Year part of that was about CAD 35 million, CAD 2.4 million in EBITDA. Had a couple of acquisitions. We do maybe, if we can, one a year. There is no commitment to that. It really is in terms of what our pipeline has and what the opportunities present to this. In 2024, just before the new administration was installed in the U.S., we were fortunate enough to pick up Gemini Water.
This is a company based in North Florida that does a lot of work in Caribbean, Central America, South America, and Mexico, and Southern U.S. Pardon me. Most recently, our largest acquisition was 2025, December last year, DS Consultants, an advisory based here in Toronto, mostly in the Golden Horseshoe and surrounding areas. We say we are an integrated partner.
We have the sciences, we have the engineering, and we have the water tech design execute to solve your problems. Execute to solve your problems. What makes us valuable? We are really benefiting from water scarcity. It is not hard to turn the TV on these days and see what is going on in the world. Nothing is the same and nor will it ever be. It is our job to have the know-how and the agility to assess and execute solutions to have resilient outcomes for our clients. Aging infrastructure is a huge issue, especially in North America. We can help there. Military demands for our water products relative to agile systems, Mission Ready Water for the military. It is a big part of our business. That strategy drives long-term and profitable growth.
The foundation of our advisory service, those are all the professional services related to engineering, sciences, technologists, operation and maintenance and so on. A very steady, high margin business. It gives us also a foundation for our water tech business, which commits to that, whereby there's a lot of cross-selling and cross-pollination of opportunities and resources. We have a unique approach for decentralized water treatment technologies. As the world moves forward, a lot of our clients, especially in the industrial commercial sector, are developing beyond the urban infrastructure and urban resources. They have to be able to have their own utilities. We can help them with water and wastewater. That also applies to mine sites, work camps. It applies to indigenous water. We just finished our recent deployment in B.C. for our first containerized system to abolish boil bans, and we're pretty excited about that.
Full service consultancy, that's end-to-end solutions in our verticals, can help with any and pretty much all opportunities that our clients come to us with. Increased share of recurring revenues through operation and maintenance. For example, the systems that we've been delivering to the Canadian military, we've been delivering those systems for the army and the navy for over 20 years, and we help them maintain, refurbish, operate, redesign. Aside from that, we have an experienced leadership team. Myself, I've been in the business over 40 years. My CFO, Dan Hilton, sitting over to my right, he's been in over 35 years. We've been around a little while. We've made lots of mistakes we hope others not to repeat. What's compelling about water? That's a pretty broad statement.
There is a bridging the $6.5 trillion water infrastructure gap was a playbook that was prepared in 2026 by the World Economic Forum. Basically what it said is closing the gap, a $10.2 trillion gap, would produce $13.2 trillion in GDP and support 206 million jobs. So there's an incredible demand here. Represents about $17.7 trillion in cumulative investments needed. The most important thing here is a dollar invested has an output of about $2.7, and it's estimated that that'll continue into the future. We play a key role in two of the four-sided pillars in that report, which is equitable access to water and infrastructure resiliency. We feel we're uniquely positioned to capitalize on water and resilient infrastructure. We have our decentralized water solutions. These are smaller systems, 50 million- 3 milion- 5 million gallon per day type systems can be effectively deployed, executed upon.
It can be contingency systems, depending on when the grid's down, when a mine needs to pop up, when there's a boil ban in place, we can activate immediately. These decentralized systems can reduce expenditures by 40%-45%, and we have a history of water supply development for municipalities. That initial advisory we talked about that was the inception of the company, these are hydrogeologists, groundwater engineers, water engineers that really understand where the water is, how to get it, how to protect it, how to deploy it. Diversified company. Really, we have four distinct end customer markets: military, mining, industrial/commercial, and government. We have about a 50/50 split in revenue currently between the water tech side and the advisory side of the business, and the advisory side provides access to infrastructure revenues in adjacent industries. So it's a really nice fit. Recurring services.
We are expanding our O&M, operation and maintenance agreements. Those are typically about 10% of the CapEx of a project we work on, a new deployment for a new system, and that has a very long tail on it. Usually, those are 10-20 year assignments. We have been doing that for the military for 20 years, and we will expand that in the newly acquired Gemini Water Solutions business. We have our first Caribbean O&M contract. We secured that in 2025, and from this point forward, everything that Gemini designs and executes on, a component of that program is O&M and sold to the client. We service about 20-40 year assets, and that is going to improve our recurring revenue. Selective M&A. We are always looking for good partners for our strategy to expand our business in an appropriate way.
