Good morning, everyone, and welcome to Permafix Environmental Services' fourth quarter and year-end 2025 conference call. On the call with us this morning, Mark Duff, President and CEO, Dr. Lou Centifanti, Executive Vice President of Strategic Initiatives, and Ben Nacarado, Chief Financial Officer. The company issued a press release this morning containing fourth quarter and 2025 financial results, which is also posted on the company's website. If you have any questions after the call or would like any additional information about the company, please contact Crescendo Communications at 212-671-1020. I'd also like to remind everyone that certain statements contained within this conference call may be deemed forward-looking statements within the meaning of the Private Securities Litigation and Reform Act of 1995 and include certain non-GAAP financial measures. All statements on this conference call, other than statements of historical fact or forward-looking statements that are subject to known and unknown risks, uncertainties, and other factors which could cause actual results and performance of the company to differ materially from such statements. These risks and uncertainties are detailed in the company's filings with the U.S. Securities and Exchange Commission as well as this morning's press release. The company makes no commitment to disclose any revisions to forward-looking statements or any facts, events, or circumstances after the date hereof that they are upon forward-looking statements. In addition, today's discussion will include references to non-GAAP measures. Frontofix believes that such information provides an additional measurement and consistent historical comparison of its performance. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures is available in today's news release on our website. I'd now like to turn the call over to Mark Duff. Please go ahead, Mark.

