SUFFOLK, VA / ACCESSWIRE / August 25, 2023 / U.S. Steel looks like it's up for sale - the major mill is now considering competing offers from both Cleveland Cliffs and Esmark Inc and there are rumors that ArcelorMittal SA is considering making a bid for the major steel manufacturer, too.
As the industry could be headed toward consolidation, Greenwave Technology Solutions (NASDAQ:GWAV) is undertaking an aggressive expansion strategy to ramp up its capacity and meet the growing demands of major U.S. steel mills.
Greenwave is a leading metal recycling facilities operator with locations across Virginia and North Carolina that collect, classify and process raw scrap metal to supply major steel mills and foundries. The metal recycler has reported achieving significant growth in the first half of this year as heavy investments in infrastructure began to pay off, with the company generating $1.23 million in positive cashflows from operations during the six months ended June 30, 2023 - a new record for the company.
Greenwave Focuses On Aggressive Growth As Steel Industry Moves Toward Potential Consolidation
The metal recycler has invested heavily in infrastructure over the past few years, including installing a new automotive shredder and downstream processing system at its Kelford, North Carolina facility. The system recovers millimeter-minus pieces of metal from the residue left in the shredder. When a car is shredded, tiny pieces of metal residue build up inside the shredder. That metal residue or "fluff" is just as valuable as the larger pieces of shred that the equipment produces but can be hard to extract effectively. That's what the downstream processing system is meant to help with.
The downstream system officially came online as of July 2023. This is a fresh revenue stream set to commence in Q3 2023. The company says this system should average $38,000 in revenue per day with margins above 80% but is on track to generate over $1 million per month by the end of the year.
That new revenue stream has helped Greenwave generate over $18 million in revenue in the first half of the year, contributing to positive cashflows of $1.23 million. With its current positive cashflows, it expects to generate positive earnings before interest, taxes, depreciation, and amortization (EBITDA) for the 2023 fiscal year.
Progress toward that goal could happen even faster when the second automotive shredder Greenwave is installing at this Carrollton facility goes online in the coming months. The new shredder will double the metal recycler's ferrous metal processing capacity. Shredding ferrous metal rather than selling it in its unshredded form allows the company to command a higher price for the metal, generating an estimated 33% in additional revenue compared to unshredded ferrous metal.
In April, Greenwave opened a new location in Cleveland that's already generating about $100,000 per month in revenue even though it hasn't yet reached full volume potential yet. A shear baler installed in the facility is expected to begin operations this month, adding to the location's full volume potential and putting the new Cleveland facility on track to generate $250,000 or more per month in revenue by next year.
SOURCE: Greenwave Technology Solutions, Inc.
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