Greenlane Renewables Q1 2026 Earnings Report

Greenlane Renewables EPS Results

• Actual EPS: -C$0.01
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Greenlane Renewables Revenue Results

• Actual Revenue: $9.54 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Greenlane Renewables Announcement Details

• Quarter: Q1 2026
• Date: 5/14/2026
• Time: After Market Closes
• Conference Call Date: Thursday, May 14, 2026
• Conference Call Time: 4:00PM ET

Greenlane is driving change: accelerating the energy transition. We are cleaning up two of the largest and most difficult to decarbonize sectors of the global energy system: the natural gas grid and commercial transportation. As a pioneer and leading global specialist in biogas desulfurization and upgrading, we have been actively contributing to the decarbonization of our planet for over 35 years with more than 355 systems supplied into 28 countries. We transform biogas generated from organic waste into high-value grid-ready renewable natural gas ('RNG') from a wide range of sources such as landfills, sugar mills, dairy farms, wastewater, and food waste. Greenlane is transforming energy production and creating new, sustainable revenue streams for its customers - all while dramatically reducing carbon emissions. Partner with us, let's accelerate the energy transition together.

Greenlane Renewables Q1 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Greenlane reported a strong Q1 with CAD 9.5 million in revenue, up 36% year over year, and gross margin excluding amortization improved to 43% from 40% last year.
• Positive Sentiment: The company narrowed its adjusted EBITDA loss to CAD 0.8 million from CAD 1.1 million in Q1 2025, helped by higher-margin business mix.
• Neutral Sentiment: Management said it is deliberately ramping down legacy low-margin upgrading system contracts and shifting toward proprietary standard products, royalties, parts and service, and biogas desulfurization.
• Positive Sentiment: Greenlane announced a partnership with Panasonic to manufacture Cascade LF and Cascade MS in Brazil, with Panasonic funding facility changes, tooling, equipment, and working capital needs.
• Neutral Sentiment: The company said Cascade LF remains on track for final development and production start readiness, with manufacturing expected before the end of 2026 and commercialization targeted later this year.

Presentation

[Darren Seed, President at Incite Capital Markets]

Good afternoon, ladies and gentlemen. Welcome to the Greenlane Renewables first quarter 2026 video conference. My name is Darren Seed, President of Incite Capital Markets, responsible for investor relations at Greenlane. I'm joined today by Brad Douville, Greenlane's Chief Executive Officer, and Stephanie Mason, Greenlane's Chief Financial Officer. We'll begin with prepared remarks, followed by a Q&A, which I will moderate. Before beginning our formal remarks, we'd like to remind listeners that today's discussion may contain forward-looking statements that reflect current views with respect to future events. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in these forward-looking statements. Greenlane Renewables does not undertake to update any forward-looking statements except as may be required by applicable laws.

[Darren Seed, President at Incite Capital Markets]

Listeners are urged to review the full discussion of risk factors in the company's Annual Information Form, which has been filed with the Canadian securities regulators. Please feel free to submit any questions you may have through our investor email address at ir@greenlanerenewables.com. Now, over to Brad.

[Brad Douville, CEO at Greenlane Renewables]

Thank you, Darren, and hello, everyone. Thanks for joining. Let me, before Stephanie gets into the numbers, let me just set the stage a little bit here and start off with our strategic plan, specifically our three strategic initiatives. I've talked about this many times, but it's worth reinforcing this 'cause it really makes sense of our results this quarter. Firstly, our first strategic initiative is to continue sales growth in our most profitable business areas. That's parts and service, biogas desulfurization, and technology licensing. In Q1, you'll see that we continued to drive strong gross margin contribution particularly from parts and service and biogas desulfurization. That leads us to number two.

[Brad Douville, CEO at Greenlane Renewables]

That's reconfigure our upgrading systems business area, and we do that by completing the ramp down of our legacy low-margin contracts and then ramp back up, centered on proprietary standard products and royalty revenues. This is where new contracts will be structured for lower risk, higher margin, and more revenue per system, with lower overall cost for customers. There's a lot there. Let me just say a few more words on that. We are reconfiguring how third-party systems modules in our Brazilian context are handled. By moving to a model where customers are invoiced directly by third-party vendors, we eliminate the low-margin revenue associated with modules for which Greenlane is not design responsible. Under these arrangements, Greenlane is transitioning to a model to drive sustainable long-term value with higher margin revenue, largely derived from royalties. Which leads us to number three.