When I say that, we look for high-value assets that will be immediately accretive, they do not have debt, and they want to be part of our enterprise and grow in our ecosystem. Our targets are around 4x-8x EBITDA multiples. Our acquisition with Gemini was in that range, under that range. We took that Gemini when we first bought them. They were about $7 million top line U.S. business, and within 10 months, they were a $20 million business. A key metric for us is what is the organic growth post-acquisition? That confirms whether it is a good fit, whether we can integrate, and whether there is a great future ahead of us, and this is a resilient asset that will stay within the organization for a long time. A priority on strong leadership as well. Culture is everything.
If you do not have culture fit, if you do not have a well-run business and you do not want to be part of a well-run business, that is not part of us. Core product and services, the advisory, natural and built environment. The natural environment was the original consultancy within BluMetric and the built environment who we bought with DS Consultants here in Toronto. Historically, all of our front-end assessment work that we were doing on the water side eventually would deal with some kind of built improvement, a building, a new facility, infrastructure, linear projects, whatever it may be.
This gives us a fulsome and complete service offering to our clients end-to-end. Water resources, environmental engineering compliance to technical building sciences, materials testing, site assessment, radiation, industrial hygiene. We really are a one-stop shop for our clients now. Water tech, the classic water tech desalination, and wastewater treatment plants.
Bringing Gemini in definitely builds that out in the U.S. market, in the Caribbean, Southern U.S. We are doing work in Texas and Florida. That business is growing rapidly. When we first picked up Gemini, they had about 10,000 sq ft facility. We moved them into a 25,000 sq ft facility with right of first refusal on the contiguous 25,000 sq ft. We just signed that up maybe a month ago, and they have since moved in there and are expanding our business accordingly. That is planning, construction, design, build, water purification, seawater, brackish water, desal, and wastewater treatment. The secret sauce for that business is we are not trying to compete with the Veolias. The Veolias do not like anything from typically 10 million gallons per day systems and less.
We can go from our desktop to the field and turn a tap on in 18 months on a 10,000 or a 10 million gallon per day system or less, or 5 million gallon per day system less, which most clients want. There is a big market for that, but those bigger firms are not built for that. We have the agility to deliver on that. Our water tech for the military, we call Mission Ready Water. That is a picture of one of our units. It is a bigger unit for the Army. These are fixed and mobile water treatment systems. They bring them in, drop them next to the water source, and within 45 minutes, we need to produce potable water anywhere. That is from the high Arctic down to the Caribbean. These are highly valuable, and we believe that they are highly sought after.
We are expanding our markets into other NATO countries. These particular units have NATO parts numbers on them, NATO approved, so we can sell into any NATO country. We have interest from the U.K., we are working on interest in Australia, and with strengthening relationships with the E.U., we hope to capitalize on that as well. These are both fixed-based mobile systems on land for the Army, but also shipboard systems for water treatment in the Navy. That is a huge investment, as you know, in Canada. Our Navy is long overdue for expansion, and we are deeply involved with that with clients like Seaspan. Water Tech Services and Support, building out our operations and maintenance business is critical. We know that is the recurring revenue side of the business. It is higher margins. You are on-site, you know what is going on.
You can sell into the client because you are there. You are their trusted advisor on-site. That business will grow. Just a few of the companies we work with. The intent here is to get the point across that from where we were to where we are now, I have been the CEO since maybe nine years ago, turning this business around. We had to fire a lot of clients, we had to pursue new clients, but we now have what we consider to be a platinum client base here. This is our book of business. If you look at commercial industrial names like EllisDon, Waste Management, Disney. If you look in government, it is definitely the far north. We do a lot of work north of 60, so way up north into Iqaluit and Nunavut. All through Nunavut. We have an office in Yellowknife.
We have a lot of respect and a lot of agility in those parts of the world, which we know within Canada is a huge emerging market with extensive demands. Military, we said Irving, Thales, the Ontario Shipyard, Seaspan is a long client, Davie Shipyards. DEW Engineering is a new partner we are working with. We had a press release recently where we have been asked to pull together a team for the next big army system, the ones that I showed you that picture recently in the sea can. These have their own power supply interface in our water tech in them. They bring them in and drop them. They have been around 20 years. We have been constantly improving them. They are due for a complete refurbishment of that fleet. That RFP is out on the street. Historically, we have subbed under.
Our last go around was with Rheinmetall from Germany. It went fine. We delivered all 26 units. These are smaller, agile systems that the Canadian Army wanted for quick deployment of smaller, agile deployment. They want the big ones redone over again, so that is probably another 20 - 25, 26 of those systems to be redesigned and then built out and operated and maintained.
We will prime that pursuit, and DEW Engineering, who is known as a leader in all the ancillary side of the business, which is the container, the power supply and the interface, they are delighted to join with us. We have also added Des Nedhe Group, Des Nedhe Group Defence. They are an indigenous-led, indigenous-owned business, highly regarded in the space, and we feel that the three of us can make a compelling position with the Canadian government to hire us for that work.