All right, thanks, David, and good morning, everyone, and thank you for joining us today. 2025 was an important year for Permafix as we focused on strengthening our operational foundation and positioning the company for the next phase of growth tied to the Department of Energy's Hanford cleanup mission. For the full year, revenue totaled approximately $61.7 million, reflecting stronger performance in our treatment segment and improving waste volumes across several of our treatment facilities. While the timing of certain government programs affected activity levels during the year, we made significant progress preparing our facilities, workforce, and infrastructure to support the increased waste volumes expected as the Direct Feed Low Activity Waste, or DF Law, program transitions into its operational phase. Throughout the year, we also made targeted investments in personnel, infrastructure, and plant capabilities to ensure we are fully prepared to support the next phase of activity at Hanford and across other DOE cleanup programs. As many of you know, the DF Law Program and the Hanford Tank Waste Program represents one of the most significant environmental remediation efforts currently underway in the United States. And we believe Permafix is uniquely positioned to support this mission, given our specialized treatment capabilities and our long history of supporting DOE waste management programs. One of the most significant milestones in the year was the renewal of the permit for our Permafix Northwest facility. This permit significantly expands our permitted processing capacity to approximately 1.2 million gallons of liquid mixed waste annually, effectively tripling our liquid processing capacity and also authorizes treatment of up to 175,000 tons of waste through macroencapsulation annually. Combined with our investments in automation, facility upgrades, and workforce expansion, these improvements meaningfully strengthen the role Permafix Northwest can play in support of multiple Hanford-related waste streams and other DOE mission objectives as activity ramps in the coming quarters. In a recent press release, DOE announced the need to extend the DOE hot commissioning phase. However, waste is expected to be received through the DFO liquid waste treatment processes beginning in May at our Northwest facility, with dry waste expected to be received in The liquid waste streams are anticipated – the anticipated waste streams are expected to grow above original estimates by as much as 20 percent as described by DOE based on changes made in the process flow, which will include grouting a portion of the effluent waste instead of using defluant ventrification processes as originally designed. A regulatory supplemental analysis is under review that includes using PermaFix Northwest grounding capacity to treat the effluent to enhance production levels at the defluant The defluant facility is processed about 50,000 gallons of tank waste through February and the melters remain hot, which produces steam resulting in generation of waste to be included as effluent to Permahoox Northwest. For investors trying to better frame the timing of the DFL opportunity, DOE planning documents indicate the system is expected to ramp progressively through hot commissioning beginning, which began in October of 2025, and within 12 to 18 months of that start date, DOE plans to reach an operational phase at approximately 40% capacity before increasing towards 80% capacity as additional systems come online, and that's required to be done within three years based on the tri-party agreement at Hanford. We view this as an important indicator of the size and durability of the opportunity in front of us, while also recognizing the exact pace of that ramp remains completely dependent on DOE execution and site operating conditions. Initial estimates regarding revenue potentials remain at about $1 to $2 million per month beginning in Q2 and ramping up through the year. At a recent Waste Management Conference in March, DOE leadership specifically addressed the importance of implementing a grouting program to supplement DF law towards meeting the Department's goals for achieving tank closures by 2040. DOE stated that this program is working towards treating up to 200 million gallons of waste by 2040 from the Hanford tanks through the DF law program and supplemented by the grouting program to be initiated in 2026. The number has grown from the original 56 million gallons estimated based on DO expectations due to the fact that they will be generating one to three gallons of wastewater from each gallon retrieved due to the need to add liquids to the tank to retrieve the waste. Over the past several months, Permafix Northwest has continued to make significant investments in automation, information systems, and personnel training to ensure the facility can operate efficiently at high throughput levels and meet or exceed expected production rates as a broader range of waste streams begin to arrive. The Hanford remediation programs are expected to generate sustainable waste streams over time, which we believe can create consistent long-term treatment demand and recurring activity for our facilities. In addition to supporting the DFL program, we expect to participate in several other DeHanford-related waste streams and site programs that will generate additional treatment demand over time. These increases in receipts include providing solidification treatment support to high-volume contaminated water from the DeHanford site, as well as increasing our transuranic waste processing program by 100 percent beginning this month, supported by additional shifts at the Permafix Northwest facility. As waste receipts increase, we expect to utilize this expanded capacity to support a growing volume of treatment activity tied to both Hanford Mission and other DOE programs. Operationally, our treatment segment delivered meaningful improvement during the year. we saw higher waste volumes, improved plant throughput, and stronger waste mix, which together drove significant year-over-year growth in treatment revenue. As a result, treatment revenue increased approximately 29 percent year-over-year, reflecting both higher activity levels and stronger pricing dynamics associated with the waste streams we processed. Importantly, our treatment backlog increased by approximately 51 percent year-over-year to approximately $1.9 million in revenue, providing improved visibility as we enter 2026. This backlog growth reflects increasing demand for our specialized treatment capabilities across both government and commercial waste streams. Another area of progress during the year was international activity. Revenue from foreign entities increased approximately 163% year-over-year to approximately $6.4 million, reflecting growing global demand for our specialized waste treatment services. International markets continue to represent an attractive growth opportunity for us, as many countries face similar