On April 27, 2016 we stated we were interviewing Cematrix Corp (CVX.V) ($0.45), a manufacturer and supplier of technologically advanced cellular concrete products. Overall, we think CVX.V is presented with some great long-term trends to fuel growth. The commitment by Canadian and U.S governments for infrastructure rebuild is very strong. The Company has projected sales of $18 million for 2016 but then $25 to $30 million for 2017 (fiscal 2015 was $15.3 million).

CVX.V ($0.45) is a manufacturer and supplier of technologically advanced cellular concrete products.

CEMATRIX provides cellular concrete product for many applications in

  • Oilsands,
  • Oil and Gas facilities, and
  • Infrastructure projects throughout North America by utilizing CEMATRIX’s production units.

Cellular concrete is a cement slurry based product that is combined with air to result in a very lightweight, foamed concrete-like material that has thermal insulating qualities with moderate structural strength. It is generally lighter than water and is used as a replacement for rigid and other types of insulation and as a lightweight fill or a void fill, which includes tunnel grouting.

The Company has a dry and wet mix production offering.

  • Dry mix production equipment is fully automated and the cement slurry mixing process is done directly from cement and other dry powders, onsite. This equipment permits the production of high hourly volumes. The dry mix system enables the Company to improve the quality of its end product, while reducing its unit cost by up to 20% as compared to the wet mix process. However, the dry mix process is typically not suitable for small to medium sized projects because of the higher costs associated with mobilization together with the onsite space required for set up;
  • Wet mix production equipment is partially automated and the pre-designed cement slurry required is delivered by a ready mix provider; this equipment has lower hourly production capability and is suitable for small volume projects or projects where there is no space for the larger dry mix units.

We recently had a call with management. Here is a summary of our call and our reasons for tracking.