BQE Water Reports Q2 2026 Results

VANCOUVER, BC – BQE Water Inc. (TSX-V: BQE), aa leader in the treatment and management of mine impacted waters, is pleased to release its interim consolidated financial results for the three and six months ended June 30, 2026.

“Despite a $2 million reduction in revenue in Q2 2026, our net income and Adjusted EBITDA were comparable to Q2 2025. In the second quarter, we remobilized our operations team back to the Minto Mine and initiated our new 3-year operational services at the Nunavik Nickel Project in Quebec. In total, we have added five long-term operations and three short-term operations when compared to the prior year,” said David Kratochvil, President & CEO of BQE Water. “Growing water treatment operations remains a central component in our company’s strategy. Our outlook for 2026 remains positive, as we anticipate the resumption of seasonal operations at the Kemess Mine and continuation of our long-term operations across ten sites in Canada, US, and China.”

 

 

COMMENTARY AND OUTLOOK

Overall, Q2 2026 was a very busy quarter. Our operations group continued to provide services at our existing sites and initiated operational services at five new sites in 2026, including the Nunavik Nickel Project in Quebec, Britannia Mine in BC, a lead smelter treatment plant in Eastern Canada, a selenium removal plant in South Dakota, and the SART plant in China. These new sites contributed an additional $1.9 million in revenue from operational services for Q2 2026 when compared to Q2 2025.

We also mobilized short-term operations at three new sites in Q2 2026, including Minto Mine, where we re-established our presence and aim to expand our partnership with the Selkirk First Nation while building a strong relationship with the new management overseeing this unique asset. Our projects group utilization also increased in comparison to Q1 2026, matching the utilization in Q2 2025, as multiple new advisory services and engineering design projects were initiated.

For the 3-month period in Q2 2026, our net income and Adjusted EBITDA were comparable to Q2 2025 even with a $2.0 million reduction in total revenue in Q2 2026. When comparing year-to-date to the prior year, it is important to note that the $4.7 million decrease in revenue was almost entirely due to the one-time pass-through sale of equipment to the Valley Tailings ERDC project completed in 2025. BQE Water is not a fabricator or vendor of equipment and this sale of equipment in 2025 was an outlier. Notably, the ERDC Valley Tailings project became one of our short-term operations sites in Q2 2026.

Training of new staff and our adaptation to the new organizational structure put in place in 2025 continued across the organization, and our aquatic toxicology laboratory became fully operational in Q2 2026. While the aquatic toxicology lab has started working on projects supporting our operations and/or performing investigative work, we anticipate that it will complete the requirements necessary for accreditation for performing regulatory compliance testing over the coming months.

Our balance sheet remains strong. While cash and cash equivalents decreased by $2.3 million over the 6 months when compared to December 31, 2025, it was mainly due to the increases in accounts receivable for our projects and operations at the end of Q2 2026, as our working capital remained at $21.0 million. In addition, we spent $871,000 in the first six months of 2026 to purchase capital assets split between mobile equipment for Britannia, office and lab improvements, and hardware updates.

Our outlook for the remainder of 2026 has not changed from our last update and we expect strong results due to the following:

• Operational Services. The increase in the number of operating sites compared to 2025 and the initiation of capital projects at the Britannia Mine water treatment facility will increase revenue from operations significantly compared to 2025.
• Short-term Operations. Our short-term operations revenue is expected to increase further in Q3 and Q4 compared to last year as we resume operations at Kemess under a seasonal amendment to an existing 5-year contract, continue our services at Minto Mine, assist water treatment at the Bell Mine, and continue treating water at Eagle Mine this season, which we expect will be comparable to 2025. While these contracts are short term in nature, this often reflects the client’s ability to commit, rather than any lack of desire to have BQE involved long term.
• Advisory and Design. We anticipate several larger engineering studies to be initiated in Q3 and Q4 and are actively preparing for commissioning of two plants that are currently under construction.

