10-K: Perma-Fix Sees Treatment Rebound, PFAS Tech Advances in 2025

Perma-Fix Environmental Services reports modest 2025 revenue growth driven by its Treatment Segment and advances in PFAS destruction technology, despite a net loss and Services Segment decline.

Summary

• Consolidated revenue increased by $2,557,000, or 4.3%, to $61,674,000 in 2025 compared to 2024.
• Treatment Segment revenue increased by $10,144,000, or 29.0%, to $45,097,000 in 2025, driven by higher waste volumes and a higher-priced waste mix, including international and commercial clients.
• Services Segment revenue decreased by $7,587,000, or 31.4%, to $16,577,000 in 2025, primarily due to delays in project mobilization and procurements caused by changes initiated by the current presidential administration and a partial federal government shutdown.
• Gross profit increased significantly by $5,971,000 to $5,973,000 in 2025, compared to $2,000 in 2024.
• The net loss from continuing operations improved by 45.5% to $(10,665,000) in 2025 from $(19,569,000) in 2024.
• Treatment Segment backlog as of December 31, 2025, was approximately $11,861,000, an increase of 50.9% from $7,859,000 in 2024.
• The Perma-Fix Northwest Richland, Inc. (PFNWR) treatment facility received a permit renewal, tripling its permitted liquid mixed waste processing capacity to approximately 1,200,000 gallons per year and authorizing up to 175,000 tons of waste annually through macroencapsulation.
• The patent-pending Perma-FAS system for PFAS destruction achieved commercial operational status at the PFF facility, with a second-generation unit anticipated in the second half of 2026 to triple production capacity.
• Total environmental remediation liabilities increased by $2,718,000 to $3,485,000 as of December 31, 2025, primarily due to a reassessment of cost estimates at the PFSG subsidiary.
• A material weakness in internal control over financial reporting was identified for the Treatment Segment regarding completeness checks for waste disposal revenue.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as a moderately positive report, reflecting a strong rebound in the core Treatment Segment and promising advancements in PFAS technology, partially offset by continued overall losses and challenges in the Services Segment.

Positives

• Consolidated revenue increased by 4.3% year-over-year to $61,674,000 in 2025.
• The Treatment Segment experienced a significant rebound, with revenue increasing by 29.0% to $45,097,000.
• Gross profit saw a substantial increase of $5,971,000, reaching $5,973,000 in 2025.
• The net loss from continuing operations improved by 45.5% from 2024 to 2025.
• Treatment Segment backlog grew by 50.9% to $11,861,000 as of December 31, 2025, indicating future revenue potential.
• The PFNWR facility's permit renewal triples its liquid mixed waste processing capacity and significantly increases solid waste processing authorization.
• The Perma-FAS system for PFAS destruction achieved commercial operational status, with plans for a second-generation unit to triple production capacity in H2 2026.
• Revenue from foreign customers increased by 162.6% to $6,440,000 in 2025.
• A joint distribution agreement was entered into in December 2025 to promote PFAS destruction technology.

Negatives

• The company reported an overall net loss of $(13,784,000) in 2025.
• Services Segment revenue decreased by 31.4% due to project mobilization and procurement delays, as well as a partial federal government shutdown.
• Selling, General, and Administrative (SG&A) expenses increased by $1,925,000, or 13.3%, in 2025.
• Research and Development (R&D) expenses increased by $119,000, impacting profitability in the early commercialization stage of PFAS technology.
• Environmental remediation liabilities increased significantly by $2,718,000 to $3,485,000.
• Anticipates incurring operating losses in the first quarter of 2026 due to fixed operating costs and investments.
• A material weakness in internal control over financial reporting was identified in the Treatment Segment regarding revenue completeness checks.

