ECO2 has reported operating losses of $12.3 million for the year-end 2008, compared with operating losses of $16 million in the previous year-end. The cash losses from operating activity were $9.9 million in 2008 versus $7.2 million for 2007.
ECO2 rode through a considerable decline in plastic prices and was able to maintain, without a decrease, the spread between buy and sell prices of the commodity. Demand for company’s product continues to exceed supply and the opportunity for the growth remains strong in company’s primary market of recycled PET flakes.
Organizationally, the management team was expanded with the addition of Fred Janz as senior vice president of operations and Ray Salomon in the role of chief finance officer. In addition, the company reconfigured its board of directors with the addition of Tom Hutton, John Moragne, David Buzby and Alex Millar.
ECO2 raised over $15 million in the financing rounds all through 2008 and received investments from two institutions; Trident Capital Management and Peninsula Packaging. Additionally to investing in company, Peninsula Packaging executed a long-term supply agreement with ECO2 for the purchase of recycled PET flake.
Operationally, the construction of ECO2’s new liquid carbon dioxide processing equipment was finished. The new system, along with other operating initiatives during the year, helped to reduce variable production costs per pound of production. Additionally, with new equipment currently being installed in the plant, the company expects further reduction in variable production costs all through 2009, with the goal of attaining profitable operation.
ECO2’s development efforts to date have resulted in the issuance of nine US patents, with eleven additional patents in the pending state. During 2008, the firm’s waterless cleaning process received approval by the FDA for use in food contact applications. ECO2 continued its development efforts with USCAR’s Vehicle Recycling Partnership, researching the effectiveness of the company’s process in cleaning substances of concern from auto shredder residue. And finally, examination of commercially available recycling equipment to optimize the existing line and position the company for expansion has been underway throughout the year.
Rod Rougelot, chief executive officer of ECO2 said ‘Although the company has accomplished many of its goals in 2008, our continued focus must be on raising additional funds to continue to improve our processes, acquire additional equipment to support our improved processes, strengthen our balance sheet and deliver positive cash flow from operations.’