 

Despite the positive outlook, management recognizes that the step change in staffing requires system improvements and upgrades in areas like resource allocation, business development, human resourcing, and accounting. These systems are currently in the early stages of implementation and BQE Water’s financial performance in the next 12 months will be influenced by the success of their implementation. We continue to observe a high level of business activity in the mining industry which is expected to support growth in sales. That said, we are always mindful of current geopolitical and market uncertainties and are prepared to pivot as required to maintain disciplined profitable growth.

 

Operations	Location	Revenue Source
JCC-BQE Joint Venture	Jiangxi province, China	Sales of recovered metals
MWT-BQE Joint Venture	Shandong province, China	Water treatment fees
Raglan Mine for Glencore	Northern Québec, Canada	Water treatment fees
Nunavik Nickel Project for Canadian Royalties	Northern Québec, Canada	Water treatment fees
Britannia Mine water treatment plant	British Columbia, Canada	Water treatment fees
Water treatment plant for lead smelter	Quebec, Canada	Operations support fees
Zhongkuang Metallurgical Facilities for MWT	Shandong province, China	Operations support fees
Zhaojin Metallurgical Facilities for MWT	Shandong province, China	Operations support fees
Shandong Gold SART plant for MWT	Southwestern USA	Operations support fees
Power utility ash pond for WesTech	Eastern USA	Water treatment fees
Wharf Mine water treatment plant	South Dakota, USA	Operations support fees
Base metal project for a metal producer	Southwestern USA	Operations support fees

 

JCC-BQE Joint Venture Operations

Our 50/50 joint venture with partner Jiangxi Copper Company (“JCC”) operates three water treatment plants at Dexing Mine and at Yinshan Mine in Jiangxi province of China. The volume of water treated, and metals recovered by the plants fluctuate seasonally depending on precipitation levels in the region. The operating results for Q2 2026 are as follows:

In Q2 2026, all three plants met mechanical availability and process performance set by the Company. When compared to Q2 2025, the volume of water treated decreased by 5%, the mass of copper recovered increased by 8%, and the mass of zinc recovered decreased by 38%. Such changes in water volume and metal grade in feed water from period to period are largely the result of environmental conditions beyond the control of the joint venture.

MWT-BQE Joint Venture Operations

Our 20% share of MWT-BQE is with our 80% partner Beijing MWT Water Treatment Project Limited Company (“MWT”) and together we operate a water treatment plant at a smelter in Shandong province of China. MWT-BQE generates revenues from the treatment of wastewater from a smelter. Operating results for Q2 2026 are as follows:

 

 BQE Water Operations

The number of operating days contributing to water treatment or support fees for three and six months ended June 30, 2026, is as follows:

 

 

The volume of water treated by geographic location for the three and six months ended June 30, 2026, is as follows:

 

The Company, with our Inuit partner Nuvumiut Development, operates four water treatment plants at Raglan Mine for Glencore Canada Corporation (“Glencore”). The plants at Raglan Mine are usually shut down in the first quarter as water stored in the outdoor reservoirs is frozen. During Q2 2026, we mobilized our operations team to site to commence our 23rd operating season at the mine. Operational activities were initiated in early May and treated water discharge began in the following month.

In 2021, we began operations of the Zhongkuang SART (sulphidization-acidification-recycling-thickening) plant and the Zhaojin SART plant at metallurgical facilities in China. In 2025, we commissioned the third SART plant at Shandong Gold in the same region. All three SART plants have been under our technical supervision since the start of production. During Q2 2026, our team provided ongoing technical supervision across all three plants.

In 2022, we began operations of a treatment plant utilizing our Selen-IX™ process to remove selenium from ash pond water for WesTech Engineering (“WesTech”). In Q2 2026, our team continued at site, providing water treatment services with the Selen-IX™ circuit to manage the presence of selenium in the feed.

In 2022, we began operations of a treatment plant utilizing a combination of nanofiltration and our proprietary selenium electroreduction process for the simultaneous removal of selenium and sulphate from mine water for a base metal project in the American Southwest. In 2023, our team began operations for a second newly constructed selenium removal water treatment plant at the same site. In Q2 2026, our team continued to provide onsite operations support and technical supervision at both treatment plants.