challenges related to complex nuclear and hazardous waste management, and we continue to see an expanding pipeline of potential treatment projects in Canada and other international markets. Turning to projectivity more broadly, we have seen a number of encouraging developments over the past several months that we believe support our growth outlook for 2026. These include opportunities tied to soil sorting work for a commercial uranium mining client, additional treatment work related to Canada and other international markets, weapons production related waste treatment programs, and remediation work supporting a major university laboratory environment. Some of these opportunities are already moving into execution while others remain in final award and start-up phases, and together they reinforce our confidence in improving activity as we move through the year. We also want to set expectations appropriately for the first quarter. While PERMAFIX does not typically provide formal guidance, it's important to recognize that factors are expected to make the first quarter softer than the stronger activity we tend to expect beginning for the second quarter. These factors include recent delays in the DFLOL effluent receipts, which shifted expected waste receipts out by several months, also normal seasonal weaknesses in field activity during January and February, and ongoing efforts at Permafix Northwest to process stored waste to prepare all of our resources for the increase in Hanford-related activity expected later in the coming months. While the Q1 numbers are not finalized, losses in Q1 will likely exceed $4 million in negative EBITDA on about $13 million in revenue. Despite those near-term impacts, we've seen stronger activity in March, and I believe the second quarter should represent an inflection point as additional waste receipts and project activity begin to ramp. The focus on stored waste, I mentioned, has resulted in a timing-related shift in revenues from Q1 to Q2 due to applicable revenue recognition rules resulting in a movement of approximately $2 million in revenue generated at Permavix Northwest to be recognized in Q2 while they were actually processed in Q1. We also continued advancing the development and commercialization of our PFAS destruction technology. During the quarter, our engineering team focused on completing construction and installation of our new Generation 2 2.0 PFAS destruction system at our Oak Ridge facility. The upgraded system is designed to increase our PFAS destruction capacity by up to three times our current rate while incorporating engineering improvements intended to reduce operating costs and improve reliability and production rates. PFAS contamination continues to receive increasing regulatory and environmental attention worldwide, and we believe technologies capable of permanently destroying these compounds will play an important role in the future remediation efforts. We also continue to see strong interest in our technology as an alternative to incineration, with our PFAS permafast system providing permanent destruction of PFAS compounds at a lower total cost while affording air emissions. We believe the ability to permanently destroy PFAS compounds and eliminate long-term environmental liability represents a compelling advantage for our customers evaluating alternatives to traditional disposal methods. Over the past several months, we've secured several field projects supporting PFAS remediation at regional airports and continue to see additional airport-related opportunities currently moving through procurement processes. More broadly, we're continuing to develop strategic relationships with companies involved in PFAS remediation and AFFF removal as we work to expand the deployment of our technology across both government and commercial markets. Taken together, we believe these developments position our PFAS platform to support increasing demand for cost-effective, permanent PFAS destruction solutions as remediation activities continue to expand. In our services segment, revenue declined during the year primarily due to the timing of project mobilizations and procurement cycles, including delays earlier in the year associated with the transition to the new administration and related policy adjustments. The partial federal government shutdown in October also impacted procurement for timing of government-related customers. In addition, we've seen the normal seasonal timing efforts of weather and delayed project mobilizations during the first quarter. Importantly, our services business remains project-based and therefore quarterly activity levels can vary depending on project timing and scopes. Nevertheless, we continue to see opportunities in this segment tied to nuclear services, decommissioning work, and government remediation programs, and we believe the progress we've made during the year positions as well as activity levels increase. In fact, I'm pleased to report we've won over $30 million in new services backlog and submitted over $40 million in new bids just during Q1. We look forward to providing further updates on our bid pipeline in the future. Finally, I want to highlight what we believe is one of the most significant long-term opportunities in front of the company. In December, the Hanford tank contractor issued an RFP tied to the Tri-Party Agreement to retrieve 22 tanks over approximately the next 12 years for commercial grouting and off-site disposition of the waste as part of a long-term remediation effort tied to the retrieval and stabilization of tank waste at the Hanford site. The RFP estimated that this contract will begin in January 28 for a volume of tank waste up to 50 million gallons to be grouted at commercial facilities. Permavix Northwest is exceptionally well positioned for this opportunity given its location within a mile of the Hanford site, its current permitting profile and its expanding processing capability currently available. While this opportunity is not expected to begin until later in the development cycle, we believe that underscores the scale of the long-term duration of Hanford-related work and is now taking shape and the strategic advantage Permavix can provide and is recognized by DOE. So when we step back and we look at the broader picture, we see the recent delays in DF Law effluent receipts from hot commission activities as relatively modest in relation to the size of the opportunities in front of us. Between the DF Law ramp, additional Hanford-related waste streams, the grouting program now in development for up to 200 million gallons of waste to be treated, expanding international work, a growing treatment backlog, and advancing PFAS and remediation opportunities. We believe the opportunity for Permafix to deliver meaningful growth and improve profitability beginning in the second quarter and continuing into the coming years has never been stronger. Thank you. And I'll now turn the call over to Ben for the financial discussion.