[Brad Douville, CEO at Greenlane Renewables]

Our third strategic initiative, add step change profitable growth potential with Cascade LF. That goes across all our business areas. We're completing final development now. We expect to commence manufacturing before the end of 2026. We'll also be establishing the manufacturing plan to serve the North American market. On the next slide, let me just reinforce the key strategic success criteria that I've talked about a number of times. I won't get into all of these, but the one I wanna focus on today is partnerships. The reason that's important is we believe that collaborating with leading industry partners who bring complementary expertise, focus, and value, help us deliver complete solutions, extend market reach, and better serve customers.

[Brad Douville, CEO at Greenlane Renewables]

The partnership with Panasonic that we announced earlier this week to establish volume production of Greenlane's Cascade LF and Cascade MS proprietary standard product lines in Brazil brings on not only Panasonic's manufacturing expertise, but also the strength of Panasonic's balance sheet to support sales growth. Next slide, please. A few words on what that partnership is. We explained it in our press release, but let me just hit on the highlights. The facility location is in the state of São Paulo, in São José dos Campos. The agreements are structured such that Panasonic has been granted a technology license for fabricating the product in Brazil. Panasonic is responsible for modifying in their existing facility, procuring and installing tooling, production equipment, while also, very importantly, providing the necessary working capital and advanced payment assurances to meet customer requirements.

[Brad Douville, CEO at Greenlane Renewables]

Greenlane, on the other side, has retained responsibility for product design, management of the supply chain, including supplier selection and supplier quality assurance, marketing and sales, and commissioning and servicing of the products. Next slide. Brazil's our launch market. Why is that? Well, there's a lot going on in Brazil, and Brazil's Considering Brazil's vast agricultural sector, the country has significant biomethane potential. Today, most of the biomethane comes from landfills, hence the focus on Cascade LF for next generation landfill gas upgrading product. There's also big potential with sugar mills in the vinasse. There's a couple government initiatives. One is that the government aims to replace all dumps with landfills equipped with biogas production. Also biomethane growth is anticipated from the quota obligations within the country's new Fuel of the Future law.

[Brad Douville, CEO at Greenlane Renewables]

This is an obligation placed on distributors, importers of natural gas to reduce their greenhouse gas emissions with biomethane starting at 1% prorated in 2026, climbing to 10% in 2034. That's an increase of 7x from 2023, and it equates to approximately 21% compound annual growth rate over the next decade. Hopefully that sets the stage. Let me pass it over to Stephanie to go through the numbers.

[Stephanie Mason, CFO at Greenlane Renewables]

Thanks, Brad. Good afternoon, everyone. As a reminder, all figures are in Canadian dollars, unless otherwise stated. We delivered solid financial results for our first quarter of this year, with CAD 9.5 million in revenue and a gross margin excluding amortization of 43%, compared with CAD 7 million or 40% in the same period last year. The 36% increase in year-over-year revenue at higher gross margins helped improve our adjusted EBITDA loss to CAD 0.8 million from a CAD 1.1 million adjusted EBITDA loss in Q1 2025. As Brad noted, we are also investing in the final development and production start readiness of our new Cascade LF product line, and our operating expenses in Q1 2026 reflect these investments accordingly. Greenlane's research and development expense increased to CAD 0.8 million in Q1 2026, compared with CAD 0.3 million in Q1 2025.

[Stephanie Mason, CFO at Greenlane Renewables]

The general and administrative expenses of CAD 3.9 million in Q1 2026, in comparison to CAD 3.5 million in Q1 2025, mainly represents an increase in operational staffing in preparation for the sale and production of Cascade LF later this year. We maintained a solid balance sheet, ending the quarter with a cash balance of CAD 13.5 million, no debt, and a sales order backlog of CAD 31.5 million. The movement in cash balance from December 31st, 2025 primarily reflects the movement in non-cash working capital and the final payment of the contingent earn-out. As we flip to the next slide, Greenlane has historically not presented biogas desulfurization results separately from upgrading systems. They have both been included combined in system sales.

