#Norway #Desert Control #water conservation #Sandnes #LNC

Desert Control's Q3 2025 Report: A Comprehensive Overview

In its recent financial report, Desert Control AS (DSRT) has outlined a series of significant developments spanning the third quarter of 2025, concluding on September 30. As they navigate the complexities of the agricultural technology landscape, the company is making strides both operationally and financially.

Operational Highlights

Desert Control's journey in sustainability took a notable turn as they observed marked improvements from their first client, Woodland Hills Country Club. Implementing their innovative Pay-As-You-Save (PAYS) initiative, they reported remarkable savings in irrigation and uplifted turf quality. The estimated savings from this collaboration may surpass USD 100,000, demonstrating the efficacy and promise of their Liquid Natural Clay (LNC) technology.

In a significant move to expand their market footprint, Desert Control initiated its first almond pilot projects in California. This initiative aims to assess the benefits of LNC on water conservancy and yield performance in this key crop sector. The outcomes of these trials are pivotal, as they pave the way for scaling LNC technology across other high-value crops like pistachios, walnuts, vineyards, and citrus fruits.

Further, the company's partnerships in Saudi Arabia and the UAE are advancing research and commercialization efforts. Notably, data from Saudi Desert Control showcase over double the water retention and triple nutrient gains in field tests, affirming the effectiveness of their innovations. In a concurrent achievement, Soyl secured a major commercial contract involving 4 million liters for landscape deployment in Abu Dhabi, underscoring the viable applications of LNC in eco-sustainable landscaping.

Financial Highlights

Financially, Desert Control has bolstered its stability through the successful completion of a fully subscribed rights issue, raising NOK 75 million. This capital infusion plays a crucial role in enhancing the company's equity position, thus extending their liquidity runway into the latter half of 2026.

However, the revenue trajectory during the third quarter was modest compared to last year, attributable to the specific structure of the PAYS contracts. Revenue recognition is contingent upon verified water savings, meaning substantial work has been completed, but income recognition will occur only as clients confirm savings.

The company anticipates that earnings will begin to materialize in the fourth quarter, as customer validation milestones are achieved and invoicing under the PAYS structure commences.

EBITDA and Net Results

Desert Control experienced a rise in operating expenses tied to heightened field operations in the U.S. These costs have impacted their EBITDA, reflecting ongoing investments in the scalability of production to support upcoming commercial activities. As of Q3 2025, the net loss has grown relative to the previous periods, driven by U.S. expansion and foreign exchange losses associated with currency fluctuations in NOK against USD. Although these non-cash translation effects can seem daunting, they do not hamper the company's operational core or liquidity.

Equity and Cash Position Highlights

The conclusion of the rights issue has brought about a slight improvement in total equity compared to last year, providing essential funds for operational expansion aimed at achieving further commercial successes into 2026. Despite a reduction in cash and cash equivalents during Q3, each investment has been strategically directed towards product development, commercialization efforts, and organizational growth. Additionally, the company received NOK 2.3 million in SkatteFUNN grants for R&D projects, compared to NOK 1.5 million from the same period last year, indicating a progressive growth trajectory in research activities.

In summary, Desert Control AS remains committed to enhancing sustainability in agriculture through its advanced technologies. As they report on Q3 2025, the firm not only showcases its financial health but also sets the stage for future growth opportunities, reinforcing its position in the environmental sector while promoting the conservation of precious water resources.
For a more detailed view of the full report, stakeholders and interested parties can access it through the official company website.