Thank you, Mark. beginning with revenue our total revenue from the continuing operations in the fourth quarter was 15.7 million compared to last year's fourth quarter of 14.7 an increase of a million dollars or 6.9 percent our treatment segment revenue increased by 2.6 million while services segment was down 1.6 in the treatment segment, the increase was the result of higher volume offset by lower average price, which was the result of a change in waste mix. Reduction to services segment revenue was due to lower startup of new projects to replace completed projects from prior year. For the year ended 2025, our revenue was $61.7 million compared to $59.1 million in 2024, an increase of $2.6 million or 4.3%. In the treatment segment, revenue was up 10.1 million while the service segment dropped by 7.6 million. As with the corridor, the treatment segment benefited from increased volume and it also had higher average pricing related to waste mix. The services segment continued to feel the effects of reduced project work related to timing of project startups and awards. Turning to our gross profit, for the fourth quarter, gross profit was $1.2 million compared to $594,000 in Q4 2024. Gross profit in the treatment segment increased by $983,000 as a result of increased revenue offset by higher labor and maintenance expense. Services segment gross profit was below prior year by $365,000 due to lower revenue and lower margin projects. However, that was offset partially by reduced fixed overhead costs. For the year ended 2025, gross profit was up by $6 million. Most of the improvement came from the treatment segment where higher revenue and improved margins were partially offset by the increase in fixed cost sets plans. Gross profit from the services segment was relatively flat as the impact of lower revenue was offset by drops in both variable expenses and drops in fixed overhead. Our total SG&A costs for the fourth quarter were $4.2 million compared to $3.9 million in the fourth quarter last year, while SG&A for the full year was $16.4 million in 2025 compared to $14.4 million in 2024. Our SG&A expenses in the quarter were up from higher marketing costs related to payroll and trade shows, while administrative expenses increased due to payroll and legal expenses. Our SG&A costs for the fiscal year 2025 were up by $1.9 million from higher payroll expenses in both marketing and admin, as well as higher trade show and legal expenses. Our net loss for the quarter was $5.7 million compared to last year's net loss of $3.5 million. Note that the current year results include an adjustment to one of the company's discontinued operations of $2.7 million related to a long-term remediation cleanup. For the year ended 2020, December of 2025, net loss was $13.8 million compared to a net loss of $20 in the prior year. Again, our net loss for 2025 included the $2.7 million recorded in a remediation reserve for our discontinued operations, as previously discussed. and note also that in 2024 our net loss included approximately $8.2 million of income tax expense related to the full valuation allowance established on our U.S. deferred tax asset. Our basic and diluted net loss per share for the quarter was $0.31 compared to a loss per share of $0.22 in the prior year. This includes the impact of $0.15 per share from the adjustment to the remediation reserve within our discontinued operations. Loss per share for the year ended December 31 was $0.75 per share compared to a loss per share of $1.33 per share in 2024. EBITDA from continuing operations, as we described in this morning's press release, was a loss of $2.7 million compared to a loss of $3 million last year. For the year ended 2025, EBITDA was a loss of $9.7 million compared to a loss of $13.8 million in 2024. Turning to balance sheet in comparison to 2024, cash on the balance sheet was $11.8 million compared to $29 million in the year ended 2024. Unbilled receivables were higher in 25 compared to 24 by 3.8 million, primarily due to the timing of waste shipments in the treatment segment. Our net property and equipment was up 3.5 million, primarily from capital spending, which included the construction of our PFAS reactors. Intangible and other assets were up 1.4 million from interest earned on the Finite Risk Sinking Fund, as well as increase to permits and joint venture investments. Our Wage Treatment Backlog for the year-end was $11.9 million compared to $7.9 million in the prior year. Long-term liabilities related to discontinued ops were up $2.7 million, again due to the increase in the remediation liability at one of our disc ops facilities. Total debt at quarter ends was $2 million, excluding debt issuance costs, which is mostly owed to PNC Bank. Finally I'll summarize our cash flow activity. Cash use by continuing operations was $10.3 million. Cash use by discontinued operations, $441,000. Cash used for investing of continuing operations was $4.9 million, primarily for cap spending and permits. Cash used for investing of discontinued ops was $54,000. And cash used for financing was $981,000, representing monthly payments to our term and capital loans of $631,000. payments related to finance lease and other debt of $327,000, the payment of offering costs from last year's equity raise of $195,000, and offset by net proceeds from option exercises of $172,000. With that, operator, I'll now turn the call over for questions.

