General Environmental Management Inc.’s focus remains on implementing its revised business model to expand from an environmental services only company to an enterprise that begins with the treatment and disposal of non-hazardous wastewater at its subsidiary, Southern California Waste Water (SCWW), and expands to include a full spectrum of environmental services for its clients. The company’s ultimate goal is to establish a nationwide network of environmental facilities.
“GEM has been providing a premium level of environmental solutions to clients in the Western Region of the United States for over seven years,” stated Timothy Koziol, Chief Executive Officer of GEM. “In 2002, we researched the landscape of environmental service companies and determined there was a need for a higher level of service in the Western U.S. Our team then began building a business model centered on GEMWare, our proprietary software designed to give GEM and its clients the data needed to properly manage regulated waste, a Treatment, Storage and Disposal Facility (TSDF) for the consolidation of waste, and a network of service centers.”
Mr. Koziol continued, “Last year, based on the current economic changes, GEM’s Board of Directors decided the Company should change its focus from a purely services based company to an enterprise with a foundation in a fixed based treatment and disposal facility, like SCWW. With that decision we sold both service lines, the mobile treatment services business and the hazardous waste services only business, and acquired SCWW, a non-hazardous wastewater treatment facility in Santa Paula, California. Our plans are to grow the business organically and develop state-of-the-art systems for operations, sales, compliance, finance, and human resources at SCWW which can then be deployed at other acquired facilities.”
Bill Mitzel, President and Chief Operating Officer of GEM, added, “In the environmental sector all regulated waste must be ultimately treated and disposed of properly at permitted facilities. Because of this, the final treatment and disposal facilities generally have greater stability in their revenues streams and higher margins. SCWW is a tremendous asset because of its ability to treat and dispose of non-hazardous wastewater. We are excited about our business strategy to push greater volume through SCWW and develop the kind of systems we created previously for efficiency, increased revenue, greater margins and scalability.”
“We were thrilled to sell SCWW to GEM and become part of their growing wastewater plans,” said Doug Edwards, Chief Strategy Officer of GEM and former owner of SCWW. “Our management team believed there was more potential and growth available if we joined with GEM. SCWW is the first piece of what we expect to be a much larger network of non-hazardous wastewater facilities. We believed in our future with GEM to the extent that we sold CLW, the parent company of SCWW, to GEM prior to the completion of the sale of its hazardous waste services only business to Luntz Acquisition (Delaware) LLC.”
Mitzel commented, “Our business model, centered around a permitted, non-hazardous waste, fixed based treatment and disposal facility, like SCWW, generates greater margins for us than those achieved by our previous model. Our change of focus has resulted in margins up to eight times greater than those maintained by our hazardous waste services only model.”
Koziol added, “The water industry domestically is a $120 billion market and growing with increasing demands from industry, government and consumers. Globally the water market, which exceeds $400 billion, is third in size behind only power generation and oil. Diminishing world water supplies will only aid the Company in securing more non-hazardous wastewater business in the future. Within the water industry, we believe the wastewater sector has great potential for building value by developing the type of systems needed for profitable and efficient operations that can be deployed for greater scale. We look forward to building a growing enterprise of wastewater facilities utilizing the experience of our management team.”
Koziol concluded, “GEM’s new business model is more in tune with the needs of today. Our experienced teams have managed to build real value with our state-of-the-art SOP systems. Our systems are completely scalable, using the SCWW platform, for regional and national expansion. GEM will continue to grow as we build organically and seek out acquisitions and reformulate them to the GEM standards. We believe that 2010-2011 will be years of enormous growth for GEM. As GEM prepares for an incredibly active year, we have dedicated ourselves to ensuring that our shareholders are kept apprised of news and information as events occur.”
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