Good morning, everyone. Welcome to EverGen Infrastructure's Q2 2026 earnings presentation. As a reminder, this call is being recorded. Before we begin, I would like to direct all participants to our website at www.evergeninfra.com, where you will find a copy of the second quarter earnings presentation. Please allow me to remind you that our discussions today contain forward-looking statements. Actual results may vary materially from those discussed. Additional information is contained in the second quarter 2026 management's discussion and analysis. I will now turn the call over to Chase Edgelow, who is EverGen's Co-Founder and CEO.
Good morning, and thank you, Shubham. I am Chase Edgelow, Co-Founder and CEO of EverGen, and I am joined here today by Maria O'Sullivan, our CFO, and Shubham Trehan, who is our Director of Business Development. I want to begin somewhere other than the numbers, because numbers only matter if you understand the evidence of the hard work that we have put into the business over the last 15 months. When we took the reins at EverGen in May of 2025, EverGen was a set of genuinely good infrastructure assets that were not working.
Real plants, real contracts, real waste coming in through the gate, and performance that did not reflect any of it. Today, our platform is running at record production, converting that production into cash, and doing it in a method that we believe we can repeat again and again. That is the story of Q2. Not a good print. Evidence of a method that works. I will take you through it in four parts. What we have stabilized, what the turnaround is now producing, the team that produced it, and why I believe this is a business that is priced at a value that bears very little resemblance to what you actually own.
Maria will then take you through the financials in detail, and we will open up the call for questions. Just to recap on the stabilization. Starting with what we took on in May of 2025, EverGen went through a recapitalization transaction and change of management. I returned as CEO, alongside Ron Green, our COO. ASK America came in as our lead investor, and across two tranches of equity raise, we did CAD 7 million of new equity into the business, all at CAD 0.60 a share.
What we inherited was four operating assets across British Columbia and Alberta, about CAD 75 million of total assets, feedstock arriving at our door, at our gate, under long-dated municipal contracts, and RNG going out to our utility buyers. What we did not inherit was reliability, and for infrastructure companies, reliability is critical. So we focused on three things. One, the assets. Without capital, without operating discipline, we saw significant downtime, unplanned downtime, interruptions, and our overall, our facility uptime went from under 80% to high- 90s.
Fraser Valley Biogas continues to set new production records, with a beat in July and continued strong performance. Secondly, fixing the balance sheet. Along with the equity raise, we also closed a CAD 13 million asset-level debt facility at Fraser Valley, which is non-recourse to the parent, and used the proceeds to retire approximately CAD 12 million of corporate senior debt. What that did for the business, we saved a significant amount of debt service costs, and we've aligned with a lender that's committed to the space in Farm Credit Canada.
Thirdly, our business is about contracts, and we entered into the 20-year period at Fraser Valley Biogas with FortisBC on our new contract in January of this year. That, collectively, is stabilization. It's not changing numbers, but it's the foundation for everything I'm about to take you through. Our next phase was a turnaround, and I think that what we're here today to tell you is that after 15 months with the business, first six months really focused on what we talked about above, the stabilization, you're starting to see the evidence of the turnaround in the numbers.
What that foundation produced in the second quarter, revenue up 71% year-over-year. RNG production up 11%. Incoming feedstock up 34%. Compost sales up 51%. Collectively adjusted EBITDA of CAD 1.75 million against sub CAD 400,000 the same quarter last year. An increase of over 400%. I think if you take nothing else from this call, take the three numbers that sit below those headlines numbers, which are, one, our direct operating costs didn't rise while our revenues did.
Two, with that, over CAD 0.70 of every incremental dollar that comes in the door converted straight to adjusted EBITDA. That's the torque that's in this business if we get our operations stabilized. And three, from a cash flow perspective, we look at positive cash flow versus negative cash flow, where the business was in the same period last year. Maria will take you through the first half in detail in a moment.
What I want to hold onto here is that the direction of the business has been four consecutive quarters of a rising floor and a run rate that has moved from approximately CAD 4.3 million of EBITDA to over CAD 5 million in a single quarter. That, from our perspective, is what our turnaround has resulted in. It's not one single number, but a floor that keeps rising. That floor only rises with the team. I think before I get into growth, wanted to talk about something that doesn't appear in our Q2 financials or MD&A.
I think we've really focused in this turnaround on building a strong team, empowering those within the business that are capable. These plants were not fixed from our head office. They were fixed at site by operators who understand that uptime is won through preventative maintenance, having inventories on spare parts and not in a boardroom. I ask you to think about two things about our team maybe versus other platforms in the space. We run a genuinely lean organization.
G&A fell approximately 20% while revenues grew. So we've got a small team carrying a lot of weight, and I want to recognize everyone that's made an impact, this quarter and in the last 15 months. So why is the team important? Why is that base important? I think ultimately, our vision for EverGen was there were strong assets underlying what were weak results. The turnaround has shown that the strong production out of those assets is capable. But I think more importantly than that, all of this provides for us a playbook for growth.
