Transformer oil rerefiner Hydrodec Group posted its first positive full-year profits in the groups history for 2017, and its revenues were up 6 percent from 2016, according to its pre-close trading update issued Monday.
The companys reported $450,000 in earnings before interest, tax, depreciation and amortization for 2017, improving from a nearly $1.3 million EBITDA loss for 2016.
Hydrodecs revenues from its continuing core rerefining business increased by 6 percent to approximately $17.8 million, up from $16.8 million in 2016, which the company attributed to improved pricing and sales mix.
The company cited further improvement in its sales mix between higher margin transformer oil and lower margin process oil, with transformer oil sales representing 52 percent of total oil sales in 2017, up from 40 percent in 2016. Hydrodec aims to have transformer oils account for at least 60 percent of sales in 2018.
Group sales volumes of its rerefined transformer oil and process oil was lower at 29.3 million liters, down 12 percent. That reflected feedstock constraints and higher feedstock inventory at the start of 2016 due to the Canton, Ohio, plant recommissioning. An explosion and fire destroyed the processing unit at the Canton rerefinery in December 2013. The rebuilt plant resumed operations with two new production trains in mid-2015 and later brought four replacement trains online.
The companys Canton plant utilization was at 61 percent on average during 2017. Feedstock remains the key constraint to higher throughput, and strategic initiatives continue to progress in securing sustainable, increased supplies going forward, with the group seeking to achieve utilization rates at the Canton facility of at least 70 percent in 2018, Hydrodec said in its trading update news release.