Energy Recovery Reports 13% Revenue Growth to $144.9 Million for Fiscal Year 2024

Energy Recovery, Inc. reported a total revenue of $144.9 million for the fiscal year ending December 31, 2024, marking a 13% increase from $128.3 million in 2023. The company's net income rose to $23.1 million, or $0.40 per diluted share, compared to $21.5 million, or $0.37 per diluted share, in the previous year. The increase in revenue was primarily driven by a 14% rise in Megaproject revenues, which accounted for 66% of total revenue, and a 21% increase in Original Equipment Manufacturer (OEM) revenues, which made up 22% of total revenue. However, Aftermarket revenues saw a slight decline of 4%, contributing 12% to the overall revenue.

The company experienced significant operational changes during the year, including a restructuring plan announced in November 2024, which involved a workforce reduction of approximately 15%. This restructuring is expected to be completed by the end of the first quarter of fiscal year 2025 and aims to lower operating costs and position the company for profitable growth. As of December 31, 2024, Energy Recovery had 254 full-time employees, a decrease from the previous year, and anticipates having 216 employees post-restructuring.

Geographically, the Middle East and Africa remained the largest market for Energy Recovery, generating $90.7 million in revenue, a substantial increase from $76.6 million in 2023. The Asia market also showed growth, contributing $36.1 million, while revenues from the Americas decreased to $9.0 million. The company continues to focus on expanding its presence in the wastewater treatment sector, leveraging its pressure exchanger technology, which is seen as a key driver for future growth.

Looking ahead, Energy Recovery anticipates continued demand for its products, particularly in the desalination and wastewater markets, driven by increasing environmental regulations and the need for sustainable water solutions. The company believes that its innovative technologies, such as the Ultra High-Pressure PX, will enhance its competitive position in these growing markets. Additionally, the company plans to invest in research and development to further advance its product offerings and capitalize on emerging opportunities in the CO2 refrigeration market.

In terms of financial health, Energy Recovery reported cash and cash equivalents of $29.6 million as of December 31, 2024, down from $68.1 million in the previous year. The company has a credit agreement with JPMorgan Chase Bank, providing a revolving credit line of $50 million, which remains unused as of the end of the fiscal year. The company’s management believes that existing cash balances and future cash inflows will meet liquidity needs for at least the next 12 months, although they may seek additional financing for future growth initiatives.