This is repeatable, templatable turnaround of assets that we think we can repeat, not just on our own assets, but as we look to grow. Organically, we have growth at GrowTEC that we will expand that facility. We have continued improvement at Fraser Valley Biogas. We have a large expansion at Pacific Coast Renewables that cleared a major regulatory hurdle in March of this year. It has CAD 10.5 million of NRCan funding towards it, of which we have allocated CAD 9.2 million toward capital expenditure as at June 30. We are continuing to move that project towards FID.
Beyond our PCR RNG expansion, in terms of large capital projects, we also hold 50% of Project Radius, which is approximately 550,000 gigajoules per year development project in Ontario. We have a FID target on that project for later this year or early next year, and it has had some really interesting developments in the last 12 months. Finally, I will speak to the consolidation potential that we believe our platform is uniquely positioned to take advantage of.
North America went from approximately 100 RNG facilities before 2020, before the sort of clean tech boom and funding, push towards the space, to more than 600 today. A great deal of those were built by developers, or I guess teams and platforms that no longer exist, that were maybe hit a little bit harder than EverGen as that capital outflow from the space happened in 2021, 2022. We see that a meaningful share of those 600 facilities underperformed for exactly the same reasons that our facilities used to.
What I am saying is that EverGen is a natural owner of underperforming RNG assets. We have already proven we can fix the ones that we own, and that is our template. Finally, I think this is important for all of our shareholders, the value question. Let me be direct, because I think this is probably the least understood part of the business. What you own today, CAD 75 million in total assets, shareholders' equity of CAD 42 million, which is about CAD 1.63 a share against 25 million shares outstanding.
Four operating facilities that are strategically located in areas where it is challenging to build infrastructure, i.e., there is a moat. Feedstock arriving under long-dated municipal contracts, RNG being sold under 20-year utility grade offtakes, and roughly CAD 16 million of debt sitting at the project level against the assets that service those. Against all of that value, EverGen carries a market cap of roughly CAD 10 million. Let me give you three ways to consider value here. One, on book value, on our net asset value.
Market is valuing our equity at about a quarter of its carrying value, despite, and obviously we will give the market time to adjust, but despite just delivered record production and record feedstock volumes. Two, on a cash flow basis, our run rate adjusted EBITDA over the first half is over CAD 5 million. Our enterprise value, including our debt net of cash, is sub-CAD 25 million, which is a sub-5x EBITDA multiple. Publicly traded RNG and environmental infrastructure companies generally trade from high single digits into the mid-teens on that same EBITDA metric, and we continue to see private sector transactions clearing well above the 10x EBITDA mark.
Finally, what the informed shareholders have actually paid. Our last two equity tranches were priced at CAD 0.60 a share, no warrants. Our Board management and institutional holders hold roughly 70% of our shares, and nobody at this table is a seller. Finally, consider the torque or asymmetry. Our valuation with every incremental CAD 1 million of EBITDA would be worth somewhere between CAD 9 million-CAD 12 million of enterprise value in the private sector or against other peers. Every single incremental dollar of EBITDA in our entire market cap is CAD 10 million today.
That is really what I want to point you to, is that we are now at the point where every incremental improvement that we put back into the business, every capital investment that our team makes, has a lot of torque for our shareholders. To bring it all together, we have stabilized the platform, uptime, our balance sheet, our contracts.
The turnaround is now visible in the rearview mirror, and we believe we have a repeatable template to point at a North American market that is full of assets, very similar to the ones that we have just fixed. With that, I will hand it over to Maria to walk through the financials in more detail, and then we will open up to questions at the end of the call. Thank you for your time. Over to you, Maria.
Thanks, Chase. Touching first on revenues. Q2 2026 revenue increased 71% compared to Q2 2025, reaching CAD 4.8 million. This growth was driven by strength across nearly every revenue stream. Tipping fees grew 52% year-over-year on higher volumes at our organic waste and composting facilities. RNG revenue was up 15%, and organic compost and soil sales increased 22%.
We also recognized CAD 1.1 million of carbon credit revenue in the quarter, which was not a contributor in Q2 2025. Compared to Q1 2026, revenue increased 81% from CAD 2.6 million- CAD 4.8 million, reflecting the normal seasonal recovery in tipping and compost volumes we saw last quarter, plus the carbon credit contribution. For the first half of 2026, revenue was CAD 7.4 million, up 57% from CAD 4.7 million in the same period last year. Turning to adjusted EBITDA.
Q2 2026 came in at CAD 1.7 million, a CAD 1.4 million or 416% increase compared to Q2 2025, and up from CAD 870,000 in Q1 2026. This was primarily driven by the revenue growth already described and touched on by Chase. Looking at the six-month period, adjusted EBITDA was CAD 2.6 million, up CAD 1.8 million from the prior year, reflecting both the revenues increases and also a reduction in general and administrative expenses.