In October 2025, we completed the commissioning of a Selen-IX™ treatment plant located at the Coeur Wharf Mine in South Dakota and began providing routine operation support. In Q2 2026, our team continued to provide onsite and offsite support to the selenium removal circuit to manage the presence of selenium in the feed.

In January 2026, we assumed operational responsibility for the provision of operations and maintenance services for the Britannia Mine water treatment plant for the BC government under a 20-year arrangement. This High-Density Sludge lime treatment plant neutralizes acidity and removes heavy metals, primarily copper and zinc, from the mine water collected in the legacy underground workings prior to its discharge into Howe Sound. In Q2 2026, our team continued to operate and treat water daily without interruption.

In February 2026, we initiated an annual operation support arrangement with an integrated lead smelter-recycling facility in Eastern Canada. Prior to such arrangement, we completed an upgrade to the existing treatment system, implemented a new sulphate removal stage to a discharge limit of less than 1,500 mg/L and provided short-term operations support for the newly upgraded facility. In Q2 2026, our team continued to provide ongoing site support and technical supervision.

In May 2026, we initiated our water treatment operations contract, through our joint venture Inuit-based partnership, to operate five treatment systems at the Nunavik Nickel Project owned by Canadian Royalties Inc. Treatment operations typically run from May to October depending on the volume of water requiring treatment. In Q2 2026, the operations team completed de-winterization and began water treatment.

 

SHORT-TERM OPERATIONS SERVICES HIGHLIGHTS

In addition to long-term operations, BQE Water provides operations and technical support services on a temporary basis at several sites. Short-term operations are non-recurring in nature with contracts typically lasting less than a year. The number of operating days contributing to water treatment or support fees for three and six months ended June 30, 2026, is as follows:

 

Short-term Operations Services

• Continued providing water treatment operations services for the temporary emergency treatment system at the Eagle Gold Mine in the Yukon.
• Initiated operations at ERDC Valley tailings facility in the Yukon, which was constructed and commissioned last year.
• Re-initiated providing operations services at Minto Mine in the Yukon.
• Initiated services at Bell Mine in BC.

 

TECHNICAL SERVICES HIGHLIGHTS

BQE Water’s technical expertise and IP are applicable globally across broad areas of water management. Highlights of some of our technical services and technical innovation projects during Q2 2026 are summarized below. 

Trusted Advisory Services (Water Management and Water Studies)

• Initiated providing water management and treatment design advisory services to an operating mine in Ontario.
• Initiated lab testing and advisory services to a new mining operation in Saskatchewan.
• Continued to provide water management and treatment design advisory services to the KSM project in BC.
• Continued providing water management and treatment design advisory services to a new mine undergoing permitting in the Yukon.
• Continued to provide water treatment advisory services to a new project in permitting stage in Argentina.
• Continued with detailed engineering for a water treatment system using ion exchange to expand rhenium production at an existing facility in Eastern Canada.
• Continued supporting the procurement and installation of a temporary contingency treatment system at the Gibraltar Mine in BC.
• Continued to provide engineering design services for a water treatment system integrated into a rare earth extraction project in Brazil.
• Performed a study to recommend the best treatment option for a legacy mine site in the Yukon.
• Performed a study to identify options for implementing selenium removal at an operating site in Quebec.
• Completed commissioning of an ion exchange system for lithium brine purification and initiated assistance with installation for a customer in Western Canada.
• Completed a review and optimization study for an existing desalination plant supplying fresh water to a copper mine in Chile.
• Completed engineering advisory services to the Kemess project in BC to transition to short-term operations.

