EcoSynthetix Reports 2026 First Quarter Results

BURLINGTON, ON, May 5, 2026 /CNW/ - EcoSynthetix Inc. (TSX: ECO) ("EcoSynthetix" or the "Company"), a renewable chemicals company that produces a portfolio of commercially proven bio-based products, today announced its financial and operational results for the three months (Q1 2026) ended March 31, 2026. Financial references are in U.S. dollars unless otherwise indicated.

Highlights
(Comparison periods in each case are the three months ended March 31, 2025)

• Recorded net sales of $3.8 million, down 7%, primarily due to lower sales volumes.
• Sales volumes have been impacted year-to-date primarily due to an inventory buildup by key accounts in the prior year and challenging macro conditions in the Company's end markets.
• The leading global pulp producer customer successfully completed an industrial-scale trial at a second, larger facility during the period.
• Trial activity is encouraging across a range of top tier global pulp, tissue and packaging producers.
• Recorded an Adjusted EBITDA¹ loss of $0.3 million, a 32% improvement.
• Purchased and cancelled 245,095 common shares in Q1 2026, under the normal course issuer bid for total consideration of $0.6 million.  
• Maintained a strong balance sheet with cash and term deposits of $29.8 million as at March 31, 2026.

"The momentum we built in 2025 remains firmly intact. While temporary dynamics with key accounts are impacting near-term volumes, we remain confident in accelerating growth in the second half of the year. This confidence is supported by consistent feedback from key accounts, who continue to recognize and validate the positive impact our bio-based polymers bring to their respective end markets," said Jeff MacDonald, CEO of EcoSynthetix. "Our pipeline of trial activity remains robust, including in the tissue and pulp end markets. The leading global pulp manufacturer, which is commercial with our SurfLock™ strength aids at one facility today, successfully completed trials at a second, larger facility in the quarter. We believe pulp represents a key growth driver for us supported by a compelling economic case for conversion to our bio-based solutions. In the tissue end market, we continue to see encouraging trial activity across a range of top tier global producers. The international retailer using our wood composites binder in its particleboard production remains committed to converting its supply chain to bio-based glues by 2030. And our marketing & development partner in personal care, Dow, reports strong engagement from manufacturers for its all-natural MaizeCare™ brand polymers. As we navigate near-term volatility, our key commercial priority is supporting our existing accounts and converting trial prospects into long-term commercial relationships. We believe this disciplined execution positions us well for the second half of 2026 with improving volume growth and broader adoption across our end markets."

Financial Summary

Net Sales

Net sales were $3.8 million for Q1 2026, compared to $4.0 million for the corresponding period in 2025. The 7% change was primarily due to lower volumes of $0.7 million, or 18%, partially offset by a higher average price which increased sales $0.4 million. The lower volumes were mainly attributable to customer inventory de-stocking and challenging macro conditions in end markets during the period. The 11% increase in sales due to average selling price was driven by foreign exchange fluctuations and an improved product mix.

Gross Profit

Gross profit was $0.9 million for Q1 2026, unchanged from the corresponding period in 2025, as a higher average selling price was offset by lower volumes and higher manufacturing costs.

Gross profit as a percentage of sales was 24.6% for Q1 2026, compared to 21.5% in the corresponding period in 2025. Gross profit as a percentage of sales adjusted for manufacturing depreciation was 30.6% for Q1 2026, compared to 27.2% for the corresponding period in 2025. The improvement in each measure was primarily due to a higher average selling price, partially offset by higher manufacturing costs.

Selling, General and Administrative

Selling, general and administrative expenses (SG&A) were $1.6 million for Q1 2026, compared to $1.5 million for the corresponding period in 2025. The 9% change was primarily due to higher salaries and benefits and other miscellaneous costs offset by lower repairs and maintenance.

Research and Development

Research and development (R&D) costs were $0.2 million for Q1 2026, compared to $0.4 million for the corresponding period in 2025. The change primarily relates to refundable SR&ED tax credits recognized in the current period, and prior year fiscal period, in accordance with Bill C-15, which was enacted into law in Canada in March 2026. R&D expense as a percentage of sales was 5% for Q1 2026. The Company's R&D efforts continue to focus on further enhancing value for our existing products and expanding addressable opportunities.

Adjusted EBITDA¹

Adjusted EBITDA was $(0.3) million for Q1 2026, compared to $(0.5) million for the corresponding period in 2025. The 32% improvement was primarily due to higher gross profit and lower operating costs adjusted for non-cash items when compared to the prior period.  

Net Loss

Net loss was $0.6 million, or $0.01 per common share, for Q1 2026, unchanged from the corresponding period in 2025.