The current budget they are estimating is between CAD 50 million and CAD 70 million for that assignment. Where are we? We are based out of Ottawa, but we are where our clients need us to be, but we also have offices across Canada, and as we said, down in Florida. Really, the concentrated offices are really in Ontario, Southwest Ontario, Quebec. We have been operating in Quebec for over 20 years.
Then up in Yellowknife. We have an office, a position out in Halifax as well. So we have good coverage. It is nice to have our Gainesville, Florida office there as a landing point for us to grow our business within, a portal for us to grow our business in the United States. But it is doing just fine. It is growing quite nicely as it is. Also, this November, we have just managed to secure leadership for a new Ottawa office for DS Consultants.
The Ottawa office, for the kind of services that they deliver, is highly underserviced. We have clients asking us to open an office in our backyard, so we are happy to host that. Part of the strategy with DS was to get them in other geographies, not just the Toronto market, and do what they do best and are highly known for.
Our key markets, if you look at our two business units between water tech and advisory, commercial industrial is growing across the Board. Government is emerging for our water tech side. It is a very stable business. Military is definitely growing in water tech and emerging in advisory services. Mining is growing on both aspects. There is a high demand for the technology, but also the services side of the business. Let me give you an example of the mining side of our business.
We have had an office in Sudbury for over 20 years. Our key client there is Vale. Well established. These are large contracts. They consider us one of their top-tier consultants to do the work that they need relative to water at their facilities. So it is a really nice base. If you look at the distribution of revenue by sector, commercial industrial is the largest, then followed after that by government and military and mining. Revenue by segment, in terms of water tech and advisory, it is almost split down the middle today, about 50/50. Advisory really presents the consultancy side, nice recurring opportunities and diversification. Our client retention is about 90%. When clients work with our advisors, they typically stay with us, so we have nice recurring revenue with them. These are long-standing relationships. The margins on this work is much higher.
It can be anywhere from 45%-60% gross margins, depending on the assignment. Concentrated mostly in Canada. We really don't do a lot of advisory work in the States, frankly because the consulting environment down there is in a bit of disarray with confusion over regulations and so on. We'll go where we know that we can deliver, but we look to expand in new geographies. Small tuck-ins where they make sense. DS was our largest acquisition in the history of the company. I would foresee in the future we'll be focusing more on water tech. That will be really our main focus. The key lever that we need to push is a continued improvement on personnel utilization, which we're deep into now. Water tech is our most scalable business. That's where you can have step changes in how the business operates.
These decentralized systems are really a hot commodity right now, targeting this range of 8,000 to 3 million USGPD. Desal, military, municipal, commercial applications, and the wastewater side is even more profitable. We've developed a high sense of ability to deliver on those systems as well. So we have a complete package to be able to go into a client.
They want to develop something outside of the urban infrastructure, we can do both water and wastewater for them. Capitalize on growing markets in military and mining, and industrial commercial. Increase our footprint. We have in Florida, not in Ontario. We're keeping our two facilities there for now. If we've managed to sign this new big contract, we'll probably be looking for a much bigger facility for the mining work or the military work, and select technology or vertical integration acquisitions if they make sense.
If you see the picture on the bottom right, the one to the left is a relatively new unit called ASUWPS unit. These are state-of-the-art. They go on a trailer. You can pull them into battle and support, say, a 250-person team. They believe that these systems will sort of be a system for the future because the nature of warfare, when it is on the ground, will be small, agile activities. So these systems are built for that. Delivering strong performance, starting at the far left, where you can see that the tan part of the stack bar is professional services, and the blue part of the stack bar is water tech. If you started out when I first came, the water tech, we had to refocus it. It got lost its way a little bit.
We said we're going to focus mostly on military and mining and build that out slowly. Those were what we call the hot dog years, where it was really paying off debt, cleaning up the balance sheet. Happy to say where we are now, we have no debt, no interest-bearing debt in the company. We have cash in the bank. We have a facility with BMO that we are dipping into and out of, depending on our needs, but we have a pristine balance sheet. We want to keep it that way. We're not debt adverse for the wrong reasons, but I don't like debt, and we don't like to be in a position where we can't operate efficiently and confidently on our own steam.
As we move to the far right, you can see that the bar chart has become a little more balanced in terms of where the revenue comes. The nice thing is you can see that our gross margins are starting to head up in the right direction as we tweak and tighten the businesses. The typical margins for water tech is around 30%, 25%-30%, maybe you get 35% or 40% in that range. It's not close to the kind of margins you can get from the advisory, but the scale is bigger, and when you put it together, it makes a nice, resilient business. To see on the very far right, a balanced revenue, about 50/50 and gross margins heading up, that's where we want to go. Tailwinds, economic uncertainty creates new opportunity.
What we mean by that is with macro impacts to an influence on especially the Canadian market, has really forced our military business to step up and start to appear and start to really look to becoming more independent. Really with sovereignty, infrastructure, and the built environment, we see great opportunities there, but also the need to have resilient water. Military demand for decentralized Mission Ready Water is universal, and we now have our first system that we just finished deploying with Rheinmetall for the Canadian Army that we hope will be the envy for NATO armies across the world. Industrial municipal fixed water treatment, that's just finding ways to help clients to execute on their business ambitions outside of what's available to them within existing utilities wherever they go.
Water scarcity, conservation, humanitarian work, a lot of that has to do with work that we do down in the Caribbean, say on island nations. Their water supplies are going from clean to brackish to saline within a year or less. So they could have stranded assets if they don't have the right water. Clients like Atlantis hire us to come in and refurbish their systems because without clean water, they have nothing. Same can be said for all the cruise lines. They all have their own Private Islands. We support them for their water and wastewater systems as well. Impact of emerging contaminants, we can always assess with our advisory how to manage things like PFOS and other things within our systems, other contaminants of concern, and address it accordingly.
The impact of climate change is everywhere in all things in the built and natural environment, and that will drive change in the necessity for innovation forever. Today, strong balance sheet. We're in growth mode, finishing and integrating our recent two acquisitions, taking our time, doing it methodically. We have a new ERP system we've executed and invested in. Heading into this year, we just finished our year at the end of September, unlock operating leverage, really work on our wins, expand our market in mining. We now have achieved our 50/50 water tech advisory services revenue, and then look for our next water tech M&A target if we find one. Future, strong base of O&M, long-term military. Tailwinds, execute on capitalizing on those, pushing 30% gross margin. We have a stated ambition.
We don't give a lot of forward guidance, but we figure by the time we're CAD 100 million in revenues, we should be 10% EBITDA or better. M&A, we talked a bit about that, culture fit. We look for high-value assets, and we integrate them fairly quickly, but we don't break anything. Cultivate new business offerings with those relationships. We invest heavily in our people and our equipment and develop new applications into the future.
Here's our team. I'll go pretty quickly, but I can tell you the management team that I have is delightful. They're all very experienced. They've been around a long time. This is not a team of kids. This is a lot of experience. As I said, I've got 40 years. Dan's got 35 years. Dean Bedford's got 45 years. Blaine Dobson's got 40 years experience. This is a solid team. The board is the same.
To the top right, our Lead Independent Director, Mohsen Mortada. He's currently the Chief of Staff for the Metropolitan Water District of Southern California in L.A. He's moving to Toronto, December. He's an old colleague of mine. I worked with him when I was in practice in the U.S. Steph May, he's a colleague and friend of Dan's. He's really on our audit committee, but he is an M&A expert.
The rest we could go through, but they're water experts, Ian Murray and David Rudolph from University of Waterloo. So a fulsome team. Cap table, let's see. Insider ownership, I'll just go straight to, is around 17.4%. Looking at full market cap, around CAD 50 million, give or take. Fully diluted market cap, around CAD 58 million, CAD 59 million. So why invest in BluMetric? Four things. Strong tailwinds. We have a tech-visory or a technology and an advisory combined business that's resilient.
We have a clean balance sheet, and we have strong leadership. Thank you. Yes, sir.
In one of your slides, you mentioned your acquisition target is 4x-8x the EBITDA. Those that will double the revenue in your first year. Based on your two acquisitions you mentioned, how do these metrics there, does it increase the revenue of the target? How many sample the overall revenue?
Yeah, I want to make sure I understand your question. The stated reference was when we look to acquire a company, that's the band of multiple on EBITDA we look for. Okay? Those companies, when we acquired them, were profitable, and they didn't have debt, and they would become accretive. Then the question is: what does that look like afterwards? I can say is for Gemini, within the first year, we essentially doubled their business, and EBITDA was growing as well. With DS Consultants, we're not even a year into them yet. I think we're 10 months. But their EBITDA when we bought them was around 15%, and that should be accretive as well. But on a scale involved, it'll all roll out. Our final numbers with our year-end will be in January, Dan?
End of January.
End of January is when we'll report out. But happy to say that the integration's gone very well in terms of roll-up, in terms of systems, in terms of execution. We're not losing people. We're actually adding to these teams and adding to the client base.
You don't know the company with a negative EBITDA.
A negative EBITDA?
Yes.
No.
Okay.
No. Yes.
You mentioned the cruise line, Private Islands. Is there an opportunity to have it on actual commercial cruise ships or-
Yes.
Bulk carriers?
We do both.
Both.
Actually, we've been asked to go out and go on cruises. What a horrible assignment, right? We send a person to go out and cruise around with them and look at their systems and then come up with a solution. Most of their technology comes from Spain.
Okay.
In the United States, everything isn't metric, and so they're a little confused. We see an opportunity there to help them on the ships as well.