Is water the new gold?
Freshwater makes up a small fraction of all water on the planet. While nearly 70 per cent of the world is covered by water, only 2.5 per cent of it is fresh. Even then, just 1 per cent is easily accessible, with much trapped in glaciers and snowfields. It is expected that increased demand from a rising global population, climate change and water pollution are likely to see already scarce resources become even more stretched in the future.
From large scale, community projects to decentralised commercial waste treatment solutions, Australian investors have several options for investing in the water space: Calix (CXL), De.Mem (DEM), Fluence (FLC), Phoslock Environmental Technologies (PET) and SciDev (SDV) are a few.
The group has so far provided a bumpy for many investors. Just a few weeks ago Phoslock Technologies admitted a KPMG investigation into its accounts has discovered fraud, falsified revenues, improper tax reporting and misappropriation of funds. The company has since been suspended pending an ongoing investigation.
With the borderline exception of Fluence, all five are yet to turn a profit. Fluence's last reported results had the company breaking even off $57 million in revenue for only 6 months, which is also considerably higher than the rest of the group. Adding to that, an announcement from Fluence on Oct 29 also confirmed the final conditions precedent for the go-ahead of a previously announced $275 million Ivory Coast water treatment plant. More the double the company's current market capitalisation.
Fluence is focused on the decentralised water, wastewater and reuse treatment markets. It offers low-cost, fast-to-deploy water and wastewater treatment products that solve local water shortages.
Managing Director & CEO Henry Charrabé is likely looking forward to hosting the company's investor conference call regarding the company’s quarterly update and Ivory Coast milestone on Friday, Oct 30.