Liquidity 

Cash on hand and term deposits were $29.8 million as at March 31, 2026, compared to $29.6 million as at December 31, 2025. The Company purchased and cancelled 245,095 common shares under the NCIB during Q1 2026, for consideration of $0.6 million.

Notice of Conference Call

EcoSynthetix will host a conference call Wednesday, May 6, at 8:30 am ET to discuss its financial results. Jeff MacDonald, CEO, and Robert Haire, CFO, will co-chair the call. All interested parties can instantly join the call by phone, by following the URL https://emportal.ink/4tjCrDG  to easily register and be connected into the conference call automatically or the conventional method by dialling (416) 945-7677 or (888) 699-1199 with the conference identification of 15947#. Please dial in 15 minutes prior to the call to secure a line. A live audio webcast of the conference call will also be available at www.ecosynthetix.com or https://app.webinar.net/n9KZB9rmdM7. The presentation will be accompanied by slides, which will be available via the webcast link and the Company's website. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast.

¹Non-IFRS Financial Measures

This press release makes reference to certain non-IFRS measures. These non-IFRS measures are not recognized measures under IFRS, do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those IFRS measures by providing a further understanding of results of operations of EcoSynthetix from management's perspective. Accordingly, they should not be considered in isolation nor as a substitute for analysis of the financial information of EcoSynthetix reported under IFRS. The Company uses non-IFRS measures such as Adjusted EBITDA to provide investors with a supplemental measure of operating performance and thus highlight trends in its core business that may not otherwise be apparent when relying solely on IFRS financial measures. Management also believes that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers. Management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, prepare annual operating budgets and assess the Company's ability to meet its capital expenditure and working capital requirements.

Adjusted EBITDA is not a measure recognized under IFRS and does not have a standardized meaning prescribed by IFRS. See "IFRS and Non-IFRS Measures." The Company presents Adjusted EBITDA because the Company believes it facilitates investors' use of operating performance comparisons from period to period and company to company by backing out potential differences caused by variations in capital structures (affecting relative interest expense), the book amortization of intangibles (affecting relative amortization expense) and the age and book value of property and equipment (affecting relative depreciation expense). The Company also presents Adjusted EBITDA because it believes it is frequently used by securities analysts, investors and other interested parties as a measure of financial performance. Adjusted EBITDA as presented herein are not recognized measures under IFRS and should not be considered as an alternative to operating income or net income as measures of operating results or an alternative to cash flows as measures of liquidity. Adjusted EBITDA is defined as consolidated net income (loss) before net interest expense, income taxes, depreciation, amortization, gain or loss on disposals of property, plant and equipment and other non-cash expenses and charges deducted in determining consolidated net income (loss).

The following table reconciles net loss to Adjusted EBITDA (loss) for the three months ended March 31, 2026, and March 31, 2025:

About EcoSynthetix Inc. (www.ecosynthetix.com)

EcoSynthetix offers a range of sustainable engineered biopolymers that allow customers to reduce their use of harmful materials, such as formaldehyde and styrene-based chemicals. The Company's flagship products, DuraBind™, Surflock™, Bioform™, and EcoSphere®, are used to manufacture wood composites, personal care, paper, tissue and packaging products, and enable performance improvements, economic benefits and carbon footprint reduction. The Company is publicly traded on the Toronto Stock Exchange (T:ECO).

Forward-Looking Statements

Certain statements in this Press Release constitute "forward-looking" statements that involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, objectives or achievements of the Company, or industry results, to be materially different from any future results, performance, objectives or achievements expressed or implied by such forward looking statements. The forward-looking statements in this Press Release include, but are not limited to, statements regarding the Company's plans to execute its commercial strategy, deliver meaningful growth across all three product categories, convert high-value strategic prospects into customers, and other statements regarding the Company's plans and expectations in 2026. These statements reflect our current views regarding future events and operating performance and are based on information currently available to us, and speak only as of the date of this Press Release. These forward-looking statements involve a number of risks, uncertainties and assumptions and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such performance or results will be achieved. Those assumptions and risks include, but are not limited to, the Company's ability to successfully allocate capital as needed and to develop new products, as well as the fact that our results of operations and business outlook are subject to significant risk, volatility and uncertainty. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including the factors identified in the "Risk Factors" section of the Company's Annual Information Form dated February 17, 2026. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described in this Press Release as intended, planned, anticipated, believed, estimated or expected. Unless required by applicable securities law, we do not intend and do not assume any obligation to update these forward-looking statements.

SOURCE EcoSynthetix Inc.

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