Risks

• The failure of Congress to approve appropriations bills in a timely manner for federal government agencies, or the failure of the Administration and Congress to reach an agreement on fiscal issues, could delay and reduce spending, cause revenue and profit loss, and affect cash flow.
• Changes in government regulation, policy, and programs, including scaled-down government workforce, tariffs, and decreased priorities in government funding for remediation projects, could negatively impact business, profitability, and future growth.
• Failure to maintain required financial assurance coverage for permitted treatment, storage, and disposal facilities could have a material adverse effect.
• Inability to obtain adequate or required insurance coverage in the future, or if insurance is not available at affordable rates, would violate permit conditions and prevent certain operations.
• The inability to maintain existing federal government contracts or win new government contracts over an extended period could materially adversely affect operations and future revenues.
• Existing or future customers may reduce, delay, or halt their spending on hazardous waste and nuclear services due to factors like accidents, terrorism, natural disasters, government budget failures, civic opposition, or economic downturns.
• Demand for services is subject to significant fluctuations due to economic conditions, reductions in federal site remediation budgets, domestic political environment, and competing demands for federal funds.
• The loss of one or a few significant governmental or governmental-related customers could have an adverse effect on the business and results of operations.
• As a holding company, the ability to meet obligations depends on the operating performance and cash flows of subsidiaries.
• The Treatment Segment has limited end disposal sites for nuclear waste, which could lead to significantly increased costs if sites cease acceptance or close.
• Direct and indirect macroeconomic impacts resulting from natural disasters, public health events, and/or world conflicts could negatively impact business and results of operations.
• Competitive pressures in the industry may inhibit the ability to reflect increased costs in service prices, reducing profitability.
• Operations are subject to seasonal factors, historically causing reduced revenues and losses during the first and fourth quarters.
• Engagement in highly competitive businesses, often requiring bidding against national, regional, and international firms, some with greater financial resources.
• Bearing the risk of cost overruns in fixed-price contracts if costs increase above estimates or circumstances change.
• Adequate bonding is necessary to win certain types of new work and support facility closure requirements, and inability to obtain it could have a material adverse effect.
• Inability to maintain existing permits or obtain required permits could prevent the continuation or expansion of operations.
• Failure to comply with extensive government regulation as a government contractor could subject the company to penalties and restrict its ability to conduct business.
• Changes in environmental regulations and enforcement policies could subject the company to additional liability and adversely affect its ability to continue certain operations.
• The business of waste management exposes the company to substantial potential environmental liability, including claims for cleanup costs, personal injury, or property damage.
• As operations expand, the company may be subject to increased litigation, which could negatively impact future financial results.
• If environmental regulation or enforcement is relaxed, the demand for services could decrease.
• Operating in a politically sensitive environment where public perception of nuclear power and radioactive materials can affect customers and the business.
• The elimination or any modification of the Price-Anderson Act's indemnification authority could have adverse consequences for the business.
• If permits, other intangible assets, and tangible assets become impaired, the company may be required to record significant charges to earnings.
• Breach of any covenants in the credit facility could result in a default, triggering repayment of outstanding debt and termination of the credit facility.
• A lack of positive operating results could limit borrowing capacity under the credit facility.
• The ability to continue operations depends on generating profitable operations or completing equity or debt financings.
• Inability to utilize net operating loss carryforwards in the future.
• Sustained losses could have a material adverse effect on operations, credit facility, liquidity, and potential growth.
• Issuance of substantial amounts of common stock could depress the stock price or dilute percentage ownership.
• No intention to pay dividends on common stock in the foreseeable future.
• The price of common stock may fluctuate significantly, making it difficult for stockholders to resell.
• Loss of certain key personnel could have a material adverse effect.
• Failure to maintain the safety record could have an adverse effect on the business.
• Systems failures, interruptions, or breaches of security and other cybersecurity risks could have an adverse effect on financial condition and results of operations.
• Climate change could negatively impact operations and financial condition.
• Failure to obtain intellectual property protection for proprietary technologies could negatively affect the company.
• Failure to maintain effective internal control over financial reporting or failure to remediate a material weakness could have a material adverse effect on business, operating results, and stock price.
• Delaware law, certain charter provisions, stock option plans, outstanding warrants, and Preferred Stock may inhibit a change of control.