Thank you very much. At this time, we'll be conducting our question and answer session. If you would like to ask a question, please press star 1 on your phone keypad now A confirmation tone will indicate that your line is in the queue You may press star 2 if you would like to remove your question from the queue For anyone using speaker equipment, it may be necessary to pick up your handset before you press the keys Please wait a moment whilst we poll for questions Our first question is coming from Howard Bruce of Wellington Shields Howard, your line is live Thank you.

I just have a couple of quick questions. You started talking about Q2 and the performance, can you give us a better sense of what you're referring to?

Sure. Good morning, Howard. Yeah, we have a lot of confidence in Q2, Howard, based on a couple of things. One is, as you know, it's really been about two and a half years since our services group has really established a strong backlog of projects, and for numerous different reasons. A lot of it was just a cyclical thing with the changing of contractors at the prime levels and other market conditions, but that's really changed significantly in the last several months, and we're excited about where the service group is going. First, we just received a new contract award for a demolition project for a radiological facility, at a national lab. We hope to be announcing that in details, some details on that in the next few days. We've also mobilized three new projects into the field in the last two weeks that will generate waste that we'll receive in process. So there's projects that have better margins than most. And we've also got a pretty significant backlog of, pipeline of opportunities we've submitted bids on squarely within our core competencies for radiological facility demolition and remediation, as well as decontamination. So those look really good for the summer, and it puts services back in a position of carrying more weight than it has, and that typically bolsters our treatment shop as well. But along with that, also the other component to why we believe Q2 will be better is related to Northwest. In just a little more detail in Northwest, there's a project up there that includes taking all the surface water waste that Hanford accumulates in settling ponds on site and evaporate that and make a brine out of it, and they sent us the brine. And that program will start up, as it planned to start April 1st, and we'll start receiving waste a few days after that. That's about a $1.5 million or so a month revenue stream that's very important to us, and that will go for an extended period of time. It's a very sustainable waste stream as a runoff from rainfall as well as from groundwater treatment activities and those types of things all comes to us, and we treat it and send it back. Secondly, DF Law, as I briefly mentioned, and it's somewhat complicated, but bottom line is that they're in hot commissioning now, and they're still running waste through the facility in smaller quantities, not at a sustainable level, but they do generate what they call blow-down water. and that's the water they use in the scrubber systems to address their effluent requirements, that waste was going to be pumped back into a DF law and make glass out of it. In a press release a couple weeks ago, about a month ago, D.V. said, you know, instead of us making glass out of that blow-down water, why don't we treat it, and then we can do more tank waste, 20% more. And so they worked with us, and they're going to be shipping us that waste here as soon as their supplemental analysis gets to the public comment period, which is mid-late April, and then we should start seeing that sometime in May. So that should also be an additional waste stream from DF Law along with some dry waste from processing. And lastly, the TRU waste program, as I mentioned, has doubled in size, so going from one shift It's a two-shift that's added about $750K to $1 million a month as well. All of this together, along with the $2 million I mentioned, is going to be bumped from Q1 to Q2 due to revenue recognition rules. April looks like a great month, and the Q2 altogether and Q3 look like a very sustainable return back to profitability based on what we're seeing right now. So we're excited about Q2, Howard.

Going back to grouting, it seems that the – this is my voice – the 200 East area where the waste treatment plant is, they've had a plan to grout and waste in the 200 West area. Can you comment about that?