 

Cyanide Management (Destruction and Recycle)

• Initiated engineering advisory services for cyanide destruction for a project in Australia.
• Initiated engineering advisory services for estimating cyanide emissions, designing emissions control system for cyanide, and revising engineering design of cyanide destruction for a project in US.
• Continued to provide plant engineering design services requiring the end-of-pipe cyanide level below 8 ppb to a project in the US.
• Continued detailed engineering for SART integration into the New Britannia mill in Manitoba, Canada.

 

Aquatic Toxicology Services

• Initiated assessment of chronic effects on aquatic environment caused by mine effluent at a mine in Western Canada.
• Initiated investigation into the effects of ammonia on acute toxicity under site-specific conditions at a mine in Eastern Canada.
• Initiated routine effluent toxicity quality monitoring for Eagle Mine water treatment operations and investigated the root cause of algae bloom.
• Completed literature review and prepared a plan for laboratory tests required to establish a site-specific performance objective limit for sulphate and total dissolved solids at a mine in BC.
• Completed the development of nitrate guidelines for a client in Alberta.

 

SELECTED FINANCIAL INFORMATION

For a complete set of Financial Statements and MD&A, please go to www.bqewater.com.

(in $’000 except for per share amounts)	3 months ended Jun. 30		6 months ended Jun. 30
	2026	2025	2026	2025
	$	$	$	$
Revenues	9,245	11,276	14,046	18,722
Operating expenses (excluding depreciation)	(4,987)	(7,575)	(8,609)	(11,814)
Gross margin	4,258	3,701	5,437	6,908
Share of income from joint ventures	838	427	882	488
General and administration	(1,312)	(1,029)	(2,371)	(1,796)
Sales and development	(1,606)	(804)	(2,916)	(1,480)
Share-based payments	(369)	(191)	(629)	(274)
Depreciation and amortization	(170)	(134)	(315)	(260)
Income from operations and joint ventures	1,639	1,970	88	3,586
Other income (expenses)	215	(54)	492	53
Income tax expenses	(6)	(8)	(6)	(4)
Net income for the period	1,848	1,908	574	3,635
Net earnings per share (basic)	1.42	1.48	0.44	2.81
Net earnings per share (diluted)	1.41	1.46	0.44	2.278
Proportional Revenues (Non-GAAP measures)	11,291	12,908	16,596	20,856
Adjusted EBITDA (Non-GAAP measures)	2,435	2,482	1,364	4,359
Comprehensive income	2,043	1,646	946	3,382
			at Jun. 30,	at Dec. 31,
			2026	2025
			$	$
Cash and cash equivalents			16,643	18,982
Working capital			21,018	21,410
Total assets			37,932	35,710
Total non-current liabilities			3,269	2,549
Shareholders’ equity			29,826	28,795

 

NON-GAAP MEASURES

The Company uses non-GAAP financial measures to supplement our consolidated financial statements presented in accordance with generally accepted accounting principles (IFRS), or GAAP, to enhance overall understanding of the Company’s current financial performance with investors and observers. Proportional Revenues and Adjusted EBITDA are reconciled as follows:

Proportional Results

To provide additional insight into our financial results, certain statements in this MD&A disclose the effective portion of results we would have reported if our Chinese joint venture operations had been proportionately integrated and are referred to as BQE Water’s proportional share (“Proportional”). All Proportional financial measures disclosed in this MD&A are non-GAAP measures.

Proportional Revenues

This non-GAAP financial measure of Proportional Revenue adds BQE Water’s share of revenues from its China joint ventures to the Company’s revenues reported under GAAP. Proportional Revenues for the three and six-month periods ended June 30, 2026 and 2025, are as follows:

 

Adjusted EBITDA

Adjusted EBITDA (“earnings before interest, taxes, depreciation and amortization”) is intended to provide additional information only and does not have any standardized meaning under IFRS and may not be comparable to similar measures presented by other companies. It should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Consequently, the presentation of Adjusted EBITDA enables shareholders to better understand the underlying financial performance of our business through the eyes of management. Adjusted EBITDA includes adjustments of the Company’s Proportional share of joint venture results. The following table reconciles this non-GAAP measure to the most directly comparable IFRS measure of net income: