Progressive Planet's Profit Soars Despite Strategic Revenue Dip

By Gary Clark

KAMLOOPS, BC – December 18, 2025 – Progressive Planet (TSXV: PLAN) has reported a seemingly contradictory second quarter, with a notable 9.2% dip in revenue offset by a significant 60% surge in net income. The results, which cover the period ending October 31, 2025, paint a picture of a company executing a deliberate, short-term sacrifice for long-term operational efficiency and market expansion.

While quarterly revenue decreased to $4.96 million from $5.47 million in the prior year, net income climbed to $971,895, and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) reached $1.45 million. The key to understanding this divergence lies not in weakening demand, but in a planned operational pause that has created a record-breaking order backlog and positioned the company for a powerful third quarter.

A Calculated Pause for Future Gains

The temporary revenue decline was a direct and anticipated consequence of a strategic shutdown of three of the company’s four production lines. This pause was undertaken for two primary reasons: to install a new, state-of-the-art robotic palletizer and to prepare the lines for the production of new product SKUs set to launch in November.

This decision effectively shifted sales that would have been booked in October, the final month of Q2, into November, the start of Q3. The market's strong demand didn't wane during the shutdown; instead, it accumulated. This is evidenced by a staggering 238% increase in the company's order backlog, which swelled to nearly $1.4 million. Further underscoring the robust demand, Progressive Planet received over $2.7 million in purchase orders in October alone—the highest monthly total since its acquisition of Absorbent Products in 2022.

“Our second quarter was a time of transition as we went through a planned shutdown to install a new robotic palletizer,” stated CEO Steve Harpur in the company's release. He credited the company's internal team for a seamless and on-budget installation.

Progressive Planet typically converts its backlog into sales within a six-week window, suggesting the massive Q2 backlog will translate directly into Q3 revenue. This is supported by the company's strong performance in the preceding quarter (Q1 2025), where it posted record revenue of $5.9 million, a 27% year-over-year increase. With no further shutdowns anticipated in Q3, the company is poised for a period of uninterrupted production to meet this pent-up demand.

“We have reduced our backlog to more normal levels in Q3 including getting the new Pure DE products out for shelf placement in over 2,400 US retail locations since the end of Q2,” Harpur added, confirming the successful conversion of orders post-shutdown.

Streamlining Assets for a Greener Future

Beyond the factory floor upgrades, Progressive Planet also made a significant strategic move concerning its raw material assets. The company announced it will not renew its lease on the Z1 Zeolite Quarry, a decision that will trigger a non-cash write-down of the asset's entire carrying value of $1,209,200 in the third quarter.

While a million-dollar write-down may initially appear concerning, the rationale reveals a calculated optimization of the company's resource portfolio. Management cited that the renewal costs were expected to exceed $100,000 and, more importantly, that assets acquired in recent years are far superior for its core business lines.

The acquisitions of Absorbent Products Ltd. in 2022 and the Ferguson Creek Pozzolan Property in June 2025 have provided Progressive Planet with higher-quality sources for producing Supplementary Cementing Materials (SCMs) and agricultural soil amendments. These products are central to the company's mission of creating 'Products for a Healthy Planet'. The Ferguson Creek property, in particular, has a history of commercial testing by a major cement company and is strategically located to supply the industry with natural pozzolan for decades.

This shift aligns perfectly with major market trends. The demand for SCMs is growing as the construction industry seeks to decarbonize cement production. Simultaneously, the market for agricultural soil amendments is booming, with the global organic segment projected to reach $8.5 billion by 2025, fueled by the growth of precision and organic farming. By shedding a less optimal asset and focusing on its superior properties, Progressive Planet is better positioning itself to capitalize on these expanding green markets.

From Factory Floor to 2,400 Store Shelves

The operational upgrades and asset realignment are directly enabling an aggressive market expansion. The newly installed robotic palletizer is a critical piece of this puzzle, designed to concurrently serve the company's two largest production lines and increase palletizing rates by an estimated 70%. This enhancement in automation boosts throughput, reduces reliance on manual labor, and improves overall packaging efficiency—essential capabilities for a company scaling its operations.

This increased capacity is immediately being put to the test. The record purchase orders in October were partially driven by the introduction of two new SKUs under the Pure DE Brand for the U.S. market. Deliveries to one of the company's largest American customers began in November, rolling the new products out to more than 2,400 retail locations.

This successful launch demonstrates an effective end-to-end strategy: upgrading production capabilities to handle increased volume and then securing the large-scale retail orders to absorb that new capacity. It's a playbook for growth that connects factory floor efficiency directly to retail shelf presence.

The company also noted that a slowdown in agricultural sales during Q2, which followed record sales in Q1, has already reversed. Agricultural sales have “strengthened significantly again in Q3 to date,” providing another tailwind for the current quarter. While Q3's bottom line will be impacted by the one-time Z1 quarry write-down, the operational momentum from a cleared backlog, new product sales, and rebounding agricultural demand suggests the company's strategic gambles in Q2 are already beginning to pay off.