Yeah. It's important to understand there's two different components to the Hanford site. The West area is where there's – the DFL does not have infrastructure included. It's a good distance from the actual DFL plant, so DOE has determined they're going to basically commercially grout all the tanks out there. And under the Trump administration, they're being very aggressive about it, and that's what the large RFP I mentioned in my script is all about. It's basically a $4 billion estimated value. There's a lot of flexibility in it. In other words, they may use other contract vehicles. They may make multiple awards, but the bottom line is they're set up to really begin high-volume grouting at about the three to four million gallon a year range, but it is expandable beyond that in the next two to four years. And we're in a great position for that, being the only facility local, and I'm sure they'll want backups to us or maybe supplementals to us. That remains to be awarded here sometime in the third quarter, but in parallel with that, the east side where DFLAW is, DOE has been somewhat vocal that instead of all the waste going to DFLAW that's currently being pumped into staging tanks to go to DFLAW, they can start grounding some of that waste. In other words, they have a million gallons of storage for DFLAW. While that's sitting there, they could be pumping it out for grouting, as well as pumping it to DF law. So there's an opportunity for supplemental grouting to occur, and we're in a real good position for that as well, and that's something they're looking at doing in the third quarter or fourth quarter if they get to the regulatory hurdles they're planning to. So both those components could start impacting us in the next 12 months and certainly in in the next couple of years, but presents a very significant backlog opportunity for Last question.

I want to address PFAS in terms of volume and capacity. Where are we headed?

Yeah, the new system has been delayed a couple of months due to supply chain issues, which we seem to be facing all the time. Everything is on site now. We're going through the installation process, we poured concrete, things are rolling, so So we're really on track for late April, early May to start testing. Once that new system comes online, we'll be basically in a position to do about 3,000 gallons a day. And a backlog has been pretty good at the Gen 1 system. We've made some improvements through the last quarter, two quarters really, where we are able to start recycling our chemistry, and that allows us to lower our rates. As I mentioned before, our target is really to undercut incineration. We can do PFAS treatment cheaper than incinerators can, and that's been kind of the shift in the industry to total destruction that's kind of our competition. So our sales focus is squarely right now on making sure we're getting as much incineration competitor waste as we possibly can, and it's going real well. And again, we continue to do a lot of partnering on that, and we believe once we get the capacity up to 3,000 gallons a day, a total capacity with the new system and the old system as well, that we'll be able to get even greater backlog because we can store more and commit to higher throughput. So that's really where we're going. We're still doing some R&D on the smaller components, smaller systems to be field deployed. Right now, we're really focusing on the new system and getting it operationally ready and rolling.

Mark, thank you. Thanks, Aaron.

Thank you very much. Just a reminder there, if anyone has any remaining questions, you can join the queue by pressing star 1 on your phone keypad. And our next question is coming from Aaron Spichella of Craig Hallam. Aaron, your line is live.

Yeah, good morning, Mark, Ben, and Lou. Thanks for taking the questions. You know, maybe first on DF Law, can you just kind of speak to, you know, the visibility into that waste stream, you know, starting? You mentioned some solids in April and liquids in May. And it sounds like, you know, still expecting that $3 million to $6 million a quarter as that ramps. Maybe just kind of walk through that timeline as well.

Sure, Aaron. You know, it's been difficult. Well, DOE has not been real public on the operations of the FLAW overall, other than its operating, and so it's difficult to understand how much waste is going in, what the issues are they're dealing with to get to an operational phase, in other words, getting through their punch list to make sure everything is working at capacity. So it's difficult to project it, but we do know that that blue down water, the EMF water I mentioned, it should be, as soon as this supplemental analysis is done to change the direction where it was originally intended on going, we should start to see that in at about 10,000 gallons a month and ramp to four times that as operations gets underway. So that's an important waste stream for us. That's a big portion of the overall DIAFLOW waste generation itself, not all of it, probably not even half of it, and there's a lot of other waste that are being generated that are basically being stored at the Bechtel facility that we expect to start receiving We don't have a lot of clarity on that at this point, Aaron, in regards to volumes and that type of thing, what the overall impact will be, but we know between the two that We should be, as I mentioned, in the $1 million to $2 million a month here, particularly by mid-quarter of Q2. And the clarity on that, I think, will increase as they get through some of these punch list items. You know, DOE is totally dedicated to getting this facility up and running as fast as safely possible. And so it's difficult to really nail down schedules on when the waste are really beginning to flow like we anticipate it will.

And then, you know, maybe on international volumes, you kind of highlighted growth there in 2025. Just how are you thinking about the opportunities there as we look to 2026 and beyond?

Yeah, we just wanted some work, Aaron, from Canada again to do some liquid treatment. and at our Florida facility, as well as the SSI facility here in Oak Ridge. That's going to be a pretty good backlog. That will begin here mid-April and run pretty much through the summer. It could go longer than that. We've also got several other projects for different clients throughout Canada that would be likely to begin in Q3. The Mexico waste we did last year, there will be another tranche of that out for bid here. It's already been out for bid. That won't likely get rolling probably until Q3 or Q4. And we continue to get strong waste from Germany. And that also is expected to be sustainable here through the latter part of the year. Then our GRC project is going very well in Italy. Unfortunately, even though it's ahead of schedule, actually, the remediation processes for pulling the drums out of the ground, that will start here in April. So all the permits are done, all the paperwork's done, and now it's actually field work. That's not our scope. That's another company, another contract. And our scope will be to characterize those drums as they come out. They come out, and that won't start until Q3. And we won't start seeing any of that waste probably until Q1 or Q27. So to answer your question, we probably won't see the same revenue levels as last year, but it will be close, but probably 25%, 30% less than we saw last year with it ramping up in Q4 and have a stronger 27% of international waste.

All right. Thanks for that. And then, you know, on the permit, expanding the capacity with everything going on at Hanford, just maybe talk about, you know, you've made investments, but just how you're preparing to handle all the volumes there.

Yeah, Aaron, we just submitted our proposal on that a few weeks ago, and we've been pretty vocal about what our capacity expectations are. Right now, as I mentioned, we can do 1.2 million gallons a year of liquids. And what we're proposing to DOE is that we will be submitting a permit mod to that permit here in the next few weeks. And that permit model will include ramping that up to an additional 3 million gallons on top of that. So in other words, a total of 4.2 million gallons total capacity for liquid treatment. That will cover all the waste streams we're talking about, plus, you know, 3 to 4 million in grouting for the tanks. And that permit model is expected to take six to nine months to get through the system. and we will be beginning to install or modify our facility to support that as well with investments here beginning in the second half of the year to get to that level. So the big deal about that permit renewal is a lot of things that are important to it. But the one that's probably most important is since it's approved, now we can do permit mods. While they were reviewing that permit application, renewal application, for the last 16 years, we couldn't do mods to it because they kept saying, if you want to do a mod, we're going to stall on here or put your renewal down and pick up your mods so you won't get your Now that we have a renewal, we can do mods and they'll be quicker and more efficient because they're not that complicated and allows us to be flexible on these things and to implement up some new technologies, expand our current capacities and those kinds of things. So we really feel like being at a capacity of 4.2 million gallons a year based on the fact that the new administration is looking at such a large volume of waste that we should be able to get pretty much full capacity in the future. I don't know when that will be. A lot of it depends on how fast they can get it out of the tanks, but our capacity is not going to be the critical path, and we'll be very aggressive on what we can produce or what we can treat based on our capability.

Thanks for that. And then just maybe one last one on the balance sheet. Can you kind of talk about cash flow expectations? Sounds like there's some receivables at year end, and then just how you're thinking about capex and investments. And in 26, you kind of talked about some maybe in the back half. Thanks for taking the questions.