Future Outlook

Expects potential improvements in financial results in 2026, driven by anticipated waste treatment volumes, including the commencement and ramp-up of activities associated with the Direct-Feed Low-Activity Waste (DFLAW) program at Hanford, Washington, and the conversion of existing Treatment Segment backlog into revenue. Anticipates incurring operating losses in the first quarter of 2026 due to fixed operating costs and ongoing investments in new technology initiatives and the DFLAW program. The company continues to focus on expansion into international markets, aggressive research and development (R&D), sales and marketing efforts, and capital expenditures related to its patent-pending PFAS destruction technology. Plans capital expenditures of approximately $3,000,000 to $5,000,000 in 2026, including for the completion of its second-generation PFAS unit.

Management Comments

• "We believe we are positioned for potential improvements in our financial results in 2026."
• "These expectations are based on managements current assumptions regarding the timing and execution of anticipated waste treatment volumes, including the commencement and ramp-up of activities associated with the Direct-Feed Low-Activity Waste (DFLAW) program at Hanford, Washington, as well as our ability to convert existing Treatment Segment backlog into processed revenue."
• "We believe that our Perma-Fix Northwest Richland, Inc. (PFNWR) treatment facility... is positioned to support the DFLAW program at Hanford."
• "Our results of operations are expected to continue to reflect operating losses in the near term as we incur fixed operating costs and make investments in anticipation of waste treatment volumes and program activities."
• "We continue to focus on expansion into international markets as well as on continued R&D, sales and marketing efforts and capital expenditures relating to our patent-pending technology for the destruction of Perand polyfluoroalkyl substances (PFAS)."
• "We believe these regulatory developments may support increased demand over time for technologies capable of permanently destroying PFAS compounds."
• "We believe that commercial destruction of PFAS offers a promising new source of revenue for us, as it complements our core waste remediation technologies."
• "We believe that our System technology exceeds the performance of other currently available destruction-based methods."
• "With commercial operation of our System, we anticipate deployment of our second-generation unit in the second half of 2026... which we believe will allow us to triple our production capacity."
• "We are continually monitoring our operating costs to ensure alignment with our revenue levels."
• "We believe that our existing cash, cash equivalents, borrowing availability under our Revolving Credit... and expected cash flows from operations will be sufficient to fund our operations for at least the next twelve months."

Industry Context

StockSavvy.ai notes that Perma-Fix operates in a highly regulated and specialized nuclear and hazardous waste management industry, heavily reliant on government contracts, particularly with the U.S. Department of Energy (DOE) and U.S. Department of War (DOW). The company's strategic focus on expanding into international markets and developing new technologies like PFAS destruction aligns with broader environmental trends and increasing regulatory scrutiny on 'forever chemicals.' The competitive landscape, which includes larger players like EnergySolutions and Waste Control Specialists, highlights the importance of Perma-Fix's unique licensing and R&D capabilities to maintain and grow its market share. The inherent reliance on government appropriations introduces significant political and budgetary risks common to the sector, impacting project timing and revenue stability.

Comparison to Industry Standards

• The company's Treatment Segment facilities hold unique combinations of Resource Conservation and Recovery Act (RCRA) Part B hazardous waste permits, Toxic Substances Control Act (TSCA) authorizations, and radioactive material licenses, which are difficult to obtain and act as significant barriers to entry for potential competitors.
• The Perma-FAS destruction technology for PFAS is believed to exceed the performance of other currently available destruction-based methods, positioning the company favorably in an emerging market with limited permanent treatment options for these 'forever chemicals.'
• Major competitors like EnergySolutions operate numerous treatment and disposal facilities, including two treatment/disposal facilities for low-level radioactive waste, and Waste Control Specialists is also a significant competitor in the treatment/disposal market, indicating a competitive environment where Perma-Fix differentiates through specialized permits and innovative technologies.