On net loss, we saw an improvement of CAD 1.6 million here from a loss, sitting at a loss of CAD 386 million for Q2 2026. For the six months ended June 30th, 2026, net loss was CAD 1.1 million, down from CAD 3.1 million in the prior period. Turning to the balance sheet and liquidity, our working capital surplus has improved to CAD 3 million as of June 30th, 2026, up from CAD 2.1 million in the prior quarter, and compared to a deficit of CAD 855 at the end of 2025.
This is showing continued improvement off the back of the financing activity we discussed in Q1 2026, and that Chase has also spoken about earlier in the presentation. The Q2 results show that our core operations, our tipping volumes, RNG production, are driving sustained improvement. With that, I'll turn it back to Chase, to conclude the presentation and to open up to Q&A.
Yeah. Thank you, Maria. I believe this is a really important time to be looking at our business. As mentioned, we've completed our stabilization, moved through a turnaround phase, and the results speak for themselves, and we're really keen to speak with anybody that wants to discuss our business further after the call. We'll move into a Q&A period. Why don't we start with this initial question. Shubham?
Yeah. So we have a question here that's saying, "Roughly CAD 1.1 million of our Q2 revenue was carbon credit sales, and if we strip that out and the quarter looks very different." So is the EBITDA real?
Yeah. It's a fair question, and one that I'd rather have people ask than wonder. I think, we look at CAD 1.1 million of carbon credit revenue and think about it this way. Our credits are generated and clear through ECCC. So there is lumpiness in the timing of the generation of those credits. Not just timing of the generation, but the timing of the sale of those credits. And we recognize revenue as those credits are sold.
That said, what we've seen in terms of carbon credit sales over the first half of 2026, it would be indicative of the run rate carbon credit sales if we were generating instantaneously and selling instantaneously. So, I think that's to say, it will continue to be a, not seasonal, but a lumpy revenue recognition on carbon credit sales. But we don't think it's not a one-time windfall. This market has really stabilized since coming into effect. It has been steadily clearing north of CAD 350 per ton of CO2 avoided emissions.
The reason for that is it is a market that is supported by both sides of the aisle. It provides a stable way of monitoring and clearing and dealing with emissions from large industrial producers. I think RNG is uniquely positioned to continue to find homes in other markets as a lowest cost decarbonization option. While we look at our business as primarily tip fee, primarily long-term base value in our contracts, our contracts also come with the upside of a portion of the carbon credits that are associated with our business.
Great. Thanks, Chase. The next question is, the company has had two good quarters in 2026, and it says that, "Is our CAD 5 million of run rate EBITDA a fair characterization given seasonality in the business?
Yeah. I think, is CAD 5 million of run rate EBITDA a fair characterization given seasonality? I think that is our run rate on our first half results. I would point out that our first half is not typically our strongest quarter. I think we have historically seen our highest volumes in the second and third quarters. That said, I think we are confident in the business continuing to perform at these levels that we are at today. We will skip time for any other questions here.
Yeah. The next question is around the PCR expansion project. It says, "When does PCR reach FID, and how do you fund it?
With the PCR RNG project, we picked up development work on that project immediately after we got our main regulatory hurdle cleared in March. We are updating our development work, our FEED analysis, our front-end engineering and design, and sourcing long lead equipment so that we can commence construction. I mentioned the grant funding and CapEx committed against it, and we believe that we are advancing towards FID from a timing perspective, and we will announce it when we take it, not before.
We are moving steadily forward towards that milestone. In terms of how we fund it, as I mentioned, there is a large portion that can be funded by grant funding. We also see, as we have shown with our project finance facilities at both Fraser Valley and GrowTEC, there is a significant amount of project finance capital available for a project like this, especially given what we believe is a much stronger revenue environment for this type of project, given the stacking of a contracted cash flow and the carbon credit attributes that this project will generate.
That is a significant improvement from where this project was three years ago. I think, final question is just around whether or not we can speak more to Project Radius and where that project is going. I think at this time, we continue to advance Radius to a notice to proceed or FID decision alongside PCR RNG expansion. We do not talk about it as much given that it is a project that is a 50/50 partnership and a large capital commitment that requires an outside source of equity, debt, and grant funding.
We have continued discussions and I believe we will be able to update the market on the full funding picture for Project Radius shortly. We are excited about the development there, in particular, our partnerships on offtake and the scale and repeatability that Project Radius brings us. I think with that, we will conclude our call and welcome any inbound interest. Happy to take calls or set up times to go through the business in more detail. If there is interest, please see the link at the bottom of the press release to get in touch, and we will see everybody on our Q3 call in November. Thanks, Maria. Thanks, Shubham.
Thanks, everyone.
Thanks, everyone.