[Stephanie Mason, CFO at Greenlane Renewables]

As we look back on a pro forma basis, firstly looking at biogas desulfurization, which is mainly our regenerative H2S removal, it achieved a revenue growth rate of 27% CAGR over the three-year period, and a gross margin of around 50%. If you look at parts and service, it achieved a revenue growth rate of 34% CAGR and a gross margin of around 40%. If you look to our royalty, it had a smaller revenue contribution, but a very outsized gross margin contribution of around 86%. If you look at our biogas upgrading systems, the revenue has been declining, and it has achieved a gross margin of around 20%. As Brad noted above, Greenlane has been deliberately ramping down its legacy low-margin upgrading system contracts to ramp back up, centered on proprietary standard products and royalty revenues.

[Stephanie Mason, CFO at Greenlane Renewables]

We look forward to keeping you appraised of our progress. With that, let's go over to you, Darren, for the Q&A.

[Darren Seed, President at Incite Capital Markets]

Good afternoon, everyone. Let's look at some questions and answers that we've had from investors for Greenlane and would consider around the financial information. Looking at today's negative adjusted EBITDA of approximately CAD 800,000, where can we see R&D expenses increased significantly year-over-year? I mean, how should investors think about R&D leading up to Cascade LF's commercialization?

[Stephanie Mason, CFO at Greenlane Renewables]

Yeah, I'll take that question. As we've said on this presentation, R&D has been a big focus in Q1, and it'll continue to be a big focus for the rest of the year. We did see some higher costs come through in Q1, as we had some spend on some external testing resources, but we are gonna continue to make investments. The whole goal is to achieve production of Cascade LF by later this year.

[Darren Seed, President at Incite Capital Markets]

Great. Sounds good. Do you anticipate needing additional capital to support the Brazil ramp or global expansion?

[Stephanie Mason, CFO at Greenlane Renewables]

No, not at this time. As Brad talked about our partnership with Panasonic is responsible for the costs of manufacturing. That includes the facility manufacturing, modification costs, tooling, and production equipment. We also have received some funding to date, and we're still in pursuit of other opportunities.

[Darren Seed, President at Incite Capital Markets]

Thanks, Stephanie. What can we talk about and say about the Cascade LF launch activities and your plans this year to secure customer orders?

[Brad Douville, CEO at Greenlane Renewables]

Well, that's an ongoing process. We're dealing with customers all the time with this new product. There's a number of initiatives or number of opportunities through the sales pipeline at different stages. Again, the launch market is Brazil. We've been attending industry conferences. In fact, there was a big one just last month. Had the opportunity to meet with all our key customers. The interest is there. We're working them through the sales pipeline. We're also introducing the product to North America. In fact, there's a conference next week, a large one. It's in Detroit this year. We'll be meeting with customers at that one as well. We'll also be continuing to update the market generally on findings.

[Brad Douville, CEO at Greenlane Renewables]

Stephanie referred to some testing that we did in Q1. We'll be continuing to keep our customers abreast of the new developments with the product as we head towards launch targeted at the end of this year.

[Darren Seed, President at Incite Capital Markets]

Thanks, Brad. Brad, how should investors think about the economics of the Panasonic licensing agreement? You know, what does Greenlane capture in terms of margin, royalties, or capital requirements?

[Brad Douville, CEO at Greenlane Renewables]

Yeah, well, I think we need to think about it a little bit bigger than just the Panasonic component, so really more broadly in Brazil. Firstly, with Panasonic, we talked about it being a technology license, which means royalty revenue. Stephanie already went through and showed some examples of what we've seen with royalty revenue in our business on a different deal, we think that's generally applicable going forward. Additionally, we're reconfiguring how third-party system modules in Brazil are handled. By moving to a model where customers are invoiced directly by third-party vendors, we are eliminating the low margin revenue associated with modules for which Greenlane's not design responsible. You know, under these arrangements, you know, that transitions us to a fundamentally higher margin revenue that's largely, but not entirely, derived from royalties.

[Brad Douville, CEO at Greenlane Renewables]

Some of the other revenue opportunity comes from the site activities. That's commissioning, that's field service. But also, we'll still be responsible for integrating the full system. There's a service that we're providing there that also generates some high margin revenue.

[Darren Seed, President at Incite Capital Markets]

Perfect. Well, thank you very much, Brad. Thank you, Stephanie. Happy to take any questions through our ir@greenlanerenewables.com email address if you have any inquiries.

Participants

Executives

• Brad Douville, CEO
• Stephanie Mason, CFO

Analysts

• Darren Seed, President at Incite Capital Markets