The costs of an aggressive push to become a full-service water and wastewater treatment utility continues to weigh down Clearford’s bottom line, the Ottawa-based firm reported this week.
Traditionally a provider of decentralized sewage systems, Clearford began pursuing a new business model in mid-2017 that would see it offer a full suite of water and wastewater solutions to municipalities and private developers – much like a utilities operator – by designing, building and operating water and wastewater treatment facilities on a long-term basis.
To support that strategy, it purchased Ontario wastewater solutions and equipment supplier Koester Canada for $7.8 million last fall and, more recently, acquired Long Beach Waterworks, a private water utility in the Niagara region. The company says it’s continuing to look for acquisition opportunities in its home province.
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That’s made Clearford a much larger company. The firm says its second quarter revenues were up by more than two-thirds year-over-year to $1.6 million in the three-month period that ended June 30.
However, Clearford has also sunken deeper into the red, in large part because of the added administration costs of its newly acquired operations as well as higher financing costs.
As a result, the company’s second-quarter loss nearly doubled from $1.4 million last year to $2.7 million in 2018.
Company executives say their work over the past year has set the stage for future growth.
“We expect in 2018 we will complete a foundation for our business that should deliver sustain revenue and earnings growth into the future,” said Kevin Loiselle, Clearford’s president and CEO, in a statement.