Management Changes

Corporate Governance

Legal Proceedings

• Michael ONeill v. Perma-Fix Environmental Services, Inc., et al., C.A. No. 2024-1211-PAF: A putative class action filed on November 25, 2024, by a shareholder alleging breach of contract and fiduciary duty regarding the approval of the 2023 Share Increase Proposal for the 2017 Stock Plan. The complaint asserted that broker non-votes should have been counted against the proposal. The Board subsequently rescinded the proposal and amended bylaws to clarify voting rules. The company's insurance carrier is providing defense, subject to a $1,000,000 self-insured retention.

Related Party Transactions

• David Centofanti, Vice President of Information Systems and son of Dr. Louis F. Centofanti (EVP of Strategic Initiatives and Board member), received annual compensation of $200,000 in 2025 and $195,000 in 2024.

Stakeholder Impact

• Shareholders: Potential for improved financial performance in 2026, but continued net losses and dilution risk from future stock issuances. The legal proceeding regarding stock plan approval and subsequent bylaw amendment directly impacts shareholder voting rights and confidence.
• Employees: New COO appointment, 2026 Management Incentive Plans, and the intention to offer new employment agreements for executives could impact morale and compensation structures. The Collective Bargaining Agreement for PFNWR employees provides stability.
• Customers (Government): Delays in Services Segment projects due to administration changes and government shutdowns highlight operational risks. The DFLAW program and permit renewals are crucial for continued service to government clients.
• Customers (Commercial & International): Increased revenue from these segments and expansion initiatives indicate growing opportunities. PFAS technology offers new solutions for a critical environmental challenge.
• Creditors: The company met all financial covenant requirements in 2025, and liquidity is deemed sufficient for the next 12 months, which is positive for creditors.
• Regulatory Authorities: Permit renewals, compliance with environmental laws, and the material weakness in internal controls are key areas of interaction and scrutiny.

Next Steps

• Commencement and ramp-up of activities associated with the Direct-Feed Low-Activity Waste (DFLAW) program at Hanford, Washington, anticipated to begin in 2026.
• Generation of several effluent waste streams from the DFLAW program expected to be treated by the PFNWR facility in the first half of 2026.
• Deployment of the second-generation Perma-FAS unit in the second half of 2026 at the EWOC facility to triple production capacity.
• Further advancement of Perma-FAS technology from demonstrated bench-scale testing to pilot-scale applications for soil, biosolids, and filter media in the next several calendar quarters.
• Positioning for further large and mid-size procurements within the DOE and U.S. Department of War (DOW).
• Continuing investments in facilities to allow for broader waste treatment, including PFAS.
• Continuing expansion of waste treatment offerings within the commercial market.
• Offering new employment agreements to executive officers, effective April 21, 2026.
• Seeking stockholder approval for the new amendment to the 2017 Stock Option Plan to increase authorized shares by 600,000 within 12 months of the Board's approval (November 13, 2025).
• Anticipating capital expenditures of approximately $3,000,000 to $5,000,000 in 2026 to maintain operations, meet regulatory compliance, and support revenue growth.

Key Dates

Recommendation

The company shows promising growth in its core Treatment Segment and significant advancements in its PFAS technology, which could be a substantial future revenue driver. However, persistent net losses, a decline in the Services Segment, and an increase in environmental liabilities present ongoing challenges. The identified material weakness in internal controls and reliance on government funding introduce notable risks. While the long-term potential from PFAS and DFLAW is attractive, the near-term operational losses and execution risks warrant a cautious 'hold' stance until sustained profitability and successful remediation of internal control issues are demonstrated.

Keywords

nuclear waste management, radioactive waste treatment, PFAS destruction, environmental services, government contracts, SEC filing, 10-K, Perma-Fix, waste remediation, corporate governance, financial performance, risk factors, Hanford DFLAW, permit renewal, stock options, environmental liabilities