Fuel Tech Inc. (NASDAQ: FTEK) reported third-quarter 2020 results after markets closed Tuesday. The developer of pollution control and wastewater treatment technologies posted diluted earnings per share (EPS) of $0.09 on revenues of $8.2 million. In the same period a year ago, the company said it had a per-share loss of $0.05 on revenues of $6.5 million. Third-quarter results also compare to a single analyst’s estimate for a loss of $0.01 per share on revenue of $9.08 million.

During the third quarter, Fuel Tech reached a $2.6 million settlement with its insurance carrier related to an outstanding claim reported in 2019. The proceeds of the settlement were received in the current quarter. For the third quarter, the company “recorded a receivable for the proceeds that reduced cost of sales at the [Air Pollution Control] business by a like amount.”

In the company’s Air Pollution Control segment, revenue rose from $1.8 million in the third quarter of last year to $2.9 million this year and operating income rose from $619,000 to $3.2 million. In the Fuel Chem segment, revenue rose from $4.6 million a year ago to $5.3 million. The revenue increases were not affected by the insurance settlement.

Gross margins jumped from 44.8% a year ago to 72.4% this year. Excluding the impact of the settlement, gross margins fell to 40.7%.

The per-share profit of $0.09 per diluted share also was “primarily due to the impact” of the $2.6 million settlement. Fuel Tech reported 25.1 million diluted shares outstanding.

While the insurance settlement may have distorted the quarterly results somewhat, Fuel Tech did have some positive news. CEO Vincent J. Arnone said he expects final decisions by the end of the year on several projects the company has bid on. If its bids are accepted, the company’s backlog for 2021 and beyond would increase by $10 to $15 million. Backlog at the end of September totaled $6.4 million.

The company also has installed the Fuel Chem segment’s targeted in-furnace injection technology on three new coal-fired units in the northeastern United States. Fuel Tech generates revenue when the units are generating power in their geographic regions. The company expects annual revenue of $500,000 to $750,000 per unit through this commercialization program.

Fuel Tech’s stock posted a new 52-week high of $2.05 early Wednesday morning and traded up more than 150% at last look at around $1.91. The stock closed at $0.76 on Tuesday and has a 52-week low of $0.30. The volume of more than 106 million shares traded in the first hour is nearly 10 times the daily average of about 124,000.

Fuel Tech stock is listed on the Nasdaq Capital Market after transferring its listing from Nasdaq’s Global Select tier. The change, made in late September, gives the company an additional 180 days to come into compliance with the Nasdaq requirement for a minimum price of $1.00 per share for 10 consecutive business days.

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