Hey, Eric. Yeah, the balance sheet, you know, we still have a number of capital initiatives to support the increased productivity expected, but our working capital remains in good shape. We don't normally comment on, you know, any kind of cash raises at this time. So right now we're comfortable with our balance sheet at 1231, and, you know, We'll evaluate that as the opportunities and the capital needs come about.

All right. Thanks. I'll turn it over.

Thank you very much. Our next question is coming from Walter Schenker of MassPartners. Walter, your line is live.

Thank you. Just to get back to PFAS, so the original unit is, it's a question, Is operating commercially and treating waste streams currently while you build the second unit? That's the first question.

That's correct, Walter. It does around 650 gallons a day, and it's running about four days a week consistently. There is some downtime associated with it, so their average is around four days a week. And, again, we've learned from that system and the engineering issues with that and perfected it for the next system. so that the next system will be more efficient in operations. But, yes, it does about 650 gallons a day.

And as a range, not a specific number, for your ability to eliminate those PFAS chemicals, pricing is roughly where per gallon?

It really depends on volume. But, you know, if we get a big volume, we typically discount. It also depends on the characteristics of the PFAS concentrations and those types of But to give you a range, for bigger totes, we can do between $11 and $15 a gallon. For smaller quantities like a drum or buckets, a lot of that AFFF comes in smaller quantities. You know, it can be above $30 a gallon. So it just depends on the quantities we're getting. As we get to the larger volumes that we can handle with the new system, we'll be pushing for larger volumes to receive so we don't have to handle as much. But just to kind of give you a range, Walter, $10 to $15 a gallon is a pretty good range for higher volumes.

And on higher volumes with that price range, a range for some sort of operating profit margin?

It's typical. So, we try to design our system from the very beginning to stay in alignment with our other waste treatment margins, which incrementally, you know, our target is 60 to 70 percent incremental margins on average. So some may be more, some may be less, depending on a lot of different factors, but it's generally Walter, in line with our treatment margins across the company.

And my last question, the second unit to get you up to 3,000 gallons, the CapEx to build that was roughly what? Or is roughly what, since it's not up yet?

Yeah, it's in the, correct if I'm wrong, Ben, $5 million, $4 to $5 million range, yeah. Okay, thank you.

Thank you very much. While we appear to have reached the end of our question and answer session, I will now hand it back over to the management team for their closing comments.

Okay. Thank you, Jenny. And overall, we believe that Permafix is entering a period where the strategic investments we've made over the past several years are beginning to translate into meaningful growth opportunities. We've significantly expanded our treatment capacity at our Permafix Northwest facility, strengthened our operational infrastructure, increased our treatment backlog, and expanded our international project activity. At the same time, we continue to advance our additional opportunities across government and commercial markets, including projects related to nuclear remediation, weapons production and waste treatment, international waste streams, and emerging PFAS destruction solutions. Importantly, the transition of the DFLAW system into its operational phase, along with several additional Hanford-related waste streams and long-term remediation initiatives currently under development, representing meaningful catalysts for increased activity at our Northwest facility. While the timing of certain waste receipts and project mobilizations may create some variability in near-term quarterly results, we believe the second quarter should mark the beginning of a broader ramp in activity as additional waste streams begin moving through the Hanford cleanup system and new project work begins contributing to the revenue. As activity levels increase and we utilize more of this expanded treatment capacity, we believe higher throughput across our facilities should allow us to better absorb fixed operating costs and achieve meaningful margin improvement. When we consider the combined impact of the DFLRAMP, additional Hanford cleanup programs, the tank retrieval and grouting initiatives currently in development, expanding international opportunities, and the continued advancement of our PFAS technology, we believe the long-term opportunity for Permafix has never been stronger. With that operator, thank you.

Thank you very much. This does conclude today's conference call. You may just connect your phone lines at this time and have a wonderful day. We thank you for your participation.